5 February 2016

Retention Marketing: Why You Need to Start!

Retention Marketing: Why You Need to Start!

Why You Need To Start Retention Marketing Today!

In the world of online marketing it can seem like trends come and go within the blink of an eye. It is slightly ironic, then, that the latest of these is known as “retention marketing”. But, unlike other marketing buzzwords, retention marketing isn’t just a flash in the pan, and there is a good reason for the increase in attention paid to this form of marketing.

But just what is retention marketing, and how can it work for you?

So, what is Retention Marketing?

While many forms of marketing focus on the acquisition of new customers, retention marketing instead seeks to increase the profits you make from existing customers by engaging them in your store and encouraging them to return again (and again). Put simply, retention marketing aims to increase the chances that your customers will shop with you again.

This, of course, means that it is not a standalone form of marketing. This is about driving extra profit and turning up the needles even further.

You’ll still need to use your existing marketing plan and techniques such as Content Marketing and SEM in order to drive the traffic to your site and make the initial sale, but with retention marketing these customers should become loyal, engaged buyers.

Two metrics to go with for retention marketing are purchase frequency and repeat purchase rate. These metrics signify how often your typical customer purchases something, and how likely it is that they will return.

Retention marketing is, overall, a long term strategy that seeks to increase profitability in the long run. You should, if all goes well, see an increase in your customer lifetime value, which is one of the most valuable metrics to companies.

Why Should Your Company Use Retention Marketing?

It feels like for the past few years us marketers have been inundated with different tactics to add to our marketing strategy. Why is it only now that we’re hearing about retention marketing?

Well, since the proliferation of SEM and Social Media marketing, things have gotten more expensive and less effective. Before we could rely on these channels to drive huge amounts of traffic to our sites, and not worry whether that person would come back since there would always be another person on the way. Now that simply isn’t the case.

Just take a look at this table for evidence. In each industry the average cost per click on US Google AdWords increased from 2012 to 2014. It’s safe to say this didn’t slow down in 2015, and won’t stop in 2016.

Social media is on much the same trajectory. In 2015 there was a large uproar when many Facebook advertisers and users found that posts were suddenly not achieving the reach that they used to. Facebook said they had new, improved algorithms, but even at the most basic level it is easy to see that as more and more advertisers use Facebook, there is less opportunity to be seen by users.

The idea of retention marketing is to combat this drop in new customers with a different method. If you make sure each customer that you do acquire is more valuable, you’ll see your profits growing anyway.

So, Shall I Just Focus on Retention Marketing Now?

Of course, to retain customers you first need to acquire them, and so your internet marketing strategy should not be completely overhauled. Rather, you should incorporate retention marketing into your current digital marketing efforts to ensure that your acquisition and retention efforts work well together.

Retention marketing will also only be truly effective if you already have acquisition marketing in place. So if yours is a brand new business, you will need to focus on bringing customers to your store before you try to engage them further. Indeed, if you’re a new business, all your marketing efforts should initially be placed on acquisition.

Some Final Thoughts on Retention Marketing

It stands to reason that your ROI will increase if you offer customers value and encourage them to return to your store. For some businesses this will not be quite as easy as others - for example, getting customers to come back and purchase another humidifier for their home may be a challenge.

Overall, however, retention marketing done right will turn up the dial on your ROI and ensure you make the most out of your current online marketing efforts.

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Ali Jhaver

Ali Jhaver


After spending 10 years helping dentists grow their practices, Ali witnessed the time and money dentists were wasting on outdated, fragmented technology that negatively impacted sustainable growth and the overall patient experience. So he developed Adit - a user-friendly SaaS platform that centralizes everything a practice needs to operate and simplifies the business of dentistry so doctors can get back to the medicine.


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