Retention marketing can also be referred to as loyalty marketing or lifecycle marketing. Retention boils down to keeping your customers involved, happy, and spending on your products or services. You can increase retention by delivering engaging and relevant content to your customers. This strategy will increase customer lifetime value (CLV) and, in turn, the bottom line of your business.
Why Customer Retention Counts
Studies have found that it is more cost-effective to retain existing customers over attracting new ones. In fact, it can cost up to five times more to find new customers than hanging on to existing ones. Moreover, an increase in customer retention of 5% can generate up to 95% in profits. Conversely, only focusing on customer acquisition and paying no attention to retention marketing, results in customer churn, which ultimately means lower profit margins. The main reasons why customers churn are:
- They no longer need your product or service.
- Your product or service no longer satisfies their needs.
- They no longer resonate with your brand or your message.
How to Increase Retention
An effective retention marketing strategy involves building engaging relationships with your customers. The key to engagement is via personalization, which is something that today’s customers expect and demand. Fortunately, in our high-tech world, big data and predictive analytics can provide you with in-depth insights into your customers and what they need. You will gain more respect and customer loyalty by focusing on what is important to the customer. Statistics show the following:
- 80% of consumers prefer companies that provide personalized messaging and offers that are relevant.
- 55% of U.S. consumers actively sign up for personalized communications.
How to Increase Retention Internationally
Doing retention marketing and doing it well are two very different things, especially if you have customers in other countries. For international marketers, effective localization is crucial if you want to have any hope of retaining customers who live in different locales and are immersed in widely varying cultures.
What is Localization?
Localization is the process of adapting a product or content to a specific locale or market. When you take your product or marketing campaign to a new region, it is vital that you first understand the cultural, religious, and political impact it will have, and tailor your offer accordingly. Charging headfirst into a new market before conducting user and cultural research can spell disaster. The following are five-steps for you to follow:
- Speak Their Language
The use of the internet continues to grow all over the world, and more and more users live in places where the native language is not English. Therefore, if you wish to succeed in the global marketplace, you must understand localization’s importance across all types of marketing channels. To increase retention, you need to understand that customers will always prefer companies that speak to them in their native language and respect their cultural influences. Language can either carve out a competitive market share or spell ruin for your global reputation.
- Be Sensitive to the Culture
If you want to increase retention, you need to understand that if you get an aspect of the local culture wrong, it can work against you. Here are two examples.
- McDonald’s: When this famous chain launched in France, it ignored the fact that the French expect to be able to order wine or beer at any restaurant. However, after a bad first quarter, McDonald’s recognized its mistake and began to serve wine and beer in their franchises. Consequently, Parisians were able to go to McDonald’s and enjoy wine with their meals, and sales increased significantly.
- Kraft: This well-known brand suffered an embarrassing entrance into Russia when they marketed their products under the name Mondelez. What their research teams had failed to notice was the resemblance of the word Mondelez to a popular Russian slang term for oral sex. This comical mistake went unnoticed at Kraft for several months. Than news outlets around the world started mocking the snack giant.
The error brought about a catastrophic drop in Kraft’s third-quarter sales, and, unfortunately, the huge divide created between the company and its Eastern European customers still haunts them today.
Localization does more than help you avoid Kraft-esque mistakes – it builds the necessary respect and trust with your new customers so that they will turn into retained customers.
Adopt Multilingual Customer Support
If you are just starting out in the international marketplace, you might wonder if you should pay attention to multilingual customer support. The answer is a definite yes! You will stand more chance of retaining your local customers if they are able to interact with your customer service people in the language they’re most comfortable with. Your customers want to be sure that their issues have been fully understood, and they want to be able to clearly understand what a service rep is saying.
Create International Loyalty Programs
Increase retention by offering rewards that are culturally appropriate. This can be challenging for any multinational company that must take into consideration a diversity of cultural values. So, do your research and avoid offering rewards that turn into culture shock, such as:
- Offering four of anything in a country such as Singapore. The number four connotes death in many Asian cultures.
- Using timepieces, such as watches or clocks, as rewards. These items are regarded as reminders of mortality in many Asian countries.
- When marketing in India, avoid giving a gift certificate from a Western fashion retailer. This will not do very much to satisfy the average Indian woman’s fashion preferences. Provide a voucher from a local clothing store instead.
Collect Customer Feedback
It cannot be emphasized enough that you should listen to your customers so that you gain a deep understanding of what they want. Let’s talk about McDonald’s again, but this time concentrate on what the burger giant did right. The company did not come up with the menu items Shaka Shaka Chicken and McAloo Tikki without doing research. McDonald’s studied the eating preferences of people in their locales and created localized products that would be familiar to them.
- Never underestimate the importance of in-country research, followed by customer feedback.
Increase Retention With Localize
After reading this article, you should be convinced of the importance of increasing customer retention. An effectively localized marketing campaign enables you to reach out to your existing customers and see for yourself how localization increases your client retention rate. Localize’s Translation Management System (TMS) can provide you with a wide range of options to make localization easier. For more information please get in touch with us.