If you’re spending all (or even most) of your marketing budget on external marketing to attract new clients, you’re missing an important revenue opportunity. And it’s costing you more than you may think.
Existing client relationships are your most valuable business asset, and while attracting new business should always be a component of your overall marketing strategy, you simply can’t afford to ignore the clients you have today. In fact, they arguably deserve most of your attention.
When you gain a client through external marketing but lose one you already had, you end up with the same number of clients. But that’s not the whole story. When you lose a client, you lower your margin because it costs much more to acquire a new client than to keep an existing one.
So, staying even—by adding one new client to offset every one who goes away—is actually costing you profit through increased marketing costs.
Not convinced? Here are a few statistics that make it hard to argue against investing in a marketing strategy focused on the contacts you already have:
- 80 percent of future revenue will come from just 20 percent of your existing clients–Gartner Group
- It’s 50 percent easier to sell to existing clients than to new ones–-Marketing Metrics
- Existing clients convert at 60 to 70 percent, compared to new prospects at 5 to 20 percent–Marketing Metrics
- Repeat clients spend 33 percent more compared to new ones–-CMO.com
- Boosting client retention by 5 percent can raise profits by 75 percent–-Bain and Company
- A 10 percent rise in customer retention yields a 30 percent increase in the value of the company–Bain and Company
Get started and see results quickly. eRelevance provides small- to medium-sized businesses with an affordable and highly responsive marketing automation service to drive more revenue from existing contacts. And unlike the alternatives, we quantify the value we deliver with nearly immediate return on investment.