What is Retention Marketing?

Retention marketing is defined by Phorest as ‘the art of getting existing clients back more often’. It’s not just about encouraging your clients to return, however; retention marketing is also about ensuring that your clients remain happy and willing to spend money on your services or products.


Retention Marketing and Loyalty

Retention marketing is, by nature, conducted for the benefit of existing customers or clients. The core term which is most often used by marketers looking to improve retention is ‘loyalty’, however this can actually be misleading. Whereas in previous years, most notably before the advent of the internet, businesses would often have the opportunity to develop personal relationships with their customers, this has become less common. It could be said, therefore, than modern retention owes less to loyalty than it does to savvy pricing and a comprehensive understanding of market need and competitor strategy.

Nevertheless, loyalty, as a term, is still being used to describe retention, with professional marketer Joanna Lord identifying no less than four different types:

  • No Loyalty – self explanatory
  • Inertia Loyalty – customers who make repeat purchases but harbour no strong feelings about your company
  • Latent Loyalty – customers with low repeat purchasing rates but warm feelings towards your brand in general
  • Premium Loyalty – customers who make regular purchases and have great attachment to your brand.

Modifying Your Marketing Strategy

Using Lord’s model above, it should be clear that in order to improve retention across the board a business will have to employ several different tactics. Developing a comprehensive understanding of your customer base is absolutely crucial as this will provide insight as to why a customer falls into one category of loyalty and not another. Data collection will help you to market more efficiently to each group.

The Benefits of Retention Marketing

Retention marketing isn’t just about selling more products. It’s also about improving the strength and reputation of your brand, about increasing customer satisfaction, and about improving communication company-wide. All of these outcomes will have positive knock-on effects for your business. For example, the customers who are most likely to talk about your brand are the ones who are either very happy or very unhappy. The happiest of customers being those who exhibit what Lord describe as ‘Premium Loyalty’, it therefore stands to reason that a company owner would want to encourage this type of market retention. We may live in a time where making personal connections with customers has become more difficult, but savvy leaders will see this as a challenge, rather than an obstacle.


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