Let’s face it: Most marketing budgets are tight. Where should you focus your direct mail or email marketing dollars when funds are limited? On engaging your existing customers! While attracting new clients is essential for growth and counteracting attrition, your current customers offer the highest return on investment. Here are five reasons why focusing on them is a smart strategy.
- Higher Spending Potential
When a retailer attracts a new customer, it’s often for a specific item, like a bathing suit. However, retained customers are more likely to purchase additional items like shirts, shorts, and accessories. In fact, existing customers typically spend 67% more than new ones, according to RJMetrics. - Greater Profitability
Acquiring new customers can be five times more expensive than retaining current ones. For example, gaining a new customer might require three marketing interactions, costing $5 each, resulting in a $50 purchase. This nets a $35 gain. In contrast, marketing to an existing customer may only require one $5 interaction to achieve the same $50 sale, resulting in a $45 net gain. - Easier Sales Process
Your current customers already know and trust your brand. This familiarity makes them more likely to buy. You have a 65% chance of closing a sale with an existing customer, compared to just 13% with a potential new client. If meeting a sales target quickly is your goal, focusing on existing customers is a proven strategy. - Referral Potential
Satisfied customers are your best advocates. They’re 50% more likely to refer new clients to your business than new customers. By nurturing your existing relationships, you create opportunities for organic business growth. - Foundation of Your Profits
You’ve likely heard of the 80-20 rule: 80% of your profits come from just 20% of your customers. Retaining these key clients is critical. Research from Bain shows that even a 5% increase in customer retention can boost profitability by 75%.
Every business can benefit from an increase in profits. If it’s been a while since you tailored a direct mail or email campaign specifically for your most valuable asset—your existing customers—now is the perfect time to take action.
How ImageSet Can Help
Ready to engage your most valuable customers and boost profitability? The ImageSet team specializes in direct mail and email campaigns tailored to your business goals. Let us help you make the most of your marketing dollars.
Learn more about About ImageSet, contact us at info@imageset.com, or visit us on Facebook and LinkedIn.
