If You Don’t Think About Retention in Your Marketing Strategy, You Won’t Succeed
If your marketing only focuses on acquiring new customers, you’re losing money.
Most marketing teams focus on generating new revenue- new leads, SQLs, sales etc. That’s the name of the game- build your marketing and sales funnel, and obsess over the alphabet soup of marketing metrics.
There’s another important metric all tech companies should be tracking. Can you guess what it is?
I bet your marketing team probably knows what your company churn rate is. But are you regularly taking customer churn into consideration when building your marketing strategy? Probably not.
Integrating marketing strategies with an understanding of your churn rate is so important.
So let’s talk about the “leaky bucket syndrome.” You spend so much time, money, effort into acquiring new customers. You might have a big thermometer that you fill in each time you make a sale, and get that much closer to hitting your quota. You probably also celebrate when you DO hit that quota- and you should! That’s an awesome achievement! Your bucket is filling with water!
But behind the scenes… there are holes in your bucket, and those customers you just won have started to slowly leak out the bottom. What the heck?! Hopefully you have a stellar customer success team who is constantly analyzing why, and helping to tweak the post-sales journey to make sure your customers stick around for as long as possible. If not- get in touch and we’ll talk!
However, you’ll never make meaningful changes to your churn if your marketing efforts don’t start addressing some of the reasons why. Here’s how to start:
- Look for clues - Why are some customers leaving you? Who are the customers leaving you? Use this as a catalyst to collaborate with others across the business who might have different insights, ideas, hunches as to why certain customers churn.
- Once you start to gather some insight here, the next step is to start thinking about how, from the VERY beginning of the customer journey (ie marketing), you can try targeting people who are not the type of customers who you’re churning.
- Build a sustainable strategy of marketing to the types of customers who are most likely to stay around- and stick with it. This will be tough. You will be tempted to abandon ship for the quick wins. But if you stick with this more targeted approach to marketing to customers that have the greatest potential to stay around, you will see revenue grow.
Seriously, I’ll say it again- this is going to be hard! It’s hard to limit your potential world of new customers. Because a lot of these people you’re weeding out might have made a purchase, and helped you hit that extremely important sales goal. But that’s playing the short game. If you want to play the long game, think about retention, and start focusing your marketing efforts on maximizing retention for the long run. I promise you, it will pay dividends (in the form of LTV) that will be really really sweet.
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We help tech-focused companies implement the StoryBrand framework in simple, powerful marketing and retention.
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Kristin Spiotto and Annie Mosbacher are dedicated to helping promising, but stuck, tech companies implement marketing and retention strategies that lead to long-term success.
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