Customer Retention Vs Customer Acquisition

How Leaky is your bucket? 

One of the most powerful theories I ever came across was ‘the leaky bucket’ and it really is the perfect and most simple analogy in regards to one of the most powerful assets of a business.

Whatever the product or service you’re involved in there’s always one thing all businesses have in common, we all understand the importance of our customers. From engaging with existing consumers and creating loyalty to attracting new ones, it really is a major contribution to your businesses success and something we believe you should prioritise.

So let me take you through the process, our leaky bucket represents your business and the water inside signifies your customers.  Unfortunately and inevitably our bucket has holes in which represents the issues we face within our companies.

So in theory the more new customers we gain, we equally loose our existing customers so what is the best thing to do?

The Solution:

There are two solutions to our leaky predicament:

#1 Keep pouring water into your bucket and therefore refreshing your customer base. The best ways to acquire new customers include exclusive first time buyer offers as this is a great way to steer consumers away from competitors and result in competitive advantage. Another great way is using marketing/advertising to create brand awareness, odds are some potential consumers may not even know you exist so advertising is a create way to attract newbies!

Although a pretty temporary solution, it is a great option for new start-ups that are still getting their brand established…

Or

#2 Fill the holes in your bucket and maintain your existing customer base and gaining customer loyalty. Usually the holes can be filled with ways to keep customer relationships going, examples of these include engagement through platforms such as social media and regular relevant content. Other examples include promotions and incentives giving benefits to your existing customers almost rewarding loyalty is a great way to maintain it. This solution is cost effective and ultimately fixes your bucket.

So how would you fix YOUR leaky bucket?

Fancy reading some more?