With more consumers using mobile apps and mobile devices than ever before, 95% of marketers have shifted their focus toward customer retention. That’s according to new research by OneSignal, the customer engagement platform.
Why retention is in
According to the survey of over 1,000 product and marketing experts, engineers, and C-suite executives, customer retention held significant importance for a majority of the participants, with 95% stating that it was either very important or somewhat important to their businesses. Furthermore, 71% of the respondents believed that customer retention would gain even greater importance in the upcoming three to five years.
Industry estimates reveal that the success rate of selling to an existing customer ranges between 60% and 70%.
In contrast, the success rate of selling to a new customer falls significantly lower, ranging between five and 20%.
Retention rate is most important KPI
Source: OneSignal
The shift in focus towards customer retention is particularly vital for subscription-driven industries like mobile apps and SaaS. Here, the ability to retain and engage users plays a crucial role in their overall survival and success. However, more traditional industries such as finance and healthcare can greatly benefit from prioritising customer retention too.
When customers feel valued and engaged with a brand, they are more inclined to recommend it to others, resulting in increased organic growth.
Adapting to an evolving marketplace
The study also found that 88% have made adjustments to their marketing and engagement strategies for the year 2023 as a direct response to the prevailing economic downturn.
Furthermore, an impressive 82% of respondents have actively taken measures to reduce their marketing and product expenditures in order to enhance their return on investment (ROI).
Economic downturn means reduced marketing spending
Source: OneSignal
“Companies need to resist the urge to make cuts in the wrong places – our survey shows that many are making decisions that can hurt retention in today’s economy. Customers expect highly relevant, timely, and personalised communication and engagement at every touchpoint – this should be your customer retention strategy for the market we’re in right now,” said George Deglin, CEO of OneSignal. “In a tight economy, increasing customer retention rates by just 5% can increase profits by 25% to 95%. Focusing on best practices like segmentation, personalisation, multichannel engagement, and real-time, automated messaging will play a pivotal role in growth.”
The survey also revealed that personalised communication was the most effective tactic for customer retention. Personalised messages based on customer behaviour and preferences can increase click-through rates (CTR) by up to 58%. Additionally, user segmentation leads to a 21% higher CTR.
Omnichannel engagement strategies yield more than 3x higher click-through rates compared to single-channel approaches.
In-app messages boast click-through rates 25 to 30 times higher than average push notification rates. Leveraging multiple communication channels caters to user preferences, enhances the user experience, and fosters stronger brand loyalty.
Key takeaways
- 95% of marketers prioritize it, leading to increased organic growth and profitability
- Personalized communication boosts CTR by up to 58% and user segmentation increases it by 21%
- Over 3x higher CTR with omnichannel than single-channel approaches, with in-app messages performing exceptionally well
