Email-Marketing Optimization — How to Retain More Customers and Radically Grow Sales
If your company is like most, your email-marketing efforts are heavily focused on the front end of your sales funnel: the acquisition and conversion of new customers. That means you’re likely not investing enough in your existing customer base. So, let’s focus on how to use email to optimize the back end of your sales funnel — retaining customers and upselling your product line — to drive more sales and revenue.
As our loyal NewsLever readers know, many of our features and blogs often focus on how to effectively use email marketing to generate leads and acquire new customers. Though the costs associated with new customer acquisition are high, it’s an essential part of every company’s marketing efforts.
The cost of getting an existing customer to buy just one more product, however, can be far less costly than new customer acquisition and conversion. That’s why keeping your current customers coming back for more (e.g., replenishments of food, supplements, or other consumables) also needs to be a key part of your ongoing marketing.
The Cost of Customer Acquisition Versus Customer Retention
So how do costs for customer acquisition versus retention compare? Check out these statistics compiled by Invesp:
- It can cost up to five times as much to attract a new customer compared to keeping an existing one.
- However, 44% of companies focus more on acquiring new customers versus 18% of companies that focus more on keeping customers.
- The probability of selling to current customers is between 60% and 70% compared to between 5% and 20% for selling to new prospects.
- Increasing customer retention by just 5% can increase a company’s profits by between 25% and 95%.
- Email marketing is the most effective digital-marketing tactic for retaining customers (56%), followed by social media (37%), content marketing (32%), referral marketing (26%), and search engine optimization (13%).
6 Ways to Cost-Effectively Use Email to Optimize the Back End of Your Sales Funnel
Here are six ways to use email marketing to optimize the back end of your sales funnel by retaining existing customers and driving more conversions:
- Make the most of your transactional emails, including shipping and delivery confirmations, receipts, and password resets. These types of emails are eight times as likely to be opened compared to promotional emails. So, take advantage of this high engagement by using them to also cross-sell and upsell products your customers will likely be interested in based on their purchase history.
- Send and optimize abandoned-cart email campaigns. A surprising number of companies still don’t send emails to follow up with customers who start to make a purchase but, for some reason, don’t finish the transaction. As this analysis demonstrates, giving them a nudge works: nearly half of abandoned-cart emails were opened, and more than one-third of clicked abandoned-cart emails converted to a sale.
- Segment your email list based on VIP status. Then, create campaigns that target and reward your most loyal customers with “exclusive” offers and rewards for this lucrative revenue source.
- Follow up purchases with a product-recommendation email. This a great opportunity not only to thank customers for their recent purchases, but also to get feedback about your products. Then, use those positive comments in future email campaigns as testimonials to promote your brand.
- Create and send nurturing email campaigns. These types of emails — which can help you stay top of mind and build relationships with your customers — include email newsletters, new product updates, and emails to celebrate a birthday or anniversary.
- Use win-back email campaigns to reignite interest in your brand with customers who haven’t made a purchase in a while. How successful are win-back email campaigns? Check out this previous NewsLever article to answer that question and for tips on how to create effective win-back campaigns.
Is your email-marketing program doing a good job of building customer loyalty and getting your existing customers to purchase more? If you think there’s room for improvement, contact FulcrumTech today and we’ll help you leverage email marketing to optimize both the front end and back end of your sales funnel to drive more revenue.