MANAGEMENT

Detailed explanation-1: -Acquiring a new customer can cost five times more than retaining an existing customer. Increasing customer retention by 5% can increase profits from 25-95%. The success rate of selling to a customer you already have is 60-70%, while the success rate of selling to a new customer is 5-20%.

Detailed explanation-2: -Repeat customers spend more money 67 percent more. Not only are your repeat customers purchasing more over time than new customers, they likely trust you enough to purchase your more expensive products or services.

Detailed explanation-3: -Repeat customers spend more Not only do repeat customers buy your products more, but they also have a higher average order value than first-time consumers. The number of previous purchases made and how long a customer has used your services directly impact how much a repeat customer spends in your business.

Detailed explanation-4: -From a business perspective, it’s far easier to sell to existing customers than to bring on new ones. It usually means that your sales team doesn’t have to prospect, qualify, or build a relationship. Your customer success team likely knows them too. And your business already has trust and credibility with the customer.

Detailed explanation-5: -Retaining your current customers increases word-of-mouth recommendations and loyalty. Existing customers are more likely to spend 30% more on a new product than a first-time customer. A higher customer retention rate leads to greater profits and lifetime customer value (LCV).