What is Retention Marketing and Why it’s Important in 2023

Feb 03, 2023
Will Devlin

What is retention marketing?

Retention marketing is all about keeping your customers close. Retention marketers create engaged customers who keep returning and are laser-focused on keeping your current customers happy. Your end goals are keeping current/past customers engaged and putting them in positions to make frequent, repeat purchases, and tell others about your brand too.

Retention marketing is a crucial part of your overall marketing strategy that reaps big rewards. It doesn’t require the same top funnel effort as acquisition marketing. Your customer already knows exactly who you are and if your strategies are aligned, they’re already funneled into a loyalty program or email newsletter. With this style of marketing, a lot of the hard work required in finding and selling your brand to a customer is already accomplished.  

What are the benefits?

One of the most significant benefits of retention marketing is the price tag. The costs of getting that first purchase from a potential customer are far higher than retaining them, and it’s no secret that the cost of attaining a new customer is growing rapidly. With so many marketing channels and competitors playing the same spaces, it’s becoming more challenging and costly to compete.

But repeat customers? They require little onboarding and provide a loyal base for purchasing. They can also tell their friends and family about your brand, further expanding your reach directly from a reliable brand ambassador. Return shoppers also convert better. If they’ve already purchased from you before, they’re far more likely to buy again given their experience was positive. Nudging an additional purchase requires less effort and cost from your marketing department.

Of course, the right retention marketing strategy depends on what you’re selling. Retail markets benefit immensely from retention strategies, where customers can purchase similar products over and over. The strategy will look different for a non-retail business, but it is still a key part of the cycle. Take an airline for example, where retention is focused on selling a positive flight experience, a seamless check-in process, good deals on flights, etc. Marketing to previous customers may look similar to new ones, however, the chances of converting are higher due to familiarity and prior experience.

In summary, the benefits of retention marketing are:

  1. Marketing to previous customers is much more affordable than acquiring new ones.
  2. Easier to incentivize a purchase from a customer who has already purchased and understands your brand values.
  3. Create brand evangelists who campaign for your products.
  4. Supports a better support system for customers.
  5. Champion your loyalty program.

Why is retention important for your overall marketing strategy? 

Retention marketing helps you learn more about your customers and tailor your strategies toward their individual needs. The lifetime value of an effective strategy is huge. If you can increase the overall customer lifetime value, you will increase the ROI of every single customer you acquire. And if you can increase the average amount a customer spends, the cost to acquire them becomes more worthwhile. 

This type of marketing becomes important not just in retaining your customers but increasing the value of each customer too. That way, you can worry less about acquiring new ones. This is your internal pipeline. 

Take the same airline example. Say a family flew to Columbus, Ohio to visit their grandparents. While you can sell them on their yearly flight to visit grandma next year, you now also can keep them engaged on upcoming deals. Offering great rates to a preferred vacation destination, for example, is an easier sale than running a display campaign to the greater internet.

What are common retention strategies? 

Trusting the customer experience 

A big part of your retention strategy is building trust with your customer. To do so, you also need to understand their pain points. That’s where creating positive customer experience comes in. Give your customers a number of options to connect with customer support, whether it’s by phone, chat, or social media. Lately, customers are looking to social channels like Twitter for support, expecting companies to take quick and actionable steps to solve issues. Thus, you need to be prepared to respond. No matter your support strategy, the customer needs to feel that if there is a problem, they can trust your organization to make it right. 

Loyalty Programs

Loyalty programs are an effective way to promote…you guessed it…loyalty amongst your customers. While loyalty programs vary in their operation, their goal is to incentivize additional purchases, increase customer retention, and further brand advocacy. A good loyalty program rewards customers for additional purchases and offers unique, additional rewards just for being a fan of the brand. A great loyalty program has participants spreading it amongst their friends and family, helping growth marketers in the process. A customer engagement platform allows you to tailor your messaging, by channel, towards specific loyalty tiers (such as early access to a new product launch) or market to new customers in hopes of enrolling them into your loyalty program. If you’re running an effective loyalty campaign, it’s no secret you need a cross-channel customer engagement solution.   

Cross-channel communications

Keeping up with your customers these days requires connecting with them on their preferred channel. The type of messaging can vary dramatically based on what channel you’re targeting. For example, say a previous customer who downloaded your app is walking past one of your brick and mortar locations. The messaging for this customer may revolve around getting them back in the door with a push notification highlighting current sales to incentivize a walk-in. Say this person goes inside and makes a purchase, this user then receives a receipt and update on their loyalty points sent to their email. Retention marketing efforts provided value to a previous customer and incentivized a new purchase.


How can you create the right strategies for your customers to ensure they get exactly what they need? Reading product reviews is a big part of getting to know your customers, but sometimes simply asking for feedback can give you an even better idea. If you’re doing it well, you’re already in a regular cadence of contact with your customers with newsletters or tailored emails offering recommendations based on their behavior. Try taking it a step further and ask your customers what they actually want. Soliciting feedback engages customers even further and creates excellent data that you can then use to sell them the right products. 

How does MessageGears help you run these strategies? 

When it comes to large, well-known brands, customer expectations are high. Developing personalized content is contingent on data connectivity, accuracy, and speed. When you have data that is up-to-date with proper identity resolution, you will have a far better idea of customer activity: what they’re doing and purchasing.

Thanks to MessageGears’ unique setup, brands are able to empower marketing and data teams in a new way to help them engage and retain more customers. Some of the main benefits include:

Direct connection: Because we connect directly to our client’s database, brands don’t have to copy and ship their data to an external cloud environment to build audiences. This means they have real-time access to the data, don’t have to wait for frustrating data syncs to complete, have vastly improved data security, and save money from not having to store the same data twice.

A secure experience: MessageGears enables high levels of security for their customer data. Because we’re warehouse-native and integrate within a brand’s modern data warehouse environment, customer data never leaves a brand’s firewalls and remains secure – eliminating customer worries about a data breach.

Personalization at scale: When brands have complete access to all their data, improved personalization can directly follow. Using MessageGears, marketers can quickly utilize any data point for personalization without having to wait for data syncs. That flexibility is crucial to getting the campaign out the door. Timing can often make the difference between being ignored and an important conversion.

Ultimately, you need the right data to run a successful retention campaign— accurate and personal information to retain customers effectively. MessageGears gives you full confidence in the data. We are, by nature, data-first in our thinking. We apply this accurate, resolute data to help you retain customers and ultimately, increase their lifetime value for you as a brand.

Looking to kick off or upgrade your retention marketing? Every day, we help brands market themselves with unique advantages for the biggest senders. Find out how!

About the Author

Will Devlin

A 20-year email marketing veteran, Will has focused on marketing strategy and execution for MessageGears since 2014. He has extensive experience on both the retail customer and service side of email marketing, and he’s interested in helping businesses better understand how they can make the most of the work they put into their email campaigns.