Beyond customer acquisition: The role of personalization in customer retention

As a B2B marketer, your job is to get your website visitors to take action. Once you’ve captured their information and they’ve made it into your funnel, the work doesn’t stop. Retaining customers is just as (if not more) important than acquiring them in the first place.

In this post, we’ll review the importance of personalization in B2B marketing, explore its benefits for both customer acquisition and retention, and offer actionable steps you can take to personalize your marketing efforts with the goal to keep customers engaged and interested.

Why personalization in B2B marketing matters

With so many avenues to discover your brand, not every customer is finding your website at the same stage of the lifecycle. Some are just finding out about you, while others have engaged with ads, your social channels, or a number of other options. 

So, when trying to attract new customers or keep the ones you’ve worked so hard to acquire, personalization is vital to meeting your customer at their stage of the customer journey. A one-sized-fits-all approach won’t work to successfully convert customers at different stages. 

 Through personalized content and impactful interactions, companies can communicate to customers that they understand their needs on a more personal level.

Customer acquisition vs. customer retention

Acquiring customers is a benchmark all companies need to hit—after all, it’s the foundation for turning a profit. Keeping these customers engaged, interested, and—most importantly—paying for your services takes just as much effort and skill as acquiring them.

It’s common business knowledge that it’s more cost-effective to retain customers than it is to acquire new ones (it’s five times more expensive to acquire new customers!). Existing customers generate 65% of a company’s revenue compared to new customers, who generate just 35%. But while 44% of businesses prioritize customer acquisition, only 18% prioritize customer retention. 

Retained customers are typically satisfied customers who can serve as advocates for your business and services, which then open another revenue source that hopefully translates into long-term customer loyalty. 

Best practices for retention-focused personalization

A personalized experience goes a long way with consumers. In fact, 89% of businesses consider the customer experience to be a main driver of customer loyalty and retention.

Building a personalization plan to retain customers rather than acquire customers can include both existing marketing activities and new strategies that hinge more on customer engagement rather than action (i.e., making a purchase). Here are a few examples.

• Segmentation. Dividing customers into groups based on their purchasing behavior, browsing behavior, preferences, and other demographic or behavioral data can help you identify who might benefit from receiving certain types of content.
• Dynamic content. Existing customer behavior data and AI can team up to deliver targeted content to customers, such as personalized product recommendations, complementary product suggestions, upgrades, or content based on what they’ve purchased or looked at in the past. 
• Targeted campaigns. If your data is in a good place, targeted email campaigns can be a huge driver for personalization and promoting your website. Based on the segmented groups mentioned above, teams can distribute event invitations, product announcements, or other customer-only communications, like offers to beta test an upcoming feature. 
• Regular interactions. Not only should you keep your messaging fresh and updated, but you also must make regular contact with your customers. The ability to nurture (but not bombard) customers with information ensures your business is at the top of their mind when they’re ready to make a purchasing decision.
• Loyalty/member-focused strategies. Keep customers’ interest piqued with exclusive customer-only offers, promotions, and (if applicable) membership perks.

Tracking and measuring the success of personalization on customer retention

Once you’ve set up a customer retention personalization strategy, you’ll want to develop a system to track the strategy’s effectiveness and analyze the results.

First, you need to define the metrics you want to track. These can include:

• Customer retention rate (CRR). Calculate this rate using the following formula:
  • (the number of customers at the end of a given period) – (the number of customers acquired during that period) / (number of customers at the start of the period) x 100
• Repeat purchases. Keep track of customers who make repeat purchases to gain insight into whether certain retargeting practices are working and which ones might need tweaking. This also can reveal which customers are more likely to make another purchase in the future. 
• Net promoter score (NPS). This metric measures customer satisfaction through a short survey that asks customers how likely they are (on a scale of 0 to 10) to recommend your organization to people they know.
• Customer satisfaction. You can capture this zero-party data through customer surveys to hear directly from customers.
• Churn rate. The churn rate reveals the number of customers who cancel a service or decide not to make another purchase. 

Acquisition vs. retention personalization strategies: Overlap, similarities, and differences

There’s a great deal of overlap in the Venn diagram of customer acquisition and customer retention strategies. They both require certain knowledge about your target audience; they both call for consistent and effective communication to make the customer feel seen and understood; and they both benefit from tailoring messaging to precise pain points and needs.

Differences can be broken down into the specific practices that are part of each strategy. Acquiring a customer might mean creating personalized landing pages with messaging that speaks to an individual visitor’s industry, role, or geography. Dynamic content that shifts based on who is consuming it is typically an effective way to attract the interest of prospects.

To retain customers, however, marketing teams may focus more on customer interactions to foster engagement and build deeper connections. Retention strategies also benefit from existing user data that can help teams personalize product offerings and upgrades. 

Building a loyal, reliable customer base 

A consistent, enhanced customer experience for those who’ve already made a purchase reminds them that you value their business. By establishing frequent and effective connections, customers may be more likely to make repeat purchases, entertain an upsell, or refer their connections to your business. This shared trust translates to loyalty and increases the LTV of existing customers. 

What’s more, committed customers can help reduce overall churn numbers and decrease the need for costly acquisition activities.

Personalization as a marketing tool is more than just a pre-sales tactic to speak to target customers’ pain points—it’s also a beneficial post-sales activity that reminds your customers why they should keep doing business with you. By targeting existing customers with tailored experiences that reiterate how your solutions solve their problems, you’ll build a reliable customer base who’s more likely to buy from you again. 

Customer retention can improve customer LTV, loyalty, and brand awareness through referrals, all of which contribute to reduced long-term marketing costs. Prioritizing personalization strategies for existing customers can increase your chances of retaining these customers for the foreseeable future.