The path to growth in a contracting economy

Key takeaway

Loyal customers spend more and buy more often than new customers. Companies focussed on customer retention and implementing smart new revenue streams are positioned for growth in uncertain times. 

Key data points: why customer retention is now the golden path to growth

• Retaining an existing customer costs five times less than attracting new customers.(1)
• When customer retention increases by 5 percent, companies can make between 25 to 95 percent more profit. (2)
• Increasing customer retention by 2 percent has the same effect on your bottom line as cutting costs by 10 percent. (3)
• 86 percent of customers intend to buy from a company more often if they feel an 'emotional connection'. (4)

Hyper personalisation generates hyper engagement

Tailored reward and loyalty programs are an extremely effective method at retaining customers and distinguishing yourself from the competition.Prosper Insights and Analyticsfound that 44 percent of consumers make more credit card purchases when they receive a cashback offer. Whereas, with 'regular' discount promotions, only 23 percent are motivated to spend more.

That’s why at Sniptech we combined Cashback with Open Banking so you can offer bespoke rewards that your customers actually want.

 API ecosystems are the engine fuelling finance innovation

A multifunctional API allows businesses to offer customers various benefits and features, while bypassing the innovation burden. Loyalty and rewards programs are low hanging fruit for banks and FinTechs aiming to win-back customer wallets. With this innovation strategy, companies can increase retention and generate additional income streams while remaining focussed on their core business. They also gain a 360° view of customer purchasing habits, allowing businesses to target customers via hyper personalised offers and rewards.  

Final words: API innovation keeps you ahead of the curve

In an uncertain market, it is no longer enough to focus on acquisition. By actively working on increasing customer retention, and using a multi-solution personal finance API,  companies can fuel sustainable growth. Investing in hyper engagement via an API is the path to stay ahead of the curve.

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 Sources:

• https://www.invespcro.com/blog/customer-acquisition-retention/
• https://media.bain.com/Images/BB_Prescription_cutting_costs.pdf
• https://www.destinationcrm.com/Articles/Web-Exclusives/Viewpoints/Listen-to-the-Voice-of-the-Customer-53239.aspx
• https://www.forbes.com/sites/shephyken/2018/05/17/businesses-lose-75-billion-due-to-poor-customer-service/?sh=7648511b16f9