Focusing on customer retention is a powerful way for brands to navigate this challenge. By honing in on the needs, preferences, and desires of their existing customer base, brands can create tailored and personalized experiences that foster long-lasting relationships and drive brand loyalty
As the new-age consumers grow increasingly discerning and constantly explore new brands, it has become more important than ever for businesses to focus on both retaining existing customers and attracting new ones. A recent Euromonitor report on GenZ and millennials show that only 29% of millennials remain loyal to brands, emphasizing the need for a dual approach.
Focusing on customer retention is a powerful way for brands to navigate this challenge. By honing in on the needs, preferences, and desires of their existing customer base, brands can create tailored and personalized experiences that foster long-lasting relationships and drive brand loyalty. This approach not only fuels repeat business but also serves as a potent catalyst for organic growth through word-of-mouth referrals.
However, a common misconception is that slow-moving consumer goods (SMCG) brands need only prioritize customer acquisition, while fast-moving consumer goods (FMCG) brands often face a more balanced emphasis on both customer acquisition and retention. The reality is that customer retention is just as vital—if not more so—for the success of SMCG brands.
Role of digital marketing for slow-moving consumer goods (SMCG)
Often, brands in the SMCG sector place a higher emphasis on offline marketing since a significant 90-95% of their sales are derived from offline channels. The remaining sales is generated through online sources, predominantly e-commerce platforms like Amazon and Flipkart, which are growing at a fast pace. While this skewed distribution may lead some to believe that digital marketing is not essential, it's crucial to understand that digital marketing is about far more than just facilitating online sales.