Acquiring new customers has become increasingly expensive.
A study by SimplicityDX shows a 222% increase in customer acquisition costs for e-commerce companies in the last 8 years, with these companies losing roughly $29 per customer acquired.
It’s time for businesses to reassess their strategies and focus on maximizing the value of each customer acquired. This is where the shift from pre-sale to post-sale service comes into play.
The Rising Costs of Customer Acquisition
With each passing year, the cost of acquiring a new customer rises higher and higher, leaving many businesses struggling to keep their heads above water. But what exactly is driving this upward trend in customer acquisition cost?
Today's consumers are more discerning and demanding than ever before. With unlimited options at their fingertips, they expect personalized experiences, seamless transactions, and exceptional customer service at every touchpoint.
Additionally, changes in regulations are driving higher ad spending leading to higher CAC. Recent regulations such as the GDPR (General Data Protection Regulation) have made it harder for businesses to segment audiences and carry out contextual advertising.
Meeting these expectations requires the right technology and customer support.
What is Pre-Sale vs. Post-Sale Service?
Traditionally, businesses have heavily invested in pre-sale activities to attract new customers.
While these efforts are essential for driving initial conversions, they often neglect the crucial post-sale phase of the customer journey. However, as consumer expectations continue to evolve, it's becoming evident that the post-sale experience is just as, if not more, important than the pre-sale experience.
You may be asking, “What is post-sale service?”.
Post-sale service refers to the support and assistance provided to customers after they have purchased a product or service. It plays a crucial role in building long-term relationships with customers, fostering loyalty, and ultimately driving repeat business and referrals. Traditional post-sale services have primarily consisted of customer support channels, returns, and warranty/repairs. As post-sale service has grown and developed in recent years, the focus has shifted to how companies can proactively help their customers use their products.
Pre-sale metrics typically focus on indicators such as website traffic, lead generation, and conversion rates. While these metrics are important for assessing the effectiveness of marketing efforts, they only provide a partial picture of customer acquisition. On the other hand, post-sale metrics, including customer satisfaction levels, retention rates, and lifetime value (LTV), offer valuable insights into the long-term success of a business.
To drive sustainable revenue growth, companies need to shift their spending towards post-sale service initiatives.
3 Ways Post-Sale Service Drives Conversions and Revenue
A 5% increase in retention can boost revenue by anywhere from 25% to 95%.
So, how exactly does post-sale service drive conversions and increase revenue? Let's break it down.
1. Enhancing Customer Satisfaction and Loyalty
At its core, post-sale service is about delivering exceptional experiences that delight customers and keep them coming back for more. Whether it's providing personalized support, offering proactive guidance, or simply expressing gratitude for their business, every interaction presents an opportunity to strengthen the customer relationship. As any savvy marketer knows, loyal customers are more likely to not only make repeat purchases themselves but also recommend your brand to others.
2. Maximizing Customer Lifetime Value
In today's subscription-driven economy, customer LTV is king. And the key to maximizing LTV? You guessed it: post-sale service. By continuously engaging with customers, understanding their needs, and delivering ongoing value, businesses can extend the lifetime of each customer relationship and unlock new revenue streams in the process. Keeping customers happy and engaged is the gateway to increasing LTV.
3. Differentiating Your Brand in a Crowded Marketplace
In a world where product features can easily be replicated and prices are constantly under pressure, the true differentiator lies in the customer experience. By investing in post-sale services, businesses can set themselves apart from the competition and create a lasting impression that resonates with consumers long after the initial purchase. As we mentioned, customers are craving connection and personalization. Whether it's through innovative support offerings, seamless omnichannel experiences, or hyper-personalized communication, the brands that prioritize post-sale service are the ones that stand out in the minds of consumers.
Increase Customer Engagement with Blustream
At Blustream, we make post-sale service a successful reality.
Unlike traditional approaches that focus solely on the transactional aspects of the customer relationship, Blustream's platform enables businesses to establish an ongoing connection with customers around their products.
Our platform empowers businesses to automate personalized experiences for customers at every stage of their product ownership journey. From the moment of unboxing to the ongoing care and usage of their purchase, our intelligent messaging platform ensures that customers receive timely, relevant, and tailored messages that resonate with their individual needs and preferences.
Recently, we’ve seen the impact of personalized post-sale service in the musical instrument industry.
With a major increase in musicians playing instruments for the first time, there is an even greater need to ensure these musicians know how to properly take care of their rented or owned instruments.
Establishing a connection by encouraging proper maintenance and care, providing guidance on usage, and sharing educational tips, all at the point of rental and beyond can be the difference between a short-term hobby and a long-term love of music. Not to mention, the companies retain a customer for life.
Blustream's platform incorporates innovative features such as Intelligent Message Triggering, Advanced Product Journey Editing, Enhanced Rapid Dialogue, and Smart Audience Segmentation designed to empower businesses and elevate the post-sale service experience.
With Blustream, companies such as Bertrand’s Music improved churn by 15% directly equating to more than $60k in revenue from retained renters in just the first 3 months. Ted Brown Music saw a 30% improvement in expected churn and more than $100,000 in retained revenue from historically lost renters - in just one semester.
It’s simple. Customer retention all starts with shifting spend to your post-sale service.
Ready to elevate your post-sale service experience? See firsthand the power of product ownership with Blustream by scheduling a demo and embarking on a journey of unparalleled growth and retention.