Customer Retention

Do you excel at customer retention?
A. No. We have trouble hanging on to customers.
B. We believe we have satisfactory retention levels … we rarely lose customers.
C. We are continuously seeking to improve customer retention levels.
D. We are good at customer retention – reliably delivering on the value proposition, service quality, continuously building customer commitment and loyalty which in turn generates referrals.
E. We excel at customer retention – consistently delivering on the value proposition, service excellence, continuously building customer commitment and loyalty, creating ‘customer apostles’ who actively generate referrals.
[Score:  A=0, B=1, C=2, D=3 and E=4]

 

Why is this question important?

The easiest way to grow your customers is not to lose them.

The average business loses around 20 per cent of its customers every year simply by failing to attend to customer relationships. In some cases this leakage is as high as 80 per cent. Either way the cost is staggering, but all too few businesses truly understand the implications.

Take two businesses, one that retains 90 per cent of its customers, the other retaining 80 per cent. If both add new customers at the rate of 20 per cent per year, the first will have a 10 per cent net growth in customers per year, while the other will have none. Over seven years, the first firm will virtually double, while the second will have no real growth. Everything else being equal, that 10-percent advantage in customer retention will result in a doubling of customers every seven years without doing anything else.

Everyone wants to retain their existing customers. Few companies have proactive positive strategies aimed at retention. Most companies are organized for ‘acquisition’. Their advertising and sales programs are designed to find and promote their products and services to new customers. The companies are organized on a product or brand basis, not on a customer segment basis.  While they may have customer service departments, they often lack an integrated marketing strategy that is directed at retention, and that defines retention as the measurement of success. You should always be looking at the best customer retention strategies to retain your existing customers.

Try some of these:

  1. Do a good job.  When you and your employees do a good job, then everything else follows. There will be good service, good products, and naturally, customers will see and feel this, and will ultimately, keep coming back.
  2. Keep track – maintain a database. If you don’t keep track of who your customers are, how can you be sure that you are getting their repeat business?
  3. Stay in touch
  4. Welcome the complaints you receive
  5. Meaningful welcome and thank you communications
  6. Instigate loyalty programs
  7. Send out questionnaires and surveys to existing customers
  8. Have you scheduled a frequent communications plan to your customer base?
  9. Provide exceptional customer service – beef up customer service, and empower them to solve problems
  10. Enhanced technical support with follow up satisfaction calls
  11. Make a good first impression
  12. Make courtesy top priority with all customer-facing staff
  13. Do regular reviews
  14. Go contact the ‘lost sheep’