Customer Retention is Not Easy but it is Rewarding

Updated: August 18, 2010

Customer Retention idea is not new. What is new is the approach. What is now being witnessed is a market increasingly commoditised and far more susceptible to competition - from other players and from new media. Customer knowledge and confidence have had a significant impact: it has become so much easier to compare and to swap products. Changing sales structures and wearing away of face-to-face interaction have helped to dilute or eradicate conventional ‘loyalty'.

What direction does this give the services marketer? It leads the way to a re-examination of profit drivers and a critical evaluation of current programmes. The business relationship with the customer has changed and is still changing, becoming far more complex. So too are the communications matrices within that relationship.

Customer retention is not easy but it is rewarding and far less daunting if it is broken down into manageable, measurable programmes which demonstrate their effect quickly and unquestionably. So, if large-scale, top- down, budget-busting ‘CRM' initiatives are not reaping the necessary rewards quickly enough for an organisation, the available resource should be channelled in a different direction.

Start by understanding the drivers to customer satisfaction and therefore retention. Arguably this is simply good marketing but few have had sufficient success in this particular area. Seek not to measure satisfaction but to manage it, and to understand the relationships between different factors of each product or its support and the propensity to brand loyalty. This will only be achieved through dialogue and by comparing what customers say they will do with what they actually do.

When or while understanding satisfaction, focus should be turned to churn management to stem the growing tide of customer defection: the expensive, disruptive and inefficient `leaky bucket' which, left unchecked, will defeat the organisation. Tease out those customers with the greatest potential to impact on profits and concentrate all available resource here.

Featured Research
  • Eight Ways You Should Be Using Contact Center Reporting

    Every day, your contact center collects critical data that can be used to drive strategic improvements to your efforts in the future. But that data is meaningless if you don’t know how to access and analyze it. The key to do doing both is using reporting features. By understanding how to use reporting tools, you will gain much greater insight from the data you are collecting. more

  • Is Your Phone System Stealing Profits?

    Having the wrong phone system can dramatically cut into your profits. Despite this, many businesses just sign up for a plan or platform that seems ‘good enough’. If you haven’t carefully considered your options and the included features, there’s a very good chance that you are leaving money on the table in some way. more

  • Best Video Conferencing Features for Business

    Most businesses are currently underutilizing their video conferencing software because they aren’t aware of the different ways it can be used. Understanding the different features of video conferencing software can be critical to getting the most out of your investment. These features often vary from one option to the next as well, so it's important to do your homework before choosing a specific service. more

  • Phone System Technology Showdown

    VoIP and IP telephony are often misconstrued as being the same type of phone system, but the truth is they operate on different technology and deployment methods. This guide will explain the differences between VoIP and IP, go into the pros and cons of both VoIP and IP-PBX, and give insight into which type of phone system will benefit your business the most. more

  • 8 Ways the Cloud is Changing ERP for the Better

    What if there was a tool available that allowed for you to save up to a quarter of your operational costs? Studies have shown that Enterprise Resource Planning (ERP) solutions enable businesses to access accurate, real-time information about daily operations which allow for the reduction of operational costs of up to 23% and administrative costs of up to 22%. more