Customer Retention! The Key to Business Growth

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CUSTOMER RETENTION

IN YOUR BUSINESS

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WHY RETAIN CUSTOMER? • Pricing

• Failed Service

• Not Comfortable/ Convinient

• Invounteer switching

• Competition

• Ethical Concerns

• Other Factors

Key to customer retention is customer satisfaction

• Stay loyal longer

• Talk favorably about organization

• Pay less attention to competition

• Are less price sensitive

• Offer service ideas to organization

• Cost less to serve than new customers

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Customer Retention in Service companies • Retain best personnel to win and keep

good customers

• Have loyal employee base

• A typical company has customer defection rate of 10-30% per year

• Raising retention rate by 5% can increase value of an average customer lifetime by 25%

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Customer Retention Tactics – Image Promotion

• Community service

• Direct mail

• Educational offerings

• Integrated marketing communications

• Newsletters

• Regular customer contact

• Website Service Quality

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Customer Retention Tactics – Service Quality

• Continuous quality initiatives

• Convenience

• Mystery shopping

• Customer representatives/ ombudsman

• Smile

• Treat customers as family

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Customer Retention Tactics – Research

• Analyze defection rates/reasons

• Classify customers by usage

• Satisfaction

• Loyalty

• Develop targeted retention programs.

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Customer Retention Tactics – Internal Marketing

• Loyalty task force

• Prepare “solutions” to recurring problems

• Share appropriate customer data with staff

• Reward customer care person of the month.

• Publicize customer care person of the month.

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Customer Retention Tactics – Customer Centered

• “Dialogue” marketing

• Customer bill of rights

• Customer care councils

• Understand customer expectations

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Customer Value

Customer value is built through the proper mix of SQIP –

Service

Quality

Image

Price

Elements that attract and keep customers!

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Customer Satisfaction, Loyalty & Retention Model

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Sequence In Retention Process

• Exploring

• Evaluating

• Establishing Strategies

• Examining Feedback

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B uyer or T ry-er

• A 1-time buyer is really a try-er , rather than a customer

• To move beyond transaction stage, your experiences must meet or exceed expectations

• Repeat incidents of high satisfaction are sought through - utilization of relationship marketing strategies, leading to great customer loyalty

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Classification – Customer Segments

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Loyalty Building Strategies

• Participate in customers events

• Hold retreat to share best practices

• Invite customers to seminars

• Set up customer advisory council

• Develop a preferred-customer strategy

• Reward customers for referring

• Develop business plans with key ones

• Partner with key industry research

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9 Effective Approaches for Enhancing Retention

1. Build a customer database/marketing information system

2. Design ongoing customer programs - continuity and loyalty-based initiatives

3. Offer long term services - membership/subscription programs

4. Custom promotion - use reminder advertising and press releases

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9 Effective Approaches for Enhancing Retention

5. Focus on key accounts and heavy users

6. Use newsletters/informational materials to stay in touch with infrequent customers

7. Attend trade shows

8. Research customers needs and wants

9. Welcome suggestions and complaints

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7 Criteria for Selecting CR Approach 1. Efficiency - low cost

2. Effectiveness - likelihood to succeed

3. Adaptability - strategic fit with culture

4. Consistency - works well with marketing plan

5. Competitive advantage

6. Ease of implementation

7. Projected profitability

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Happy Customer Retention

to all!

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