Customer retention strategies: How to keep churn in checkby
Customer acquisition may be rising up the list of business priorities according to experts, but any business that doesn't have retention and profitability under control is heading for trouble. Jack Springman takes a strategic look at customer retention.
Gartner’s prediction is that acquiring new customers will rise to the second highest priority for businesses in 2010. Such a reaction to signs of upturn after a long recession is understandable; but such a focus risks alienating existing customers if they notice special deals offered to new customers are not available to them. Their natural response is to search for new customer deals being offered by alternative suppliers, with a merry-go-round resulting.
No-one wins from this – not businesses whose marketing spend creates a prune juice effect (current customers exiting as fast as new ones arrive); and not customers who expend time and emotional energy moving from one company that does not care for them to another whose feigned interest evaporates as soon as a contract is signed.
Jack Springman is head of corporate advisory group at consulting and systems integration firm Business & Decision.