Retaining Customers

Research suggests that it costs between three and ten times as much to replace lost customers than to keep them. Here is a brief ‘what, why and how’ on customer retention.

WHAT Keep in touch with what your customers want and how their needs are changing.
WHY Prevents complacency.
HOW Regularly measure customer satisfaction levels and use market research.

WHAT Welcome complaints.
WHY Something is wrong and you need to know what so that you can act and keep the customer.
HOW Record and analyse the complaint so that you can see what changes you need to make.

WHAT Customer relationship management (CRM) might be the key. CRM is the process of developing personal relationships with your customers.
WHY As your business grows, it becomes more difficult to maintain a personal relationship with all of your customers.
HOW A CRM solution may involve databases, the internet, telemarketing and direct mail.

In summary, if you have a large customer base, you should probably communicate:

regularly and personally with the top 20%
through telemarketing and occasional personal contact with the next 40%
through occasional mailings for the rest.