Customer Acquisition Versus Customer Retention
by Paul Travis, Executive Interim Manager
Two buzz words that are thrown around in boardrooms all the time are customer acquisition and customer retention. Research done by Rockefeller Corporation tells us 68% of your customers will leave because they feel that you no longer care about them. It’s not because of the product or service and not because of the competition. It’s because of how you are treating your own customer.
In my own practice I work with clients on how to distinguish between different classes of customers. We never have just one customer, we always have different constituencies of people that we are serving. The place that I usually focus on is customer relationship management. This is the class of technology systems that have become the back office for most companies. Some are still not doing it very well. Sales may have one data base and product support has another database. People in the field know about their own folks, and they’ve never put things into the computer, so customer information can be lost.
Numerous studies have been done over the years that show that it will cost anywhere between 5 to 9 times as much to sell to a brand new customer as it does to sell to a customer who we’ve already had. It’s much more profitable. Why not use customer relationship management systems and the distinction between acquisition and retention to be able to target and build that base of high mind share?
