Customer retention vs. customer acquisition. They're both important. What is your focus?
Customer retention versus customer acquisition. They're both important and can shift based on the lifecycle of your business (newer companies must focus on customer acquisition), product or service type, and other factors. If you do a quick Google search, the majority of articles heavily favor customer retention. A quick survey of several articles indicates many of the same findings summarized below. -The cost of acquiring a new customer is 5X more than retaining an existing customer. -The success rate of selling to an existing customer 60 to 70%. the success rate of selling to a new customer 5 to 20%. -Loyal Customers 5x more likely to repurchase & 4x more likely to refer new customers, the lifeline of new business. When I was a sales manager at a large media company my loyalty was always split between the company and clients, now 100% of my loyalty goes to clients. ConnectADtv operates as an extension of our clients business (See Reviews herehttps://bit.ly/32PgT7h) The large media mentality was churn and burn, as a small customer-centric company our focus is delighting current clients, delivering superior results, and 100% transparency. This has led to tremendous customer loyalty and regular referrals. I have always believed- take care of your clients and the rest will take care of itself. A Google search was not necessary for me to realize retention is the right strategy for ConnectADtv. Over the last few weeks, I have been paying attention to AT&T's new commercials – “Everyone Gets Our Best Deals”. I like it, we will have to wait and see how it works for At&T. Just yesterday I received my Internet bill and I was shocked to see that it went up again. My Internet service has increased by 153% over 3 years, from $49 a month to $75 a month. I called the company and asked if I was a new customer what would the service cost. I think it was $44. I was then reassured that I was still getting a great deal at $75. In my view retention is built on quality, value, satisfaction, and reward. The assurance I received from the cable company is like selling ice to Eskimos, I don't need it. My three years of loyalty has led to price increases above that of other customers. I have left this company before and I will leave them again. It is very predictable, as soon as I leave they will be courting my business again. With cable companies hemorrhaging customers, you would think they would adopt A new strategy. I am happy I cut the cord, the only conclusion I can come to is that most cable companies prefer the high cost of new customer acquisition over customer retention. My personal experience from running sales at a large media company is that the compensation system favored customer acquisition over customer retention. Retention, Acquisition, they're both important I guess it's up to the leadership of individual companies which they focus on. My belief happy customers build strong businesses.