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| IT’S BEEN SAID THAT THOSE WHO FAIL TO PLAN, PLAN TO FAIL. |
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It might also be said that those who fail
to plan for keeping their customers, might
as well plan on losing them.
When you’re devising strategies and creating
budgets for the coming year, don’t forget to
plan and commit resources for retaining
your existing customers. According to the
Journal of Marketing Research (JMR), the average firm’s chances of making
a sale to a prospect are between 5 and 20 percent, but your chances of making
a repeat sale to an existing customer are 60 to 70 percent.
Plus, just a 5 percent increase in customer retention can result in profit
increases of 40 to 95 percent according to global business consulting
firm Bain and Company. It seems obvious that the smart money is in
retention marketing.
Repeat customers not only mean repeat sales — they also are a prime source
of referrals for new customers. Even if you’ve achieved significant sales
growth, disloyal customers are difficult and expensive to replace, and the
negative word of mouth generated by unhappy customers could be costing
you new business as well.
So the question becomes not whether retention marketing is a good idea,
but how to do it effectively. This issue of First Perspective offers proven
strategies for marketing to your existing customers... with a focus on three
areas: Customer Lifecycle (the first in a four-part series), Measurement and Technology.
While every business needs new customers for continuing growth, retaining
the customers you have is at least as important as acquiring new ones. This
year, make retention marketing a priority in your annual plan for more
profitable, long-term relationships with your customers.  |
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