Here are ways your CRM can help serve your Most Valuable and Loyal Customers.
New Customer Acquisition Cost = 5X Customer Retention Cost. Probability of Selling-to New Customer: 5-20% vs Existing Customer: 50 - 70%. Still, most Sales and Marketing budget is aligned for new customer acquisition, is it time to rethink?
For those in the numbers game, getting more clients means more business. This means all their efforts and your budgetary allocations are geared towards engaging these new potential clients.
However, research has shown time and again that the differentiating factor between companies that grow and those that don’t is their ability to retain customers.
The numbers speak for themselves. According to research, with a 5% increase in customer retention, you can increase profits by 25% to 95%.
Read on for tips on how your CRM system can help you curb the dreaded customer churn.
Customer churn or customer attrition refers to the rate at which your customers stop doing business with you. So, if you started with 100 customers and 10 customers left you at the end of the year, that would mean an attrition rate of 10%.
Nine times out of ten, these are the common factors that motivate customers to switch.
Cost – the cost of the product is often the deciding factor. However, if the customers are unable to see the value they can get for their money, they will most likely leave before long.
Does not meet their needs – the ever-changing demands of the customers have to be accounted for to increase sales. Failure to evolve and offer better services is another critical error.
Poor customer engagement – Today’s customer has a wide range of platforms where they prefer to engage with the manufacturer. Poor customer service due to disjointed teams and information, lack of interaction as per their convenience and preference is soon becoming the most important reason why customers choose to leave.
Considering that these dissatisfied customers would share their experiences online, you tend to lose on any potential new customers as well.
“Personalized engagement with your most valued customers will ensure repeat as well as new business via referrals.”
New Customer Acquisition vs Customer Retention
Probability- selling to new customer vs selling to existing customer
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