What Is Customer Retention 2

By Remy Lebeau

Fact # 4: With just a 5% decrease in customer attrition equates to a 125% increase in profit.

By successfully increasing customer retention rate by just 5%, you can expect a 125% increase in your profit. This exceptionally high ROI explains why most companies that are considered industry leaders continually spends on programs that lowers customer attrition.

Given these four important facts, one can easily deduce that customer retention is indeed an important factor to focus on in growing the profitability of the business. But the question that remains is what can you do to increase your customer retention rate?

The answer is to make your existing customers happy. Below are three strategies you can work on in increasing both retention rate and buying frequency of your current clients.

1.Focus more resources on your existing clients

These existing customers are already doing business with you. And investing on them are more likely to payoff than spending your resources in acquiring new clients. Thus, it is but logical to spend more resources on these group since they present a higher ROI.

Investing more time, effort, and resources on your existing clients will also give your business a “market sanctuary”, or a group of loyal customers that can provide regular sales that can help sustain your company in rough times.

2.Maintain communication with your top clients

A phone call or a short email every now and then will go a long way in strengthening your existing relationship with your top clients. These simple gestures will remind your customers that you value them, and they are not just mere numbers across your financial statement.

It is also important to note that communication is a two-way thing. Thus, it is essential to listen to your customers because it is never about you and it is always about them. And listening doesn't just mean hearing your customers' concerns, but actually doing something about them. This doesn't mean that you have to grant all of your clients' wishes even how absurd they are. Saying “no” to a request and explaining the reason why it is not possible, if done correctly, is an action that can demonstrate your honesty to your customers.

What you want is to be prioritized by your clients, and the best way to achieve this is to show that you are prioritizing them as well. And this can be accomplished by maintaining a regular and open communication channel between you and your top customers.

Article Source: http://getico.co.za