But why does retaining a customer matter so much? Dependent upon which statistics you are viewing, it can cost anywhere between five and nine times as much to acquire a new customer as it does to retain an existing one. And as the Harvard Business Review states, 91% of small businesses do absolutely nothing to retain their existing clients (meaning only 9% understand this reality). Consider the following numbers:
• According to John Coe, author of, The Fundamentals of Business To Business Sales and Marketing, “68% of long-term customers stop buying because they just don’t feel loved.”
• The average American business loses 50% of its customer base every 5 years. –HBR
• An existing customer spends an average of 67% more than new customers. – HBR
If you take it a step further and consider that customer retention is influenced just as much by brand, product and service proposition, then customer experience is the primary factor in brand loyalty, acquisition and customer retention. All that being said, the average organizational expenditure still breaks down as follows (according toJames Digby, marketing manager at TeleFaction):
• 55% is on new customer acquisition
• 33% is on brand awareness
• Only 12% is on customer retention
How are you using to retain your customers?
Traditionally……
