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CUSTOMER RETENTION
IN YOUR BUSINESS
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WHY RETAIN CUSTOMER? • Pricing
• Failed Service
• Not Comfortable/ Convinient
• Invounteer switching
• Competition
• Ethical Concerns
• Other Factors
Key to customer retention is customer satisfaction
• Stay loyal longer
• Talk favorably about organization
• Pay less attention to competition
• Are less price sensitive
• Offer service ideas to organization
• Cost less to serve than new customers
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Customer Retention in Service companies • Retain best personnel to win and keep
good customers
• Have loyal employee base
• A typical company has customer defection rate of 10-30% per year
• Raising retention rate by 5% can increase value of an average customer lifetime by 25%
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Customer Retention Tactics – Image Promotion
• Community service
• Direct mail
• Educational offerings
• Integrated marketing communications
• Newsletters
• Regular customer contact
• Website Service Quality
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Customer Retention Tactics – Service Quality
• Continuous quality initiatives
• Convenience
• Mystery shopping
• Customer representatives/ ombudsman
• Smile
• Treat customers as family
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Customer Retention Tactics – Research
• Analyze defection rates/reasons
• Classify customers by usage
• Satisfaction
• Loyalty
• Develop targeted retention programs.
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Customer Retention Tactics – Internal Marketing
• Loyalty task force
• Prepare “solutions” to recurring problems
• Share appropriate customer data with staff
• Reward customer care person of the month.
• Publicize customer care person of the month.
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Customer Retention Tactics – Customer Centered
• “Dialogue” marketing
• Customer bill of rights
• Customer care councils
• Understand customer expectations
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Customer Value
Customer value is built through the proper mix of SQIP –
Service
Quality
Image
Price
Elements that attract and keep customers!
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Customer Satisfaction, Loyalty & Retention Model
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Sequence In Retention Process
• Exploring
• Evaluating
• Establishing Strategies
• Examining Feedback
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B uyer or T ry-er
• A 1-time buyer is really a try-er , rather than a customer
• To move beyond transaction stage, your experiences must meet or exceed expectations
• Repeat incidents of high satisfaction are sought through - utilization of relationship marketing strategies, leading to great customer loyalty
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Classification – Customer Segments
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Loyalty Building Strategies
• Participate in customers events
• Hold retreat to share best practices
• Invite customers to seminars
• Set up customer advisory council
• Develop a preferred-customer strategy
• Reward customers for referring
• Develop business plans with key ones
• Partner with key industry research
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9 Effective Approaches for Enhancing Retention
1. Build a customer database/marketing information system
2. Design ongoing customer programs - continuity and loyalty-based initiatives
3. Offer long term services - membership/subscription programs
4. Custom promotion - use reminder advertising and press releases
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9 Effective Approaches for Enhancing Retention
5. Focus on key accounts and heavy users
6. Use newsletters/informational materials to stay in touch with infrequent customers
7. Attend trade shows
8. Research customers needs and wants
9. Welcome suggestions and complaints
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7 Criteria for Selecting CR Approach 1. Efficiency - low cost
2. Effectiveness - likelihood to succeed
3. Adaptability - strategic fit with culture
4. Consistency - works well with marketing plan
5. Competitive advantage
6. Ease of implementation
7. Projected profitability
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Happy Customer Retention
to all!
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