Customer retention is important for businesses for several key reasons: (1) the cost of retaining an existing customer is much lower than acquiring a new customer, (2) increasing customer retention rates by 5% can increase profits by 25-95%, and (3) satisfied existing customers are more likely to purchase again and refer others than new customers.
B2B Customer Experience Management Best Practice Study PREVIEW SAMPLE
Customer retention
1. Why is C.R important?
1. Customer acquisition cost & customer retention
cost are to determine ROI
2. Widely accepted formula: C.A.C = 6 X C.R.C
3. C.R increase 5% = Profit increases 25% - 95%
(cmo.com)
4. Converting existing customers = 60% - 70% vs.
converting new customers = 3% - 20%
2. Why is C.R important?
5. C.R impacts on C.A (WOM, referrals…)
6. Satisfied customers tell 9 other people about their
positive experience vs. dissatisfied customers tell 22
“word of mouse spreads even faster than word of mouth”
7. Repeat customer spend 33% more than new
customers
8. Every cent spent on improving customer
experience = 34% - 400% ROI increase
http://www.slideshare.net/custthermometer/22-customer-retention-stats
http://www.customerforlife.com/blog/salesforce/2013/03/26/retention-vs-acquisition/
http://www.cmo.com/articles/2013/7/18/customer_retention.html