Customer Retention: The Art of Keeping Good Customers

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Cynthia Holt
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1 Customer Retention: The Art of Keeping Good Customers

2 REDUCE ATTRITION TO INCREASE PROFITS REDUCING THE ATTRITION RATE FROM 10% TO 5% CAN INCREASE PROFITS FROM 25% TO 85% 85% 75% Calculated by Comparing the Net Present Values of the Profit Streams for the Average Customer Life at Current Attrition Rates, With the Net Present Values of the Profit Streams for the Average Customer Life at 5% Lower Attrition Rates. Branch Deposits Charge Card Insurance Brokerage Industrial Distribution 50% 45% 45% 40% Industrial Laundry 35% 30% 25% Office Bldg. Management Software Auto Svc Chain Credit Insurance

Present Values of the Profit Streams for the Average Customer Life at 5% Lower Attrition Rates.

3 Key Messages Customer Values Are Changing Customer Focus is a Discipline Customer Retention is an Art The Art of Keeping Good Customers

4 If it touches the customer, it s a marketing issue

5 Changing Customer Values 1. Relevant features and functions, with the ability to customise 2. Choices and Flexibility 3. Relationships based on trust and rewarded with loyalty

6 Changing Customer Values 4. Sufficient knowledge and information 5. Complete and full satisfaction 6. Speed and Convenience

7 Changing Customer Values 7. Environmental Impact

8 Importance of Customer Retention If we don t take care of our customers, someone else will. Nick Utton Chief Marketing Officer MasterCard International

9 Customer Focus Is A Discipline

10 Customer Focus Is A Discipline Create customer intensity everywhere. Lew Platt CEO Hewlett-Packard

11 Focussing on Customer Needs

12 The Importance of TLC T L C

13 TLC Think Like Customers

14 Think Like Customers

15 Customer Expectations Core Non- Negotiable Negotiable Added Value (Needs) (Wants) (Desires) (Likes)

16 Customer Evaluations 4 PE s Promise + Performance Experiences People Experiences Process Experiences Personal Experiences

17 Customer Experience Matrix Core Non- Negotiable Negotiable Added Value Promise Perform People Processes Personal

18 Customer Experience Scoreboard Core Non- Negotiable Negotiable Added Value Promise Perform People Processes Personal

19 Heighten Customer Experiences Flexible policies Empowered customer contact staff TLC Consistent quality and service delivery

20 Customer Retention Is An Art

21 Defining Customers What is a Customer? When does someone become your Customer?

22 Relationship Marketing NOT Customer Relationship Management! Forget CRM as you know it. Think: Customer Retention Marketing!

23 Perceptions vs. Reality What is the difference between perception and reality?

24 Perceptions vs. Reality What is the difference between perception and reality? Perceptions are BELIEVED by the beholder!

25 Perceptions Perceptions are REAL. Actually..perceptions are more important than reality. Why?

26 Perception Points The crucial moment when customers and prospects: see hear smell feel touch taste experience

27 Perception Points Key point: Each and every point of customer contact before, during, and after a sale will affect what people say and believe about you.

28 Points of Interaction Perception Points = Contact Points Contact Points = Points of Interaction Perceptions are formed by customers through interactions.

29 7 Cs of Customer Retention Caring Attitude Customised Practices Competent CCPs Call/Visit Once Convenient Access Compressed Cycle Times Committed Follow Through

30 Customer Loyalty Customer Satisfaction is an attitude. Customer Loyalty is a behaviour.

31 Customer Retention Is An Art

32 Summary The great businesses of tomorrow will grow exactly the way great businesses have always been built: by doing marvelous things that meet the needs, wants, and desires of customers.

33 Commitment Don t have a commitment to customer service have a commitment to customers.

34 Howard Marketing Services Added Value Monday Morning Marketing Memo newsletter Articles, references, links to marketing and sales sites

35 Thank You

Copyright 2007 Performance Equations. Service Excellence through Customer Experience Management

Copyright 2007 Performance Equations. Service Excellence through Customer Experience Management Excellence through Customer Experience Management Links in the Profit Chain Operating strategy and service delivery systems concept Business results Internal Internal Quality Quality Satisfaction Satisfaction