Building loyalty in unconventional markets
There are no less than nine key techniques for successful customer retention in unconventional marketplaces, according to a new white paper published by Allegiance.
The paper, entitled 'Retaining Customers in Tough Economic Times', explains the firm's nine strategies for customer retention in marketplaces that do not follow traditional rules, including ways to identify defecting customers and understand what is causing them to leave, how to keep customers coming back, and how to prevent them from leaving.
"The current economic climate is causing customers to be more selective about which businesses they spend their money with," explained Kyle La Malfa, Allegiance's best practices manager. "As a result, many companies are losing customers at a rapid rate."
However, the paper suggests that marketers often focus too much on acquiring new customers and consequently fail to keep existing customers. There is also a lack of focus on taking existing customer relationships to a higher level, the paper reports.
It is estimated by ICLP that the average business loses between 10% and 30% of its customers each year. To help address this problem, some businesses have dozens of tools and procedures in place to "listen to the voice of the customer (VOC)".
However, these tools often duplicate efforts and take up valuable time and resources. For this reason, marketers are increasingly turning to Enterprise Feedback Management (EFM) systems to collect customer feedback through multiple channels (whether email, Web, print, or telephone) into a central database for analysis and action.
Once a comprehensive feedback system is in place, companies can focus on several key areas to identify new ways to improve customer retention. For example, they should examine:
- The type of customer feedback and the percentage in each feedback category (complaints, suggestions, comments, concerns);
- The channel most used by customers to provide feedback (e.g. web, telephone, in person);
- The underlying drivers of customer loyalty and engagement, such as their emotional bond with the business;
- The current strength and depth of customer loyalty and engagement;
- Trends in customer loyalty and engagement levels over time;
- Opportunities for new revenue and growth.
The full white paper has been made available for free download from Allegiance's web site - click here (free registration required).
Sources: Allegiance / The Marketing Factbook.
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