According to a 2007 study conducted by Strativity Group based on the responses given by about 300 executives working for various companies, 54% of these executives were loyalty to the brands their companies owned.
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That's appalling considering that a little less than half of those surveyed don't wish to be customers of the very companies they work for.
Start with unquestionable quality products and services: There are no excuses to start a "me-too" business with product or service quality that leaves much to be desired. Neither will you be able to gain a competitive edge in the market, nor will you be able to retain customers who somehow stumbled on your products/services. None of the plans and strategies will work and you will find that your million dollar marketing campaign will tank too – at least in the long term.
Have a strategy: Starting from great products or services, move to a more strategic realm. Create a long-term vision of how you want customers to come back in droves to buy what you have to offer. They can only do that when you let them do it. Your strategy should now focus on peripherals like distribution, reach, brand image, channel development, customer service – all rolled into one. You could think of tools and systems like a CRM – enterprise or web-based -- to help you do this effectively. When you have a clear system based strategy to bring home the bacon, chances are that you won't go wrong with customer retention.
Be Paranoid about Customer Service: If there could be just one thing you could do to delight your customers, you could perhaps do just this – focus on customer service like nothing else matters. Find ways to improve everything about your product or service and follow those efforts up by focusing on how to address customer service issues; quick problem resolution, calm but professional responses to customer queries.
Don't deal with anything without metrics: What you can't measure, you can't improve. It is critical that your efforts in retaining customers must be quantified. Using an effective, customized Customer Relationship Management (CRM) software, bring in metrics to calculate your customer life time value, customer life cycle and finally, total worth of your customer. Having done that, it will be easy for you to start from knowing where you are all the way to where you want to be.
Measure, improve, measure, improve: Get numbers to work for you. Once you know the life-time value of your customer, the total cost incurred in acquiring your customers and other such important metrics, it is time to initiate efforts to improve those numbers. Follow the strategy you developed earlier to increase your customer retention numbers.