Investor, Sales and Marketing Pioneer, Author, Technology Champion, Philanthropist, Leadership Mentor
As an entrepreneur, I have to constantly look for revenue growth every year. And one thing that I have learnt the hard way (though I always knew it) is this: it makes more sense to focus on customer retention than on customer acquisition. Not because of the simple reason that customer acquisition is ten times costlier than customer retention; but because it makes 100% more business sense to help your customers grow. Because when your clients grow, you also grow with them. That’s it. There is no two ways about it.
For example: We have a client in healthcare sector from North America for the last three years. The client specialises in manufacturing disposable phototherapy as a smart alternative to taking newborn with jaundice to the doctor’s office or hospital daily for “blue lights” treatment. It was a new company when they started with us. They had limited budget for marketing and badly wanted to market their products to a wider audience. From a revenue point of view this client was not worth even 10 perecnt of what we usually get from a client. But somehow we had conviction in their product and we decided to go the extra mile to help their business grow. It paid off, and their business grew by somewhere close to 30% every year. Today, we are getting ten times more revenue from this client.
Customer retention is not a fad. It is an indispensable necessity. The whole crux of customer retention revolves around providing services to clients that add value to their business. It going beyond the standard benchmark of customer satisfaction and woo them over with customer loyalty. When you retain your clients by adding value to their business, they become your most vocal brand ambassador. Customer retention is one of the most important strategies to define not only customer lifecycle but also to ensure a thriving business cycle.