Manage Business through Customer Acquisation and Retention

Customer Acquisition:

Customer we say is the king and we need to serve the king but is it worth we we do one time business and dont think at all about Customer Acquisation and Retention, so lets focus how we can go about it,

The goal for the acquisition phase of your program should be deciding which prospects most closely match your company’s "ideal prospect" profile, but you should also decide which prospects don’t meet your criteria for acquisition and eliminate them up front. This simple decision helps focus your marketing and acquisition efforts while saving costs and increasing your return on investment (ROI).

Analyzing your marketing campaigns to determine which are most effective in bringing in new customers is also important. A CRM system that is able to tag data (assigning each contact to a specific campaign) lets you analyze the return on the investment you are making in your marketing effort as well as its overall effectiveness in identifying likely prospects. Another benefit of tagging is that it lets you look at marketing programs and their related expenses by leads generated, customers acquired, and potential and realized revenue. This will enable your company to better tailor campaigns to individual customers and prospects based on response or effectiveness rates.

While looking at data for individuals can help you better understand their needs and interests, analyzing data in the aggregate can show which groupings or classes of customers respond best to your company’s campaigns. This step can help you develop products or services that meet the needs of specific groups of customers or prospects.

There are a number of other questions you should consider as you develop the acquisition part of the data strategy. For example:

• What is our best source of customers?
• Did they find us on their own initiative or were they referrals?
• Did they come from external sources such as a direct marketing list or were they from our own marketing campaigns?
• When customers first contact us, what information are they interested in?
• What was the ROI for that campaign?
• Was it self-service or assisted interaction that eventually lead to a sale?

The absence of certain types of inquiries should also be investigated. For instance, why are there no Web inquiries from groups of prospects that you know are part of your regular customer base? Analyzing the use of self support via the Web (such as searches of the knowledge base or support cases initiated) allows you to see where customers’ interests lie and where self support can be improved.

Keep in mind that prospects may have significantly different information and support needs than customers and use this knowledge to tailor your acquisition program to their needs.

Finally, consider how well the company is responding to prospects. As an example, data may indicate that inquiries responded to within 30 minutes are twice as likely to result in sales than those responded to the next day. This type of analysis can reveal areas where the company’s performance can be improved.

When Prospects Become Customers

As the focus of your program shifts from acquisition to retention, the goals become those of establishing loyalty, advancing the relationship and building a sense of community, participation and affinity. As with prospecting, however, the data strategy should also help determine whether customers do or don’t meet the company’s criteria for retention.

Look for factors that will feed back into the acquisition cycle to reduce marketing costs, increase success rates or both. Look for trends in the length of customer relationships and determine if steps can be taken to avert the loss of customers at critical points along the way. Even a small improvement in retention can result in a significant rise in profitability and your overall ROI.

Since all organizations continually update customer data, reviewing and analyzing the data will identify opportunities where up-selling, cross- selling and service sales can be increased. Sales data, for instance, can indicate which customers are due for product/service upgrades or warranty extensions.

The development of the data strategy as it relates to retention issues should address questions such as:

• What characterizes our best customers, and what keeps them loyal?
• How do the information and service needs of new customers differ from those of established customers?
• Is it necessary to keep all prospect information once a customer relationship is established?
• What changes does the organization need to make as the relationship goes along?
• Were any products returned and why?
• How many service calls did customers place?
• How were they resolved?
• What was the time to resolution on those calls?
• What is the potential for developing other customers such as these?
• Why does one group or class of customer respond to opportunities when another does not?.........this simple check list can do wonders to retain and acquire your customers ........