Does Your Company Favor "The New Guy"

Competition is increasing • Commoditization is now a reality. • Globalization is creating new opportunities to buy and sell goods and services. • Markets are becoming saturated. • New customers must be “stolen” from competitors. Sources: Jupiter Media Metrix Research, AMR research, RedCMarketing Copyright © McDaniel Consulting Limited

Customers are becoming more vocal • Blogging – there are more than 7 million and the number is growing exponentially. • Think YouTube where 2 billion members upload and share experiences. “Research today shows today's wired customer relies heavily on information from peers, rather than traditional media sources or from the seller, itself.” Jill Griffin, Interview with The Wise Marketer Copyright © McDaniel Consulting Limited

Replacing unhappy customers can Conservative estimates place the cost of acquiring a new break the bank customer at 5 times the cost of retaining a current customer. Those costs include • Marketing & Advertising. • Sales incentives and compensation. • New customer incentives. • New order verification, and processing. • Credit checks. • Account set up. • Customer Care calls. Sources: Customer expressions, crmguru.com Copyright © McDaniel Consulting Limited

Investments in customer retention pay off “In research concluded this year, we found that while a 10% reduction in acquisition costs improves the overall value of the customer base by only 1%, a 10% improvement in customer retention increases value by 30% … Given the increasing cost of customer acquisition, a focus on retention is highly desirable – and improvements in retention rates represent huge payoffs.” Tony LoFrumento, Executive Director CRM, Morgan Stanley. Copyright © McDaniel Consulting Limited

Loyal Customers • Are more efficient. • Buy more and more often. • Are less price sensitive . • Are more willing to tell you what they think and how you can improve. • Reduce new acquisition pressure. Sources: Bain & Company Copyright © McDaniel Consulting Limited

• Advocates can’t wait to tell others about you! • “In order to attract quality suspects ... you must find ways to spread positive word-of-mouth through current customers and supporters. Your future rests on your ability to recruit advocates to your company, because your customers listen to others like them.” Loyalty expert Jill Griffin, interview with The Wise Marketer. Sources: crmguru.com, Fred Reichheld Copyright © McDaniel Consulting Limited

At the end of the day, you can create as many products as you can manufacture. If you don't have people to buy them, or you can't keep customers over time, it doesn't matter how good your products are. Treat all customers with respect and reverence, figure out how to give the truly stellar customers something even more special than they got when they were less stellar, figure out how to train your staff so they understand they are your brand, and you will get all the business that's yours to get. Sharon Drew Morgen, Morgen Facilitators Inc. Copyright © McDaniel Consulting Limited

Does Your Company Favor "The New Guy"

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