Skills based workshop on Customer Retention. Why its important, how to measure it, and the tactics to drive a defensive and offensive strategy designed to optimize customer loyalty and revenue.
7. Impact of Retention rate on Customer Lifetime Value (CLV)* *Source: Sunil Gupta, “Managing Customers as Investments,” Wharton 2005 CLV Rate of Retention r 1+ i – r { } CLV = m m = margin or profit from a customer per period r = retention rate i = discount rate
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15. Pricing Sensitivity from Servicing Attributes Source: Harvey N Schycon, “Measuring the Payoff from Improved Customer Service,” Prism 2001. Study of 25 attributes impact on pricing, 2,000 businesses surveyed Pricing Sensitivity for Plastic Laminates 2.0% Product Attribute 0.6% Reasonable payment time 0.2% Notification when Shipment Delayed 0.4% Problem Solving Helpfulness 0.6% Value Attributes 0.8% Carrier Capability 2.4% Accuracy of shipment to order 0.2% Finishing capabilities 0.4% Consistent Quality 1.4% Product Line Scope 7% TOTAL PRICE IMPACT 0.6% Handling of Rush Orders 4.4% Service Attributes Price Increase
When Apple l eapt past Microsoft in market cap, Steve Ballmer brushed it off saying , "I am still pleased that 94 times out of a 100 somebody picks a Windows PC." That's true, but if you step back and look at the bigger picture, Microsoft only has 70% of the share of the two most important computing devices -- smartphones and PCs. If you look at estimates for smartphone and PC sales for 2011, Microsoft will only have 50% share of those devices.