Acquiring a new customer is five times more expensive than retaining an existing one. And improving retention by just 5% can see your profits increase by anything from 20% to 90%. So why is customer acquisition always prioritised over retention?
Almost all businesses, from the one-man bands to the big corporates, fall into the trap of going all out to win new business but doing so at the expense of their customers. How many of you have experienced the disappointment of, say, being a broadband customer with a company who are showering new customers in trinkets and discounts but want you to carry on paying as your are as their ‘loyal customer’? It happens all the time.
There’s glamour, pats-on-the-head and shareholder happiness associated to winning new business but your biggest profits are sitting under your nose if you manage it correctly and focus equally on both.
To get it right, you need someone on your business development/sales team that serves as both a friend and support system to prospects and clients.
Great sales people focus more on the client than on themselves through advocacy, relatability, expertise and excellent listening skills. They build strong relationships that mean they can acquire new business and retain existing customers – increased profit all round!
Is this your team? If the answer is ‘No’ you’re missing a trick.
If you’d like some help coaching your sales team to increase profits, drop me a line at firstname.lastname@example.org