The statistics on how much more it costs to find a customer than to keep one vary wildly – anywhere between 3 and 10 times as much – but pretty much everyone is agreed that customer retention is the cheaper deal.
If we also consider that it’s likely that 20% of your customers bring you 80% of your revenue it’s clear that the smart money should be invested in protecting what’s yours already before you invest in looking for new customers.
So, it pays to protect at least the top 20% by being proactive. You’re likely to have your most experienced Account Managers allocated to these few precious customers – the most basic form of insurance against your customer wandering towards the competition. Your Account Manager should know the answers to two questions as a minimum:
- Do you know what your customer really needs from you?
- Does your customer really understand what products/services your organization offers to meet those needs?
From here it will be clear “what do we need to do to keep this customer happy?”. Only by knowing that you’ve got a good grip of the answers can you be confident of locking out the competition. (Or, in the very worst case, you will at least be clear that there is nothing your organization can do to retain the customer, because what you provide does not match what they need.)
Disruption in buying behavior
In a market place with increasingly fickle customers, “disruptive start-ups” are all over the place, challenging the status quo and doing things differently. They’re taking advantage of the fact that the way we buy is also different these days. The reliable Account Manager that we’ve been buying from for years isn’t our sole source of information anymore.
Google/Millward Brown Digital’s, B2B Path to Purchase Study, 2014 found that 71% of B2B researchers start their research with a generic search online. 70% of B2B buyers and researchers are watching videos throughout their path to purchase. Nearly half are watching 30 minutes or more of B2B-related videos during the research process and the research shows that video is helping to encourage prospects to investigate and engage further. If the answers are online, the incumbent supplier should now beware. Just because the customer isn’t asking you the questions, doesn’t mean they’re not asking them.
Joined up sales & marketing
Better sales engagement can prevent a newcomer from sweeping into your customer and taking business from right under your nose. This is where marketing and sales need to work effectively together.
Your website and online communications should to reflect the content of the conversation you expect your Account Manager to be having. By using clever marketing software, you can map your customer’s digital engagement against their in-person engagement to create a single picture of what’s piquing their interest.
To have this additional perspective can pay dividends in forewarning sales about customer priorities and interests. Of course, having the intelligence is only a benefit if you apply it by acting on it. The worst way to lose a customer is to not ask the right questions and to not have taken the opportunity to position your solution when you had the chance.