Learn how your Company can decrease customer attrition with personalized communication

When we think about personalized communications we often think about boosting sales, but there are many other uses of 1:1 communication that can boost your bottom line. Are you taking advantage of them?

One of the ways is to use personalized messaging to improve client retention. Research has shown that it costs an average of eight dollars to replace every one dollar lost to attrition. In a Forbes Magazine article entitled Mining the Gold in Existing Customers they assert that it is “six to seven times more expensive to gain a new customer than to retain an existing customer.”

Given the current economic environment the inverse is also true. Existing clients are seven or even eight times more valuable in terms of revenue and growth opportunity than new ones. For many companies, existing clients represent the largest opportunity for incremental revenue that is often missed. If you can hold onto your customers longer it will have both an immediate and a long-term impact on your bottom line.

Using available data, companies can predict which clients are likely to leave in the near term and can design efforts to retain them. The most-effective retention management efforts are based upon automated triggers supported by clear and compelling sets of data. Looking at customer activity levels either manually or through your software can be a telling indicator of a customer relationship. If you see a drop off in revenue or an unusually extended time period between client orders it could signal that the client is likely to leave.

Programs can be set up to review the data on a regular basis and highlight potential problems based upon the criteria established. This allows you to address the issue before it is too late to get the client back. Using a proactive approach you can significantly reduce attrition. However, you are watching for client triggers, you can use 1:1 communications as a powerful tool to reduce attrition and boost your bottom line.

Some ways to do this include:

Make a personal contact

Talk to the client and try to understand what has happened. Find out how they feel about your company and make them feel that they are more than just a name in a database. If their business is struggling make sure they know that you are there for them in good times and bad.

Respond swiftly

Respond to the feedback you are given and let them know you appreciate their input. Send them a personalized offer or other incentive of immediate relevance to them.

Cultivate the relationship

Once you have prevented the client from leaving, nurture the relationship with other personalized and relevant communications that keep the client close and build their loyalty over time. Communication plans can be set up to help your clients better utilize your services and solutions can be put in place that distribute offers based upon periods of inactivity or to reward loyalty.

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