Which is better: retaining current customers or adding new customers?
That really is not a question that you can answer without saying both are important. Authors Emmet C. Murphy and Mark A. Murphy made several impressive statements in their book, Leading on the Edge of Chaos. • Acquiring new customers can cost as much as five times more than satisfying and retaining current customers • A 2% increase in customer retention has the same effect as decreasing costs by 10% • Depending on the industry, reducing your customer defection rate by 5% can increase your profitability by 25 to 125% • Customer profitability tends to increase over the life of a retained customer What is the likelihood that you will retain your customers? What do those numbers mean to you and the success of your company? Have you evaluated your customer retention rate? Do you have a plan to keep your customers? Do you have the tools to make that job easier? Here are the reasons customers leave, according to the U.S. Small Business Administration and the U.S. Chamber of Commerce: • 68% le
