Customer Retention


Customer retention is the activity that a selling organization undertakes in order to reduce customer defections. Successful customer retention starts with the first contact an organization has with a customer and continues throughout the entire lifetime of a relationship. A company’s ability to attract and retain new customers, is not only related to its product or services, but strongly related to the way it services its existing customers and the reputation it creates within and across the marketplace.

Customer retention is more than giving the customer what they expect, it’s about exceeding their expectations so that they become loyal advocates for your brand. Creating customer loyalty puts ‘customer value rather than maximizing profits and shareholder value at the center of business strategy’.

Customer retention has a direct impact on profitability. Research by John Fleming and Jim Asplund indicates that engaged customers generate 1.7 times more revenue than normal customers, while having engaged employees and engaged customers returns a revenue gain of 3.4 times the norm.


Six “Customer Retention” Steps

1.   Sincere apology

Most often apology seems like that “sorry about that” this is not sincere apology, so make sure you apologize sincerely.

2.   Involve the customer in the Solution

You may ask the customer

“How would you like from us to handle this?”

“What can we do to make you happy?”

The customers usually ask for something which is much easier than what we had planned to do for them.

3.   Fix The Problem… Not the blame

It is very easy to say “no one informed me that the order is shipped, and the data is not updated on our system, the delay occurred because our sales didn’t take needed actions bla bla bla …”

Remember that, the customer doesn’t care what happen or who caused this error in serving him properly.

So, Focus On the Problem and Fix It First.

4.   Do Something Extra

Think about it for a moment, the customers need something extra in order to regain their loyalty.

Example Lexus the car manufacturing company issued customer survey to measure the customer satisfaction with the tires of their new model of cars.

The survey itself is something extra which aims to sense the heartbeat of their customer’s satisfaction. Lexus exceeded expectations and spend the cost of a new set of tires for unsatisfied customers.

5.   Follow up

To make sure that everything is ok now

6.   Ask for repeat Business