Proven Systems - eAdvisor - Feature Article

Leaking Customers: Stem the Tide

In the last issue of eAdvisor, we kicked off a four-part series about the importance of tending to your sales funnel. In Part I, we discussed how businesses commonly leak opportunities to up-sell to current customers and why eNewsletters are a highly effective way to fix that leak.

In Part II we’re exploring an even harsher reality for businesses that neglect their sales funnel: Beyond leaking opportunities to up-sell to current customers, businesses may leak customers altogether.

If your customers haven’t heard from you since the last time they bought your product or service, don’t expect them to feel much loyalty to your company or brand. In fact, previous customers may not even remember your company the next time they are in the market for what you provide.

According to StrategicClientRetention.com, two-thirds of customers do not feel valued by those serving them. That jilted feeling can easily cause a customer to “jump ship” to a competitor; suddenly you’ve leaked a customer from your sales funnel.

Not only is this a senseless loss of a customer you spent time and money to acquire, but it is an expensive mistake. Consider this:

• Acquiring new customers can cost five times more than satisfying and retaining current customers.
• A 2-percent increase in customer retention has the same effect on profits as cutting costs by 10 percent.
• A 5-percent reduction in customer defection rate can increase profits by 25-125 percent, depending on the industry.

(source: StrategicClientRetention.com, Benefits of Customer Retention: Statistics)

Prevent leaks, build loyalty
Even in a tight economy, there’s no excuse for not communicating with customers. Communication can be one of the easiest and cheapest marketing tactics, and it will build the long-term customer relationships that every product- or service-based company needs to sustain and grow business. The key is to:

• Select a medium: Commit to at least one marketing channel that lets you personally communicate with current customers (e.g., email, direct mail).
  
• Set a schedule: Establish a regular pattern of communication with customers and stick to it! Customers will get used to hearing from you at a certain time every week, month or quarter depending on the frequency of your communication strategy. Sporadic, inconsistent communication may hurt your effort and your customer’s image of you as a professional, proactive business.
• Offer something of value: Be sure your customer communication offers value to your customers’ lives. This “value” can be monetary (e.g., a customer discount or promotion), or it can be as simple as sharing industry news, how-to tips or expert advice.

eNewsletters: The golden ticket
It’s hard to argue that email is the most cost-effective means of personal communication available to modern marketers. But is it effective? When used correctly, absolutely!

eMarketer’s “Getting and Keeping Customers” report analyzes how marketers are responding to recessionary pressure and budget constraints. According to the report:

“Email works well for retention because it offers a way to establish and maintain regular communication with customers. In addition, because the folks on your email list have opted in, they are potentially more valuable customers — they have expressed interest in an ongoing relationship with you.”

eNewsletters are one form of email communication that is fast becoming a company’s “must-have” marketing tool. Why? Because a good eNewsletter:

• is not junk mail — your customers have opted in to your eNewsletter and anticipate its arrival in their inbox
  
• can resonate with multiple audiences in a single issue
  
• helps build your brand and your customers’ loyalty to it
• is relevant to your customers’ lives
• helps affirm your customers’ decision to choose your company over your competitors

As the industry’s leading B2B eNewsletter marketing and production outsourcer, Proven Systems can ensure that your company eNewsletter accomplishes these objectives while establishing a consistent communication stream with current customers.

Discover how an eNewsletter can help you consistently and effectively tend to the customers in your sales funnel — contact Proven Systems today at (800) 720-5398 or info@provensystems.com.

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