Retention plays a key role in effective marketing for your company?
Posted by Patrick Murphy on Wed, Mar 02, 2011
Digital marketing changing the way we approach clients?
The digital revolution has dramatically changed not only the way companies approach new customer acquisition but also their attitude to customer retention. Some industry commentators go as far as to argue that traditional approaches to customer acquisition have come to an end as they have been supplanted by digital marketing strategies which are characterised by two-way communication, interactive relationships with customers, vocal consumers, current customers acting as a source for new customers and customer service serving as a way to up-sell to customers as well as acquire new business.
Retention is key to success
The economic downturn of recent years has also forced companies to put a greater emphasis on the retention of customers and this method is proven to be more cost effective. In the US, for example, it is estimated that up to 40 percent of companies have in place active customer retention strategies as compared to 29 percent of European companies.
Digital marketing about reducing costs
The recession, which hit America harder than Europe, is given as the main reason for this disparity. US companies were forced to find ways to keep costs down and customer retention is a proven to do this. Although, traditionally marketing activities focus on business development rather than customer service, moving forward a merger will evolve between the two. Marketing budgets are rarely designed with the two functions in mind, but where digital media offer so many opportunities in both fields, this is expected to change in coming years.
Develop new metrics
To assess the real value of prospects, it will be likely that marketers will have to build a new measurement into strategies: likelihood of retention. This value can be built into the acquisition process and measured with data over time. Relevant date for the measurement of a customer’s retention value can include length of relationship and value of relationship i.e. how much that customer spent.
If you would like more information about effective online marketing, contact a member of SiliconCloud today.
Speak the Truth
We are looking for your help to Speak the Truth, we would like your reviews on everything online. Each week we are going to select something that has an impact on how we do business online and we would like your opinion. This week we would like you to Speak the Truth on LinkedIn as a business tool.