Re: Customer Retention Programs

From: Jim Novo <jimnovo_at_sprintmail.com>
Date: Fri 28 Jul 2000 14:28:19 -0400

MARK BISHOP <mbishop_at_meandaur.com> WROTE:
> Does anyone on this list have a good resource
> for researching and developing customer
> retention programs?

Hi Mark.

That's a pretty broad question. There are lots of sites
that talk about customer retention, give examples of
programs, discuss features of software, etc.

Frederick Reichheld of Bain & Company is generally
considered the founder of the movement with a 1990
article in Harvard Business Review proving that a 5%
increase in customer retention by can result in a
profit increase between 25% and 85%, depending upon the
industry. He's written a number of books and articles
over the years; these materials would probably be a
great place to start for an overview. The company site
is:

http://www.bain.com

A decent quick overview of the general idea can be
found here, with some charts to help you visualize it:

http://www.kestnbaum.com/art2c.htm

Because of all the hype around CRM, the whole notion of
retention management has been buried in buzzwords and
made to seem much more complex than it is.

That said, many of the CRM oriented sites speak
generally to retention, although CRM advocates seem to
think that good customer service and some fancy
cross-selling automatically equals customer retention.
It sure helps, but one would design a customer
retention program only * after * they were already
providing good customer service, in my mind.

Otherwise, what's the point?

Could you be a little more specific with your question?
Type of business, publishing or commerce? Size of
business? Have you measured defection and are trying to
solve the problem, or are you trying to get a handle on
whether you have a problem at all? More information
would help the group point you in the right direction.

Good luck to you.

Jim Novo
Marketing Mercenary
jimnovo_at_sprintmail.com




Received on Fri Jul 28 2000 - 13:28:19 CDT