FACTS ABOUT CUSTOMER RETENTION AND CHURN FACTS: 1. A 5% reduction in the customer defection rate can increase profits by 5 – 95% –Bain & Company 2. A 50% reduction in customer base would occur if left alone over a 5 year period –Bain & Company 3. It costs 6 – 7 times more to acquire a new customer than retain an existing one –Bain & Company 4. An average company loses between 10 – 30% of its customers annually – McKinsey 5. A customer is 4 times more likely to defect to a competitor if the problem is service related than price or product related – Bain & Company 6. 68% of customers leave because they were upset with the treatment they received whilst speaking to customer services – US Chamber of Commerce 7. Dissatisfied customers whose complaints are taken care of are more likely to remain loyal, and even become advocates, as those that are ‘just’ customers – Strauss & Seidel 8. The probability of selling to an existing customer is 60 – 70%. The probability of selling to a new prospect is 5-20% – Marketing Metrics 9. For every customer complaint, there are 26 other unhappy customers who have remained silent – Lee Resource 10. 96% of unhappy customers don’t complain, however 91% of those will simply leave and never come back – 1st Financial Training services 11. A 2% increase in customer retention has the same effect as decreasing costs by 10% – Leading on the Edge of Chaos, Emmet Murphy & Mark Murphy 12. Customer profitability tends to increase over the life of a retained customer –Leading on the Edge of Chaos, Emmet Murphy & Mark Murphy 13. In the US alone, people that switch from insurance providers represent a $7.6 billion market in annual premiums – JD Power & Associates
Posted on: Wed, 16 Jul 2014 14:54:44 +0000
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