Over the last three weeks I have met with several CEOs and other senior managers within several sectors; Technology, Human Resources Outsourcing (HRO), Business Process Outsourcing (BPO), and Staffing and Recruiting, and most shocking is that most of them — not all — have little to no strategy in play to protect their current client base, but indeed have strategy and execution plans for new customer acquisition. In fact, their burn rate for new sales outpaces their customer retention programs by five times.
You might be asking yourself – so what? Well, for starters, 81% of America’s fastest-growing companies have initiated programs aimed at customer expansion, retention and profitability. They are acting on what we all know to be true: it is less expensive and always more profitable to retain, grow and expand a current relationship than to make a new one – but not all companies are engaging in this space. Further, the 81% of America’s fastest-growing companies that have a client relationship program in place have achieved 45% faster revenue growth than their peers over the last five years, and are projecting 35% higher growth over the next 12 months.
Am I missing something? The negative impact of customer dissatisfaction is all too familiar to us:
- 96% of clients who have had a bad experience will not complain.
- 90% of these customers will not return.
- On average, a client who has had a bad experience will tell 9 others.
- 13% of these customers will tell at least 20 other people.
- For every customer complaint, there are 26 other customers who had a similar experience.
- 6 of these had serious problems.
- 68% of customers who stop doing business with organizations leave because of company indifference.
If you’re not outraged, you’re not paying attention. It is costing solid organizations (perhaps yours) millions to show barely any growth in profitability, and yet the answer is so easy, it is almost ridiculously stupid. Organizations today must figure out a way to fuse together a solid relationship management program with their current new sales strategy – if not, they’re chasing their tails by creating a self-fulfilling prophecy within their own sales team.
Your thoughts and comments are always welcomed – I will try my best to respond personally to each of you.