While the old adage “The customer is always right” isn’t exactly true the overall sentiment behind it is correct. In the world of business, the customer is king. Everything a business does should be done through the eyes of the customer that they hope to eventually serve.
There are many job functions centered around customers, but today we are looking at customer acquisition and customer retention. The two truly work part and parcel and are more than vital to the success and health of your business.
Let’s start by quickly looking at these two functions and what they mean at the 10,000-foot level.
Customer acquisition is the process of interesting potential clients, engaging them, and then turning them into actual customers. A lot of this work is done in the UK by outsourced call centres.
Customer retention is the process of keeping these acquired customers. Keeping existing customers is far more cost-effective than it is to be out there attracting new customers.
So, these are the basics, got it?
Let’s look a bit more in-depth at the role of customer acquisition. The job of people working in customer acquisition is to attract new customers and do it at the most affordable cost. These tasks are a variety of marketing and sales tasks that are aimed at generating leads, warming leads, and turning leads into sales.
These tasks vary but are a mix of prospecting, lead generating, cold calling, engaging, hosting webinars, attending tradeshows, attending networking events, digital and traditional advertising, search engine optimization, holding sales calls, negotiating, and selling and implementing customers
Whew, that was a mouth full, but you get the point.
These tasks are examples of what makes up the sales process from generation to implementation.
Now once we have customers, we have to keep them. Here’s looking at you customer retention team.
As stated earlier, it is far more cost-effective to keep a customer than it is to acquire a new one.
- You do not need to educate them on your product, service, and or business. They’ve been through this; they know what they are getting.
- They have had to have liked you at least once. People buy from people they like, so a current customer has already crossed that threshold once.
- Depending on your type of business, they may just be looking to renew their contract or upgrade or make an add on purchase. This is a quick, easy, and budget-friendly sale for your company.
- Reasons one through three add to what amounts to be a much shorter sales cycle which will cost your company far less.
Okay, now that that is squared away, what kind of activities does the customer retention team handle.
For one, they deal with customer service-related issues. A customer complaint may seem like a negative, but a bad situation turned around quickly and helpfully can create a loyal customer for life. This crisis handling team can make a big impact on the future of your business.
Secondly, they will handle the contract renewals for businesses that operate on customers locking into term agreements. This process is so important as companies in this model can ill-afford a high customer churn rate.
We have talked about cost loosely here, but this biggest cost is overhead. Overhead is made up of labour, utilities, facilities, benefits, etc. Basically, we can say that is the cost of putting butts in seats, turning the lights on, putting a roof over their heads, and helping the employees when they are sick.
This can get costly.
For this reason, many companies are outsourcing their customer acquisition and retention requirements to companies like PITON-Global in the Philippines. The multi-awarded BPO has been providing high-performance customer acquisition and retention services for UK-based companies since 2001.
Your business can obviously not survive without these essential business functions but finding ways to keep these costs down at the same time will be super beneficial for your business.