Customer acquisition is a critical component of any effective business model. After all, you can’t increase profits and grow a company without a steady stream of new customers. But amid the all-encompassing quest for new customers, strategists can forget a metric that’s just as important: retention. Repeat customers help keep companies in business, but they’re often neglected after that initial sale — neglect which can lead to massive churn rates.
To avoid alienating existing customers, businesses need to adopt solid retention strategies — a process that includes determining which department is responsible for increasing retention and reducing churn.
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Prioritizing Retention
A recent Brightback study included some eye-opening data: 93% of subscription businesses view customer retention as equally or more important than user acquisition. As Brightback put it, “…The acquire-at-all-costs mentality has, at times, done a disservice to the customer experience. Many organizations have operated with the belief that if a customer leaves, they’re easily replaced.” Obviously, this is untrue, or else acquisition wouldn’t be such a focus in the first place.
Even more alarming is the fact that 96% of respondents reported losing customers due to issues that could have been managed or fixed relatively easily. In other words, without dedicated customer retention policies in place, existing customers will slip through the cracks. This can kill momentum and stunt company growth. Businesses can ill-afford to ignore retention, yet many still don’t have a specific team to manage it.
Whose job is it, anyway?
It’s one thing to say that you want to focus on retention in order to reduce churn. It’s another to actually make retention part of the workflow. So on who’s desk does customer retention fall? According to that same study, more than 80% would place retention within the “customer success,” sales, operations, and/or marketing departments.
Okay, that’s a wide net to cast, but it’s a good start. However, outside of that single survey, there’s a strong consensus that customer retention should be managed by a dedicated customer success team. An effective customer success team can interpret customer feedback into actionable retention strategy and advocate for the customer during internal discussions.
No matter which team you put in charge of increasing retention and reducing churn — or what title you decide to give it — the important thing is to make these goals high priorities. Most importantly, don’t neglect your existing customers in favor of attracting new ones. Remember, acquisition is critical, but not at the expense of retention. Keep your customers in mind through every step of their journey and you’ll see retention rates soar.