Page 91 - Benjamin Franklin\'s The Way to Wealth: A 52 brilliant ideas interpretation - PDFDrive.com

41 CUSTOMER RETENTION

Franklin was a great believer in putting down roots in business. When
he says ‘I never saw an oft removed tree, nor yet an oft removed family,
that throve so well as those that settled be’, he was clearly referring to
the joys of being established.

Nowadays location is not so critical to business, but other forms of
establishment certainly are.

DEFINING IDEA…
When you stop talking, you’ve lost your customer. When you turn
your back, you’ve lost her.
~ ESTEE LAUDER

While just about every business pays lip service to the importance of
customer retention and creating a community around a brand, product or
service, the fact is that the vast majority remain far more interested in
customer acquisition. So much so that a survey by Accenture a couple of
years ago found that boardrooms in the UK ranked maximising revenue
from existing customers at the bottom of their list of objectives. Franklin
could have told them, however, that as natural as that may be, it is also
wrong.

Email, mobile phones and online shopping have all helped erode the amount
of contact between businesses and their customers, but that only means that
each touch point is all the more important. At a time when it has never
been easier to take your custom elsewhere customer retention is crucial, but
many companies don’t even have effective mechanisms for monitoring
customer attrition, let alone for doing anything about it.

The first step is to start to measure attrition, meaning the number of your
clients who don’t go on to repeat their purchase or renew their relationship
with you. That should be done over an appropriate trading period and
expressed as a percentage of the total. The next step is to go back to the