The image below is a rather amusing yet fairly typical example of the importance most companies place on retaining customers. FusionBrand anecdotal research suggests that companies invest 85 – 95% of their marketing resources into the acquisition process and only 5 – 15% into the retention process. Can anyone explain why?
After all, according to Bain and Co, a firm has a 15% chance of selling to a new customer and a 50% chance of selling to an existing customer. Wouldn’t it make sense therefore to invest more in retaining customers than acquiring them? Furthermore, once a prospect becomes a customer, it is a lot easier to build a relationship with that customer, using content that is relevant and interesting to them, and not via the mass economy blitzkrieg popular with most advertising agencies.