There are hordes of studies that reveal that the cost of acquiring a new customer is twice that of retaining an old one. With so many of such studies backing up this statement, why is it that many organizations fail to retain customers?
How is it possible that when metrics show an organization’s capability of generating around $400 million revenue, then why does it fail to capitalize on this advantage?
There are various inconsistencies across different departments of a typical firm, and if these are addressed appropriately and in a timely manner, then they can significantly increase their bottom line.
Data Governance Plan – Rather the lack of it
Most companies do not understand their customer. Their data accumulates throughout the organization, while their CRM systems become chock-full of duplicates. The finance department, with its databases of procurement contracts provides them no overview of the customer.
It is important to understand what the customer does – particularly when the client itself is a company. An ignorance regarding the customer reveals the organization’s lack of interest in its customers.
A lot of information and systems exist in today’s modern enterprise, and things can get quite messed up when it comes to the mounting quantities of data.
This is precisely why an organization needs to clearly define its data standards to clarify:
- Which individuals can access data, and to what extent they can control it
- Which systems need integration to reveal complete information regarding the customer
- What their data hygiene process is
The above few points are just the tip of the iceberg that an organization needs to consider to maximize usefulness of data. Without having proper data governance, a company would not be able to benefit from the data.
Reduced Focus on Demand Generation
When the topic of ‘demand generation’ is mentioned, a lot of marketers think that it refers to drawing in new business. There is no denying the fact that getting new business should be the primary focus of demand generation, it shouldn’t be the only focus.
Similar principles of demand generation are applicable in any sales situation: engagement, nurturing, and converting the customer. When selling something to an existing client, a company simply aims to expand their relationship with them. This is easy as compared to trying to get a first time customer to buy.
The potential revenue that can be generated from current clients is huge; and companies should create programs that aim at strengthening the current relationship further. This will lead to a significant increase in customer retention rates and a major enhancement of the customer lifetime value.
While companies have data spread out throughout its various departments, making it almost impossible for them to market to their target audience effectively. However, even those organizations have some semblance of control over their data lack the analytics required to market in an effectual manner.
The only way to solve this is by employing powerful analytics tools that are widely available. The use of these tools will bridge the gap between marketing and sales that is often found in many companies, resulting in reduced productivity and losses.
With that said, data analysis should be the top priority of organizations wishing to take their bottom line to new heights.
If this topic of interest to you, please contact me to start the conversation with me on how to help you harvest more leads/revenue from your existing clients
Until next time, of course feel free to share and distribute this post as you wish