MarketingProfs' Members Register for B2B Forum 2010 for just $695! (good until 11/30) »

Ask your question ... sign up today! It's FREE!
Student Questions     
 
This question has been closed, and points have been awarded.
How Does The Company Maintain Their Customer?
Posted By: jyy22692003* on 11/4/2004 3:07 PM (CST) 250 Points
today the competition is very fierece. many companies build customer relationships with their customers rather than to gain new ones, according to the 80/20 principle.
through segment of the customer, the company know which types of cusotmers have the potential customer value ? and the company can meet these customers. i have a question:" how does the company maintain and retain these customers? which retention strategies the company can use? please give me some successful examples.

Posted by: Peter (henna gaijin) Accepted Answer
11/4/2004 3:22 PM (CST)
I think it can all be summed up as good customer service. Provide the customer with a good product and good service (if needed), and they are more likely to come back. If they have problems, then they are more likely to go to someone else.

The saying "you never go wrong buying an IBM" was true of IBM in the 80s (and perhaps still is). It meant that even though you paid more for IBM computers, you would get products that worked and excellent service if needed.
 
Posted by: jyy22692003* Author Response
11/4/2004 3:29 PM (CST)
good product, good service is equal to retain customers?

good product is imitated by others. the company that provides good service or good quality can create customer satisfaction . but customer satisfaction is not equal to customer loyalty. IBM is famous for good quality and good service. but IBM doesnot dominate the computer market in the world. it invovles other factors, such as price, competitors and offers, etc.
 
Posted by: mac504 Accepted Answer
11/4/2004 4:55 PM (CST)
Here are two strategies:

1 Build a 'cummunity'

2 eliminate the competition

Companies that build communities are the ones that do a better job at holding on to customers.Best example is the NFL.The National Football League.The goal is to build a cult like atmosphere where like minded people come together as a community and buy the same products.

Young people who are into 'hip hop' are part of a community where they buy the same kinds of clothes and listen to the same kinds of music.It is human nature to want to 'belong' to something.The marketers goal is to provide a place where like minded groups can belong.

You can also maintain retention of customers through eliminating the competition all together.Location and exclusive distribution are the most effective ways to eliminate competition in an given area.Become a big fish in a small pond.
 
Posted by: Peter (henna gaijin) Member Response
11/4/2004 6:28 PM (CST)
good product, good service is equal to retain customers?

Yes, you are correct. Your product can't just be good, but must be perceived as better than the other options the customer has.

It is hard to look at the 'computer market' as one thing, as there are products which serve different markets and needs. But in general, IBM's problem was that the market changed as new products came out, and IBM didn't keep up.
 
Posted by: Gary* Accepted Answer
11/4/2004 8:06 PM (CST)
Im not sure of the point of your question but on this subject I usually break ranks with me counterparts adn would disagree with your premise. Yes it is vital to maintain your customer base, but you simply cannot grow a business without going after new business.

Treating your current customers will bring in some new business, but without an aggressive and effective plan to increase your customer base your business will not survive long term. Besides, no matter how well you treat your customer, you will lose many of them over time through attrition or through other means.

just my 2 cents
 
Posted by: mgoodman Accepted Answer
11/4/2004 9:53 PM (CST)
First, I would question a strategy that focuses solely on customer retention. It's a nice goal, but it needs to be part of a broader strategy that also seeks new customers. In this sense I agree with maxxtdog.

Second, I'd suggest that customers are loyal to brands that offer high value and deliver on an important benefit promise. If you do that, and do it consistently, you'll keep the important customers.

Third, you may not want to retain all your customers. What if some are not profitable? Why keep them? Let your competitors have the money-losing customers. Keep the profitable ones. You want customers who have a problem that you can solve uniquely well, those who recognize and appreciate your highest value in use. You're worth more to them, and they will be your highest margin customers.

I once helped a client discontinue 30% of his line (and give up about 25% of his customers), and it improved the bottom line by more than 50% immediately! Don't worship the god of customer retention for its own sake.

Hope this perspective helps.
 
Posted by: eugene Accepted Answer
11/5/2004 2:17 AM (CST)
jyy,

maxxtdog and mgoodman certainly have a point in that a company must also acquire new customers besides trying to retain existing ones.

I suppose a lot of companies overlook the importance of having a good retention strategy and concentrate on acquiring new customers.

On your question of how a company can maintain and retain its customers, there are multiple aspects to that retention strategy or if you like building customer loyalty.

A good product is probably the pre-requisite because if your product is inferior, nobody would buy it in the first place or would want to buy again from you.

Good or even excellent customer service is equally important. Imagine buying a notebook and you face some problem with it. When you call the customer service hotline, you either get transferred all over the place or someone tells you that they can't help you. How would you feel? You'd probably tell everyone you know not to buy from this company again, right?

It would also help if the company has a strong and positive brand image / association. Consumers tend to trust a known brand more especially if it's a big ticket purchase.

Also, as mac504 said, having a community will break down the barrier with customers. For example, if you join the community, you are more likely to respond to an offer made by the company etc...an alternative to building a community would be to have a loyalty or rewards programme. Tesco did this wonderfully. You might want to check out their website or even read the book on this (Scoring Points).

cheers.
 
Posted by: bob* Accepted Answer
11/27/2004 10:56 AM (CST)
In order to maintain customers, it is imperative that a strong "COMMUNICATIONS " is created and executed.

Staying in touch with present customers is KEY to keeing them. This can be done through a number of different programs. I especially like using direct mail more then e-mail. Look at a newsletter format where you get your customers "involved" in the publication by asking questions and inviting your customers to answer. Featuring client profiles is alway a popular format to use this invites two way communications. This can be done by having questions posted every issue and publishing the answers that best answers the questions you are asking.

I also like a personal note that says, "thank you" for your interest or purchase. This form of PR is old fashion, but in our high tech world, companies forget to do this.

Hope this response sheds some good positive light on your question.

Thank you
b_perlstein
 
Posted by: Val (Moderator)* Moderator Response
11/27/2004 10:44 PM (CST)
Hello all. I am closing this question, since its more than 10 days old. We do this to make sure members' contributions are rewarded in a timely manner and to improve the visibility of newer questions.

Thanks, so much, for participating!

Val (Moderator)
 


Get more answers ... ReTweet this!

Would you like to post a response?
Welcome to Know-How Exchange!
This is a collaborative community. We welcome everyone's participation.
All you need to do is login. Enter your account info in the box above (top right).
Not a member? Not a problem. Register here (it's FREE and EASY).




Know-How Exchange powered by MarketingProfs


Sponsored Links

Buy a Link Now

Just Released ... Download Today!
Just Released ... Download Today!
Look inside
Included with Premium Membership
User Name:
Password:
Remember Me
Forgot your password?

Top 25 KHE Experts
(Student Questions)
W.M.M.A. (28840)
Carl Crawford (22363)
wnelson (20398)
Puru Gupta (19298)
Peter (henna gaijin) (18747)
mgoodman (15744)
Jay Hamilton-Roth (13995)
thinkmor (10987)
ASVP/ChrisB (10031)
Gary Bloomer (9758)
mbarber (9061)
Pepper Blue (8859)
SRyan ;] (8165)
Sanjeev Kumar Vyas (7310)
stevea (6301)
jose04 (5994)
NoStressXpress (5284)
bennydunreallycare (5043)
michael (5010)
bobhogg (4824)
MANSING (4819)
Michele (4712)
SteveByrneBranding (4652)
sham (4488)
telemoxie (4315)
Recently Posted Marketing Jobs
Director of Marketing and Communications
Demand Generation Manager
Marketing/Advertising Faculty
Director of Marketing
Market Analyst
Sr. Field Marketing Manager - Business Intell.
Associate Vice President of Marketing and Corporat
Marketing Manager
[more jobs]

Join over 355,000 members ... SIGN UP!

My email address is and I'd like my password to be .

Already a member? Sign In!

My email address is , and my password is .


HACKER SAFE certified sites prevent over 99.9% of hacker crime.