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Acquisition, Retention and CRM

Oct 8, 2007
Marketing is a difficult concept to grasp but once you get it right you are sure to be heading for success. Three of the most important aspects of marketing are acquisition, retention and Customer Relationship Management (CRM). Not only do you need to achieve these things, you also need to maintain them - something that many businesses find a challenge.

Acquisition is the act of gaining new customers through various different methods with the goal of turning potential customers into actual customers. This is a very difficult stage because with so much competition around today, customers are inundated with choices meaning that competition is fierce and customers are more informed. As a result of this people have become more demanding as they know that they have the upper hand. However, this is a very important step in marketing because for most businesses the only way they can grow is through the acquisition of new customers. There are various methods of achieving this from finding customers who weren't previously aware that the product was available to people who may not have needed the product before maybe needing it now. For example pet food - someone who didn't previously have a pet but then bought a cat would suddenly need to buy cat food.

There are several different methods of achieving customer acquisition such as mass marketing which includes magazines and billboards and direct marketing such as telesales and through the post. This is probably the most expensive out of acquisition, retention and CRM as a lot of advertising and promotional work is needed. However it is equally as important as the others so is worth the investment.

Although winning new customers is extremely important customer retention is crucial to the life of any business. As it costs considerably less to retain a customer than it does to win new ones, focusing on a retention strategy makes perfect business sense. Studies across a number of industries have revealed that the cost of retaining a customer is only about 10 percent of the cost of acquiring a new one. The main aim of customer retention is to prevent customers from swapping to competitors and to increase customer loyalty and profitability.

Some of the many advantages of customer retention are that long - term customers are less likely to stop using your product or switch to a competitor, they tend to be less price sensitive, they may introduce new customers through referral, they're more likely to purchase additional products, are less expensive to service because they are familiar with the process and are consistent in their buying behaviour.

CRM involves using software applications that allow companies to manage every aspect of their relationship with a customer and thus turning customer satisfaction into customer loyalty and building longer lasting relationships.
About the Author
Smarter Marketing is a programme that can help answer all your questions about effective marketing. retention, acquisition and CRM has all the information you need to help you control your business and staff.
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