So, what sort of things should we be asking ourselves? And what are the benchmarks? 1. Who are our customers? 2. Who are the most profitable customers? What is their lifetime value? 3. How many customers are we losing, and why? 4. What value do your customers see in your products and services? 5. What are the best product and service offerings for specific customer seg- ments? During an Ernst and Young/CIM debate in the following companies were asked what benchmarks they used to measure customer satisfaction. Answers were as follows:
A 5% increase in customer retention for a range of service businesses estimated yield improvements in profitability from 20-85%. It is well-known that existing customers are up to seven times cheaper to retain than new customers are to acquire. Keeping hold of your customers throughout their purchasing life seems obvious, but we would suggest that very few organisations effectively measure the economic value of their customer retention strategies. CRM is about more than just stakeholding, relationship marketing or build- ing consumer trust. It should encompass a whole future corporate strategy: what a company is for and how its brand equity is built and maintained.