Customer retention – better than acquisition!

Banks and financial institutions are under growing pressure to increase profitability, capture new market share and retain customers, all while reducing operational expenses and meeting regulatory compliance rules. To top things off banking is a well-established and mostly saturated market. So the question is, 'Is customer acquisition where you should be spending your important marketing budget?' And the answer is, 'Probably not!' Through these trying economic times companies have stayed afloat by investing a concerted effort into retention marketing – a practice that is becoming more prevalent in business today, writes David James Pickering

David J Pickering was born in Guernsey, the Channel Isles, at the start of that crazy decade, the eighties. Parented by Philip Pickering, the former head chef to the King of Spain, and Rona Pickering, a diligent and honest worker, David was lucky enough to grow up in tandem with the digital age. Technology was always a focus for David and, as he spent his teenage years in rural Wales, helped to connect him with the outside world and civilization.

"I’ve always loved the way marketing is used to promote technology," David says "especially now that this format is being flipped, technology is now the foundation that marketing processes are built upon in relation to automation, multi-channel communication and predictive analytics."

David looks forward to the bright future that technology is delivering, ever faster, upon us.

 

Banks and financial institutions are under growing pressure to increase profitability, capture new market share and retain customers, all while reducing operational expenses and meeting regulatory compliance rules. To top things off banking is a well-established and mostly saturated market.

So the question is, ‘Is customer acquisition where you should be spending your important marketing budget?’ And the answer is, ‘Probably not!’ Through these trying economic times companies have stayed afloat by investing a concerted effort into retention marketing – a practice that is becoming more prevalent in business today.

The reason why retention and other processes of maximizing revenue from an existing customer base (such as up/cross sell opportunities) is so important is that customer acquisition and on-boarding is a costly process indeed! If we were to think how much budget has to be invested to acquire new customers it makes such perfect sense to focus on existing clients for new revenue opportunities. There are a multitude of such opportunities to explore for this extra revenue such as leveraging inbound contacts and enquiries to become sales opportunities using predictive analytics and communication management.

For example when your customer calls in with their inevitable query or complaint, we can look at an immediate, real time single view, history of that customer, inclusive of their buying patterns; what channel they usually buy through and when they are typically open to new offers, so that the right offer or service can be made through the right channel at the right time. US bank saw a gigantic 300% rise in cross/up-sell revenue when they started using software that amalgamates inbound and outbound activity.

All this attention on the existing customer base is only going to strengthen the business/customer relationship and lead to more referrals while generating greater revenue and increasing brand awareness and positive perception which in turn, will produce new customers without any of that costly acquisition marketing and reduce churn.

So calling all marketing managers in the financial services sector, cherish your existing customers! Adopt Metro and US Bank’s point of view and be totally customer centric rather than product orientated!

Now, chant with me!

Predictive analytics are the way forward! Predictive analytics are the way forward! Predictive analytics are the way forward!