Retaining Customers and Pursuing Prospects

By Peter Lyle DeHaan, PhD

Peter L DeHaan, publisher of TAS TraderAlthough the number varies with who’s doing the telling, it’s many times more costly to obtain a new customer than to keep an existing one. The sad reality is, though, no one at the giant megacorporations gets this – or at least their actions belie that they do.

For years, I’ve been trying to get a lower rate from my local phone company, practically begging them to give me a reason to stick around. As soon as I had a viable alternative, I switched providers and cancelled my service.

For the first time in twenty-four years, they asked me, “What can we do to keep you as a customer?” Sorry, too late.

A week later I received an email from them. It seems they pre-approved me for a special rate, a deal they wouldn’t consider giving me as a customer but will if I’m a prospect. They offered me a “triple play,” a package with phone, Internet, and satellite for about what they were charging me for just phone and Internet before.

If existing customers were treated with a bit more respect, the sales and marketing folks wouldn’t be under as much pressure to make up for the lost revenue from defecting customers. But instead, they do things backwards, taking customers for granted and offering sweet deals to prospects.

Although rampant at large corporations, this situation isn’t unique to them. Smaller companies can fall prey to this as well. Does this scenario have any implications at your answering service?

Peter Lyle DeHaan, PhD, is the publisher and editor-in-chief of TAS Trader. He’s a passionate wordsmith whose goal is to change the world one word at a time.