As we claw our way out of the downturn, and if you are of the same view as the majority of other senior execs around the world, then you will empathise with this recent finding by Gartner:
“the focus for 71%of business leaders is a return to revenue growth”
One distinct way that companies plan to realise their revenue-growth targets is to put a high business priority on revitalising and refreshing their client relationships. According to the 2010 IBM CEO research, 88% of CEOs are making “getting closer to their customers” their top priority over the next 5 years. 95% of leading organisations – those organisations that consistently perform better than their peers over both the short and the long term – have this same main-priority as well.
Retaining focus on current clients, as well as attracting new ones, also came out as top-rated business priorities in the 2010 Gartner CEO and Senior Business Executive Survey. As a result of their research, Gartner learned that the top three business priorities for 2010 were:
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Retaining and enhancing existing customers
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Maintaining competitive advantage
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Attracting new customers
Why the spotlight on clients? Because there is a robust link between retaining current clients and increasing profits. Let’s consider the following statistics:
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A 5% reduction in customer defection rate can increase profits by 25-125%, depending on the industry
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Acquiring new clients can cost 5 times more than satisfying and retaining current clients
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Loyal clients are 15 times more likely to increase spending than high-risk, intermittent clients
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Repeat clients spend, on average, 67% more
With such a powerful connection between client retention & profitability and between client loyalty & increased client spend, it is no wonder that senior leaders across the globe are dedicated to the top-priority initiative of “getting closer to their customers”.
When it comes to meeting the first and fundamental business objective of revenue growth, it appears that most Chief Execs and Business Managers agree: success hinges upon strengthening client relationships and delivering successful client outcomes.
No matter what the economic climate, the old adage will always remain true – the client will always be king.
The Way Forward
So let’s assume that you work for one such organisation whose top business priorities, for the next few years, include increasing top-line revenue and bottom-line profit. What levers can you pull to most-effectively fulfill these business demands?
Whilst an array of diverse techniques can be employed, many organisations are deciding to strategically invest in client-retention and attraction programmes that create, develop, and sustain deeper, more-effective client-relationships. These, in turn, will deliver profitable, long-term growth for the company.
And this is where StratMetrix can help. Our Client-Insight, Business-Assessment and Change programmes provide the fuel and the know-how to drive innovation, growth, and business performance improvement, ever onward and upward.
We help firms to be more effective at harnessing, applying and leveraging valuable customer knowledge – because harvesting and exploiting customer insight is essential to optimising marketing, sales and business performance.