What is the Value of Customer Retention?

Understand the value of customer retention

Many companies realize that customer retention is extremely important. They recognize that losing valued, loyal customers is bad for the company’s long term revenue potential and overall success. Even though this is understood on a basic level, few companies – especially those companies providing a service – seem to misunderstand what losing a single customer can mean to their business.

 

Example:  Sandra took her car to an auto maintenance facility for trouble with her oil gauge. Sandra knows very little about cars, so she decided it would be wise to have her car towed to the closest auto maintenance facility to be serviced. The mechanic on duty treated Sandra with absolute condescension.  He acted as if Sandra should know much more about cars and how to check her own oil. Upon completion of service, the mechanic charged Sandra for 2 hours of service even though Sandra had only waited an hour for her oil to be checked and changed.  It was obviously a bad experience for Sandra, and she had no intention of returning to that auto maintenance facility for future services, nor would she recommend their services to friends and family.

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