
I don’t remember the exact figures, but it has been demonstrated time and time again that it is much more cost-effective to try and keep an existing customer than it is to try and find a new one. In trying to attract additional clients, you will probably put out a fair amount of money in marketing and advertising. Your conversion rate won’t be anywhere near 100%, not to mention the time and effort involved in the “gamble” of attracting new customers.
As I’ve discussed on Beyond the Rhetoric, the single best source of additional revenue is your existing client base. You already have an established relationship with these customers and this relationship can be mutually beneficial. You already know what to expect and the customer already knows what to expect from you. This rapport gets well past the initial “feeling out” period when you’re still trying to get to know one another.
It’s up to you whether you want to take the route of signing customer agreements and contracts, but it is always in your best interest to do what you can to keep your customers. If you have a client that is thinking of going somewhere else, thinking that the grass is greener in your competitor’s lawn, you need to offer something better. This may not necessarily be a reduction in price! You can remind this client of your exceptional customer service, as well as all the features you offer that your competitor does not.
This process of retaining customers can actually increase your revenue, despite the possibility that you may be offering a discount of some kind. That’s because this retention provides an opportunity to upsell and suggestive sell your customer on additional products and services. Further still, the customer will walk away happy and is more likely to refer associates and colleagues your way. That’s more business for you.
Yes, offering a “retention discount” may sound like you are losing money in the short run, but it will ultimately provide you with additional revenues in the long run.




