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Customer Loyalty and Retention
Improved customer
retention and loyalty
Customer loyalty
Customer
loyalty is the result of well-managed
customer retention
programmes; customers who are targeted by a retention programme
demonstrate higher loyalty to a business. All customer retention
programmes rely on communicating with customers, giving them
encouragement to remain active and choosing to do business with a
company.
LP helps
companies create "loyal" customers who engage in profitable
behaviour, using data customers create through their interactions
with the organisation to build models or rules to follow.
In addition, LP
helps organisations develop "early warning systems" to identify high
loyalty customers who are at risk of leaving the business, with a
view to developing and implementing retention strategies that
prevent customer erosion. These behaviour models cause the data to
speak about the loyalty status of the customer before it's too
late.
Customer retention
Retention-oriented marketing is a tactically-driven approach based
on customer behaviour. The basic philosophy is that past and
current customer behaviour is the best predictor of future
customer behaviour.
In general,
this is more often true than not, and when it comes to
action-oriented activities like making purchases and visiting web
sites, the concept really shines through. It works because actual
behaviour is better at predicting future behaviour than
demographic characteristics are. It is possible to tell whether a
customer is about to defect or not by watching their behaviour;
and once defection can be predicted, it is possible to retain the
customer by taking action.
At LP, we help
clients listen to the data customers create through their
interactions with the organisation in order to build models or
rules to follow. These models are listening systems, they allow
the data to speak to the organisation about its customers.
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At LP, we also
help clients work out their cutomer retention and customer loyalty
strategy and identify strategic options for the development and
roll-out of sophisticated customer retention and loyalty
programmes.
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