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The Value of Customer Retention

The Value of Customer Retention Predictive Analytics is critical in today's marketplace Proactive, real-time Loyalty & Retention offers turn loyal customers into valuable brand advocates. Proactive Retention: Business leaders know... Customer Loyalty & Retention • prevents defections ...the ... and the bottom 20% drain 80% of profits'. Enhance top 20% of increases customers company-wide profit generate 150% of a company's profit... The #1 focus of CMOS through 2017? • enhance Customer Loyalty & Retention • promote advocacy That's because: Attracting a new Organizations acquire 30% An Accenture 2011 survey found customer increase in costs 66% company value through a of respondents switched brand loyalty due to customer service 10% improvement in customer retention as much as keeping an existing one dissatisfaction A loyal customer can bring greater value to an organization than ever before. Business leaders recognize that customer retention is vital: Today's Changing Consumer Society A recent UBM TechWeb study: 94% of companies increased focus on customer retention since 2010 57% expressed a strong desire to incorporate technology- based customer loyalty tools, such as Social Media analytics Diverse critical Lacking Predictive Analytics challenges leave business leaders uncertain of their only 38% consider their Without Predictive Analytics Analyzing Unstructured Data Loyalty and Retention effective next move... less than 36% use Social Media info to (like Social Media) Truly Reveals Customer gauge customer loyalty Sentiment, bu... Here's why: Predictive Analytics is Key for Loyalty 2012 Forrester Wave" ranked IBM first in Strategy & Market IBM Predictive Analytics reduces Companies using Predictive customer & Retention defections, Analytics achieve improves retention & Presence for high client 73% increases satisfaction profits higher sales than those who don't & demonstrable business value XO Communications, U.S. provider & IBM adopter with more than 4,000 employees, reduced customer defections by 8% Defections down Customer Annual ROI of revenue 376% providing retention 18% increased by year two an annual 60% net benefit in excess of $3.8 million "Larry Selden and Geoffrey Colvin, Angel Customers & Demon Customers: Discover Which is Which and Turbo-Charge Your Stock, Portfolio, 2003 IBM CMO survey. IShayon, Sheila (2012, February 21. Accenture: Boost Loyalty by Avoiding Blind Spots, brandchannel. *Lee Resources 2010 "Bain & Co. *Kucera, Trip: White, David (2012, February 1). Divide and Conquer: Using Predictive Analytics to Segment, Target and Optimize Marketing, Aberdeen Group. IBM www.ibm.com/spss

The Value of Customer Retention

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Graphic for IBM discussing the use of predictive analytics to enhance customer loyalty and retention.

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