What Is Most Important in Business: a thought exercise
I’ve been thinking frequently, perhaps too much, recently about things that a business finds most important. In the past, I’ve heard many (highly intelligent) focus on the cost of customer acquisition as being of the single most importance to the business. In fact, that statement was made about the ISV market…but was generalized as applicable to a wide range of small business.
I think that I agree in principle. Decreasing cost of customer acquisition would have substantial, immediate impact on the business bottom line. To be clear, that cost would typically encompass items such as integration, testing, deployment, etc…basically all of the elements that are considered when finance refers to “fully-loaded” costs.
And yet, I wonder whether those costs, and the acccompanying thought process, are also applicable to customer retention.
Particularly in a somewhat saturated market, I feel that customer retention begins to, perhaps, have even greater import than acquisition. If your primary method of growth is through churn from other providers of your technology, then retention of your extant customer base is a substantively more important consideration.
So how do you retain customers?
A simple one word answer. More.
Rather, two words. More and Appropriate.
You have to continue to provide the service that helped you acquire the customer initially while continuing to innovate in such a fashion that you meet their current needs while anticipating their future needs. It isn’t just about features…it is about necessary features.
I could continue to pontificate to excess…but will break for now while I continue to ruminate.
What’s your perspective? Agree? Disagree? Anything to add? Critiques?
The comment form is below. . .
August 27, 2008