Most cable or Satellite TV companies and cellphone
companies have entire departments dedicated to retention of customers. There is intense
competition between companies, so often times one will make an offer to get someone to
switch, and then the retention department tries to counteroffer to get them to stay, as
it makes more profitable business sense to give current customers further discounts if
it means they will stay with the company for many more billing
cycles.
Customer acquisition is the department that tries
to get others to switch. They cold call, use advertising, run specials, and otherwise
entice potential customers away from their current provider and add to their customer
base.
The two strategies I would choose in these situations
might look something like this:
Customer
Acquisition:
1) TV or newspaper AD: Special this month!
Free hardware and installation when you subscribe to our HD TV extravaganza for 24
months, at a low introductory rate of $24.99 a month.
2)
Direct Mail: send fliers with special offers right to their individual homes, which
usually leads to a 1 - 2% reply rate.
Customer
retention:
1) Call everyone who attempts to cancel your
service and offer them an incentive to stay - free month, new upgrades, lower rates,
etc.
2) Sign people to long term contracts with high
penalties if they break them, so you lock your customers in for a long period of time
and have revenues you can count on.
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