Customer relationship marketing (CRM - see Volume 5) stresses customer identification, differentiation and interaction.

There are 3 facts of corporate life that underpin CRM:

i) customer loyalty cannot be taken for granted - people simply move on if their needs are not met promptly and with minimum effort on their part

ii) acquiring a new customer costs a lot more than selling to an existing customer

iii) a relatively small percentage of customers deliver the bulk of most organisations' profit

More important than customer satisfaction is customer loyalty/retention/referral. Customer satisfaction does not ensure a customer returns and/or refers your business to another customer. Remember: it requires 5 times more effort to attract a new customer than to keep one.

 

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