When a seemingly ‘loyal’ customer leaves you, do you really know why? According to recent research by ServiceSource more than half of customers who fail to renew contracts and services do so because businesses simply fail to communicate efficiently with them.
This inefficiency was found to be driving a trend of ‘AWOL’ customers, costing businesses dearly. 54% of customer non-renewals in EMEA were due to an inability to connect with customers. The combined effects of bad data - such as lack of up-to-date contact details, incomplete customer history is driving a lack of loyalty that is hitting the region harder than competing markets.
Globally, ‘non-responsive’ customers are the top reason for customer loss, accounting for 45% of non-renewals. This is an issue that is compounded by bad data. Effective customer relationships can only be built through effective, timely and personalised communication.
The report analysed over $1.4 billion in lost revenue from more than 50 companies, globally over the last two years. Estimates from industry research firm, Gartner put the total figure lost due to inadequate data management and processes as $30 billion.
With potential revenue of $30 billion up for grabs, if EMEA businesses focused on implementing strong data systems, and building loyalty through effective relationship management they would outperform competitive regions in almost every area.
Whilst businesses in EMEA should be undoubtedly concerned about the effects of bad data, the real worry is the lack of focus on identifying why customers leave. The probability of selling to an existing customer is 60-70%. The probability of selling to a new prospect is 5-20% (Source: Marketing Metrics). In the current downturn, businesses cannot afford to neglect the reasons why customers leave them.
Whether through bad data, competitive pressures or lack of customer satisfaction, access to real-time, analytical data is the key to unlocking these streams, worth billions.
More Business articles from Business 2 Community: