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BEFORE TRYING TO SOLVE A PROSPECTING PROBLEM, make sure you don't have a customer attrition problem in disguise. |
Sales and profits fall when attrition gets too high. Marketers may look at the problem as one of losing more customers than they are replacing. To solve the problem, they simply bump up their prospecting efforts to attract more customers. However, new customers have little value when attrition is out of control. They likely will become another batch of customers lost to attrition.
When customers are leaving faster than they can be replaced, the first problem to fix is customer attrition. Improving loyalty greatly increases the lifetime value of existing customers. In turn, increasing the lifetime value dramatically raises the potential value of prospecting, and greatly increases the number of potential prospects that are logical targets.
Like trying to dig out of a hole, you can't prospect your way out of an attrition problem.
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