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Acquisition vs. Retention: Where Should Your Focus Be?

Thursday, March 16, 2017

According to the White House Office of Consumer Affairs, it’s 6-7 times more costly to attract a new customer than it is to retain an existing customer. But that doesn’t mean you can survive solely on existing customers alone.

As modern marketers, we seem to face the dilemma of where to focus our efforts and our budgets. If it’s more cost-effective to focus on existing customers, how do we get those customers in the first place?

Suite 700 Direct is a strong believer in communication. After all, that’s what we do. But before you can begin sending anything, it’s important to develop a plan. You’ll need to understand your business and develop key goals – remembering that Rome wasn’t built in a day.

Below are some ideas on both acquisition and retention practices:


How do you develop a list of prospects? Sure it’s easier to purchase leads and prospect data. But how good is the list? Where did it come from? And are the recipients open to receiving your communication? This will most likely be answered by the type of business you have. Of course, a list built from organic leads, like data capture functionality on your home page, will typically be the most fruitful.

Once you have your lists squared away, it’s time to revisit that plan. You’ll need to decide how you will message your list. Will it be an email and a postcard? Perhaps a formal letter followed by an email. Or maybe it’s a dimensional package full of goodies. And what will your message be? What do you want the recipient to do? And what happens when you don’t get a response?

Bottom line, acquisition can be a tricky practice. There are tried and true methodologies, but not everything works for everyone.


Now that you’ve got a healthy list of loyal customers, how will you retain them? This is where customer relationship marketing (CRM) comes in. As we stated earlier, retention is key because it’s easier to keep customers than find new ones. So, it’s important to keep customers engaged.

Make sure they know about new products and services. Keep them updated and let them know you appreciate them. But remember, too much is not a good strategy. The last thing you want is for the recipient to say “oh no, not again”, and throw it away before even opening it.

Equally important is to track your efforts. Keep a record of who responds, analyze the click patterns on your emails and begin to segment your list into different groups based on activity.

Numbers you can learn from

  • 89% of consumers who have stopped doing business with a company have experienced poor customer service. (RightNow Customer Experience Impact Report)
  • It takes 12 positive customer experiences to make up for one negative experience. (Parature)
  • 70% of buying experiences are based on how the customer feels they are being treated.  (McKinsey)
  • 55% of consumers would pay more for a better customer experience. (Defaqto Research)
  • A customer is 4 times more likely to buy from a competitor when the problem is service related vs. price or product related. (Bain & Co.)
  • A 10% increase in customer retention levels can result in a 30% increase in company valuation. (Bain & Co)
  • Consumers are 2 times more likely to share their bad customer service experiences than positive experiences.  (2012 Global Customer Service Barometer)

Let me know your thoughts.

No matter what your business is or who your customers are, The Contrino Group team can help you in all facets of communication. From acquisition and retention strategies, to segmentation, formats and touch strategies – we’ve done it all and have some great success stories to share. 


Joe Contrino is CEO of The Contrino Group, a direct marketing agency located in Lafayette, CO.

Joe is an award winning direct marketer with over 32 of years of experience.   Prior to founding The Contrino Group, Joe was a Senior Partner at Suite 700 Direct, Integrated Marketing Solutions Manager at Henry Wurst, Inc., and CEO and owner of Contrino Direct Marketing, Boulder, CO.

Joe is a Direct Marketing Association Certified Direct Marketer Professional, Industry Co-Chair of the Denver Postal Customer Council Board of Directors, and speaks regionally and nationally on direct marketing topics and trends.


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