Sample Research Paper
Rygielski et al. (2002) suggest that given the high cost of acquiring new customers, it makes more sense to conduct business with existing customers. In so doing, the marketing focus shifts away from the breadth of the customer base to the depth of each customer’s needs.
Reichheld et al. (1990), through their research, found out that even a 5% increase in customer retention produced as 95% on the net present value delivered by customers
An opposite view is expressed by Christopher et al. (2002) who indicate that a number of studies show that many companies are still more strongly focused on the acquisition of new customers than on developing their existing customer base. This is also confirmed by a study made by KPMG (1997) for different industries.
Kotler (2005) gives a balancing suggestion between working on customer acquisition versus customer retention. He suggests that before a company starts worrying about acquiring new customers, it must develop a strategy to satisfy its existing customers.
Furthermore, Russell-Jones (2002) suggests that acquisition and retention of customers are influenced by different drivers
Supplementing the authors above, Griffinand Lowenstein (2001) point out that companies also need to win back their lost customers. Putting together “acquisition management”, “retention management” and “win-back management” strategies they suggest “The Big Three CRM strategies” where they compare them in respect of “Targets and their Product Experience”, “Customer Segmentation”, and “Customer Communication”.
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