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BizReport : Loyalty Marketing : September 12, 2008

Customer retention becomes business priority

New research carried out by SPSS Inc. has revealed customer retention as a top priority for European businesses, as consumers become less brand loyal and more price sensitive.

by Helen Leggatt

SPSSlogo.gifCollecting and analyzing existing customer feedback to build better relationships will become a priority over the next few years, according to a recent survey of around 100 businesses across Europe by software solutions provider, SPSS Inc.

Around a third of businesses cited customer retention as a key concern, compared with just 8% which are focusing on acquisition.

"The shift in the market is not surprising," said Haydn Lewis, SPSS's vice president of EMEA.

"In the past few years, companies have been stuck in a cycle of customer acquisition and loss. Previously, customers were much more loyal to one brand but this has recently been replaced by a constant search for the cheapest deal. Analyzing customer feedback can determine what makes someone switch suppliers, and prevent it from happening in the future."

Not only are customer retention programs often less costly than acquisition, suiting many a current budget, but businesses need to address increasing rates of customer attrition that have been brought about by continuing consumer financial concerns and belt-tightening. A recent article by e-consultancy presses home the realities of retention.

Tags: acquisition, attrition, loyalty, retention

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