Most distributors know that losing customers costs them money. Despite this, few have specific plans for reducing defection – and even fewer have someone in charge of this important task.
But losing customers costs more than you think for one very important reason: Customers that defect can only drop to zero sales dollars. Customers you retain tend to grow over time. That means when you improve retention, you not only keep the sales you would have lost, but you also add growing accounts over time. The multiplier effect of retaining more accounts means distributors should invest more in retention than they think. The opportunity cost is much greater than the lost sales alone.
In this episode hosts Ian Heller and Jonathan Bein share the true costs of customer defection – and the real upside of reducing it.
Ian Heller is the Founder and Chief Strategist for Distribution Strategy Group. He has more than 30 years of experience executing marketing and e-business strategy in the wholesale distribution industry, starting as a truck unloader at a Grainger branch while in college. He’s since held executive roles at GE Capital, Corporate Express, Newark Electronics and HD Supply. Ian has written and spoken extensively on the impact of digital disruption on distributors, and would love to start that conversation with you, your team or group. Reach out today at firstname.lastname@example.org.