The global economy teeters on the brink of recession, forcing many organizations to cut costs, either by slowing down investments or aggressively cutting costs. Cutting back can be an effective defense against inflation and slowing sales, but how can founders proactively drive growth in a recession?
In recent decades, many technology companies have managed to weather economic downturns and even grow by refocusing assets and focusing their efforts on creating customer value and driving retention. New customers are critical to growth, but there are no guarantees that a first customer will become a lifetime customer. In times of economic uncertainty, companies cannot count on new customers alone, and perhaps not at all.
A more reliable growth strategy is to manage existing customers and broaden the products and services they use over time. Profitable and mature companies with large, active customer bases are better able to absorb setbacks, especially if more than 75% of their revenue comes from existing customers.
Here are a few ways a company can shift focus to a growth-through-retention strategy that prioritizes customer experience:
Account management isn’t just about cross-selling or upselling, it’s about putting the long-term goals of the customer ahead of the company’s short-term interests.
Centralize first-hand data
Customer data is first-party and companies can access critical information about the products their customers already use, their area of operation, where they are located, relevant spokespersons and decision makers, and more. Unlike third party consumer data, which may have been misappropriated or misinformed, first party data is exchanged in good faith.
In other words, first-party insights assume an existing, positive relationship between a company and its customers, and those customers correctly assume that their information will be used to support future interactions and guidance from their supplier. If a company knows all of the products and suppliers a customer uses, it can position itself in multiple ways to save the customer money and bring more value to the table.
The challenge is that customer records rarely contain this kind of information. Depending on the size of an organization, first-hand data is likely to be stored across multiple departments and systems, including marketing, customer advocacy, sales, and support.
Janice has been with businesskinda for 5 years, writing copy for client websites, blog posts, EDMs and other mediums to engage readers and encourage action. By collaborating with clients, our SEO manager and the wider businesskinda team, Janice seeks to understand an audience before creating memorable, persuasive copy.