Free Essay on Retaining a Long-time Customer

Acquiring new customers is more expensive than satisfying or keeping the existing ones. According to Kotler, Keller, Lane (2012) reducing the customer defection rate by five percent increases the chances of the company to gain immense profits by 25-85% depending on the industry. Keiko, therefore, faces a considerable loss if LZT exits and seeks the service of their competitor.

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Keiko, therefore, needs to implement strategies that can help in managing the interests of LZT and making it hard to defect and affecting their long term relationship. LZT can be assigned employees who are more knowledgeable, experienced and friendly to increase the satisfaction rate of LZT as the questions or worries relating to the company's products are answered adequately. Keiko can also increase the longevity of their relationship with LZT by increasing their engagement levels. LZT can be offered new products or the customization of the existing ones while maintaining quality at a lower price. In doing so, the chances of LZT remaining committed to Keiko are increased.

Additionally, Keiko can implement a disproportionate effort strategy by specially treating LZT. Special treatment ensures that the customer remains loyal as he or she may not get the same treatment as a new client to the competitors. Thoughtful gestures such as small gifts, invitations to special events, arts and sports, and birthday greetings are critical in sending a positive signal (Kotler, Keller, & Lane, 2012). Apart from special treatment, Keiko can also enhance the growth potential of LZT through "wallet sharing" (up-selling and cross-selling). Keiko can increase its sales to LZT by offering new opportunities such as products and accessories that are complementary to the existing one. Such products may encompass both predictable and unpredictable goods belonging to a variety of industries.

Moreover, Keiko can also retain LZT by focusing on building their loyalty. Loyalty is built through strong ties with bonds that heed particular considerations (Kotler, Keller, & Lane, 2012). The relationship between Keiko and LZT can be established through proper interaction mechanism. Keiko can listen keenly at LZT requests, complaints, worries and needs and offer immediate feedback. Apart from listening, Keiko can support the perspectives of LZT to increase the need to remain loyal.

Also, Keiko can offer LZT loyalty programs such as club memberships. Such club membership programs are good at building a consumer database and also create long term membership interests (Kotler, Keller, & Lane, 2012). Keiko can also create long-standing ties with LZT by supplying special equipment and link to services that are key in the daily activities of the customer. By availing services linked to management orders, inventory and payroll LZT is less inclined to switch to the competitors as the move will mean increased search costs, capital costs and even loss of loyalty discounts. If Keiko inevitably loses to their competitors, there is also a great chance of winning LZT back. Win-back strategies such as such as exit interviews that are tailored to the service and purchase history of LZT can help in identifying areas of dissatisfaction and helping Keiko win back their customer.

Keiko, therefore, stands a greater chance at making it hard for LZT to switch to their competitors by implementing special services that are not offered by other companies, offering loyalty programs, increasing the longevity of service provision and engagement levels, supplying links and special equipment's, and offering tailored customer service.

References

Kotler, P., Keller, D., Lane, K., (2012). Marketing Management, Fourteenth Edition, Pearson Prentice Hall. Retrieved from http://socioline.ru/files/5/283/kotler_keller_-_marketing_management_14th_edition.pdf