Holiday and travel suppliers are currently producing the most effective customer retention marketing campaigns, while insurance companies are lagging far behind, according to a survey by mailstream technology firm Pitney Bowes.
The company's research found that many vertical market sectors are experiencing unprecedented levels of churn - a serious problem given that the cost of replacing defectors is usually significantly higher than retaining existing customers.
The Pitney Bowes survey was conducted to create a customer retention campaign index by measuring consumer attitudes to campaign quality across five vertical sectors, compared to the current level of customer churn in each of those sectors.
A sector with high churn rates therefore needs to produce campaigns that consumers find highly effective in order to suppress further attrition. The index revealed that the insurance sector is currently facing the biggest customer retention challenge, and that the situation is being made more urgent by the influx of new, non-traditional entrants into the market.
At the opposite end of the scale, holiday and travel suppliers were found to be far ahead when it comes to earning repeat business from their customers. Even though travel gives a more pleasurable buying experience than insurance, the index survey found that businesses in the sector are definitely not taking their customers for granted.
According to David Jefferies, marketing director for Pitney Bowes, "Any sector below the average on our scale needs to look hard at its marketing practices. Customer retention campaigns need not be about glossy, dynamic creatives. Customers also respond positively to accuracy, timeliness, and documents that are obviously relevant to their particular circumstances."
One possible solution to the problem, Jefferies suggested, is for those companies and sectors that are under-performing to look into affinity partnerships with companies from those sectors that are already leading the way in terms of customer retention. This could help to stem the currently unacceptable levels of churn.