A true sales process that keeps expectations realistic has an impact beyond the sale: it also affects customer retention. Marketing agencies have always struggled in this area with historically high churn rates. An LSA report titled “SMB Advertiser Churn: New Data for an Old Industry Problem” (January 2016) found that agencies continue to have one of the highest churn rates by media category , at a rate of 40-50% per year. The only media category that experiences higher churn rates is television. SEO/SEM as a media category has also seen higher than normal churn, averaging around 40% per year. LSA Data -
Churn Agency and SEO Source: LSA Report, “SME Advertiser Churn: New Data for an Old Industry Problem” (January 2016) Customer retention is important from a cost and revenue perspective. According to data shared by Google at the 2016 LSA annual jewelry retouching service conference, it costs five to 10 times more to sign up a new customer than to retain an existing one. On the revenue side, Google also said selling to existing customers had a 60-70% chance of success, compared to only 5-20% for new customers. These numbers reveal that
customers who see results that match what was promised to them in the sales process trust their marketing vendor, grow into long-term business relationships, and eventually become much more profitable accounts. What can marketers do to gain the trust of SMEs? LSA has created a set of standards that capture these best practices that SMBs state would help build trust in a digital marketing vendor. Examining these standards and implementing them into company policies, training, quality controls, agreements, and customer communications will go a long way in developing strong digital marketing sales