Hello, need assistance with the following:
Compare and contrast the cost of customer retention versus customer acquisition. Explain the different types of relationships for Business to Business (B2B) and Business to Consumer (B2C) in the pre and post sale in terms of the decision to buy and customer retention.
In present scenario of intense competition, customer retention and customer acquisition become the most vital part of business. Customer retention is the process to retain the high proportion of valuable customers for business success (Chapter 9: Managing the customer lifecycle: customer retention and development, 2008). Customer acquisition is the method of acquiring new customers. Nowadays, organizations are contributing all their efforts in retaining and acquiring the customers for the survival of their business. There are some similarities and differences in the cost of retaining and acquiring the customers for business success. In B2B and B2C, customer relationship strategies are used differently in the pre and post sale activities to ensure long term retention. There will be a discussion of comparison and contrast between customer retention and customer acquisition.
Comparison and Contrast
Cost of customer retention and customer acquisition is different but the implications are similar for the organizations. There are some similarities and differences existed between the cost of customer retention and customer acquisition. These are as follows:
Similarities: Cost of customer retention and customer acquisition has some similarities. These are as follows:
- Purpose: The objective of investing in customer retention and customer acquisition is to boost the sales of products and services (Chapter 9: Managing the customer lifecycle: customer retention and development, 2008). Organizations perform these two activities to ensure a wide base of customers for the growth of the business.
- Activities: Cost of sales activities in retaining and acquiring the customers for business is also similar up to certain level.
- Strategies: Cost of strategies used for retaining and acquiring the customer is also identical in terms of sales activities.
- Direct relationship: Cost of retaining the customer is directly related to the cost of acquiring the new customers (Buttle, 2008). Loyal customer assists the company to acquire a new customer by spreading a positive word of mouth. In this way, cost of customer retention and acquisition is similar.
Differences: It is true that cost of customer retention and acquisition is similar up to certain extent, but at same time, it is also true that there are some differences. These are as follows:
- Investment: Cost of ...
The solution is styled as a short essay of 1442 words that lists the similarities and differences in B2B and B2C and then the relationship strategies for both. Many references listed.