Three Reasons Why Your Customer Conversion Rate is Low

When it comes to converting prospective customers to paying customers, many organizations have a very low conversion rate. Here are three reasons why:

  1. They think all business is good business. Organizations need to determine who their ideal customer is and develop strategies to acquire them. It’s also important to stratify existing customers so you know where the best opportunities are. Most organizations put effort behind pursuing and retaining the wrong customers.
  2. They don’t take the time to find out what the customer is trying to accomplish. Many organizations are so in love with their own products that they sell the features and benefits of those products, regardless of what the customer really needs. The most successful companies find out what customers want to achieve and develop solutions to help them.
  3. Too many people are involved and not all of them add value to the relationship. We have sales reps and account managers and subject matter experts, so it is often unclear who is accountable for the relationship. There are also many situations where one or more of these roles become order takers, not actually adding any value. If any of these front line people are not helping to acquire or retain customers, why are they involved?

Miller’s Monday Morning Message

Andrew MillerMiller’s Monday Morning Message
presented by ACM Consulting Inc.

Andrew Miller on operational excellence, strategy, life balance and everything in between

Toronto – February 10, 2014
Many organizations struggle with balancing the acquisition of new customers and the retention of existing customers. Even though these two are linked, the strategies are often different. When an organization wants to grow, it’s very easy to look for growth with new customers. We get motivated by bringing in new customers and closing the deal. But we need to remember two things: growth can also come from existing customers, and growth from new customers should not come at the expense of your existing customers.

Here are some things to think about:
  • Growth can come from both acquiring new customers as well as from offering more to existing customers.
  • If you focus too much on just bringing in new customers, you will erode your existing customer base.
  • Once you bring on a new customer, ensure they now become part of your retention strategy.
  • You can leverage relationships with existing customers to gain introductions to new prospective customers.
Your customer acquisition, on-boarding and retention strategies can be different but need to be strongly linked together. Don’t focus on one at the expense of the other. The most successful organizations are able to bring on new customers quickly and easily while holding onto the customers they already have.

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