Poor quality and out-of-date customer data is preventing UK businesses from implementing effective customer retention and acquisition activities, according to new research from Royal Mail Data Services – the specialist data business of Royal Mail Group.
The survey found two thirds of UK businesses had incomplete, missing and old customer information – the data which is essential for any CRM and retention activity and the foundation of an informed approach to customer acquisition.
As a result, UK companies report losing nearly 20% of their customers each year. For one in eight businesses the rate of annual customer churn is extreme, at 30% or more.
Despite this loss of customers, 60% of UK businesses claim that acquiring new customers is their biggest marketing challenge. Only one third of businesses state that nurturing and retaining existing customers is their main marketing challenge.
Without insight on current customers to inform acquisition strategies, nearly 20% of UK businesses report that they are struggling to convert prospects into customers.
Jim Conning, Managing Director, Royal Mail Data Services, said: “Businesses are missing a trick by focussing on customer acquisition rather than keeping existing customers happy and their contact information relevant and up-to-date. The emphasis on customer acquisition means marketers are facing their biggest challenge – converting prospects into customers – at the very moment when their knowledge of those targets is at its weakest.
“Without good quality, up-to-date customer data and the resulting insights which identify potential buying behaviours, marketers are building their campaigns on flimsy foundations. Consumers expect a more personalised experience and businesses need to respond to this by doing everything possible to make sure their customer interactions are right first time, every time.”