Over 60% of SMEs do not know how much revenue they lost last year as a result of lost customers

revenue

New research reveals that 62 per cent of SMEs do not know how much revenue they lost in the last financial year from lapsed customers.

The research shows that where SMEs were aware of the amount of customers they had lost in the last financial year, the median figure lost by SMEs as a result was £100,000.

Moreover, the research reveals that the large majority of challenger brands and SMEs do not know how many customers they lost in the last financial year. This is a significant issue for SMEs when a 5 per cent increase in customer retention rates is estimated to equate to approximately 25 per cent increase in profit.

SME’s and challenger brands need to take retaining customers as seriously as they do gaining new customers, copying the success models of the household name businesses they wish to displace.

MD of GI Insight, Andrew Adkins: “Any SME wants to win new customers, but as our research shows they really need to focus more on retaining them. They should start by knowing how many they’re not keeping hold of.

“We believe that marketing should be simple, and it should work. That means helping you attract more customers, but equally it means holding on to the ones you’ve got.”

Director of Ashworth, Jonathon Grove: “Once we recognised retained customers were significantly more valuable than new ones, we went ‘all in’ on making the ones we have happy, and directly marketing to them. We found that 6 per cent of lapsed customers equated to 55 per cent of total lost revenue from prior year, we just needed to reach out to them. Simple when you think about it – and it had a big impact on the bottom line”.  

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