In fact, companies that engage customers see better business outcomes, including a 55% increase in annual company revenues and 30% higher customer retention, according to a study by Aberdeen Group.
Saverin was equally as bullish, saying: "Hopscotch is taking a customer focused approach and as a result seeing record high customer retention.
In particular, customer engagement, such as participation in positive WOM, increases the commitment and social identification with the brand as well as the brand community and leads to higher customer retention (Brodie et al. 2013).
AT&T and Verizon also had significantly higher customer retention, with Sprint, T-Mobile, and other carriers retaining fewer customers in the quarter (see chart).
In evaluating a portfolio company, I'd much rather see a business with good growth and high-quality customer retention than one with explosive growth but low retention.
The result is a positive, streamlined and sometimes pleasantly surprising experience for customers – leading to higher user satisfaction and customer retention, and from there to gains in terms of profit and market share.
Reasons for focusing on increased customer value are the long-term customer retention and high flexibility throughout the entire lifecycle.
Externally, customers reported a 31% increase in customer retention, 34% higher brand awareness, a 27% increase in new customer sales and a 28% decrease in call support volume.
