In business, as in life, it is easier to avoid the hard questions than to confront them.  If we sweep it under the rug, perhaps next time we look the problem will have solved itself.  That is our hope.  How many times is that strategy successful?  Not many.  When the economy turns down, as it is now, the questions can get hard.   What are historically successful companies doing to weather the downturn and prepare for the good times ahead?

1. Focus on customer retention – it is easier to retain customers then to attract new ones
2. Consolidate around profitable segments
3. Identify future growth areas and position for economic expansion

Just looking at these strategies will prompt hard questions in your company: What are you doing to retain your customers?  What is profitable, and can you reduce costs in the non-profitable areas?  What resources can you re-deploy to position for future growth.  The answers involve people, systems, dollars, ego, etc.

I would argue that focusing on customer retention is the most important thing that you can do.  Keeping and growing profitable customer relationships will do more for your business over the long run than any customer acquisition strategy.  What do you think?  Send me your comments.