In today’s competitive marketplace, it is increasingly important for coatings companies to hold on to their most important asset — their existing customers. At best, the coatings market is experiencing slow growth. Companies that plan to grow at a greater rate than the industry growth rate have two choices. They can concentrate on faster growing niche opportunities, or they can aggressively target competitors’ business.
Regardless of the approach, customer attrition cannot be ignored. If a company devotes all of its resources to growth, while failing to protect its base, a downward spiral of “one step forward and two steps back” can ensue. Conversely, a company taking a status quo approach, pursuing neither growth nor retention, will instead be internally focused and become the victim of aggressive competitors. The result can be an unpleasant war of attrition. In either case, the result is continued low growth and shrinking margins. In this time of slow growth, the company that focuses on customer loyalty and increasing customer retention will reap significant rewards.