LinkedIn Twitter
Founder of We Wire People, Martijn has 15 years experience in the field of Integration, as an Architect working in and for Enterprises. He mainly advises in case of mergers, application rationalization and Cloud / Social Media back-office integration Martijn blogs at martijnlinssen.com

4 responses to “Why acquisition beats retention”

  1. @rachel_a

    Agree with your Law of Invisible Problems and have seen it far too many times. I think it’s also an issue of positive v negative. While acquisition is gaining and is therefore positive, retention is often measured as “reduced attrition” – negating loss and therefore negative. Perhaps if companies stopped seeing retention in the negative that would help? Simplistic I know, but just a thought.

  2. Martijn Linssen

    Thanks you Rachel, good point

    In fact, retention does point to something negative: a good reason for employees to leave your company. If companies were to stop taking it personally and wonder *why* all those people are so gladly willing to get out, they might actually turn it into something positive – by changing their company culture or ways

    After all, if attrition is considered a problem and thus retention a solution, how big a step is it to realise that retention is only a workaround and the solution lies in the company itself?

  3. Social Customer Service – proving you failed?

    […] Martijn Linssen on January 4, 2011 TweetA great comment by Guy Letts to my previous post on Acquisition versus Retention made me write this one – the comment is only half an hour old but blew my mind: There’s […]

  4. Adrian Cockcroft

    Netflix is a counter example, we use AB testing to measure retention, and we use Customer Aquisition Cost and Customer Retention to optimize for a higher Customer Lifetime Value. If you have extra dollars to invest in growth, there is a diminishing returns limit on how much you can spend on aquisition (marketing) so beyond that point it is better to spend on retention (e.g. content deals in our case). This isn’t particularly novel, but it is extremely well tuned and with everyone in the company aligned and focused on this approach it is a very effective way to optimize the business.

    Netflix isn’t “ye olde enterprise”, I don’t think most enterprises have ways to measure what their CAC, CLV or retention rates are. If anyone is interested, there is a detailed presentation on the Netflix business model/opportunity linked from http://www.Netflix.com/jobs