We are entering increasingly volatile times. There are countless approaches to weathering the economic uncertainty we all currently face. In addition to traditional expense and growth levers, one opportunity we are seeing for many of our clients is often overlooked—it is customer conservation.

Customer conservation, premium leakage, asset retention units… whatever label you want to use, the concept of keeping customers (and their business) tops executive agendas today. The logic makes sense: we are in a slow and uncertain market, we already have the customer, and we need to take every reasonable opportunity to keep existing customers and their interest in our products and services. We also know it takes at least 10 times the effort and money to find a new customer.

Some perceive conservation opportunities as less exciting or a relatively low priority. Frankly, that thinking is part of the problem. Those who are winning at the game are approaching the opportunity with innovation and vigor. Many companies with high retention rates are already making customer service a top priority and differentiator. We also know that those who are focusing on conservation are hanging on to as many as 40 percent of customers who would have left otherwise.

A few questions to ask yourself:

• How well do you understand the reasons customers are leaving or lapsing their business? All of our clients have retention rates, lapse rates, and so on as key measures, and most conduct customer service surveys. The problem for some in the industry is that they look at historical trends and say, "Well, that's just the way our business works," or "Those levels are acceptable." Those who are making a difference are questioning historical expectations and digging deep to find the insights behind why customers leave.
• Who do you have dedicated to conservation? Do you have someone who owns the conservation issue? Do you have a dedicated unit with the look and feel of a can-do sales organization, or is the unit staffed more along the lines of an administrative department?
• How innovative and motivated are those working in the conservation unit? Often, customers are deciding to leave because the product they bought was not the right fit for their needs. In many cases, it just takes someone to place them into another product that better suits the customer's needs. This is especially true for the Baby Boomer market as they move from one stage of their life to the next.
• How well do you tie the lessons from conservation efforts back into your core business operation? There is a great deal you can learn from the customers who leave (or were thinking of leaving). Product design, sales techniques, commission structures, product awareness, and billing practices are just a few examples of areas that are improved by increasing the communication between conservation and the core business.

Ultimately, there are no silver bullets to solving the customer conservation problem. Done well, however, the answers to these questions can add up to much more than you might think. Good luck, and let us know if a conversation on the subject would be helpful.