Customer retention: case studies of agencies in the
professional service sector

Abstract: In recent years, customer retention has gained increased value among both
goods and service providing firms. However although extensive research
exist on the concept of customer retention and its measures and
instruments, studies and research on how professional service firms retain
their customers remain limited. Hence, in this thesis how professional
service providers retain their targeted customers over time will be
investigated through four case studies in the professional service
industry, more specifically in the advertising sector. The empirical data
was collected through interviews with four Swedish advertising agencies:
Lowe Brindfors, Favör Reklambyrå, Holy Diver and Vinter Reklambyrå. The
findings of this study first and foremost indicate that professional
service providers do not have any formal nor standardized procedure which
they follow when it comes to retaining their customers. The strategies
employed by the firms are highly customized to each individual customer.
Further the findings from this study indicate that in order to retain
customers over time professional service providers need to place more
efforts on the creation of personal relationships with the clients, as it
is a strong bond tying customers to the firm. The findings further imply
that the creation of customer satisfaction and the creation of switching
barriers are the main strategies employed by firms, for retaining
customers. Other factors affecting professional service firms’ retention
strategies are the firms’ ability to convey confidence, to get the
customers involved, and to be able to deliver good quality services.