Customer retention is an important principle for most companies. This is further highlighted by the limited size of the Maltese market and the wide variety of substitute goods available.

Firms use considerable manpower and capital resources to attract and retain customers. Recently, however, most companies seem to be focusing more on attracting custom away from competitors rather than offering existing customers better value.

This can be clearly seen in the mobile telephony sector. Those who opt to join Go, for example, do not get any upfront offers; however, when they decide to change operator the new company immediately endeavours to satisfy the needs of the new customers.

Such aggressive sales tactics verge on being unethical towards the network's existing customers who do not benefit from any of these 'special offers' which are only available when joining competitors.

As competition gets tougher, with business rivals or other channel partners offering Just in Time delivery, no 'out of stock' situations, and better demand planning, firms which operate in an oligopoly or a duopoly must focus more on harvesting returns from existing customers while attracting new customers by using true corporate responsibility initiatives and good word-of-mouth and, of course, excellent customer relations.

Price wars as we are seeing now only lead to lower profitability, not only for the operator concerned but also for all companies operating in the same market.