– build your reputation by letting customers tell one another about your uniqueness
The pivotal goal of any business is to build stronger relationships and strive deliberately to minimise complaining customers in the quest to meet and exceed their expectations while seeking to do much, much more. Many businesses will shun this and tell you the goal is to create shareholder value. Great! How do we build and sustain the drive for profitability with a high customer attrition rate? The key to avoiding this trap is to accept the reality that most customers of a given business will not remain active customers indefinitely. We must arm ourselves with this insight to keep them satisfied at all times.
The competition these days is so fierce that the propensity for customers to switch to your competitors is very high. Consider my personal experience with utilities in the UK, where every year there was no shortage of promotions to influence a change of mind for the customer. Water, electricity and telecommunication companies were actively clamouring for attention with juicy offers that were hard to turn down. Years ago when I was flying (as a novice) on one of the airlines, I encountered an unfortunate situation where a cabin crew member literally threw her hands up in the air in reaction to a request I made.
In my ignorance, I cringed at the reaction and did not pursue the matter any further. She had had her way. Would I accept that reaction today? Certainly not! I would follow this up by making a formal complaint about the matter, or failing a reasonable response to my complaint, I probably will sing that company’s tune on mountain tops to gain attention. Moments of magic are critical moments where any brand finds itself in a make-or-break situation. The goal is to build sustainable relationships with customers to keep them loyal to our brand and to minimise attrition rates.
Customer attrition (also known as customer churn, turnover, or defection) is when clients or customers end their relationship with a company. To avoid this tendency in our businesses, it is imperative that we pay attention to managing the relationship with the view to minimising customer churn by focusing on key metrics to track any such tendencies and to find the reasons why this is happening. In reality, the cost of marketing to existing customers is significantly higher than marketing to existing ones. In this regard, monitoring attrition on a regular basis can help us project future growth or declines.
Many companies today track customer lifetime value (CLV) as a key benchmark when planning the marketing costs for acquisition. This data is best found by first investigating customer churn. CLV is one of the key stats to track as part of a customer experience programme. It is a measurement of how valuable a customer is to our company, not just on a purchase-by-purchase basis but across entire customer relationships. To avoid the minefield of losing our customers, we must pay attention to the triggers that precipitate high attrition rates. Here are a few tips we can adopt to keep customers satisfied and enhance our competitiveness.
First, we must own our mile by standing up in our customer community in an area where we have chosen to excel. In other words, be known for something unique. Second, we must ensure that we are easy to do business with. We must position our business to win and keep customers always. Third, get first-hand experience by learning about our own products and being perceived as an authority on what we sell. Fourth, we must stay in touch with our customers consistently. Fifth, we must get proactive by solving problems before they start.
Own your mile
This is about choosing an area where you’d like to excel and developing it to stand out among the competition. Whatever your store sells or product is, you must establish yourself as the first place for your customers to stop within the radius of the store location. For example, cafés are very common in London and other parts of the UK. I recall, though, that there was a particular café I stopped at every morning on my way to work, the college where I taught. The café owner was very conversational and would banter with his customers, of which I was no exception. The experience of a good conversation to start my day was something I looked forward to.
The mile is more than just a distance. Owning your mile means being visible in your community as was the case with the café owner. This community is not necessarily geographic. It could be in anything that you are good at. A friend of mine buys her waakye from a popular waakye seller in Korle Bu and always gets to be treated preferentially anytime she goes there to buy. Michael Gerber’s description of a hotel upstate where he received personalised services cuts the mould of an extra-mile customer experience. It’s all about being so distinctive that whenever your service or product is thought of, you immediately come to mind.
Every business has a mile that it owns and it must do well to identify this mile for development. You do this by targeting a community that you wish to dominate. Mind you, owning a mile is only a metaphor. It can be geographic, demographic or psychographic. It can even be global. Major brands – such as Apple and Samsung – have identified their mile variously. While Apple focuses on customer loyalty by delivering products that have emotional appeal, Samsung is content with developing to scale and reaching out to the wider market. Both have found their mile by leveraging what they are extremely good at.
Be easy to do business with
Customer experience is more about empathy than ratings. However great your ratings are, note that just the ratings will not tell the full story. Customer loyalty is more about emotions than business metrics. Remember that customers will remember how you made them feel much more than the efficacy of the product or service. A satisfied customer feels a sense of fulfilment that the basic requirement has been fulfilled and would not need a complaint to achieve his/her goal. Loyalty must be earned; it is not guaranteed for a lifetime although it can be eventually – it is more about the next time every time.
If your business makes life easy for customers by ensuring that their needs are met adequately, then you are in a good place. To find out the ease of doing business with you, perhaps, the Customer Effort Score (CES) metrics will provide some answers. It is a customer experience metric that measures the ease with which customers can use your product or service, resolve a support issue, or find the information they need. Customers rate their effort on a 1-7 rating scale with a CES survey. If our utilities would devote some effort to finding out how easy it is to engage their touchpoints, we would be close to ease of business.
Consider the ease of topping up your electric metre. There are times when the online update goes through smoothly; yet, there are other times when this is not the case. It is about developing consistency in service delivery and ensuring that customers can engage your touchpoints effortlessly. If you have policies, procedures or business rules that get in the way, then a customer-first mindset is under threat and needs immediate overhauling. Use customer feedback, and mystery shopping programmes to identify opportunities for improvements. As you interact with the customer, it helps to ask: “Is what I am doing making it easier for the customer”?
Get firsthand experience
Customer experience is all about empathy. What this means is that if we sell or are delivering a service, we must first have a personal experience with what we sell – at least, a demo of it in the same way a customer would. Having a broad level of understanding of what we deliver makes us an authority and positions us to genuinely convince the customer that the product is authentic and the promise of value is truthful. Admittedly, we may not necessarily know everything; however, we need to know enough to share an informed opinion about the product with the customer.
A few times at the restaurant, we rely on the expertise of the waiter to determine what would be a good take for the evening. Imagine a waiter who just started work and gets asked by a customer to help choose an item on the menu. Should the waiter respond sheepishly to the customer: “I actually only started work yesterday”, that would be a big downgrade for both the waiter and the restaurant. We must ensure that our front liners are gurus when it comes to the products we sell. They must have the confidence to share product information knowledgeably and with no pretensions.
When we train our staff to be knowledgeable about what we sell, any random call by a customer will land at the feet of an ‘expert’. The shopfront must always be full of people with personal experience in specific areas of interest to the customer. Apple relies on a very effective communication technique it adapted from The Ritz-Carlton: Steps of Service. Every employee is trained to walk a customer through five steps that spell out the acronym A-P-P-L-E (The Ritz-Carlton has three steps). Being deliberate about training employees to become experts in the products on sale is pivotal to every successful customer interaction.
Stay in touch
To keep the brand in the focus of the customer we must develop strong relationships. In short, we must stay in touch with our customers for as long as we can. It has nothing to do with a thank you note or follow-up call. Continuously staying in touch with customers will enable us to develop what marketers call ‘Top of Mind Awareness’. The key is to keep in touch by creating a series of regular touchpoints to show customers that we are interested in maintaining and developing a professional relationship. By generating and sustaining engagement, we earn their loyalty. It is all about doing the simple things, nothing complicated.
A powerful touchpoint that can yield some tangible results is a simple phone call to find out how the customer is doing. This makes them realise you are thinking about them, although technically, the calls you make are sales calls. These calls sometimes offer the opportunity to announce to them new products you are expecting that might be of interest to them. Car sales dealers use some subtlety in sending emails to customers and friends reminding them of battery checks, oil changes, and general servicing to keep the car in good shape. I get such occasional calls from my mechanic when I have gone AWOL for a bit.
Some businesses send out e-newsletters to keep customers abreast with current developments and to inform them about new products or product upgrades. Additionally, typical maintenance, repair and general advice to inform customers about the efficient use of products enables them to maintain the items they purchase, thus assuring them of the longevity and durability of the products. It is possible to offer some good price deals to keep customers loyal to our brand. The birthday message and season greetings (Christmas and Easter) are all forms of personalised engagements to keep customers attached to us.
Be proactive
This is all about ensuring that you solve problems before they occur. Years ago, I went to a restaurant with an ex-boss of mine for an evening dinner. I ordered something quite simple but he went for a giant lobster. However, when he tucked into the meal, he quickly noticed that something wasn’t right with the meal; so he called the waiter over. The waiter’s immediate reaction was to argue that this wasn’t the case. Fortunately, his manager was standing close by so he quickly came over and asked the waiter to move on to serve other tables. He quickly apologised to my boss and offered a replacement for the meal.
My boss declined the offer but was satisfied that the manager had accepted the complaint and apologised while assuring him it would not happen again. The manager in this situation quickly headed off what could have been a major complaint and perhaps, a decision never to use their services any longer. Proactive services offer us an opportunity to demonstrate to customers how good we are and to earn their trust and loyalty in the process. Although there is no formal process for companies to think ahead, being alert to the customer’s needs and acting quickly instead of waiting for them to act on their problems can be worth our while.
Proactive service can be as simple as greeting the customer at the shopfront and asking what the customer is looking for. I recall the support by floor walkers and shelf loaders in supermarkets in the UK. Although you find them busy working anytime you ask for their assistance in finding an item, they quickly stop what they are doing and walk you to the location. After they have done that, they will turn to you and ask: “Anything else”? Most times your response will be no; however, the special attention is flattering. By making proactive service normal, we can step back and watch our customers say wow!
By taking advantage of opportunities that come our way when engaging with customers at our touchpoints, we set ourselves up to deliver planned – not random – acts of kindness to achieve ‘moments of magic’ – one customer at a time.
| The Writer is a Management Consultant (Change and Customer Experience). He can be reached on 059 175 7205, [email protected], https://www.linkedin.com/in/km-13b85717/
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