Standing Out From The Crowd

Stop right there!

If you were looking for some “how to improve your love life” article, you came to the wrong place. Rather, I would like to explore how the emotions involved in customer relationships are strangely similar to those you have with your loved ones.
…
Well, customers may be willing to share the object of their affection with a couple million other people, but the difference ends there… Like in romances, customers will become jealous if you favor others over them. If your company sees more value in acquiring new customers than in keeping a current one, the current one will leave.

Take for example wireless companies. To get into the proverbial bed with you, they lie and say they’ll treat you right. They offer you free phones, cash back, gifts and promise to take care of you and make you happy forever after. However, as soon as the sun comes up, or you’ve signed a two-year contract, you are tossed aside and simply added to the list of their many conquests. You, as an individual customer, don’t matter anymore.

Being treated this way is bad enough but then, adding insult to injury, the company continues to flirt with others right in front of you; making the same empty promises they made to you.

If your girlfriend or boyfriend treated you this way, how would you respond? Exactly!
Now, how do you think your customers will respond?

Oh sure, you may be able to fool a few and keep them with you for a while. But, as soon as the competition starts making its move and offering better perks, your customers are as good as gone.

Long romance or one-night stand?

Does offering all these perks to attract new customers really pay off when you treat them like that and they leave you in two years? Why not reward loyal current customers by giving them special offers or at least the same advantages as new customers when they renew their contracts. Better yet, why not offer them incremental benefits throughout the years?

It costs six times more to attract a new customer than to keep an existing one.¹

So, investing in customer retention not only saves your company money, it also leads to loyal, life-long customers and a higher return on investment.

In simple language: Set the right expectations, and be ready to invest as much in retention as you do in acquisition!

After all, one of the most basic rules of relationships is that if you are happy with what you have, you will be less tempted or willing to risk your relationship for instant gratification.

Is it time to break-up?

SPRINT has taken a somewhat unique approach to the customer relationship; they’ve flipped the table and are dumping their unhappy customers, (SPRINT is starting to cancel customers’ contracts when they call customer service too often).

I wrote an article about this topic last year (Bad, Bad Customer… No Soup for You!), explaining how companies were starting to identify customers who don’t measure up or are deemed too high maintenance.

I am not taking sides on this matter², but you can bet that outraged high maintenance customer is going to tell everyone she knows about your service and your company has a lot more to lose in brand awareness and public image than she does.

Having said all this, I ask again: Is it worth losing the one you’re with?

^{1 - Stevens, M. Extreme Management: What They Teach At Harvard Business School’s Advanced Management Program. Warner Business Books, March, 2002.
2 - You can read views of both sides on Seth Godin’s Blog “Treating different customers differently” and “The first thing“, and also at the consumerist.com.}

Originally published at Vox Inc Customer Experience Articles

In my last post (”Welcome Back! Long Time, No See“), I commented on how face-to face interactions are being affected by the reliance on technology, subsequently missing real customer relationship development opportunities. After posting it, I realized that it wasn’t very fair. Technology and CRM tools can be useful for improving the Customer Experience in real world situations with creative implementation. So I decided to devote a few brain cells towards imagining some scenarios that could be implemented with today’s tools and technology.  Here is what I came up.

Grocery Stores:

After a busy day at the office, Beth (our imaginary customer) is driving home when she decides to stop by the store for some groceries.

On entering the store, she goes directly to the first available Customer Service Kiosk and, having forgotten her “Preferred Client” card, uses her index finger to log in. The system shows Beth her current shopping list with her son’s wish list, added earlier at home over the Internet. The system offers Beth some interesting new products fitted to her needs and a list of personalized coupons. She then prints out her shopping list and coupons, sorted by the store’s aisle layout so she won’t have to backtrack.

As she shops, a chip embedded in Beth’s cart stores her information and a wireless device indicates her location in the store.

Beth is speeding through her list until she notices that one item is out of stock. Of course, the list shows several recommended substitutions for the missing item, but Beth is not sure which to choose.  She decides to ask for help and presses a Customer Help button on her shopping cart. A nearby attendant, alerted by an automated text message on his two-way radio, approaches her.

“Good evening, Ms. Johnson, It is good to have you back!” says the attendant.
“Are you by any chance wondering about a substitution?”

“Oh yes, thank you!  I was looking for a dandruff shampoo for my husband, but his favorite brand is out of stock,” she tells him.

“Not a problem!” He swiftly picks up his hand computer and downloads her list and shopping history. “We have several other good brands, but I see here that your husband bought ACME shampoo the last time he was here. Was he happy with that purchase?”

“Yes, I think he said he still preferred the other one, but this brand was ok,” she says.

“If you like, I can get one for you. If not, I personally think this other brand here is very good. It’s a little more expensive, but it is more effective,” he adds.

“Oh, thanks! I will try that one,” Beth decides.

Satisfied with her choice, Beth walks towards the checkout and a small display on her cart indicates which cashier has the shortest line. At the checkout, the smiling cashier greets her with a “Hi Ms. Johnson, did you find everything you needed?” while quickly scanning her purchases. As the cashier thanks her, she adds, “Did you know that you can call us ahead of time and have your whole list ready for you by the time you arrive?”

She didn’t know that, but she is already considering doing that the next time she shops.

. . .

Forget all the Sci-Fi movies’ wildest predictions (although Minority Report has an interesting take on possible future customer experiences), the example here is imagined, but quite feasible with today’s technology. I wouldn’t be surprised if someone is already doing something like it already. 

Are you? 

If you lived your whole life in the U.S., you may be oblivious to some curious everyday situations that I, as an outsider, can’t help but to find amusing.

For example, everyday I tear money apart.

No, I am not saying that I spend more than I should on a daily basis. I am stating that I LITERALLY tear money apart.  EVERYDAY!

Before you start cursing some made up foreign habit of throwing money away, let me explain: Given that all my normal written communication with friends and family is done through the Internet, every time I check my mailbox I rest assured to find only bills and direct marketing. Additionally, I frequently find marketing pieces disguised as money.

Some are checks for pre-approved loans that I didn’t ask for, some are checks to transfer debts to one of my credit cards, and finally some are checks for refund on the first month fee of a new bank service that I don’t want to sign-up for.

So, after the revision of delivered mail, I often pick the bills to be paid and immediately tear apart all the  “checks”, before I feel an urge to credit any of them.

That said, I can’t avoid the sense of wrongness when I think how I dutifully send my money to pay others and, at the same moment, I am throwing away any money that others send to me…

Maybe I am just crazy, but it helps me to think that if the global economy usually doesn’t make sense to me, why my personal one should? In any case, now I can understand a little bit why so many Americans are always in debt.

Here are two examples in the opposite side of the Customer Experience spectrum:

The first one was pointed out today by Seth Godin in his blog and is a perfect case of holding a grudge against your customers without learning how to deal with them. At the “Four Paws Design” website, an oblivious customer may find the following FAQ:

“Unfortunately, we can no longer take phone orders. Customers forget to tell us something and after the order is placed and processed, they claim we wrote down incorrect information. By placing an order online, we have a record of exactly what you want, especially for custom-designed items, leaving no room for error.”

I think I don’t even need to go as far as reminding the “customer is always right” cliché. It’s enough to observe that no company should be arrogant to the point of believing that they are NEVER wrong.

The second example I saw commented in the Signal vs. Noise Blog and shows how far a company can go to be remarkable to their customers. HP is launching a new feature for its digital cameras: An Instant Digital Diet! (At least on your pictures.)

I will not discuss the moral or ethic implications of their ad, but one has to appreciate the lengths they seem to go to be innovative and customer-centric.

Well, if nothing else, at least is food for thought…

Maybe I am a pessimist, but I think many companies today focus all their efforts and budgets on projects that don’t solve their main problem. They wait too long to realize when they need specialized help. It’s like being concerned with making dinner while the house is on fire. You don’t call 911 until the whole house has burned down. Do you think the firemen can help you now?

If you work in a corporate marketing department with more than 1,000 customers, you probably spend your days looking for creative ways to obtain new customers and increase revenue. Doubtless, you’ve read at least one Customer Experience article lately and you agree that the best way to keep your customers is to improve customer interactions to meet their expectations. However, all your annual budget and goals are directed to acquire new customers, not retain current ones.

What most companies fail to understand is that the road to credibility and profit lies in devoting at least some of their investment and attention to Customer Experience. The numbers confirm this: It costs 10 times less to maintain a customer than to obtain a new one. It also costs 10 times more to recover one lost customer.

So now, all you have to do is get a holistic view of your customers, evaluate all their interaction points with your company, and implement a strategy that would be valid across all channels. Shift your perspective. It may sound overwhelming, but it doesn’t have to be.

There are two ways to get hold of the idea and change how you approach your business:

1. Step-by-Step
   • Improve the Customer Experience in small projects. Look for low hanging fruit
   • Constantly review and gradually expand the scope — as you measure results
2. Top-Down
   • Gather related data and numbers
   • Show the merits of customer-centricity to top management
   • Implement a company-wide Customer Experience strategy

Either way, you must realize that the fire is already burning. The market is changing. Customers are becoming more demanding and savvy. Companies are speeding up to adapt and you cannot risk being left behind. It’s a mindset change but it just takes the effort to look at things from a different angle. Refocus how you use your marketing budget. Think about how you’ll see a better return on your investment as you grow your business.

Don’t wait for others to make their move. Most of all, don’t wait for your customers to make their move! Call 911!

*Originally published in May 19, 2006 at http://www.voxinc.com/customer-retention-shift-your-perspective.htm

I usually say that I am a very practical person. I am proud of my capacity to research the best possible deal before purchasing anything. Moreover, when asked, I always say that price DOES matter to me. It matters a lot!

Well, if this is true, why do I frequently end up paying more for the products and services I buy?

To answer that, I started recalling my last purchases.

• First, my wife’s birthday present - OK, that doesn’t count… I couldn’t be concerned with price on a special date. It HAD to be the right gift!
• Second, our last vacation - Yeah, I didn’t get the cheapest package available, but it was our vacation! Why not seize the moment and get something better.
• Finally, our last grocery purchase - That should be an easy one… Hmm… I could have bought less expensive stuff, maybe used some coupons. But what can I do if the products I like most are not on promotion. After all, I can’t spend all my valuable free time saving a cent or two.

After analyzing that, I came to the conclusion that nothing really went wrong and that, despite my bravado about low prices, what really matters to me is the tingling feeling that I made the right choice and bought what I really wanted or what I really needed, for me and for my loved ones. There is no better deal than that!

Yeah, well. I think I am no different from any other consumer after all…

*This post was originally published at the Customerspective Blog