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8 Ways Customer Bonding Programs Create Customers For Life

Posted by Tom Smith on Fri, Jan, 31, 2014 @ 10:01 AM

customer bonding programs to create customers for life

 

 

 

 

 

 

 

 

I have developed and implemented numerous customer, and prospect, bonding programs for clients, channel partners and employers over the course of my career.

The objective of the programs is to enhance the company's relationship with its customer or prospects since any successful business' most valuable asset is its current customers.

There are several elements of a customer bonding program.  The most critical element is an accurate and well-maintained customer relationship management (CRM) database.  This database is necessary for tracking communications and all other elements of the relationship.

Once your CRM is up and running, you can begin providing:

  • Information of value (content)
  • Customer satisfaction measurement and improvement programs
  • Customers for life programs
  • Personalized communications that lets the customer know you're listening to them and responding with what's most important

Specific elements of a program might include:

  • A welcome kit
  • Invitation to events of interest
  • Cause-related marketing
  • Newsletters
  • White papers
  • Videos
  • Presentations
  • Customer satisfaction surveys
  • Thank you and anniversary gifts

The benefits of such a program are numerous.  Here are eight:

  1. Move customers up the customer hierarchy from prospects, to triers, to users, to loyal customers to "raving fans"
  2. Increase long-term customer value
  3. Increase "share-of-wallet"
  4. Go beyond "share-of-mind" to "share-of-life"
  5. Reduce churn
  6. Engender loyalty
  7. Promote a dialog
  8. Reduce marketing expenses as a result of the referrals you are getting from satisfied customers and raving fans

How can your company benefit from a customer bonding program?

Want to Accelerate Sales? Download the Free e-book

Tags: customers for life, dialog, improve loyalty and retention, customer bonding programs

5 Tools to Use to Get More Customers For Life

Posted by Tom Smith on Thu, Jan, 30, 2014 @ 10:01 AM

customers for life

 

 

 

 

 

Customers For Life is a very powerful philosophy. It puts customers at the forefront of your company and your strategic plans.

It makes a lot of sense to do so since you won't have any revenue without any customers.

A Customers For Life philosophy does not mean you will end up serving all of your customers for their entire life or the life of your business.

Some of your customers' needs will change beyond what you offer and you will outgrow some of your customers. However, a Customers For Life philosophy ensures that you look out for your customers and help them find the right solution for their needs when you no longer offer the best solution.

Just because you're no longer doing business with someone doesn't mean you can't be friends. A Customers For Life philosophy will ensure you're getting referrals from former customers long after the business relationship has ended.

People like to do business with those they know, like and trust. They also like to see their friends be successful and are often willing to go out of their way to help their friends.

Here are five things I recommend pursuing to get more customers for life:

  1. Use Net Promoter Score surveys. This quick and easy three question survey lets you know several things: how you're doing in your customers' eyes; what areas you can improve upon; and, how engaged your customers are in your brand. It lets your customers know you're concerned about their happiness and interested in referrals. It's also the way to initiate a dialog with those customers with whom you've yet to speak with.

  2. Customer Bonding Program. A customer bonding program helps the customer get the most value out of your product or service. By following up with customers after their purchase, you know if they have any issues which you need to address for them as well as for future buyers of your product or service. You learn what they like and don't like, as well as what they need, or don't need, next.

  3. Empower employees. By educating your employees about the Customers For Life philosophy, you are empowering and encouraging your employees to provide outstanding customer experiences that will help you earn customers for life. These outstanding customer experiences are also likely to be shared with family, friends and colleagues in person and via social media. Employees that provide the most outstanding customer experiences are likely the future leaders of your, or someone else's, company.

  4. Trust. Dr. Ralph E. James wrote The Integrity Chain for the construction industry in 2002. I had the pleasure of working with Ralph and publishing the second edition of the book. While the book is written for the construction industry, its principles apply to ANY industry. Have integrity to earn trust. Earn trust to get repeat business. Get repeat business to be profitable. With the growth of the internet and social media, integrity and trust are far more important today than in 2002. In order to have Customers For Life, you must earn, and keep, their trust. Doing so will give you a cushion on those occasions when you do fail to live up to a customer's expectation.

  5. Model and reward a Customers For Life philosophy. From the CEO down, everyone in the company should be able to explain what the philosophy is, why it's important and their role in its execution. Those that exemplify a Customers For Life philosophy will help the company, and themselves, be much more successful. It's useful for employees to think of their colleagues as customers as well. By treating your colleagues as customers, your business will run more smoothly.

Do you have examples of how a Customers For Life philosophy has improved your relationship with customers?

Or, have you experienced how it has improved a company's relationship with you? 

 

Want to Accelerate Sales? Download the Free e-book

Tags: customers for life, trust, dialog, empower employees, improve loyalty and retention, connecting emotionally with customers, integrity chain, customer bonding programs

Earn Customers for Life By Using Consumer Insights from Data

Posted by Tom Smith on Tue, Dec, 10, 2013 @ 06:12 AM

customer experience

 

 

 

 

 

 

 

 

 

My best friend and I have been shopping at the same grocery chain, in different cities, for years.  We're both members of their loyalty program.  My friend receives a weekly e-mail of "personalized" specials.  I just get a tape of coupons when I check out.

After sharing my philosophy about the investment companies are making in analytics at the expense of interacting directly with their customers, my friend starting forwarding his "personalized" e-mails from the grocer which were clearly not personalized (e.g., his 21 year-old son no longer needs diapers).

After several years receiving useless coupons, I just received a coupon at checkout for something I would actually buy.  When I went to redeem the coupon, the store didn't have the product and didn't even appear to have it planogrammed.  How frustrating!

I forwarded the e-mails to the SVP of merchandising and operations for the grocer and received no response.

So why spend all the money on analytics packages that not only don't help you gain a greater share of wallet but actually show your customers how clueless you are about using the information you're collecting?

If retailers would spend 10% on consumer insights to understand the data, as what they spend on their analytics packages, they would see a greater return on their analytics investment and actually get customers for life rather than alienating them.

Perhaps if my grocer did this, I would get meaningful coupons when I walk in, my best friend would get relevant "personalized" e-mails and the grocer would get a greater share of our wallets. 

For me, with analytics used properly, my grocer would know when it's time for me to buy shaving cream and almond milk so I would not have to make a shopping list. 

What could they do for you?

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Tags: customers for life, customer experience, dialog, consumer insights accelerate sales, improve loyalty and retention

8 Steps to Earn Customer Loyalty

Posted by Tom Smith on Mon, Oct, 21, 2013 @ 06:10 AM

Loyal customers buy more

 

 

 

 

 

 

 

 

Customers are becoming more demanding, better informed and increasingly empowered.

Traditional marketing is no longer working, and customers want richer and more relevant dialogues with the companies they deal with.

They want their preferences to be respected and their loyalty to be rewarded. Under these conditions, so-called "pray and spray" communications are destroying both relationships and brand value.

Amid these challenging circumstances, how can an organisation differentiate itself? With the best product?

No, because products can be duplicated.

With the lowest price?

No, because discounts can be matched and promotions can be copied.

With satisfied customers?

No, because satisfaction isn't the same as loyalty.

A number of studies have indicated that majority of the customers who defect are either "satisfied" or "very satisfied" with their former suppliers.

So, while customer satisfaction is clearly important, true loyalty is what is absolutely essential.

This is because loyal customers:

  • Buy more and more often than other customers;
  • Enhance profitability and cost less to service;
  • Provide an invaluable referral system (i.e. they share, recommend and advocate).

In order to drive true customer loyalty, you need to understand customer's perspective, and know what they want - which usually includes statements such as:

  1. Treat me as though my business is important to you;
     
  2. Reward my loyalty and recognize me for who I am;
     
  3. Respect my preferences and the information that I share with you;
     
  4. Make it easy to do business with you, anywhere, at any time;
     
  5. Be relevant to my needs and circumstances;
     
  6. Help me realize my needs and dreams;
     
  7. Save me time and money;
     
  8. Connect me with people like me.

Which of these keys are you currently doing and which do you need to add to convert your satisfied customers to loyal customers?

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Tags: customers for life, earn your customers trust, improve loyalty and retention, connecting emotionally with customers

A Corporate Culture of Customer Loyalty

Posted by Tom Smith on Thu, Oct, 17, 2013 @ 06:10 AM

Corporate culture of customer loyalty

 

 

 

 

 

 

While it’s a noble notion to devote a month to customer loyalty, it should not be viewed as a point-in-time event.

Similarly, when many people think of customer loyalty, their first reaction is to envision the department that manages the organization’s customer loyalty initiatives. Customer loyalty should also not be viewed as simply a department.

Rather, customer loyalty needs to be viewed much more holistically. Customer loyalty should be an enterprise-wide culture.

Companies who have successfully initiated a company-wide culture of customer loyalty – that goes beyond a catchy company slogan – are the ones who reap the best business results. 

Whether you work in the manufacturing plant, the corporate office or on the customer-facing front lines, building customer loyalty must be viewed as every single employee’s primary job responsibility.

Creating loyalty is a collaborative and continuous process that builds consumer confidence and creates not just satisfied customers, but "raving fans."  

Raving fans not only are true company loyalists, but brand advocates help the company influence other buyers through “social marketing” and positive word-of-mouth testimonials. 

Consider these facts:

    • Recommendations from family and friends trumps all other consumer touch points when it comes to influencing purchases[i]
    • People are making 500 billion influence impressions on one another about products and services every year[ii]
    • 46% of people feel that they can be brutally honest on the Internet; 38% of them aim to influence others when they express their preferences online[iii]
    • Word of mouth is the “primary factor” behind a much as 50% of purchases[iv]
    • 74% of those who received advice from family and friends found it to be influential in their decisions[v]
    • Word of mouth companies are 16% more profitable than those generated by conventional advertising[vi]
    • 77% of American consumers say they are more likely to purchase a product or service recommended by someone they know[vii]
    • 75% of people do not believe that companies tell the truth in advertisements[viii]

Product quality and value are the first steps -- and foundational elements -- to successfully enter the marketplace. 

Once these are achieved, the most successful companies further differentiate their products with exemplary service. 

You won’t keep customers if you can’t support what you sell with great service.

Customer service is a never-ending role.  A company’s reputation is only as good as their consumers’ last experience with the brand. 

Delivering great service once isn’t too hard. Doing it all the time is far more challenging. And, it is the consistency of great service that builds customer confidence in your organization, which in turn will eventually create loyalty.

Creating truly loyal customers and raving fans is not an event.  Nor is it a department.  It is a clearly defined strategy and culture within the organization.

How well do companies understand and execute on the magic formula of product quality + exemplary service = brand advocacy?  

According to the University of Michigan’s American Customer Satisfaction Index (ACSI), not as many as you would think.

According to the ACSI most recent report, customer satisfaction at the national level achieved a score of 75.8% for the fourth quarter of 2011. 

This quarterly score is based on an evaluation of 44 companies located within eight industries:  supermarkets; department and discount stores; specialty retail stores; health and personal care (drug) stores; gasoline service stations; and Internet retail, brokerage and travel.

Congratulations to Publix Super Markets, Inc. who leads the pack in the super markets vertical with a customer satisfaction score of 84%.  

Publix Super Markets, Inc. clearly has embodied the culture of customer loyalty as they have led their vertical with the highest customer satisfaction scores since 1994!

For more information on the American Customer Satisfaction Index, visit www.theacsi.org.

Regardless of what vertical you serve, executing a consistent and thoughtful customer loyalty culture throughout the organization will yield “super human” results for your business.

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[i] ZenithOptimedia, as reported in AdAge, April 2008

[ii] Forrester, April 2010

[iii] Harris Poll, April 2010

[iv] McKinsey, April 2010

[v] Econsultancy, July 2010

[vi] Wharton University, July 2010

[vii] Wharton University, July 2010

[viii] Yankelovich, January 2010

Tags: outstanding customer experience, customer satisfaction, earn your customers trust, improve loyalty and retention

Use Data to Provide an Outstanding Customer Experience

Posted by Tom Smith on Mon, Sep, 09, 2013 @ 06:09 AM

Use data to provide an outstanding customer experience

 

I was recently booked on a Delta flight from RDU through ATL to Cedar Rapids for an interview.

My flight from RDU to ATL developed some unidentified problem while waiting to take off and had to go back to the gate.  

The pilot could not give us an idea of how long it would take to address the problem but it was clear to me that I would not make my flight from ATL to Cedar Rapids with only 50 minutes to make my connection in ATL if my flight from RDU was on time.

The flight was full.  Passsengers were trying to figure out whether or not to stay on the plane or get off the plane and take a chance on getting another flight, or set of flights, to their ultimate destination.

Fortunately is was in the back of the plane with a window seat, not going anywhere fast, so I called the travel agent that had made my reservation.

They were able to let me know there was a flight from RDU to Minneapolis in 80 minutes and that I could get from Minneapolis to Iowa City a couple of hours later than originally planned. Only one seat was remaining.  Did I want it?  No brainer.  Problem solved.  Got off the plane without stressing about dealing with the madding crowd at the gate.

In hindsight, this shouldn't have been an issue.  I have a Delta app on my iPhone. Why didn't Delta immediately offer me the alternative the travel agent provided with a message to my phone.

Delta knows where I'm going. They know I'm not going to make my flight in ATL. Why not use the data they have about me, and the status of their flights, to provide a proactive solution to the problem and take some pressure off their agents?

Hopefully they're working on it.

Everyone's talking about how you can improve marketing by leveraging big data.

How about improving the customer experience by using the data you already have?

If companies aren't thinking about how to use the data they currently have to improve the customer experience, they're wasting money on big data with the goal of getting more customers.

A satisfied customer will spend more, more frequently and have a greater lifetime value than a non-customer or a non-satisfied customer.

Why not invest more to improve the customer experience to have more satisfied customers?

Do you have any examples of how your firm is using data to provide an outstanding customer experience?

Need More Insights From Your Analytics? Download the Free e-book

Tags: loyal customers, outstanding customer experience, earn your customers trust, improve loyalty and retention

Say "Thank You" to Customer Complaints

Posted by Tom Smith on Thu, Jul, 25, 2013 @ 06:07 AM

Getting your customers to complain is invaluable

 

The Corporate Executive Board Financial Services Practice Operations Council released a study which found that 90% of financial services customers do not complain when they have an unsatisfactory experience.

Perhaps this is why four banks and two insurance companies account for six of the top 10 providers of poor customer service (http://wp.me/pYHt6-pE)?

Operations executives at financial services firms are focused on addressing customer complaints and service problems. 

However, by only focusing on those customers that do complain, operations executives are only addressing the 10% of the problem they know about. Ninety percent of problems are not being addressed.

This situation is not unique to financial services. It's a problem in every industry. This just happens to be the industry study I came across most recently.

The topic goes back to the message on the home page of my website and the title of this post -- "Getting Your Customers to Complain is Invaluable."

As Zig Ziglar said, "Statistics suggest that when customers complain, business owners and managers ought to get excited about it.  The complaining customer represents a huge opportunity for more business."

In the Corporate Executive Board study, 80% of customers who don't complain defect.

When I worked on a cellular client's customer satisfaction measurement and improvement business, we had significant data that showed that customers who complained were less likely to churn, move to another carrier, than those who never complained.

That's why getting your customers to complain is invaluable. If they don't say anything, you'll never know what needs improving.

What are you doing to get your customers to complain?

Have you empowered your employees to get customers to complain?  Do they know this is a good thing and not a bad thing?

By the way, when your customers do complain make sure the first two words out of your, or your employees', mouth are "thank you!"

Need More Insights From Your Analytics? Download the Free e-book

Tags: improve loyalty and retention, getting your customers to complain is invaluable, customer satisfaction measurement and improvement, empowered employees

8 Reasons to Create a Customer Bonding Program

Posted by Tom Smith on Wed, Jul, 24, 2013 @ 06:07 AM

Customer bonding programs

 

I have developed and implemented numerous customer, and prospect, bonding programs for clients, channel partners and employers over the course of my career.

The objective of the programs is to enhance the company's relationship with its customer or prospects, after the saleis made, since any successful business' most valuable asset is its current customers.

This reduces churn and increases revenue.

I am also an advocate of having a "customers for life" philosophy. Customers are sufficiently difficult to get that you should aspire to keeping them for life. They may not always buy from you; however, by maintaining a good relationship, they'll always be a good source of referrals, references and testimonials.

There are several elements of a customer bonding program.  The most critical element is an accurate and well-maintained customer relationship management (CRM) database.  This database is necessary for tracking communications and all other elements of the relationship.

Once your CRM is up and running, you can begin providing:

  • Information of value (content)
  • Customer satisfaction measurement and improvement programs
  • Customers for life programs
  • Personalized communications that lets the customer know you're listening to them and responding with what's most important

Specific elements of a program might include:

  • A welcome kit
  • Invitation to events of interest
  • Cause-related marketing
  • Newsletters
  • White papers
  • Videos
  • Presentations
  • Customer satisfaction surveys
  • Thank you and anniversary gifts

The benefits of such a program are numerous.  Here are eight:

  1. Move customers up the customer hierarchy from prospects, to triers, to users, to loyal customers to "raving fans"
  2. Increase long-term customer value
  3. Increase "share-of-wallet"
  4. Go beyond "share-of-mind" to "share-of-life"
  5. Reduce churn
  6. Engender loyalty
  7. Promote a dialogue
  8. Reduce marketing expenses as a result of the referrals you are getting

How can your company benefit from a customer bonding program?

Want to Accelerate Sales? Download the Free e-book

Tags: customer satisfaction, improve customer experience to accelerate sales, earn your customers trust, improve loyalty and retention, customer retention, customer satisfaction measurement and improvement, customer bonding programs

Insights Reduce Churn, Accelerate Sales, in Telecommunications

Posted by Tom Smith on Thu, Jul, 11, 2013 @ 08:07 AM

Consumer insights reduce churn in telecommunications

 

Amdocs just completed a study with Informa Telecom and Media that highlights the importance of customer retention and loyalty programs.

Sixty-six percent of operators believe customers are less loyal today than they were two years ago and 70 percent of service providers cite customer retention and loyalty as the critical factor for driving growth with a strategic marketing shift from customer acquisition and market share to long-term customer engagement.

Due to market saturation and increasing competition, 82 percent of service providers believe customer loyalty programs will be "very important" or "important" to their company's strategy over the next five years.

The four key findings of the survey:

  1. Too little, too late: 65 percent of service providers only initiate a retention program when the customer has started the process of leaving, while 90 percent measure customer loyalty by churn rates.
  2. Customer loyalty misconceptions: Service providers saw service quality (97 percent), network coverage (95 percent), network capacity (92 percent) and customer care (86 percent) as the key drivers of customer loyalty.  However, a separate study showed that network coverage and customer care are regarded as basic service requirements by customers and are not competitive differentiators -- they're the equivalent to clean bathrooms in the quick service restaurant industry.  Two-thirds of customers believe personalized and tailored services, proactive care and reward for being loyal customers win their loyalty.
  3. Organizational challenges block loyalty initiatives: Service and knowledge consistency across channels (94 percent), the ability to offer simple, transparent pricing (94 percent) and creating and an integrated view of the customer (89 percent) are seen as being vital in supporting customer retention and loyalty strategies over the next five years.  However, only 21 percent of service providers have the necessary collaboration between their IT, customer retention and loyalty departments to enable this.
  4. Different regions, different churn trends: Most regions show a linear growth trend in customer churn with higher prepaid regions facing the biggest loyalty challenge.  The North American market, despite facing the largest competitive threat, is the one market bucking this trend since service providers have adopted loyalty programs centered on building a complete view and more in-depth knowledge of their customers while also initiating loyalty programs tailored to the individual.

Having been a part of the first loyalty program in the cellular phone industry in the early-1990's the findings of this research are not surprising; however, the lack of adoption of such programs is.

I worked on a customer bonding and customer satisfaction measurement and improvement program for GTE Wireless, now Verizon, that reduced churn by 29 percent in the first year.

In the second year we focused a more personalized program on the top 10 percent heavy users.  This more targeted and rewards-based program reduced churn by nine percent and resulted in $16.2 million in saved revenue.

What surprises me most about the study is that 18 years after having worked on a very successful customer loyalty and retention program, is that more is not being done in the U.S., and around the world, to increase retention and reduce churn.

These programs take a lot of work up front; however, once instituted, the increased customer satisfaction and revenue gains provide a significant ROI. 

I'm surprised every telecommunications and cable TV provider does not have a highly developed customer loyalty and retention program in place.

What strategies and tactics have you employed to increase retention, consumer engagement and reduce churn in your business?

Want to Accelerate Sales? Download the Free e-book

Tags: accelerate sales, consumer insights accelerate sales, improve loyalty and retention, customer satisfaction measurement and improvement, customer bonding programs

Positive Customer Experiences Accelerate Sales

Posted by Tom Smith on Mon, Jul, 08, 2013 @ 06:07 AM

 

Positive customer experience accelerates sales

Great study from Forrester Research entitled, "The Business Impact of Customer Experience, 2013."

In the study, Forrester finds a strong positive correlation between consumers' ratings of a firm in their Customer Experience Index and consumers' willingness to buy from the company again (0.71), as well as the likelihood to recommend that company (0.64). 

Likewise there is a negative correlation between the Customer Experience Index and the consumers' likelihood to change to another brand or service provider (-0.42).

Forrester was able to build a predictive model that includes:

  • Incremental purchases from existing customers in the same year.
  • Revenue saved by lower churn.
  • New sales driven by word of mouth or referrals.

The potential incremental revenue in each segment is huge:

  • Wireless service = $3,149 million
  • Airlines = $2,339 million
  • Hotels = $1,131 million
  • Credit card providers = $866 million
  • Car rental companies = $447 million
  • Medical insurance = $306 million
  • Insurance providers = $252 million
  • TV service providers = $261 million
  • Banks = $237 million
  • Retailers = $227 million
  • Internet service providers = $161 million
  • Iinvestment firms = $105 million
  • Consumer electronics manufacturers = $88 million
How much are you spending to improve customer experience, which will accelerate sales by generating more purchases, reduce churn and increase word of mouth?
By learning what cell phone users valued most, we were able to reduce churn among heavy users and save $16.2 million in revenue.
By implementing a customer bonding program for a B2B provider of investment research, we were able to reduce churn 50% and save more than $1 million in revenue in year one and untold millions in subsequent years due to repeat business and referrals.
Providing a positive customer experience is worth the expense and the effort.
Want to Accelerate Sales? Download the Free e-book

Tags: improve customer experience to accelerate sales, improve loyalty and retention, customer bonding programs