Many businesses have rigidly defined the respective roles and responsibilities of their customer service and marketing departments. This is often the source of frustrations as, on one hand, the marketing guys do not have the opportunity to interact with the customers and, on the other hand, the customer service team has only a limited opportunity to influence product design and communication.
Small businesses have much more room for manoeuvre, as they can chop and change, test and experiment without affecting a large volume of customers. Very frequently, small companies manage their customers through a single channel, handling social interactions, marketing efforts, customer service and many other activities in one place. They use mishaps as a marketing opportunity and dispatch little gifts and samples to “compensate” customers. Customer service is clearly being used as a marketing tool.
Whilst larger operators are busy leveraging their social media reach by pushing multitudes of promotions, special offers, coupons, vouchers and deals, small businesses can build a long-term advantage by establishing close-knit communities of customers. Positioning customer service at the heart of the marketing strategy contributes to the exchange of ideas and the resolution of problems whilst creating a platform for future recommendations.
All this contributes to the development of a very strong sense of loyalty.
The challenge comes when the business grows and someone makes the suggestion that life would be much easier if dedicated marketing and customer service teams were established…it will be hard but just make sure you resist the temptation.
Guest blog by Very Good Service.
Read more in our dedicated section about customer service.
I have been thinking about the brands we love and how to improve customer retention. Let me tell you a couple of stories.
Three years ago, I took delivery of a car and on the way home it literally died. I did not see the car again for four months. However, the gentleman who looked after my “case” was exceptional. He updated me regularly, kept me totally informed on progress and made a bad situation OK. The car firm also sent me a range of well thought-out sorry gifts that were actually appropriate and of suitable value. I am now very loyal to this brand and I have a good opinion of them.
The other day, my wife and I were chatting about Clark Plc expenditure. We had decided to tighten the belt in a few areas and Sky TV was first on the list. With three kids of different ages, all of us have different viewing requirements ranging from football, Disney and South Park to Grey’s Anatomy. We currently have the full Sky package. It was going to be challenging to cut back.
In fact, my wife had a very, very good experience with Sky TV. The man on the phone listened and came up with a superb idea that was appropriate to the situation and our request. It was surprising and well delivered. To be frank I think we were expecting a bit of a challenge. It was the opposite. So now I have a great opinion of Sky, Clark Plc has the viewing requirements sorted and I will tell people about the positive experience.
So this got me thinking about two things: why we become loyal to certain brands and how businesses can improve customer retention.
In order to establish a loyalty scheme of any kind we need to establish who it is we actually want to reward and what it is we want to reward them for. If our most valuable customers are 100 per cent loyal to us then do we give them rewards just for being there, or do we concentrate on making the less valuable customers more valuable? We must ensure that we are adding value to our business and not simply creating a discount scheme.
Defining our objectives needs to be the first step – are we looking to reward behaviours that are good for our business, such as a customer spending more within a certain time frame, for instance?
We then need to understand our audience segments. Customers are all different and treating them as one entity means that we may be missing the main motivational factors for some of them.
After we have segmented the audience we need to look at who is the most valuable to us and why – is it the segment that makes up the highest proportion of our base? Those who spend the most? Those who are the least hassle? Or those who we feel we might be in danger of losing soon? How do these customers stack up against our objectives?
Having understood who our customers are, we need to understand their motivations – this allows us to be relevant. What do they value most?
We are a business, so we also need to understand our own motivations – what would we like our customers to do? Spend more? Stay with us long-term? Again, we need to look at this against our objectives.
Adding all this up we can see who we should be targeting, what we want to encourage them to do and what is going to motivate them. Our aim is to identify positive behaviours we want to reward and habits we can seek to change in order to make our business more profitable.
In an environment where winning new customers will get harder, it is more vital then ever before that we cherish our current customers. Some are happy, some are apathetic and some may be disappointed. As spring approaches it would be wise to look over your customer base and reward them, tackling any issues with empathy and understanding. We do long for loyalty from them; let’s give them some reasons to love us and importantly to tell their friends and associates about the great experience they have had with you.
Losing weight, giving up smoking, getting a better education, getting a better job. Some people only need it. Others really want it.
And so it is with customer service. Some organisations really need to give better service. Their customers are telling them so, their employees are telling them so and their profits are probably telling them so. But for whatever reason, they don’t want to give better service.
And then there are those who really want it. Those organisations that recognise the importance of listening to their customers, creating a culture with high levels of employee engagement and building their bottom line and their goodwill.
If you want to experience great service, go to an organisation that wants to serve you, where the people are empowered and encouraged to delight you. Very often these organisations don’t need big budgets for advertising or recruitment or training. I’ve never seen a single advertisement for Pret A Manger yet their service is outstanding and their business has grown rapidly from humble beginnings in 1986.
It starts with leadership, with a vision, the ability to communicate that vision and the strength to look for long term growth rather than short term profits. You can feel the leadership running through the organisation like the word Blackpool in a stick of rock. I feel Julian Richer’s influence at Richer Sounds, John and James Timpson at Timpson shoe bars, Richard Branson at Virgin Atlantic and Charles Dunstone at Carphone Warehouse.
You don’t have to be big. You don’t have to be small. But remember that a big business is just a small business that did the right things.
Think lifetime value. When a customer comes in for a USB stick, for instance, think what their lifetime value might be — a computer every two years, plus printers, and cables and inks and paper and servicing and broadband, for them, for their family, for their business. Cock up on the £10 sale and you lose that lifetime value for your lifetime.
We do not say “thank you” enough.
Therefore we take people for granted. If people feel taken for granted they become less loyal. Is that what you want?
I don’t know why people don’t say “thank you” so much these days. Maybe it just isn’t cool to be seen to be thankful.
Maybe it shows vulnerability or frailty to acknowledge that you are grateful.
Or maybe the problem is that most words lose their value and their currency with over-use ("nice", "pro-active", "strategy" to name but a few).
Turning the situation around, I am constantly aware of how certain people seem almost incapable of saying "thank you". Why would that be? Maybe they aren’t grateful(?); but their inability to acknowledge my action actually hurts me.
So, when did you last say (and mean) the words “thank you”?
Your kids, partner, staff, customers, suppliers will all appreciate a sincere "thank you".
The cynical may say that I am just trying to put a deposit in the emotional bank account (or some similar weasel words), but actually I think that it is just basic common courtesy to acknowledge when someone does something for you.
Thank you for reading my blog.
FACT: If you are the same as the rest then why should customers bother to buy from you?
SO WHAT?: Ignore the one-liner at your peril! Wake up and smell the coffee!
In a world where competition seems to be everywhere, you need to separate yourself from the rest.
FACT: If you compete on price, only the customer will win – in the end the company with the lowest prices (and biggest buying power) will get the business. This is no place for the timid.
SO WHAT?: If you try to be the same as the rest, a ‘me-too’ business, it is incredibly difficult to survive in the long run. After all, the only way you can differentiate yourself if several businesses are selling the same product will be on price. And if you differentiate yourself on price then it becomes inevitable that you enter a price war – customers will chase the cheapest prices – those businesses with the biggest market share (and economies of scale) will be able to command better prices from their suppliers. As a result, these competitors will be able to pass on those savings to customers while maintaining healthier profit margins than their competition. You will end up cutting your profit margins, probably until you go out of business.
Legendary, remarkable customer service will be your secret weapon.
I have spent my whole working life in the business world. Before creating Ecademy in 1998, I was sales and marketing director of a computer distributor. I worked for an entrepreneurial managing director and he had an excellent hold on the value of a customer to our relatively small company. We won respect and loyalty in a very competitive market by truly seeing the value of each of our 6,000 customers.
An interesting learning curve for me was that my ‘boss’ also gave me the responsibility for customer service. He felt the outcome and quality of that department were intrinsically linked to sales and marketing - and of course he was right. However, his beliefs and foresight are only just beginning to be vindicated now that consumers and businesses have a loud voice on the Internet.
In 2010, I see many opportunities for businesses to have an impact on the relationship they have with their customers. One area I am fascinated by is the relationship that will have to be formed between the customer service and marketing departments.
In a recent study carried out by CPP Group, they investigated what constitutes bad customer service and how consumers are by no means shy about telling their friends and family about their experiences. In this study they saw a growing trend toward utilising social media to share frustrations rather than telephoning or writing to the ‘offending’ company directly. A shocking set of statistics were:
“…. young adults under the age of 35 could do the most damage to an organisation’s reputation as they are most likely to talk about poor customer service online. Nearly three in ten (28.6%) of 16-24 year olds and two in ten (19.2%) 25-34 year olds would specifically use Facebook, versus only 2.7% of consumers aged 45-54 years old; highlighting the persuasive influence of this single website”.
Source: CPP Group Plc survey – October 09 (CPP White paper on Customer Service)
The use of social media by the under 35’s begs the question ‘What are companies doing to actively seek out the conversations online that can destroy a brand?’
I believe the opportunities and threats that have emerged for companies and brands within the conversations inside social networks will continue to rise at an unprecedented speed. We are only at the cusp of the use of these social networks, with the use of mobile devices only just beginning to integrate social networking into their functionality, and the utilisation of these sites by the mass to vent their frustrations.
In 2010 we will see growing use of mobile interaction with social networks. Through this avenue, consumers will create a much larger demand for high levels of customer service. The ability to spontaneously vent frustration at the exact moment of disappointment will capture irrational, gut-felt emotions in real-time. This will require a rush to get to the ‘disrupted’ customer before their conversations become viral and damaging. Speed of feedback and use of sophisticated search mechanisms to find these conversations will be critical. Microsoft have launched their new search engine, Bing, now indexing Twitter conversations, and Google will follow. Ths is an indication of the desire to seek conversations and be part of them fast.
Customer service will become a game of ‘hunting out the customer’s emotions’, not just waiting for them to call and complain. At this point the customer service team will need to become pro-active rather than reactive. I predict that the customer service team will have as much influence on the marketing and belief in a brand as the marketing teams do.