17 Ways to Build Customer Loyalty Through CRM

7/31/2019 17 Ways to Build Customer Loyalty Through CRM

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17 Ways to Build Customer

Loyalty through CRM


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1. Bond with the customer early

First impressions create expectations, andexpectations die hard. Prospects making theirfirst contact with your company should

immediately decide that they are in the rightplace. A few glitches later on in therelationship will be brushed aside asexceptions to the rule that the customer has

invented.


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2. All customers are not created equal.

Some customers value relationships and personal

interactions. They want to be known and

valued on a personal level. Others value

efficiency, cost and time savings. Still others

value comfort and avoiding pain at all costs.

The sooner you can discover what a customer

values, the sooner you can deliver it and buildloyalty.


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3. Convey your company's value

proposition in everything you do.

All of your interactions with customers must

answer two questions: What do they really buy

from my company, and why should they buy it

from my company instead of a competitor?

Customers who are reminded of your

business's value remain loyal.


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4. Do more than make your point.

You must also communicate in ways to whichyour customer is receptive. Some customerslike phone calls, while others dont want to be

bothered. Some customers prefer email, whileothers are drowning in it. Some customerswant just the facts, while others enjoy someentertainment, too. Dont forget that

communication is a two-way street. Providemultiple channels for customers to deliver theirfeedback.


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5. Know why customers leave.

Good CRM shines a spotlight on customer

departures, searching for ways toimprove and problems to fix.


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6. Measure everything.

If your company measures something, chances

are it can improve it. Measure customer-

contact frequency, referrals, contact-to-sale

conversion rates, contacts per month, customer

satisfaction as revealed by surveys, and every

metric that you can think of that has a bearingon your business.
http://www.insidecrm.com/features/crm-metrics-111207/http://www.insidecrm.com/features/crm-metrics-111207/


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7. Always ask for referrals. Companies aresupposed to manage the relationship with the

customer. But too often, companies let customers

manage it by leaving the timing of referrals up to

them.

8. Make loyalty-building a team effort. Everyone

from the receptionist to the delivery person is

responsible for nurturing customer loyalty. It isimportant to convey that message to everyone in your

organization and teach them how to contribute.


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9. Meet customers' expectations. Failed expectations

lead to customer dissatisfaction. Most often,customers feel let down in the area ofcustomerservice, not product quality. You must know yourcustomers expectations and improve your business's

processes in order to meet them.

10. Go beyond rewards programs. A discount maybuy sales as long as it is in effect, but it wont buy

loyalty. The same is true of rewards programs.Customers remain loyal to a company that is alwaysimproving and growing.
http://www.insidecrm.com/features/entrepreneur-customer-service-toolbox-102407/http://www.insidecrm.com/features/entrepreneur-customer-service-toolbox-102407/http://www.insidecrm.com/features/entrepreneur-customer-service-toolbox-102407/http://www.insidecrm.com/features/entrepreneur-customer-service-toolbox-102407/


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11. Turn complaints into opportunities as quickly aspossible. Studies show that customers tend to become more

loyal when their complaints are handled immediately andeffectively.

12. Engage customers in a two-way dialogue. Create a peerrelationship with customers by admitting where your company

needs to improve and enlisting their help to solve theproblems. A customer who makes such investments in acompany is more loyal than one who does not.

13. Build opportunities for repeat business. That sounds

simple, but many businesses are based upon occasional salesand lack other products that can generate additional revenue.


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14. Survey customers, and pay

attention to the responses.

Survey research can be used to identify or

solve problems. Keep surveys simple,

unbiased and short. Questions with simple

answer choices such as agree/disagree or

satisfied/unsatisfied deliver quantitative

responses that your business can measure. You

may want to consult with a professional surveydesigner in order to craft an effective survey.
http://www.insidecrm.com/features/4-questions-020708/http://www.insidecrm.com/features/4-questions-020708/


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15. Create a system for collecting, analyzing and

acting upon all customer feedback.EFM(Enterprise Feedback Management) is more than justcollecting data; its aim is to build a dialogue withcustomers. Technology exists to systematize the

collection, analysis and use of customer feedback.

16. Tie customer loyalty to expected businessoutcomes. Determine whether to measure your

engagement programs outcome in terms of customersatisfaction, likelihood to purchase again or anothermetric.
http://www.insidecrm.com/features/15-crm-innovations-2007-121907/http://www.insidecrm.com/features/15-crm-innovations-2007-121907/


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17. Use analytics to predict future

loyalty.

The measurements taken in your company's

surveys and engagement program can be

analyzed statistically to predict the likelihood

that a customer will continue to buy or refer

new customers. Predictive analysis can also

correlate customer loyalty to profitability and

other expected business outcomes.

Ni P i i l


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Nine Principles

Of

CRM Give customers what they expect. Satisfaction is the

difference between customer expectations and actual servicedelivery. Know your customers' expectations and be

prepared to evolve your product or service to meet them.This is basic business 101, but often it is ignored.Fundamentally, business needs to be a balanced transactionwhere someone pays for something and expects a fair tradein return.

Expectations of product quality come from many sources,including previous quality levels set by your organization,value propositions set in the competitive landscape andimpressions in the media.


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Turn complaints into opportunities. Managing questions,

comments and concerns benefits your business in twoimportant ways. First, research indicates that an upsetcustomer whose problem is addressed with swiftness andcertainty can be turned into a highly loyal customer. Second,unstructured feedback, gathered and managed appropriately,

can be a rich source of ideas. Establish channels (electronic, phone, written) to build engagement

one customer at a time.

Encourage customers to voice their thoughts.

Create metrics to improve response to concerns ("time to first

response," "time to resolution"). Create metrics to measure loyalty before and after the problem.

Use technology to help you centralize the information, create reportsand structure drill-downs.


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Go beyond simple reward programs.

Points and rewards encourage repeat

purchases but don't actually build loyalty.

This is demonstrated by a drop in sales when

the rewards are no longer offered. Trueloyalty comes when customers purchase

products without being bribed.


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Engage customers in a two-way dialog. An engaged customer is morethan satisfied and more than loyal. They go out of their way to showtheir association with your company. They also support you during bothgood and bad times because they believe what you have to offer issuperior to others.

Engagement takes your customer beyond passive loyalty to become anactive participant and promoter of your product. Engaged customers willgive you more feedback -- and you should be ready to handle it. All thistranslates into a customer who will spend more money with you over

time. Listen to customer feedback from comment cards, letters, phone calls and

surveys.

Respond quickly and personally to concerns of high interest to yourcustomers.

Organize unstructured feedback for tracking and trending over time.

Trust your customers to tell you what the problem is. Use statistical techniques to discover which action items will have the most

impact on your business outcomes.


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Build opportunities for repeat business. Give

your customers a chance to be loyal by offeringproducts for repeat business.

Monitor what customers request most and offerproducts or services that compliment otherpurchases. In addition, exceed expectations bydriving product development to offer more valuefor less cost. Use technology to track, classify andcategorize open-ended feedback.

Be acutely responsive to customer questions,

comments and complaints. Often, these are yourmost loyal customers. If you resolve a complaintquickly, you can actually grow loyalty and drivemore business.


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Survey customers and solicit feedback. Actively solicitinginformation from a population of customers is a time-tested

technique pioneered by Arthur Nielsen (creator of theNielsen ratings) in the 1920s. Survey research can be usedfor problem identification or problem solving. Questionswith simple scales such as "agree/disagree" or"satisfied/unsatisfied" deliver quantitative insight forproblem identification. Open-ended follow-up questionsprovide rich insight for problem solving. Professionalservices are available to help you with proper survey design.

Make sure your surveys are short, bias-free and well structured.

Use random sampling to gather feedback continuously without over-surveying.

Create summary survey indices that can be displayed graphically andtracked over time.


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Create a centralized system for managing feedback

throughout the enterprise. Technology such as EnterpriseFeedback Management (EFM) helps to centralize surveysand customer feedback and track both qualitative andquantitative information. EFM is more than just collectingdata. It adopts a strategic approach to building dialogs withyour customers. Through technology, your company cancreate a structured, searchable and quantifiable body ofinformation that can be used to drive critical businessdecisions.

Empower customers to give feedback through common advertisedchannels.

Centralize reporting for proactive surveys and complaintmanagement solutions.

Structure quantitative feedback into a drill-down or rollup report.

Make open-ended feedback intuitively searchable.


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Tie customer loyalty and engagement to business outcomes.Orienting your organization to focus on satisfaction, loyalty andengagement is no panacea. However, researchers have clearlydocumented evidence of short-term benefits to customer/employeeretention and long-term benefits to profitability. In the modern economiclandscape, loyal customers give your organization a huge competitiveadvantage.

Determine whether to measure your engagement outcome by satisfaction,

likelihood to purchase again, likelihood to recommend, or another voice ofthe customer (VOC) metric.

Create hybrid VOC measurements using more than one metric if necessary.

Link your VOC metrics with business outcomes like shareholder returns,annual sales growth, gross margin, market share, cash flows, Tobin's Q,customer churn or employee turnover.

Be aware that changes in loyalty/engagement scores generally precede

changes in business outcomes (typically by 45-60 days).


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Use analysis to predict future loyalty. Businesses use avariety of statistical techniques to make predictions about

the potential for future events. Furthermore, predictiveanalytics may be used to ascertain the degree to whichanswers from a survey relate to particular goals (such asloyalty and engagement). Tactical knowledge of how actionitems impact an outcome discourages the wasting ofresources on ineffective programs, and competent statisticalmodeling reveals the insight of which tactical options havethe most impact.

Analyze data using a statistical technique to reveal the mostimportant areas of focus.

Ask your analyst about common statistical methods including

correlation, multiple regression, factor analysis and logic models. Recognize that the important areas of focus may change over time to

respond with changes in the economic, competitive and demographicenvironment of your business.


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17 Ways to Build Customer Loyalty Through CRM