INVESTING IN THE CUSTOMER RETENTION PROCESSES AND 2013 …files.ctctcdn.com/d03acf35001/82fbb6d8-122d-4527-bbaf-4b... · 2015-08-02 · By truly knowing what customers want and NEED

INVESTING IN THE CUSTOMER RETENTION PROCESSES AND 2013 BEST PRACTICES

Sherry Redden Evans

Customer Service 101

Evans Consulting Group

Meeting Purpose:

To provide successful customer retention strategies and best practices.

Learn how to develop a customer retention program that fits your organization’s needs and also shows your customers that you value their business.

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Customer Acquisition and Retention

As brands become increasingly similar and

competition fiercer, keeping and expanding customer relationships depends on the ability to deliver a customer experience tailored to changing customer needs and values and consistent with the brand promise.

With customer trust eroding and purchase behaviors growing harder to predict—mastering this ability has become even more critical to staying relevant, competitive and profitable.


What will separate the best from the rest? To survive and thrive in today’s

environment, many organizations should take a fresh look at their strategies and methods for retaining customers—

And… if necessary renew their commitment to the customer.

It will take more than a “smile” to retain your customers! Think EASE of Business!


It Is A Fact…

It costs much more to attract new customers than it does to keep existing customers, right?

Each customer interface that occurs over the lifecycle of the customer's business relationship with your organization defines how your organization is perceived and has a major impact on the bottom line.


Why Invest in Customer Retention? The IMPACT on the Bottom Line. (It’s not rocket science)

It costs 7-10 times more to recruit a new customer than

to keep an existing one.

A gain in customer loyalty of only 5% CAN lift lifetime

profits per customer by as much as 95%

An increase in loyalty of just 2% is, in some sectors,

equivalent to a 10% cost reduction.


Best Practices Research… Exceeding expectations – moderate impact? Think EASE of Doing Business!

1. Exceeding customer expectations had a

moderate impact on loyalty.

2. Satisfaction does not predict loyalty.

3. Reducing effort has the greatest impact on loyalty.

This is a call center-focused survey, but the key points are applicable to any organization…

* Source: Am I GREAT at Customer Service? By Ed Gagnon

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Consumer Reports Survey Face to Face Asked 1,010 adults about their customer-service experiences.

64 percent of respondents said they have left a store because

of poor customer service.

65 percent in-store customer

gripes were rude and pushy

salespeople.

Customers were least annoyed having to wait in a long line at the checkout counter or wait for a scheduled repair.


CUSTOMER SERVICE OVER THE PHONE 71 percent of respondents were most annoyed about the experience when they weren't able to reach a human on the phone.

67 percent hung up the phone without getting their issue resolved.

However, when asked about preference for handling a customer service issue, only 16 percent said they prefer to resolve the issue in person.

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THE BEST & THE WORST COMPANIES Service Delivery The best and worst companies and service providers in 21 industries.

According to the findings, brokerage firms, eyeglass retailers and pharmacies were some of the highest-rated

Computer tech support, TV, phone and Internet service providers earned some of the lowest scores.


Loyalty Principles (each part represents the whole)

Know What to Look For Think EASE of Doing Business…

Most companies know a lot about their customers,

and comparatively little about the factors influencing acquisition and retention.

Achieving high performance in customer retention means aligning activities throughout the relationship with the TOTAL customer experience.


View the Entire Value Chain. Still Think EASE of Doing Business!

Third-party channels and routes to market also affect customer loyalty

and can destroy their loyalty unless they are managed effectively

all dimensions of the customer experience—should include all the trading partners who contribute to the customer experience.


Know What to Measure

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Companies often measure the wrong things when trying to measure customer profitability and loyalty

Loyalty indicators are far more involved than customer satisfaction scores

Establishing and managing cross-functional key performance indicators throughout the customer lifecycle helps prevent the loss of current and potential customer value

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Delivering a Differentiated Experience. It is STILL About Perception… BUT IT IS STILL ABOUT EASE OF BUSINESES!

Customers tend to have distinct preferences regarding

multiple factors that shape their perceptions of

and satisfaction with the experience: product functionality

price and service terms

variety and availability

Understanding and addressing all these preferences

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Develop and retain profitable customer relationships by creating differentiated, customer-centric experiences

Know the customer

Reach the customer

Deliver the experience

AND MAKE IT EASY!


CUSTOMER CENTRIC CULTURE


WHAT DOES CUSTOMER CENTRIC CULTURE MEAN?

Creating a customer centric culture is all about understanding your brand value and delivering it consistently to customers. This does not mean doing everything customers

want.

It means focusing on what they value most, in line with your overall business strategy and brand promise.


How to create a customer centric culture

1. Have a clear, customer-centered vision

2. Know your customers’ needs and expectations

3. Clearly communicate the importance of customer centric behavior to every employee

4. Make every business decision in alignment with the vision


A New Mindset

Changing the corporate mindset is an

important step.

A different approach

VS - “How do we keep customers from going to someone else?”

A more useful perspective casts the issue as a

positive: “How do we get customers to want us more than the alternatives?”


SEE THINGS DIFFERENTLY – TAKE A NEW LOOK AT THE PROCESS… IT’S OK TO MAKE CHANGES, RIGHT?


Know What YOUR Customers Want & MUST HAVE!

By truly knowing what customers want and NEED today, companies create a better basis for determining needs, predicting future behavior and shaping customer experiences accordingly.

This cannot be accomplished with a customer survey!

VISIT your customer find out what they want from your organization and how they FEEL (perceive) you.


Don’t Confuse Loyalty with Satisfaction Satisfaction can be an easy thing to

measure, but is seldom a reliable predictor of loyalty...

And SURVEYS alone ARE usually based around a negative experience….

Customer Service Today is a LOT More Than a Smile and Being Nice.

Think EASE of Doing Business … that equals an empowered front line!


Assess Task Popularity & Complexity Of Customer Touch Points

It is also a best practice to create a classification of all transaction types.

This makes it easier to track the trends of task popularity across different customer touch-points.

Example: If paying bills can be done on your web site and your IVR system, and of course by speaking to an agent

And it is valuable to observe the shift from one customer touch-point to the other based on incremental improvements made in each area.


Five Best Practices to Building a Customer Retention Program 1. Establish a baseline for current average retention.

Examine your customer base to understand average retention.

Do it by customer segment if possible.

2. Understand the timeline to customer profitability.

Every business has different acquisition and services costs. If you don't know how long it takes for a new customer to become profitable, you need to figure it out.


Five Best Practices to Understanding Customer Retention 3. Set a target retention rate.

The longer it takes to become profitable, the higher the retention rate needs to be.

Establishing and monitoring a retention KPI will tie retention directly to business performance.

4. Define marketing tactics to improve retention. If current retention isn't at the target level, set improving retention

as a key business objective and drill down into a series of tactics aimed at moving the needle. Don't shoot in the dark though.

Then, establish marketing and customer service practices and campaigns that specifically focus on encouraging the factors that are correlated with long-term customers.


5. Measure results consistently.

Periodically, reevaluate the retention rate to see how what you are doing impacts customer retention.

Make sure you consider metrics that help you tweak your programs at a tactical level, too. Specifically, are the procedures you've implemented really encouraging those factors that correlate with long-term customers?

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Five Best Practices to Understanding Customer Retention

Prepared by Sherry Redden Evans - Evans Consulting Group 5/23/2013

Survey Example of Customer Expectations

Customer Expectations Your Business Needs

Easy to do business with

Quality Stand by the product (for returns)

First call resolution

No transfers or told I can’t help you

Opt out option via the IVR to speak with a live

person

Knowledgeable, friendly staff

Answer call quickly / little or no hold time / if

have to hold have option to be called back or

tell me how long hold time will be

Keep your promises

Fair Price

Identify Customer Expectations VS Reality of what can be accomplished.

and what are the roadblocks and cost of implementation

and the cost (consequences) of not implementing.

Identify customer expectations by customer segment –

And per product or service


Market Your Customer Retention Program!

Understand how customer touch points set the tone of the experience and how service skills and accurate processes are an fundamental part of the process.

Market the service experience to obtain intradepartmental buy-in and share budget expenses!


Documents

INVESTING IN THE CUSTOMER RETENTION PROCESSES AND 2013 …files.ctctcdn.com/d03acf35001/82fbb6d8-122d-4527-bbaf-4b... · 2015-08-02 · By truly knowing what customers want and NEED