Sorry it’s been too long since our last post but we have been busy doing seminars. We hope to update our blog a little more frequently.
I was on linked in yesterday and saw a discussion started with a question on what are people using as attributes to enhance their “Customer Loyalty Strategy”. I was a little surprised by some of the responses. The idea of customer loyalty seems to be some card you keep on your key chain or a reward you give your employee for taking care of a customer. From the responses I read I have come to the conclusion that these programs are not too successful. That should come as no surprise!
Customer Loyalty is not today’s program in hopes of driving repeat business. Customer Loyalty is the ability of your employees to make that emotional connection with a customer. So how do we define an emotional connection? An emotional connection is different for every individual. It is the connection with a customer that is deeper than just meeting the expectation. That is what the competition does. It’s going beyond that! So how do you teach it? You can’t! It’s a development process that starts with the culture of your business. It starts with the business owner and trickles down to all the employees.
An example of that emotional connection can be a visit to a restaurant. You can go to the restaurant have a quality meal,pay a fair price and leave without a bad experience. The restaurant was successful satisfying you, nothing more,nothing less. Will that experience drive you back for a future visit? Maybe. Let’s say you go to that same restaurant and you run into a server that is really good with people. Starts up a conversation makes you feel relaxed,recommends an exceptional meal, the complete experience is beyond belief. When you’re on your way out the door getting in your car you just say to yourself, WOW! That is what drives customer loyalty!
The next time you make a decision of where to dine where do you think you are going? Back to the same restaurant and you’ll probably ask for the same server! That is how you can get a Loyalty Strategy in your business. Loyalty is built by having a Loyalty strategy built in your Strategic Plan, a Loyalty Strategy within your leadership, A Loyalty process and Loyal employees. When looking at your business these all need to be developed and implemented.
Why should a business owner pay so much attention to developing this strategy? According to Fred Reichold author of “The Ultimate Question,” a 5% improvement in customer retention can improve profits up to 100%. The best way to improve customer retention is by developing a Loyalty Strategy.
Loyalty Solutions is getting ready to launch Customer Loyalty Seminars in June. We’ll have more information to follow. If you would like to get more details feel free to contact either Bill Griffith at firstname.lastname@example.org or Jeff Johnstone at email@example.com or Ocie Irons at firstname.lastname@example.org.
You have probably heard that most buying decisions are not based on a need but rather on an emotion. Most people can get to their destinations in a Chevrolet just as easily as they can in a Mercedes. They need transportation from Point A to Point B. But an emotion (pride, for example) would motivate a rising executive to purchase a Mercedes which might make a statement about her status in life. And, recognizing this, the Mercedes dealer dealership has policies and processes that focus on satisfying their customer’s need to satisfy that pride. This requires that they know the customer…understand her motivations…meet and surpass her expectations. But it also requires that the dealership management communicates that creating and maintaining an emotional connection is of high importance.
My associates and I recently completed a customer loyalty seminar in which we discussed the difference between customer loyalty and customer satisfaction. A loyal customer is more likely to:
o Return to your business without the need for incentives
o Refer your business via word of mouth
o Are willing to pay more for your product/service
o Are more forgiving of your company’s errors
A satisfied customer, on the other hand, will be more likely to change companies or products to take advantage of a sale, coupon, or some other incentive. A company has only met the expectations of its satisfied customers. In particular, the company/product/service has met the customer’s minimum requirements.
You might be satisfied flying ABC Airlines. Its flights served the markets that you wanted to travel between. ABC Airlines got you to your destination safely and on time. Your knees were sore from being pressed up against the back of the seat in front of you but then again, at 6’5” tall you have gotten used to that. ABC met your expectations. But for the mere price of more frequent flyer points or a free car rental you might choose XYZ Air for your next trip. What would be an emotional connection that would cause you to be loyal to ABC? Consider the story I recently saw from Time.com (http://bit.ly/ehyBhB). To summarize, a passenger trying to make a flight connection in order to attend the funeral of a family member was clearly running late. He was going to miss the connecting flight as a result of circumstances beyond his control. The pilot of that connecting flight learned of his situation and held the flight for him. The grieving passenger, expecting to miss the connector and thus the funeral, was obviously grateful. We can assume the pilot empathized with the passenger and that the stressed traveler had his expectations exceeded. I think it is also a fair bet that if that airline serves the routes this passenger travels in the future, he is going to fly with them. So the airline likely established an emotional connection with this customer during this interaction with the pilot who waited for him. An emotional connection was created.
The article uses the word hero to describe the empathetic pilot. It mentions the risk he took of angering waiting passengers or running afoul of airline performance standards. I do not think his risk was especially high though. And I don’t mean any disrespect in saying this. I believe that the airline has created an environment in which loyal employees feel empowered to create memorable customer interactions. They pay attention to the customers’ needs and emotions…and their own. And in the process they create emotional connections resulting in a reputation for high customer service and loyalty. They have institutionalized a set of values and a corporate vision that makes the pilots action less risky. The company set strategies designed to focus on meeting customer needs and exceeding expectations. At critical points of connection the airline’s customers experience memorable interactions. They have created a strategy designed to generate loyal customers.
If you are interested in learning more about how your organization might benefit from a customer loyalty strategy please contact us.
Ocie Irons / email@example.com / (248) 231-2210
Bill Griffith / firstname.lastname@example.org / (586) 431-9311
Jeff Johnston / email@example.com / (248) 891-1560
Key Measurements for Building a Loyal Customer Base
January 11, 2011
How Do You Measure Customer Loyalty?
This two-hour workshop focuses on:
How does your organization measure Customer Loyalty?
Why is it important to know your Loyalty Factor Score?
What is your Loyalty Factor Score?
Why is it important to know your Employee Loyalty Score?
What is your Employee Loyalty Score?
Session 3 – The Power of Customer Loyalty – Points of Connection
Register for sessions 2 and 3 for $89!!!
Date: Tuesday, January 11
Time: 8:00am – 11:00am
Cost: $50 in advance
Location: Heritage Church
Sterling Heights, MI 48313
Space is Limited. RSVP Today!
Contact Bill Griffith:
Send Checks to:
WJG Business Concepts
Clinton Township, MI 48038
Starts: TuesdayMarch 15,2011, 08:00AM EDT
Ends: Tuesday March 15,2011 11:00AM EDT
Event Type: Training/Seminar
Location: Heritage Church
44625 Schoenherr Rd
Sterling Heights, MI 48313 US
Price: $50 in advance ($55 at the door)
Keywords: customer satisfaction, customer loyalty, business
Intended For: Business owners, Executives, General Manager, CEO, Director of Marketing, COO, Customer Service Manager
Organization: Loyalty Solutions
Developing a Customer Loyalty Strategy This workshop focuses on: Customer Satisfaction vs. Customer Loyalty, Perceived Value as defined by Customers, Why your company would want loyal customers, Customer Loyalty Strategy.
$50 in advance, $55 at the door. To register contact Bill Griffith at (586) 431-9311 or firstname.lastname@example.org.
Workshop presented by Loyalty Solutions, a collaborative effort of Goal Advantage, Ironbridge Development, and WJG Business Concepts
Creating customer loyalty must be, at least in part, related to having a customer’s experience with and of your organization be a positive one. What are those experiences and where do they happen for your customers? Are your counter personnel highly motivated and educated to provide outstanding service that “wows” your new and existing customers? Is your website easy to navigate? Does your shipper deliver your product undamaged, on time, all of the time? Each of these points-of-connection is an opportunity for your company to create a positive experience for your customers. They are opportunities for you to create loyal customers…or customers for your competitors.
I recently had occasion to look at my own interactions with an organization that I do business with. Someone asked if they should become a customer of this organization and, without hesitation, I said no. Now understand, I am currently a customer, and probably will be for some time. The organization’s business model dictates that unless I choose to throw money down the drain I will stick around. So they haven’t lost me as a customer, but they didn’t gain the person that sought my opinion. What did that cost the organization? And how many more times am I likely to dissuade someone from becoming a customer?
I became a detractor as a result of a succession of less-than-positive experiences that combined to color my overall opinion of this company. These experiences occurred at points-of-connection…the website, a phone call to the office, and reading the monthly invoice. I have to admit that the severity of one of the experiences created a halo effect that had me look for less than expected results with other experiences with this company. The website uses some pretty common navigation tools and methods but I found myself thinking there should really be a simpler way to get the information I wanted from the site. So I contact the company, explain my problem, and describe what I believed to be a reasonable solution. I was not thanked for being a customer or offering an improvement (regardless whether the suggestion is acted upon I think customer interaction of this type should be welcomed and acknowledged) and as far as I know nothing ever happened as a result of my call.
The delivery of service by this organization has been somewhat spotty. I have placed an order and gotten no response. No follow up. No return phone call. Nothing. My order, for all intents and purposes, disappeared. In addition to not having my order fulfilled, I spent valuable time seeking the service and placing the order. To add insult to injury I received my monthly invoice that clearly spells out my monthly fee.
The “final” straw occurred when I contacted the company to advise them of this experience. Rather than speaking to a person I was routed into voicemail. As there were no options to get to a live person, I left a message that has, as yet, not been acknowledged. So I am still a customer (member) but if not for money already tied up with this organization, I would have taken my business elsewhere. I am not what I would consider a loyal customer though I am and will continue to be a customer for some time. And I am certainly not a satisfied customer. Why? A combination of less-than-satisfactory experiences have combined to have me advise prospects of this company to not become customers. How many of your customers would refer their friends or acquaintances to your company? How many little experiences with your company erode your customer’s support and willingness to give you more of their business? Are you even conscious of the points-of-connection with your company…and the value they hold?
Any (and I do mean any) experience that your customers have that they associate with your company serve as points of connection. These points of connection are your company’s opportunity to create loyal customers. To the best of your ability you must know what those points of connection are and manage them so that customers have positive, referenceable experiences. Those experiences are critical to your creation of loyal customers and profits.
For information about how your organization or company can improve customer loyalty contact a Loyalty Solutions partner:
Bill Griffith / email@example.com / (586) 431-9311
Ocie Irons / firstname.lastname@example.org / (248) 231-2210
Jeff Johnston / email@example.com / (248) 891-1560
I was with some friends a couple of nights ago, I was telling them about some exciting seminars my partners and I are putting together to help businesses develop a Customer Loyalty culture at their place of business. As I was speaking of the seminars and some of the content I was asked if I was a C.R.M. (Customer Relations Manager) “Specialist”, to which I answered “Yes, I am.” As I was thinking of his question I began to ask myself, what qualifies anyone as a C.R.M. specialist?
The qualifications would be a person with extensive experience in customer relations, right? Don’t we all have experience in this field? We have all been customers many, many times. We have all developed relationships with local businesses and had unique experiences in dealing with those businesses. The most memorable relationships and business experiences stand out, causing us to return and to bring our friends. I would define a customer relations specialist as one who creates this unique experience consistently for customers and then earns their loyalty.
What is it that would have you recommend a place of business to your friends and family? And if you do what does “Customer Loyalty “mean to that business? In simple dollars and cents let’s take a look at the impact on the restaurant business. What would be the possible effect if your expectations were not only met but exceeded to the point of being delighted? If the restaurants average bill is $100.00 per couple and you visit that restaurant four times a year, (Birthdays, Anniversary, and one Miscellaneous visit) you would spend $ 400.00 per year. Simple, right? Over a ten year period you would spend $ 4000.00 with that restaurant.
Let’s take a look at the 10 people you have told of your experience at this great restaurant. If 5 of the ten try it and they have the same impression of their visit it is now their favorite restaurant and they visit as often as you do well… I’m sure you can see where this is going. The first impression being a lasting impression and Customer Loyalty being the culture of the restaurant we can see taking care of that one customer can lead to $ 24,000.00 of business plus it has continuous growth because your five friends are telling their five friends and so on.
Now that we have looked at the restaurant business look at your business. This formula applies to all business whether we’re manufacturing, selling homes and insurance, whatever your business is. It’s networking with immediate rewards. It’s absolutely imperative to follow the simple business philosophy to treat people the way you want to be treated. The positive economic impact is immediate and it’s long term.
So come on all you C.R.M. specialists out there, take a look at the inside of your business and start developing a Customer Loyalty culture in your business today! If you would like a free consultation you can give any of us at firstname.lastname@example.org a call or check out our websites.
The story of Steven Slater dominated the news for a few days recently. He is the JetBlue flight attendant who reportedly responded to a rude passenger with a torrent of publicly-delivered verbal abuse. He followed that up with an exit from the aircraft via the inflatable emergency ramp with beer in hand. I have since read that many passengers had no recollection of any altercation involving Slater. And one passenger vouched for his generally pleasant, bubbly disposition. Some are calling Mr. Slater a hero for telling off a rude passenger. Others deride him as unstable and out-of-control. My question has to do with the effect of Steven Slater’s actions on the experience of JetBlue’s customers.
Many companies seek to build reputations for delivering superior quality, outstanding customer service, or unique customer experiences. The ultimate goal is to grow revenues and profits through the creation of loyal customers. But what is a loyal customer and what are the key factors in creating one? A loyal customer is one who will do business with the company again and proactively refer the company to others. How does this differ from a satisfied customer and why is the distinction important? A satisfied customer generally has his/her expectations met. The customer will usually indicate that service wasn’t bad…but it wasn’t exceptional either.
The value of a loyal customer when compared to the satisfied customer is that she drives revenue growth and profitability for your company.
Studies have shown that acquiring customers is a costly endeavor. Having a customer base comprised largely of loyal customers infers lower costs and higher revenues. And thus the loyal customer is of greater value to a company than a satisfied one. But how do you create a loyal customer? The essence is creating an emotionally positive experience for customers every time they come into contact with the company. We know that most purchases are based on an emotional response. To hold that customer…earn their loyalty…the company must create positive emotional reactions from the customer at every point of connection. A high level of trust must be created, an emotional tie must be created, and empathy must be used to strengthen relationships.
Conventional wisdom says that loyalty is created by products that are highly differentiated, higher-end products where price is not a significant factor, products with a high service component, and multiple products for the same customer. Think Apple or Mercedes-Benz. A product/service orientation is important but I contend that the emotions are an equally important factor. It was critical in the original decision to purchase and it is just as important in the creation of a loyal customer.
So here is the connection to the Steven Slater event. Customer interactions are always experiences that generate an emotional response. At each point of connection with your company there is an opportunity to create an emotional bond that can lead to a loyal customer. Where that point of connection is manned by a human being he/she must know and respond appropriately to customer emotions and…know and control his/her own. If an employee is not self aware, cannot identify and manage his/her own emotions, what are the chances that he/she will be able to identify and respond to the emotions of your customers?
Regardless of the motivation or trigger for Mr. Slater’s actions I assert there was an emotional impact on the JetBlue customers. Depending on whether they were positive or not the passengers’ response to his behavior created a positive experience upon which to build a relationship of trust and loyalty…or not. Customer loyalty is created by exceeding customers’ expectations at every point of connection. Your employees’ ability to manage the emotions (theirs and the customers’) is a key factor in the process. Is your company looking to ensure growth and profitability through the creation of a loyal customer base?
Most automobile manufacturers engage in some type of customer feedback survey used to measure both the new car purchase and the service experience. As the Customer expectation levels increase the process of gathering data is changing. What for years has been the “Customer Satisfaction Index” is now evolving to the “Promoter Score” or some similar term is used to identify a loyal customer.
The Customer Loyalty score is derived from “The Net Promoter” a customer loyalty model developed by (and a registered trademark of) Fred Reichheld of the Bain and Company and Satmetrix. The model was written in the Harvard Business Review in 2003. The score is taken from basically one question to determine the chances of a customer moving from being just satisfied to an advocate of your business and a promoter. Using the Promoter model the rating scores will categorize a customer as either a Promoter, Neutralizer or a Diminisher.
As automobile dealerships begin using the model, the question becomes, are they using it to really measure the buying and service experience of their customers? Auto manufactures wrap huge dealer bonuses around the promoter scores. Dealer management pay plans and bonuses are in kind tied into the score. Any wonder why customers are coached on how to respond to the survey? Any wonder why you feel like you are treated differently than other service customer. Some vehicles are flagged as survey customers when they come in for service and receive a different process.
My question is if a segment of your customers are being coached for the responses, and service customer’s cars are being flagged as a survey customer, are the surveys really measuring your customer shopping experience? Can you really measure your dealership’s “Promoters” based on a survey to customers that have been shown or told how to answer the questions of the survey?
True “Customer Loyalty” is a measurement of your customer’s entire shopping experience and can be improved through the proper management of customer “Points of Connection.” Points of Connection are defined as any contact between your business and the customer. It can be a web site, a Yellow Pages ad, a telephone call to any department, the landscaping, the appearance of a Salespersons desk, the accuracy of the paperwork etc. Any point the customer comes into contact with your business is an opportunity to improve customer loyalty.
Understanding how to improve your business by using a real Customer Loyalty process that shows the methods of managing Points of Connection, gives a better understanding of what the customer perception really is and how to truly exceed expectation levels. Using this customer loyalty process will help develop the necessary tools to reduce employee turnover, increase sales ,and to increase profits. As we navigate through the most competitive times in history, successful businesses will be defined by their ability to manage their customer base. Peter Drucker states “The number one purpose of business is to attract and maintain customers.” The Customer Loyalty process has all of these goals ready to be achieved. For more information please contact.
Ocie Irons email@example.com
Measuring Your Customers
As a business owner or manager of business, have you measured your customers lately? Most of us have, but I would like to discuss what we measure about our customers and why we do it.
According to business expert, Peter Drucker; “The function of any business is to attract and maintain customers”. Without customers we cannot make a profit, we cannot be financially viable and we cannot serve our employees, families and community. Therefore, investing time in measuring the customer is important to any business. Remember, “You can’t manage what you don’t measure.”
Lets start with how many customers do you have. How many are active customers? Is the number of active customers increasing or is it decreasing each month? What is their return rate? With this customer data you can look through your marketing, advertising and networking expenses and know whether they are providing a reasonable return.
How much on average does an active customer spend with you per visit, per year? Are there any distinct groups? Are there groups that shop only the discounts or groups that purchase product or service from you regardless of price? How big are these groups? This customer information helps us predict business volume and manage staff, product/service mix and promotion accordingly. These measurables can be collected without interfacing directly with the customer.
The last but most beneficial customer measurement is loyalty. Loyal customers return regularly for your product or service. Loyal customers spend more per visit, are less price sensitive and less sensitive to minor hiccups. They enjoy the experience that your business provides and they make it a point to let others know. Data on this is harder to collect but it is possible if you learn how to ask. Fred Reichheld in his best selling book, “The Ultimate Question” talks about how to grow profits and revenues by measuring and managing your business to increase customer loyalty. Customers are asked, “How likely is it that you would recommend ABC Company to a friend or family member?” This question measures the customers overall experience dealing with your business and is also a predictor of future behavior. Those highly likely to recommend are your loyal customers. Your focus as an owner or manager is now to listen, learn and improve your business experience to earn more and more loyal customers. Remember, it all starts by measuring your Customers!
For further information please contact:
Bill Griffith firstname.lastname@example.org
Ocie Irons email@example.com
Jeff Johnston firstname.lastname@example.org