Editor’s note: Geoff Ables, Principal Consultant for Customer Connect, recently spoke at the National Center for Database Marketing Conference. This Guest Opinion is based on his address.The No. 1 way to retain customers is by listening to their needs and finding a way to exceed their expectations.
It is tempting to over-complicate the process of listening to customers in a midsized or large enterprise. But there are simple and cost-effective steps that any company can take to maximize results and minimize risk.
The first step is gathering information. This happens in many ways, but most companies don’t store and retain the information in ways that make it easy to sort through the information and find the useful gems. At a minimum, you want to be able to link specific customers to transactions in order to look for patterns. It’s even better if you can segment customers and look for trends within their transactions. When your data is good, you can begin to use those patterns and trends to predict future behavior.
Information that leads to actionable knowledge falls into categories that can be readily prioritized. Some of those categories include:
Once you have gathered information, the next step is to mine it. That can be as simple as looking at how one customer’s sales compare from one year to another. Or, it can involve complex mathematical analysis involving many variables. Regardless of whether you use simple or advanced methods, never forget that the result must be information you can use to drive your own business decision-making. You want to be better prepared to analyze the market and make high-level, quick responses.
If a company lost 10 percent of its inventory, it would react quickly. But if it lost 10 percent of its customers–it probably wouldn’t even notice.
Is that true at your business?
One overlooked area of customer relationship marketing (CRM) is looking at people who aren’t even your customers…anymore. Think of it as the CRM version of an exit interview for a departing employee. Why did the customer choose to go elsewhere? Did the competing firm really offer a unique product or superior service? Or did you just forget to let the customer know you cared?
Understanding why customers leave is just as important as knowing why some stay and why new customers come.
Once you have data, figure out how to customize your information. Start with basics such as name, address, ZIP code or area code, method of purchase, order volume, etc. Then look for ways to add more specific information, to learn more about how your business does business. For example, do you understand your delivery channels as well as you think you do?
Quick, how many customer contacts do you have each month through each channel (direct mail, phone order, on-site, online, etc.)? How much does it cost to supply an order through each channel? Which channel is most profitable? How much unused volume do you have in each channel? How much revenue can you drive through each channel? Can you successfully integrate your channels so that you are touching your customer through all of the methods you have at your disposal and creating a 360-degree experience?
When you are customizing your data, don’t forget to add in results of satisfaction surveys (you do those…right?), as well as follow-up data on concerns, complaints and questions. Ideally, to have a true picture of your customer relationships, each service customer should be surveyed within 24 hours of each service delivery. Those responses should be captured, tracked and trended, and a personalized response (also captured) should be made by a service manager. This is especially important for dissatisfied customers, who are soon-to-be ex-customers.
You can use your CRM information to measure the results of a marketing campaign and determine effectiveness. Before you start, ask yourself some questions:
Once you have a CRM in place, you need to use it throughout the marketing cycle to improve customer interaction and expand your understanding of each customer’s needs.
If all this sounds expensive, think of the cost of losing customers. “If the moola you spend on marketing isn’t growing your business and bringing in more moola in return, then you have marketing that–.sucks,” says Mark Stevens (from his book, “Your Marketing Sucks”)
Geoff Ables is Principal Consultant for Customer Connect, which provides CRM planning services and implementation of customer management campaigns, technologies, and analysis. He can be reached at firstname.lastname@example.org or 704-892-2633.