It's All About The ExperienceA blog about managing and improving customer experience and improving profits.https://rrassoicates.azurewebsites.net/Rons-Blog8 Innovative Ways to Improve Customer Retention Using Email https://rrassoicates.azurewebsites.net/Rons-Blog/PostId/31/8-innovative-ways-to-improve-customer-retention-using-email-or-notificationsBranding,Conversion Improvement,Customer Service,Digital Marketing,New Product Development,Product Management,Profit Improvement,Research,RetentionSun, 04 Feb 2024 16:01:27 GMT<p><meta name="uuid" content="uuidzcqdWG6dEMYn" /><meta charset="utf-8" /></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;">In digital marketing, email remains a stalwart for direct communication with customers. For marketers looking to retain and monetize an existing customer base, email can be an affordable, customizable mechanism for improving retention. This blog investigates eight inventive strategies where email drives customer loyalty with personalized&nbsp;messages that&nbsp;delight customers.</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;"><strong>A Personal Touch from an Online Retailing Giant: Amazon</strong></span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;">Have you ever received a &quot;Just for You&quot; email from Amazon? Using complex algorithms, Amazon crafts individualized product recommendations based on a customer&#39;s purchase history and browsing behavior. This personalized optimization encourages further purchasing and makes customers feel understood and valued, enhancing their loyalty to the brand (Ghelber, 2020).</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;"><strong>Exclusive Perks and Prestige: Sephora&#39;s Beauty Insider Program</strong></span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;">The way Sephora uses email to reinforce customer loyalty is unparalleled. Their Beauty Insider program members receive status upgrades, birthday gifts, and special access to deals&mdash;all communicated through personalized emails. These perks make members feel part of an exclusive community, building brand affinity and retention (<em>About Beauty Insider Loyalty Program | Sephora</em>, n.d.).</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;"><strong>A Screen-Full of Interest: Netflix&#39;s Show Updates and Recommendations</strong></span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;">Netflix&#39;s user engagement emails are a staple of its retention strategy. Emails entice subscribers to return to the platform with updates on shows they might enjoy, directly aligning content with their viewing behavior. These recommendations drive engagement and demonstrate a detailed understanding of each user&#39;s preferences, fostering loyalty (Io Digital Agency, 2024).</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;"><strong>The Soundtrack of Your Life: Spotify&#39;s Curated Playlists</strong></span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;">Understanding that music is a profoundly personal experience, Spotify offers curated playlists directly delivered to inboxes. Based on a user&#39;s taste and listening habits, these playlists function as personalized entertainment and offer a nudge to revisit the platform&mdash;providing a harmonious approach to customer retention through email (Anderson, 2024).</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;"><strong>Step into the Customer Service Hall of Fame: Zappos&#39; Follow-Up Emails</strong></span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;">Zappos is renowned for its customer service, and email plays a significant role. After a customer interacts with Zappos&#39; representatives, they receive a follow-up email ensuring all is well. This extra mile in customer care ensures a lasting positive impression is maintained even when things might not have gone perfectly (Sharpen Staff Writer, 2024).</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;"><strong>Write into Success: Grammarly&#39;s Progress Reports</strong></span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;">As a linguistic companion, Grammarly doesn&#39;t just fix language errors but also educates users with insights into their writing. Weekly emails with writing stats and personalized progress reports are educational and engaging. They instill a desire for improvement, measure how much the user uses Grammarly in their writing, and make users more likely to stay with the service (Reallygoodux &amp; Keen.io, 2023).</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;"><strong>Educate to Elevate: HubSpot&#39;s Helpful Content</strong></span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;">HubSpot&#39;s educational content emails are an underappreciated gem. By consistently providing value through blog posts, whitepapers, and webinars, HubSpot nurtures customer relationships beyond its platform. This act of &#39;giving before expecting&#39; is a powerful customer retention method that positions the brand as a source of knowledge (Storm, 2023).</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;"><strong>A Trip Down Memory Lane: Google Photos</strong></span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;">Google Photos is the default photo storage solution for Android phones. The Google Photo application stores photos in the cloud and then mines this database of photos to create collages of photos from the past. Facial recognition technology, timeline information, location data, and event-related information allow Google algorithms to organize the pictures into collages and, more recently, movies set to music. Google creates and shares these trips down memory lane via user notifications (Ben-Yair, 2021).&nbsp;</span></span><span style="font-size:larger;"><span style="font-family:verdana;">Users can share the output by text or email or customize the output (e.g., to stop seeing photos of exes) using the app user settings. Recently, Google created a separate tab to store these &quot;Memories&quot; within its Google Photo application. Google&nbsp;added functionality to allow users to name, rename, and edit the Memories that Google created (Brinkmann, 2023).&nbsp;&nbsp;</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;"><strong>Data Mining, Personalization, and Links to the &#39;Mother Ship&#39;</strong></span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;">Note that most of these examples rely on three critical elements. First is mining customer information and preferences to understand their needs. Second is personalizing the email or system notification relevant to those needs; third, the messaging provides links to bring the customer back to the website to enjoy or act upon custom offers and opportunities.&nbsp;</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;"><strong>Summing up: Five &quot;izes&quot;</strong></span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;">From special offers to customer education to excellent service follow-up to trips through your photo memories, retention messages engage, excite, and entwine your customers in the fabric of your brand. To deliver this experience,&nbsp;<strong>synthesize</strong>&nbsp;customer data,&nbsp;<strong>analyze&nbsp;</strong>your users&#39; needs,&nbsp;<strong>personalize</strong>&nbsp;your messaging, product, or service&nbsp;to provide a value-added offering, and then&nbsp;<strong>publicize</strong>&nbsp;it to your community using&nbsp;<strong>customized</strong>&nbsp;email. To learn about other digital marketing technologies that you can use to improve customer retention, check out our blog article on <a href="https://www.ronrassociates.com/Rons-Blog/PostId/30/eight-digital-marketing-technologies-that-can-improve-retention" target="_blank">Eight Digital Marketing Technologies</a>.</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;"><strong>References</strong></span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;"><em>About Beauty Insider Loyalty Program | Sephora</em>. (n.d.). Sephora.&nbsp;<a href="https://www.sephora.com/beauty/loyalty-program" target="_blank">https://www.sephora.com/beauty/loyalty-program</a></span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;">Anderson, A. (2024, January 24).&nbsp;<em>Making Personalization the Center of Your Customer Retention Strategy like Spotify</em>. Sharpen.&nbsp;<a href="https://sharpencx.com/spotify-customer-retention/" target="_blank">https://sharpencx.com/spotify-customer-retention/</a></span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;">Ben-Yair, S. (2021, May 18). Your photos, your memories, your way.&nbsp;<em>Google</em>.&nbsp;<a href="https://blog.google/products/photos/new-memories-features-look-back/" target="_blank">https://blog.google/products/photos/new-memories-features-look-back/</a></span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;">Brinkmann, M. (2023, August 16).&nbsp;<em>Your memories have a permanent place now in Google Photos</em>. gHacks Technology News.&nbsp;<a href="https://www.ghacks.net/2023/08/16/your-memories-have-a-permanent-place-now-in-google-photos/" target="_blank">https://www.ghacks.net/2023/08/16/your-memories-have-a-permanent-place-now-in-toogle-photos/</a></span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;">Ghelber, A. (2020, November 24). Seven steps to achieve customer retention like Amazon.&nbsp;<em>Forbes</em>.&nbsp;<a href="https://www.forbes.com/sites/forbescommunicationscouncil/2020/11/24/seven-steps-to-achieve-customer-retention-like-amazon/" target="_blank">https://www.forbes.com/sites/forbescommunicationscouncil/2020/11/24/seven-steps-to-achieve-customer-retention-like-amazon/</a></span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;">Io Digital Agency. (2024).&nbsp;<em>iO &mdash; blended agency with wide-ranging and in-depth expertise</em>. https://www.iodigital.com/. Retrieved January 30, 2024, from&nbsp;<a href="https://www.iodigital.com/en/history/raak/how-netflix-defined-email-marketing-for-streaming-platforms" target="_blank">https://www.iodigital.com/en/history/raak/how-netflix-defined-email-marketing-for-streaming-platforms</a></span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;">Lambert, S. (n.d.).&nbsp;<em>This is Why HubSpot is the Best Content Marketing Platform</em>. Retrieved January 30, 2024, from&nbsp;<a href="https://www.xcellimark.com/blog/this-is-why-hubspot-is-the-best-content-marketing-platform" target="_blank">https://www.xcellimark.com/blog/this-is-why-hubspot-is-the-best-content-marketing-platform</a></span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;">Reallygoodux &amp; Keen.io. (2023). Grammarly&#39;s re-engagement emails.&nbsp;<em>GoodUX.appcues.com</em>. https://goodux.appcues.com/blog/grammarly-engagement-emails</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;">Staff Writer, S. (2024, January 3).&nbsp;<em>The customer service strategies behind Zappos&#39; success</em>. Sharpen.&nbsp;<a href="https://sharpencx.com/zappos-customer-service/" target="_blank">https://sharpencx.com/zappos-customer-service/</a></span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;">Storm, A. (2023, September 9). Crafting Customer Retention Emails: The Complete Guide.&nbsp;<em>Blog.Hubspot.com</em>.&nbsp;<a href="https://blog.hubspot.com/service/customer-retention-emails" target="_blank">https://blog.hubspot.com/service/customer-retention-emails</a></span></span></p> <aside arial-label="Suggestions panel" data-name="sidebar-tier">&nbsp;</aside> 31Eight Digital Marketing Technologies That Can Improve Retentionhttps://rrassoicates.azurewebsites.net/Rons-Blog/PostId/30/eight-digital-marketing-technologies-that-can-improve-retentionConversion,Conversion Improvement,Customer Complaints,customer experience,Customer Relationship Management,Customer Service,Digital Marketing,New Product Development,Profit ImprovementRetention,Social MediaMon, 29 Jan 2024 15:34:48 GMT<p><meta name="uuid" content="uuidrMHno6Xr8OgI" /><meta charset="utf-8" /></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;">Over the past decade, a big part of our consulting practice has been helping companies determine how to improve customer retention.&nbsp;</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;">A recent series of requests for contributions to a marketing blog on LinkedIn led us&nbsp;to develop this article. Below are&nbsp;<strong>eight digital marketing technologies</strong>&nbsp;marketers can use to help improve customer retention and grow revenue.&nbsp;</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;"><em>(Please note that while we provide vendor names, the list of software providers mentioned under each category is&nbsp;</em><strong><em>not</em></strong><em>&nbsp;exhaustive. New technology vendors emerge almost monthly, so please search for and compare competitors of the software vendors listed to find the right one for your company.)</em></span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;"><strong>Email Marketing Software.</strong>&nbsp;Email marketing is first on our list of customer retention technologies. Why? With email, a business can regularly touch its customers by sending information and messaging that&#39;s relevant to customer interests. The critical adjective here is&nbsp;<strong><em>relevant</em></strong>! The most effective emails are personalized based on valid segmentation schemes. They are consistent in branding and well-timed. They are carefully tested. The test data should show that they will reliably resonate with your customers. Retention emails bring customers back by speaking with your brand voice and offering incentives, discounts, special offers, or unique experiences otherwise unavailable to noncustomers. Email is a powerful tool. But use your email list carefully. Please don&#39;t abuse it, or your list of receptive customers will quickly dwindle. Tools for email marketing include <strong>Vertical Response</strong>,&nbsp;<strong>Mailchimp</strong>,&nbsp;<strong>Constant Contact</strong>, and<strong>&nbsp;HubSpot</strong>. For more on this topic, check out our blog article with <a href="https://www.ronrassociates.com/Rons-Blog/PostId/31/8-innovative-ways-to-improve-customer-retention-using-email-or-notifications" target="_blank">eight examples of companies that do retention email well</a>.</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;"><strong>Customer Relationship Management (CRM)</strong>: Marketers use CRMs to store customer data like email addresses, phone numbers, physical addresses, and communication preferences. They also use CRMs to track marketing interactions with current and potential customers. Leverage CRM data to discern customer behavior. Use it to understand individual preferences and track purchase history. If you sell shoes, for example, does this customer buy when shoes are on discount, or is their purchasing more fashion-conscious? Is it event-related (i.e., snow boots after a major snowstorm) or seasonal (summer, winter, fall, and spring collection purchases)?&nbsp;</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;">With some imagination and elbow grease, CRM data can give us the information we need to reach these conclusions. It allows marketers to create personalized, high-converting marketing campaigns and ensures that customers who bought from us before keep buying. Integrate your CRM with Marketing Automation (see below) to improve your communication with customers and prospects. Use this integration to build repeat sales funnels with existing customers, driving repeat purchases and improving retention. CRM software providers include&nbsp;<strong>Salesforce</strong>,&nbsp;<strong>Zoho CRM</strong>, and&nbsp;<strong>Microsoft Dynamics</strong>. For more on <a href="https://www.ronrassociates.com/Rons-Blog/PostId/8/customer-relationship-management-not-just-for-big-business" target="_blank">CRM and its uses</a>, see our blog article on how CRM can help improve conversion and retention.</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;"><strong>Social Media Management Tools</strong>. Social media has become an integral part of any retention strategy. Use social media to provide brand updates and inform your customers of reasons to maintain a relationship with you.&nbsp;<strong>Hoot Suite</strong>&nbsp;or&nbsp;<strong>Buffer</strong>&nbsp;are two examples of software enabling marketers to schedule social media updates and track social activity across platforms. Social media can increase customer engagement and maintain customers&#39; interest in your brand. See also our blog article on <a href="https://www.ronrassociates.com/Rons-Blog/PostId/24/28-examples-of-social-media-advertising-campaigns-small-businesses-can-use-to-build-their-brands" target="_blank">Social Media Marketing for 24&nbsp;examples </a>of ways you can use Social Media to increase sales, improve customer retention, and support your brand.</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;"><strong>Marketing Automation Platforms.</strong>&nbsp;Marketing automation platforms provide tools for automatically triggering marketing execution, including email campaigns, social media posts, remarketing campaigns, and more. If properly configured, marketing automation can track and manage lead generation from all your customer touchpoints and automate follow-up throughout the customer life cycle. Marketing automation systems allow retention marketers to personalize emails for post-purchase follow-ups, upsells, and cross-sells. It can trigger social media posts, offer targeted promotions, and send follow-up requests to salespeople or customer service representatives. Think of these tools as brilliant conductors in your brand marketing symphony. Research and map your online marketing funnel activities to see what works now, then automate it! These tools can save e-marketers time and effort while ensuring consistent, branded customer retention follow-up and communications. Popular options include&nbsp;<strong>Keap</strong>,&nbsp;<strong>Marketo</strong>,&nbsp;<strong>Pardot</strong>,&nbsp;<strong>Drip</strong>, and&nbsp;<strong>Eloqua.</strong></span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;"><strong>Remarketing Tools.&nbsp;</strong>Another favorite way of turning suspects into prospects and customers into return customers is&nbsp;<strong>remarketing</strong>. With remarketing, a website visit can trigger a series of personalized advertisements on platforms like&nbsp;<strong>Google</strong>,&nbsp;<strong>Facebook</strong>,&nbsp;<strong>LinkedIn</strong>&nbsp;or&nbsp;<strong>Twitter</strong>. Marketers can design experiences around the web content visited by linking a website product page to a particular advertisement on Google or a social media platform. These tools are especially useful in marketing luxury or high-involvement products or services because they direct advertising toward people who have already shown purchase intent. While generally reserved for new product sales, we have also seen this technology used successfully to grow revenue from service or parts upsell to customers who have visited company websites related to after-sale subjects. For more on this topic, check out our <a href="https://www.ronrassociates.com/Rons-Blog/PostId/11/small-company-big-data-huge-impact" target="_blank">blog article on Big Data</a>.</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;"><strong>Customer Feedback Software.&nbsp;</strong>We all think we listen to our customers. But do you systematically keep track of their feedback and then take action to address their concerns? Those two final steps are crucial for improving customer retention.&nbsp;<strong>Verint,</strong>&nbsp;<strong>SurveyMonkey</strong>, and&nbsp;<strong>Qualtrics&nbsp;</strong>are software vendors that sell technologies that gather valuable customer insights and allow users to aggregate the information to identify actionable trends. Use that information to tease out customer service needs, gaps in your product and service offerings, complaint trends, and brand challenges. Use these technologies to develop systematic ways to leverage customer feedback and improve. See our <a href="https://www.ronrassociates.com/Rons-Blog/PostId/7/finding-increased-profits-through-better-complaints-management" target="_blank">blog article on customer complaints </a>for more on this topic.</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;"><strong>Personalization.&nbsp;</strong>Personalization is another meaningful way of retaining customers, making them feel valued by the brand. Personalization tools such as&nbsp;<strong>Optimizely</strong>&nbsp;or&nbsp;<strong>Adobe Target</strong>&nbsp;are software designed to permit marketers to create customized experiences. Design individualized experiences or offers for each customer persona based on their segment&#39;s preferences and behavior. Build customer experiences that make their lives easier. See <a href="https://www.ronrassociates.com/Rons-Blog/PostId/22/buying-and-delivery-preference-the-new-battleground">our article on buying preference</a> for more on this topic.</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;"><strong>Loyalty Program Software.&nbsp;</strong>Ever since a coffee shop figured out how to offer punch cards to give loyal customers a tenth coffee free, loyalty programs have become a time-honored way to drive customer retention. Reward customers for their continued business. As with everything, software now exists to track and manage this activity. Loyalty program software vendors include&nbsp;<strong>Smile.io</strong>&nbsp;or&nbsp;<strong>LoyaltyLion.&nbsp;</strong>Both can help create and manage new loyalty programs and make starting a program more manageable. Create incentives and rewards for customers, and design programs that encourage them to return. Then, watch retention numbers improve. See our <a href="https://www.ronrassociates.com/Rons-Blog/BlogPage/3" target="_blank">blog on Customer Lifetime Value</a> for more on how companies manage customer loyalty.</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;"><strong>Integration and Reporting.&nbsp;</strong>Before pulling the trigger on any software purchase, carefully examine how well these systems integrate with your existing marketing infrastructure. Pay special attention to reporting, scalability, and customer support capabilities (and support cost). Many of the leading vendors in each category above offer capabilities in other categories. For example, many marketing automation providers also provide CRM capabilities.&nbsp;</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;">Also, make sure that the reporting system for the software can exactly replicate what you are currently providing to senior management. Senior leaders want what they want, and if the new software can only provide a slightly different report from what leadership likes, you may spend the next couple of years downloading and formatting data to meet their needs.&nbsp;</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:verdana;">For more on integration and marketing, see our blog article about <a href="https://www.ronrassociates.com/Rons-Blog/PostId/15/integrate-or-die" target="_blank">integration as the modern marketing superpower</a>.</span></span></p> 30Business In a Post-COVID-19 Worldhttps://rrassoicates.azurewebsites.net/Rons-Blog/PostId/12/business-in-a-post-covid-19-worldcustomer experience,Customer Relationship Management,Customer Service,Profit Improvement,RetentionWed, 01 Apr 2020 16:07:25 GMT<p style="text-align: justify;">&nbsp;</p> <p style="text-align: justify;">The Corona Virus pandemic has changed the way we do business.&nbsp;</p> <p style="text-align: justify;">And while we can debate how and when things will return to &quot;normal,&quot; it would be naive to think that the business environment post-COVI-19 pandemic will be like the one before it.</p> <p style="text-align: justify;">How will it change?&nbsp;&nbsp;</p> <p style="text-align: justify;">Dramatically. And Forever.</p> <p style="text-align: justify;">Here&#39;s why. Online meetings, chat, and collaboration technologies have been around for a long time. But their adoption outside of the tech sector has been relatively slow until now. The Safe at Home requirement enforced in most states forced&nbsp;us to change the way we do everything. In the process, we are all learning new, remote working skills. These skills will permanently change the way we shop and work. Indeed, the broadband revolution, previously driven mostly by entertainment demand, in the post-COVID-19 world, is forcing the adoption of work-from-home technologies.&nbsp;&nbsp;</p> <p style="text-align: justify;">Since the arrival of the COVID-19 pandemic, most white-collar workers -- from lawyers to reporters to accountants to salespeople to human resources professionals -- have had to learn how to use these technologies from home or stop working. And adopt they have. Dining room tables and spare bedrooms across the country have turned into impromptu offices. This trend will continue. Look for more and more remote work as employers and employees alike become more comfortable with these technologies. The costs of maintaining large offices become increasingly dangerous (and economically redundant.)</p> <p style="text-align: justify;">Call centers provide another example. Companies with call centers, especially those in high-cost metropolitan areas with good residential bandwidth, began leveraging Virtual Private Network (VPN) technologies nearly a decade ago. Pioneering employers developed the capability to manage telephone queues, route calls, monitor performance, and deliver all the technology available in the call center to employees working remotely. Implementation amounted to creating a platform to transfer the telephony, call routing, management oversight, and any call center desktop software into something that can work over a VPN, then training workers to use that technology from home in a &quot;virtual call center&quot; solution. This capability saved thousands of dollars in office costs for employers and provided great flexibility in disasters. It also made employees happy because they no longer had to commute to work! In places like Atlanta, New York, or Los Angeles, these initiatives were a home run. Now, this technology also makes those same employees safe from the virus and, increasingly, assures their employers&#39; economic viability.</p> <p style="text-align: justify;">Grocers and other high volume retailers have grudgingly moved into online shopping services. For many, this was mostly a defensive measure in response to Amazon&#39;s competitive incursions, but in the post-COVID-19 competitive environment, this adjunct service is becoming essential. Look for customers to increasingly avail themselves of delivery services and drive further change in the retail sector. Look for workers to organize and gain power as they become increasingly important. And look for their employers to automate those jobs away in response.</p> <p style="text-align: justify;">In the manufacturing realm, in March 2020, Reuters reported, &quot;A shortage of workers and restrictions on human contact because of the coronavirus pandemic is driving up demand for service robots in China.&quot; So it will go around the globe. Robots can&#39;t get sick, and their relatively high fixed cost becomes increasingly attractive as workers become scarce.&nbsp;&nbsp;</p> <p style="text-align: justify;">Small businesses are adapting too. A few examples:</p> <ul> <li style="text-align: justify;"><strong>Car Repair.</strong>&nbsp;High-end auto repair shops have, for decades, offered to drive customers home while they waited for repairs. With only a slight change in the model, innovative auto mechanics offer to pick up, repair, sanitize, and drop off vehicles once they finish the repairs.</li> <li style="text-align: justify;"><strong>Churches.&nbsp; &nbsp;</strong>Even before the COVID-19 outbreak, a&nbsp;little church we attended used&nbsp;Facebook&#39;s free live streaming capability to share church services electronically with its congregation. Many of the members of this church have to travel on weekends.&nbsp; They also use an electronic e-giving application for donations.&nbsp; If your church doesn&#39;t do this yet, now is the time to learn.</li> <li style="text-align: justify;"><strong>Dry Cleaning.&nbsp;</strong>Dry cleaners who offered drive-through, pick-up, and delivery services targeting their most prominent customers have refocused their offering to provide this service to everyone. In the face of declining to nonexistent traffic, offering remote laundry pick up and sanitization services seems to be one of the few ways forward.</li> <li style="text-align: justify;"><strong>Restaurants.</strong>&nbsp;Take out and food delivery, once the focus of fast-food restaurants is moving upscale as restaurants must deliver or close.</li> <li style="text-align: justify;"><strong>Pet Groomers.</strong>&nbsp;Pet grooming is nonessential, but Fifi, the labradoodle, will need a cut sooner or later. Remote grooming services that pick up, groom, and return dogs curbside in front of their master&#39;s home provide an agile response.</li> <li style="text-align: justify;"><strong>Hardware Stores.</strong>&nbsp;An ingenious manager&nbsp;at the local Bearden Elder&#39;s Ace&nbsp;hardware store took some plexiglass and a couple of two-by-one strips of wood&nbsp;and fitted the checkout with a clear plexiglass cover face level at all the registers. Shouldn&#39;t all stores have these? &nbsp;</li> </ul> <p style="text-align: justify;">You get the gist.</p> <p style="text-align: justify;">The bottom line? As you ponder your business and its economic future from home over the next few weeks (or months), business leaders think hard about how your company works, sells, and delivers services to people who aren&#39;t allowed to leave their homes. The time to improvise, invest, and the test is now.</p> <p style="text-align: justify;">How can you meet customer needs in this strange new world? The answer is your opportunity. It may even be the key to your business&#39;s economic survival.&nbsp;</p> 12The Seven Deadly Sins of Customer Experiencehttps://rrassoicates.azurewebsites.net/Rons-Blog/PostId/3/the-sever-deadly-sins-of-customer-experiencecustomer experience,RetentionTue, 27 Feb 2018 07:00:00 GMT<p style="text-align: justify;"><span style="font-family:arial;"><span style="font-size:larger;">A study some years ago by Frederick F. Reichheld and W. Earl Sasser presented in the&nbsp;<em>Harvard Business Review</em>&nbsp;found that in a wide range of industries, customer loyalty is a more important determinant of profit than market share. They estimated, for example, that a five percentage point increase in customer loyalty could produce a profit increase from 25 percent to 85 percent in the service industries they studied.<a href="https://fixingleaks-my.sharepoint.com/personal/ron_ronrassociates_com/Documents/Fixing%20The%20Leaks/Blog/7%20Warning%20Signs%20About%20Your%20Corporate%20Culture.docx#_edn1">[i]</a></span></span></p> <p style="text-align: justify;"><span style="font-family:arial;"><span style="font-size:larger;">The importance of this finding to the owners of small and </span></span><span style="font-family:arial;"><span style="font-size:larger;">medium-sized</span></span><span style="font-family:arial;"><span style="font-size:larger;"> businesses is hard to overstate.&nbsp; In the customer relationship, where small and </span></span><span style="font-family:arial;"><span style="font-size:larger;">medium-sized</span></span><span style="font-family:arial;"><span style="font-size:larger;"> businesses have a natural advantage, we find the&nbsp;<em>quality</em>&nbsp;of that relationship is a key determinant of profitability!</span></span></p> <p style="text-align: justify;"><span style="font-family:arial;"><span style="font-size:larger;">How ironic that we find many clients spending most of their<em>&nbsp;</em>time looking at&nbsp;<em>top-side revenue</em>&nbsp;growth. They pay&nbsp;<em>little</em>&nbsp;<em>or no attention to</em> customer loyalty or the customer experience that drives it.&nbsp;</span></span></p> <p style="text-align: justify;"><span style="font-family:arial;"><span style="font-size:larger;"><strong>Loyalty Index</strong></span></span></p> <p style="text-align: justify;"><span style="font-family:arial;"><span style="font-size:larger;">To start a conversation about customer/donor loyalty with our clients, we developed a&nbsp;<em>loyalty index</em>.&nbsp; The index is a series of 7 questions about how the company manages the customer experience.&nbsp; Weights to responses, typically ranked 1 to 5 by interviewees, give us insights into how the executives feel about these topics.&nbsp;&nbsp; We average an executive team&#39;s collective responses. This number allows us to understand how our client&#39;s management team thinks about customer experience and management in general terms. &nbsp;</span></span></p> <p style="text-align: justify;"><span style="font-family:arial;"><span style="font-size:larger;">Here are the questions:</span></span></p> <ol> <li style="text-align: justify;"><span style="font-family:arial;"><span style="font-size:larger;"><strong>Does your organization emphasize excellent customer experience?</strong>&nbsp;What </span></span><span style="font-family:arial;"><span style="font-size:larger;">concrete steps</span></span><span style="font-family:arial;"><span style="font-size:larger;"> been taken in the past three years to make this happen? &nbsp;</span></span></li> <li style="text-align: justify;"><span style="font-family:arial;"><span style="font-size:larger;"><strong>How well would you say your organization handles customer/member complaints?</strong>&nbsp; Does your company have a formal complaint-management process?&nbsp; How is complaint information gathered, tracked, and used?</span></span></li> <li style="text-align: justify;"><span style="font-family:arial;"><span style="font-size:larger;"><strong>How accountable is the organization&#39;s management team for customer satisfaction?</strong><strong>&nbsp;&nbsp;</strong>Do your executives know how satisfied their customers or nonprofit members are?&nbsp; Is customer satisfaction and longevity, something for which the executive team is measured or rewarded?&nbsp;</span></span></li> <li style="text-align: justify;"><span style="font-family:arial;"><span style="font-size:larger;"><strong>If something goes wrong, do members of the leadership team take responsibility?</strong>&nbsp;Do they fix the process, or do they find a scapegoat? How do your leadership team members get along?&nbsp; Are executive committee sessions characterized by collaborative problem solving or intractable debates and finger-pointing? Recent examples?</span></span></li> <li style="text-align: justify;"><span style="font-family:arial;"><span style="font-size:larger;"><strong>How does the company respond to challenges from outside the company (e.g., a significant service or product snafu?)&nbsp;</strong>Would you say the organization&#39;s culture encourages learning and adapting from mistakes? Or is the culture more about damage control?&nbsp;</span></span></li> <li style="text-align: justify;"><span style="font-family:arial;"><span style="font-size:larger;"><strong>Is there an &#39;us (your employees) versus them (customers/members)&#39; mentality when talking about customers?</strong><strong>&nbsp;&nbsp;</strong>Are there employees in the organization who see themselves as customer advocates?&nbsp; How much prestige, or what kind of authority do these people have in the organization?&nbsp;</span></span></li> <li style="text-align: justify;"><span style="font-family:arial;"><span style="font-size:larger;"><strong>Would you say that your organization is more transaction or relationship-oriented?</strong><strong>&nbsp;&nbsp;</strong>Is your organization more focused on making a sale today, or would you say you are more focused on building </span></span>long-term<span style="font-family:arial;"><span style="font-size:larger;"> relationships?&nbsp; What processes do you have in place to build these </span></span>longer-term<span style="font-family:arial;"><span style="font-size:larger;"> relationships?</span></span></li> </ol> <p style="text-align: justify;">&nbsp;</p> <p style="text-align: justify;"><span style="font-family:arial;"><span style="font-size:larger;"><strong>The Seven Deadly Sins of Customer Loyalty Management</strong></span></span></p> <p style="text-align: justify;"><span style="font-family:arial;"><span style="font-size:larger;">As you might expect, responses to these questions tend to uncover a lot of misconceptions and opportunities for improvement.&nbsp; Quite often, we can tease out what we have identified as the&nbsp;<strong><em>7 Deadly Sins</em></strong>&nbsp;of customer retention.&nbsp;&nbsp;<em>Deadly sins</em>&nbsp;tend not to be lethal in the short </span></span>run <span style="font-family:arial;"><span style="font-size:larger;">if addressed quickly.</span></span></p> <p style="text-align: justify;"><span style="font-family:arial;"><span style="font-size:larger;">Each section below identifies the question, provides an analysis of why the measure is essential</span></span>&nbsp;<span style="font-family:arial;"><span style="font-size:larger;">and advances the related &quot;deadly sin.&quot;&nbsp;</span></span></p> <p style="text-align: justify;"><span style="font-family:arial;"><span style="font-size:larger;"><em>Sin 1: The organization does not pay sufficient attention to customer experience, satisfaction, and loyalty.</em></span></span></p> <p style="text-align: justify;"><span style="font-family:arial;"><span style="font-size:larger;"><strong>1.</strong>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<strong>Does your organization emphasize customer experience?</strong>&nbsp;&nbsp;</span></span><span style="font-family:arial;"><span style="font-size:larger;">Reichheld</span></span><font face="arial"><span style="font-size: larger;"> and Sasser&#39;s&nbsp;</span></font><em style=""><font face="arial"><span style="font-size: larger;">Harvard Business Review article</span></font></em><span style="font-family:arial;"><span style="font-size:larger;">&nbsp;estimated that the average US Fortune 500 Company loses 50 percent of its customers every five years.<a href="https://fixingleaks-my.sharepoint.com/personal/ron_ronrassociates_com/Documents/Fixing%20The%20Leaks/Blog/7%20Warning%20Signs%20About%20Your%20Corporate%20Culture.docx#_edn2">[ii]</a>&nbsp; Many companies we work with talk the talk on customer experience but fail to walk the walk.&nbsp;&nbsp; These organizations fail to test their </span></span><span style="font-family:arial;"><span style="font-size:larger;">websites</span></span><span style="font-family:arial;"><span style="font-size:larger;">, use mystery shoppers, listen to the CSRs on the phone, or ask customers or members how satisfied they are.</span></span></p> <p style="text-align: justify;"><span style="font-family:arial;"><span style="font-size:larger;"><em>Sin 2: The organization does not manage</em><em><strong>,&nbsp;</strong></em><em>monitor, or embrace customer/member complaints.</em></span></span></p> <p style="text-align: justify;"><span style="font-family:arial;"><span style="font-size:larger;"><strong>2.</strong>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<strong>How well does your organization handle customer/member complaints?</strong>&nbsp;We find that organizations that do not have systems for submitting, tracking, and resolving complaints often spend too much time reacting and cleaning up. They don&#39;t spend enough time diagnosing problems and improving.&nbsp; Worse, without proper management, simple issues that companies could fairly routinely turn into major public relations problems and even legal battles. Worst of all, by failing to address customers&#39; issues, companies are failing to take advantage of free consulting from their very best customers.<a href="https://fixingleaks-my.sharepoint.com/personal/ron_ronrassociates_com/Documents/Fixing%20The%20Leaks/Blog/7%20Warning%20Signs%20About%20Your%20Corporate%20Culture.docx#_edn3">[iii]</a>&nbsp;</span></span></p> <p style="text-align: justify;"><span style="font-family:arial;"><span style="font-size:larger;">Statistics on complaints show that 26 out of 27 people will not complain.&nbsp; However, that does not mean they will go away quietly.&nbsp;<a href="https://fixingleaks-my.sharepoint.com/personal/ron_ronrassociates_com/Documents/Fixing%20The%20Leaks/Blog/7%20Warning%20Signs%20About%20Your%20Corporate%20Culture.docx#_edn4">[iv]</a>&nbsp;&nbsp;On average, satisfied customers will tell 8 to 10 people about a good experience, while on average, they will tell 17 people of a bad experience. (See chart below.) For every person that did complain, there are additional twenty-some malcontents. They are telling everyone they know about their bad experience!<a href="https://fixingleaks-my.sharepoint.com/personal/ron_ronrassociates_com/Documents/Fixing%20The%20Leaks/Blog/7%20Warning%20Signs%20About%20Your%20Corporate%20Culture.docx#_edn5">[v]</a>&nbsp;&nbsp;With the advent of social media, the power of those unhappy people amplifies geometrically.<a href="https://fixingleaks-my.sharepoint.com/personal/ron_ronrassociates_com/Documents/Fixing%20The%20Leaks/Blog/7%20Warning%20Signs%20About%20Your%20Corporate%20Culture.docx#_edn6">[vi]</a>&nbsp; (See Table 1 below.)&nbsp; While social media users will pay more for &quot;excellent&quot; service, they are also more likely to&nbsp;<em>not</em>&nbsp;purchase because of a bad experience. The multiplier effect of a bad experience on the part of someone who uses social media is startling.&nbsp;<a href="https://fixingleaks-my.sharepoint.com/personal/ron_ronrassociates_com/Documents/Fixing%20The%20Leaks/Blog/7%20Warning%20Signs%20About%20Your%20Corporate%20Culture.docx#_edn7">[vii]</a>&nbsp;</span></span></p> <p style="text-align: justify;"><span style="font-family:arial;"><span style="font-size:larger;">Table 1</span></span></p> <p style="text-align: justify;"><img alt="" src="/Portals/0/Amex_Survey_Data_1.jpg" style="width: 522px; height: 372px;" title="" /></p> <p style="text-align: justify;"><span style="font-family:arial;"><span style="font-size:larger;"><strong>Source: See</strong>&nbsp;<a href="http://about.americanexpress.com/news/pr/2012/gcsb.aspx">http://about.americanexpress.com/news/pr/2012/gcsb.aspx</a>&nbsp; Citation on 10/22/14.</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:arial;"><em>Sin 3: The leadership team doesn&#39;t&nbsp;</em>fix<em>&nbsp;problems as much as it&nbsp;</em>affixe<em>s blame.</em></span></span></p> <p style="text-align: justify;"><span style="font-family:arial;"><span style="font-size:larger;"><strong>3.</strong>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<strong>How accountable is the organization&#39;s management team?</strong>&nbsp;When we begin an engagement, we often visit with the departmental heads of the organization. For example, we will visit with the heads of sales, marketing, technology, operations, and fulfillment. Each of those managers </span></span><span style="font-family:arial;"><span style="font-size:larger;">tells</span></span><span style="font-family:arial;"><span style="font-size:larger;"> us about the problems of the organization from their perspective.&nbsp; While we ask about challenges in<em>&nbsp;their departments,</em>&nbsp;very often executives focus on problems in&nbsp;<em>other</em>&nbsp;departments. There is usually a great deal of truth in these reflections; however, rarely do these same executives mention problems in their part of the organization. &nbsp;By blaming other departments for profitability problems, and refusing to look inwards, these executives don&#39;t have to take any action to address their departmental shortcomings.&nbsp;&nbsp; They can argue.&nbsp; In the long term, however, both sides of the argument eventually lose. &nbsp;Often the loss is of their jobs or the control of the company. &nbsp; The path to profitability in most organizations requires the involvement of&nbsp;<em>all</em>&nbsp;departments identifying and addressing problems in their&nbsp;parts of the organization. At the same time, they must work&nbsp;<em>collaboratively</em>&nbsp;with other executives and other departments to get things right.&nbsp;</span></span><span style="font-size:larger;"><span style="font-family:arial;">&nbsp;<a href="https://fixingleaks-my.sharepoint.com/personal/ron_ronrassociates_com/Documents/Fixing%20The%20Leaks/Blog/7%20Warning%20Signs%20About%20Your%20Corporate%20Culture.docx#_edn9">[ix]</a>, to G.A. Rummler and A. P. Brache<a href="https://fixingleaks-my.sharepoint.com/personal/ron_ronrassociates_com/Documents/Fixing%20The%20Leaks/Blog/7%20Warning%20Signs%20About%20Your%20Corporate%20Culture.docx#_edn8">[viii]</a>&nbsp;&nbsp;</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:arial;"><em>Sin 4: When problems occur, leadership routinely blames&nbsp;</em>people,<em>&nbsp;not&nbsp;</em>process<em>.</em><em>&nbsp;</em></span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:arial;"><strong>4. If something goes wrong, do members of the leadership team take responsibility?</strong>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A corollary to finger-pointing is to blame people, not process routinely. Management gurus from W. E. Deming have said that it is usually problems with the process, not employees when things go awry.&nbsp; &nbsp;Indeed, it is unusual to find employees who don&#39;t want to do a good job. Most employees, and especially those who have been in their jobs for a while, are eager to improve. Indeed, quite often, they can provide valuable insights on how to do so.&nbsp; All too often, when things go wrong, it is because that good employee did not have the knowledge, tools, resources, or authority to get it right. While it is always tempting to ask, &#39;Why the&nbsp;<em>heck</em>&nbsp;did he or she do that,&#39; it is more productive to ask, &#39;How can we fix the&nbsp;<em>process</em>&nbsp;so that it doesn&#39;t happen again?&#39;&nbsp; Ask why five times<a href="https://fixingleaks-my.sharepoint.com/personal/ron_ronrassociates_com/Documents/Fixing%20The%20Leaks/Blog/7%20Warning%20Signs%20About%20Your%20Corporate%20Culture.docx#_edn10">[x]</a>, and get to the bottom of the problem.&nbsp; You may find that it is a bad process (of management&#39;s design), which led to the issue in the first place! Top management thinkers say</span><span style="font-family:arial;"> that between 80 and 96 percent of failures lie in the system and the process and NOT the people. &nbsp;In our experience, the root cause of our clients&#39; problems is almost always a bad process, not a rogue employee!</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:arial;"><em>Sin 5: The organization allows its limitations to define it.</em></span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:arial;"><strong>5.</strong>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<strong>How does the company respond to challenges from outside the company?</strong>&nbsp; Far too often, we find clients who have allowed&nbsp;<em>perceived</em>&nbsp;limitations to define how they manage their business. They may have, for example, too little capital, too small a distribution network, or they may not have the scale economies that their competitors do.&nbsp;&nbsp; Or they think they are too big.&nbsp; Does your team say, &quot;We already tried that?&quot; &quot;We can&#39;t afford that?&quot; Or do they say, &quot;our customers are different from that,&quot; about too many initiatives?&nbsp; Here is what Comcast CEO Brian Roberts had to say about the company&#39;s customer service challenges in an interview after the Ryan Block video went viral.&nbsp;&nbsp;</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:arial;">&quot;What unfortunately happens is we have approximately &hellip; Three hundred fifty million interactions with consumers a year, between phone calls and truck calls. It may be over 400 million, and that doesn&#39;t count any online interactions, which I think is over a billion. You get one-tenth of one-percent bad experience, that&#39;s a lot of people &ndash; unacceptable. We have to be the best service provider, or in the end, this company won&#39;t be what I want it to be.&quot;<a href="https://fixingleaks-my.sharepoint.com/personal/ron_ronrassociates_com/Documents/Fixing%20The%20Leaks/Blog/7%20Warning%20Signs%20About%20Your%20Corporate%20Culture.docx#_edn11">[xi]</a>&nbsp;</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:arial;"><em>Sin 6: The voice of the customer is weak (or mute) in the organization.</em></span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:arial;"><strong>6.</strong>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<strong>Is there an &#39;us (your employees) versus them (customers/members)&#39; mentality among the employees?</strong><strong>&nbsp;&nbsp;</strong>We find that another critical barometer for the health of an organization&#39;s customer-facing culture is how employees think about and talk about their customers. &nbsp;</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:arial;"><em>How is</em>&nbsp;information about the customer experience (good, bad, or ugly) shaped before its delivery? Is it delivered to the CEO or Executive Director&#39;s desk? The answer to this question often dictates the service culture of the organization.&nbsp; It also helps determine which steps are (and are not) taken to address customer retention-related issues.&nbsp; &nbsp;In sum, leadership must make Voice of Customer concerns a priority. It should use the Voice of Customer team as a window into the customer experience rather than a layer of insulation between themselves and a complaining customer base.&nbsp;</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:arial;"><em>Sin 7: The organization focuses on transactions, not relationships with its customers or members.</em></span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:arial;"><strong>7.</strong>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<strong>Would you say that your organization is more&nbsp;</strong><strong><em>transaction</em></strong><strong>&nbsp;or&nbsp;relationship-oriented</strong><strong>?</strong><strong>&nbsp;&nbsp;</strong>Too often, we find the organization thinks in terms of near-term&nbsp;<em>transactional</em>&nbsp;values, not in terms of longer-term relation or&nbsp;</span>lifetime values<span style="font-family:arial;">.&nbsp; Customer lifetime value (CLV) is a measure of the present value of all the income from a customer relationship minus the current value of all acquisition and servicing costs for that customer.<a href="https://fixingleaks-my.sharepoint.com/personal/ron_ronrassociates_com/Documents/Fixing%20The%20Leaks/Blog/7%20Warning%20Signs%20About%20Your%20Corporate%20Culture.docx#_edn12">[xii]</a>&nbsp; By using CLV and managing to it, clients can identify those segments which are paying the bills over the long-</span><span style="font-family:arial;">term,</span><span style="font-family:arial;"> and those segments which may be losing the company money.&nbsp; Sound too theoretical? &nbsp;Don&#39;t be put off by the Greek letters in the article cited above.&nbsp; The point of the analysis is to identify which relationships are the most valuable to your organization. CLV is a long term metric measured over several years.&nbsp; With this information in hand, your organization can nurture its profitable relationships with people, systems, </span><span style="font-family:arial;">and processes that address the needs of the most valuable portions of your customer base.&nbsp; This knowledge can also help managers identify which segments are losing money, how they can find more of the very profitable customers or donors.</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:arial;"><strong>Conclusion</strong></span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:arial;">The responses to these Loyalty Index questions tell us much about an organization and its organizational culture. We have also found that our index can be an excellent predictor of future profitability and long-term organizational health.&nbsp;</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:arial;">How would you say your company would fare in answering the questions above?&nbsp;</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:arial;"><strong>&nbsp;</strong></span></span></p> <p style="text-align: justify;"><br /> <span style="font-size:larger;"><span style="font-family:arial;">Notes:</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:arial;"><a href="https://fixingleaks-my.sharepoint.com/personal/ron_ronrassociates_com/Documents/Fixing%20The%20Leaks/Blog/7%20Warning%20Signs%20About%20Your%20Corporate%20Culture.docx#_ednref1">[i]</a>&nbsp;Heskett, James L.; Sasser, W. Earl (1997-04-10). Service Profit Chain (Kindle Locations, 530-532). Simon &amp; Schuster, </span><span style="font-family:arial;">Inc.</span><span style="font-family:arial;"> Kindle Edition.</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:arial;"><a href="https://fixingleaks-my.sharepoint.com/personal/ron_ronrassociates_com/Documents/Fixing%20The%20Leaks/Blog/7%20Warning%20Signs%20About%20Your%20Corporate%20Culture.docx#_ednref2">[ii]</a>&nbsp;Reichheld, Robert F.,&nbsp; Harvard Business Review, Cambridge, MA, 1996.&nbsp; Adapted from The Loyalty Effect: The Hidden Force Behind Growth, Profits, and Lasting Value, written with Thomas Teal (Harvard Business School Press, March 1996).</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:arial;"><a href="https://fixingleaks-my.sharepoint.com/personal/ron_ronrassociates_com/Documents/Fixing%20The%20Leaks/Blog/7%20Warning%20Signs%20About%20Your%20Corporate%20Culture.docx#_ednref3">[iii]</a>&nbsp;See Barlow, Janelle; Moller, Claus, &quot;A Complaint Is A Gift,&quot; Barrett-Koller Publishers, San Francisco, 1996, Chapter 2 pp. 19-36.</span></span></p> <p style="text-align: justify;">&nbsp;</p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:arial;"><a href="https://fixingleaks-my.sharepoint.com/personal/ron_ronrassociates_com/Documents/Fixing%20The%20Leaks/Blog/7%20Warning%20Signs%20About%20Your%20Corporate%20Culture.docx#_ednref4">[iv]</a>&nbsp;Technical Assistance Research Programs (TARP), Consumer Complaint Handling In America: Final Report, White House Office of Customer Affairs, 1980.</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:arial;"><a href="https://fixingleaks-my.sharepoint.com/personal/ron_ronrassociates_com/Documents/Fixing%20The%20Leaks/Blog/7%20Warning%20Signs%20About%20Your%20Corporate%20Culture.docx#_ednref5">[v]</a>&nbsp;Alan R. Andreasen, &quot;Consumer Complaints and Redress: What We Know and What We Do Not Know,&quot; The Frontier of Research in Consumer Interest, Ed E. Schott Maynes, et al.&nbsp; (Columbia, MO: American Council on Consumer Interests, 1988), p 708.</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:arial;"><a href="https://fixingleaks-my.sharepoint.com/personal/ron_ronrassociates_com/Documents/Fixing%20The%20Leaks/Blog/7%20Warning%20Signs%20About%20Your%20Corporate%20Culture.docx#_ednref6">[vi]</a>&nbsp;See&nbsp;&nbsp;<a href="http://about.americanexpress.com/news/pr/2012/gcsb.aspx">http://about.americanexpress.com/news/pr/2012/gcsb.aspx</a>&nbsp; Citation on 10/22/14.</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:arial;"><a href="https://fixingleaks-my.sharepoint.com/personal/ron_ronrassociates_com/Documents/Fixing%20The%20Leaks/Blog/7%20Warning%20Signs%20About%20Your%20Corporate%20Culture.docx#_ednref7">[vii]</a>&nbsp;Ibid.</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:arial;"><a href="https://fixingleaks-my.sharepoint.com/personal/ron_ronrassociates_com/Documents/Fixing%20The%20Leaks/Blog/7%20Warning%20Signs%20About%20Your%20Corporate%20Culture.docx#_ednref8">[viii]</a>&nbsp;Deming, W.E. Out of the Crisis. MIT, Cambridge, 1982</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:arial;"><a href="https://fixingleaks-my.sharepoint.com/personal/ron_ronrassociates_com/Documents/Fixing%20The%20Leaks/Blog/7%20Warning%20Signs%20About%20Your%20Corporate%20Culture.docx#_ednref9">[ix]</a>&nbsp;Rummler, G.A., and Brache, A.P. Improving Performance: How to manage the white space on the organization chart. Jossey-Bass Publishers, San Francisco, 1990.</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:arial;"><a href="https://fixingleaks-my.sharepoint.com/personal/ron_ronrassociates_com/Documents/Fixing%20The%20Leaks/Blog/7%20Warning%20Signs%20About%20Your%20Corporate%20Culture.docx#_ednref10">[x]</a>&nbsp;For more on this read about the 5 Why&#39;s technique initially developed by&nbsp;<a href="http://en.wikipedia.org/wiki/Sakichi_Toyoda">Sakichi Toyoda</a>&nbsp;and was used within the&nbsp;<a href="http://en.wikipedia.org/wiki/Toyota">Toyota</a>&nbsp;Motor Corporation during the development of its manufacturing methodologies.&nbsp; See&nbsp;<a href="http://en.wikipedia.org/wiki/Taiichi_Ohno">Taiichi Ohno</a>; foreword by Norman Bodek (1988).&nbsp;<em>Toyota production system: beyond large-scale production</em>. Portland, OR: Productivity Press.</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:arial;"><a href="https://fixingleaks-my.sharepoint.com/personal/ron_ronrassociates_com/Documents/Fixing%20The%20Leaks/Blog/7%20Warning%20Signs%20About%20Your%20Corporate%20Culture.docx#_ednref11">[xi]</a>&nbsp;</span>See <span style="font-family:arial;">http://www.marketplace.org/topics/business/corner-office/comcast-ceo-we-reinvent-ourselves-every-couple-years.&nbsp; Citation on 10/22/14.</span></span></p> <p style="text-align: justify;"><span style="font-size:larger;"><span style="font-family:arial;">&nbsp;For an excellent article on the topic of Customer Lifetime Value see: http://www.anderson.ucla.edu/faculty/dominique.hanssens/content/JSR2006.pdf<a href="https://fixingleaks-my.sharepoint.com/personal/ron_ronrassociates_com/Documents/Fixing%20The%20Leaks/Blog/7%20Warning%20Signs%20About%20Your%20Corporate%20Culture.docx#_ednref12">[xii]</a></span></span></p> <p style="text-align: justify;">&nbsp;</p> 3Of Good and Bad Retention Methodshttps://rrassoicates.azurewebsites.net/Rons-Blog/PostId/4/of-good-and-bad-retention-methodscustomer experience,Customer Service,RetentionTue, 27 Feb 2018 04:49:45 GMT<div style="position: relative; height: 0px; padding-bottom: 56.25%; text-align: justify;"><iframe allow="autoplay; encrypted-media" allowfullscreen="" frameborder="0" height="360" src="https://www.youtube.com/embed/yYUvpYE99vg?ecver=2" style="position:absolute;width:100%;height:100%;left:0" width="640"></iframe></div> <p style="text-align: justify;"><span style="font-size:larger;"><strong>Different Kinds of Customer Retention Defined</strong></span></p> <p style="text-align: justify;"><span style="font-size:larger;">There is a&nbsp;<strong>big</strong>&nbsp;downside to being&nbsp;too hard to break up with. </span></p> <p style="text-align: justify;"><span style="font-size:larger;">Much of what you will read in this Blog is about&nbsp;<em>customer retention</em>.&nbsp; This post will contrast two kinds of customer retention &ndash; that which&nbsp;is driven by corporate&nbsp;economic goals&nbsp;by making&nbsp;it difficult for customers to leave and that&nbsp;which seeks to keep customers by addressing their needs.</span></p> <p style="text-align: justify;"><span style="font-size:larger;"><strong>Coercive Retention Techniques That Focus On Needs of Company&nbsp;Are Risky</strong></span></p> <p style="text-align: justify;"><span style="font-size:larger;">A video (really, a sound recording) portraying a bad customer experience (see above) went viral a couple of months ago, doing much damage to a national cable provider, Comcast&#39;s already a checkered reputation for customer service.&nbsp;&nbsp; To summarize the video, a long-time Comcast customer, Ryan Block, records himself attempting to close a Comcast Internet account. &nbsp;Ryan encounters an aggressive and determined&nbsp;Comcast Customer Retention Unit CSR who refuses to close the customer&#39;s account.&nbsp; The 18 minutes of the ensuing banter is brutal when listening from the customer&#39;s perspective. It was &quot;hard to listen to,&quot; for the leadership at Comcast. They had to respond to the media in its wake.<a href="http://www.ronrassociates.com/Lists/Posts/NewPost.aspx?Source=/blog#_edn1">[i]</a>&nbsp; While it is easy to blame the CSR in this instance,&nbsp; an internal Comcast leadership memo leaked to CNET points out that this CSR did what he was trained to do.&nbsp;<a href="http://www.ronrassociates.com/Lists/Posts/NewPost.aspx?Source=/blog#_edn2">[ii]</a>&nbsp;&nbsp;</span></p> <p style="text-align: justify;"><span style="font-size:larger;">One reason this video went viral is that so many of us can empathize with the caller.&nbsp;&nbsp;How many of us have found ourselves trapped in subscription arrangements, the details of which were glossed over by salespeople when we made the purchase agreement?&nbsp; How many service providers with whom we have longterm contracts drive us to anger with bad customer experience</span><span style="font-size: larger; letter-spacing: 0px;">? I&#39;m sure each of us can think of a provider, anything from alarm systems to cell phones, to landlords, and business services, where this has occurred.</span></p> <p style="text-align: justify;"><span style="font-size:larger;">For example,&nbsp;I recently tried to cancel a service with an online meeting provider. &nbsp;I called, then emailed my local&nbsp;business services&nbsp;representative requesting cancellation. &nbsp; He never replied. &nbsp;When I received a renewal&nbsp;bill for the next year&#39;s service a month later, I contacted accounts payable (in India) then fought my way back to a customer service executive assigned to my region here in the US. &nbsp; The executive said that I hadn&#39;t canceled in time, and I owed the full subscription amount for the next year. &nbsp;I said I had requested cancellation; however, their staff had failed to take action on my request. &nbsp;Back and forth, it went. &nbsp;It took five emails and three phone calls to address the issue. &nbsp;The whole ordeal cost her company many multiples of the original bill. &nbsp;Worse, that company lost a customer for life. &nbsp;We&nbsp;will do our&nbsp;best never to do business with that company again.</span></p> <p style="text-align: justify;"><span style="font-size:larger;"><strong>Service-Driven Retention Focuses On Needs of Customer</strong></span></p> <p style="text-align: justify;"><span style="font-size:larger;">In contrast, I will compare these&nbsp;experiences to one I had with a local dry cleaning company,&nbsp;<a href="http://crowncleaners.com/" title="Crown Cleaners Website">Crown Cleaners</a>, here in Knoxville, Tennessee.&nbsp; While picking up some laundry recently, I happened to mention that my son had just sat in some bubble gum while waiting for me to pick him up from football practice, and the bubble gum had ended up smeared all over the front passenger car seat.&nbsp; Without any prompting, one of the employees grabbed a bottle of solution, came out to my car, and cleaned the bubble gum, almost magically removing the gum from the seat.&nbsp; When I offered to pay for the service, the employee politely declined, saying, instead, that Crown appreciated my business.</span></p> <p style="text-align: justify;"><span style="font-size:larger;">A little later, I received an email from Crown Cleaners pointing out that I hadn&#39;t been in with more dry cleaning&nbsp;for a while.&nbsp; Had something in the service gone wrong, the email asked?&nbsp; I responded no, I just hadn&#39;t been traveling a lot lately, doing most of my work from home.</span></p> <p style="text-align: justify;"><span style="font-size:larger;">That same week, I ran into the owner at a football game and told him everything was great, and I loved the systemic follow-up.&nbsp; He said, somewhat sheepishly, that he didn&#39;t send it, &nbsp;it was an automated email from his CRM platform.&nbsp; Well, it worked great, I said.&nbsp;</span></p> <p style="text-align: justify;"><span style="font-size:larger;">These are two different types of retention activities and two very different kinds of customer experiences. One focused on the customer&#39;s needs, and the other focused on the&nbsp;<em>company&#39;s</em>&nbsp;needs. &nbsp;While we would all like to think that&nbsp;<em>our company</em>&nbsp;would be more likely to provide the Crown Cleaners&#39;&nbsp;</span><span style="font-size:larger;">Customer Experience rather than that served up by Comcast,&nbsp; it is hard to know for sure. &nbsp;&nbsp;</span><span style="font-size: larger; letter-spacing: 0px;">As the above YouTube video makes plain,</span><em style="font-size: larger; letter-spacing: 0px;">&nbsp;power has&nbsp;shifted&nbsp;into the hands of the customer.&nbsp;</em></p> <p style="text-align: justify;"><span style="font-size:larger;">If we&#39;re smart, we worry about this.&nbsp; If we&#39;re even more intelligent, we do something about it as Crown does.&nbsp;<em>&nbsp;</em></span></p> <p style="text-align: justify;">&nbsp;</p> <p style="text-align: justify;"><span style="font-size:larger;"><a href="http://www.ronrassociates.com/Lists/Posts/NewPost.aspx?Source=/blog#_ednref1">[i]</a>&nbsp;See:&nbsp;&nbsp;<a href="http://www.cnet.com/news/comcast-admits-service-rep-did-what-he-was-trained-to-do/">http://www.cnet.com/news/comcast-admits-s ervice-rep-did-what-he-was-trained-to-do/</a>&nbsp;Citation on 10/17/24.</span></p> <p style="text-align: justify;">&nbsp;</p> <p style="text-align: justify;"><span style="font-size:larger;"><a href="http://www.ronrassociates.com/Lists/Posts/NewPost.aspx?Source=/blog#_ednref2">[ii]</a>&nbsp;Ibid.</span></p> 4