Agreement on the need to retain customer is easily arrived at, not too many views against this motion is voiced because it is no longer a closely guarded secret that mighty aren’t those who acquire customers at the rate hurricane destroys whatever comes in its way alone but also those who retain a great majority of those who choose to stop by, more like what a humble piece of sponge does to water when they get to date. Companies that become formidable brand force .. do so not solely by their aggressive acquisition drives but by building a solid foundation of loyal customers. Customer who are willing to come back for more!!
Enough has been said and written already to establish that cost of keeping a customer engaged in the long term is almost always lesser than acquiring a new one. I do not mean to paint customer acquisition effort as anything any less important, you need the denominator to gain weight by every passing day to survive, what is truly, an unforgiving and unapologetically so, market. New customer acquisition is key to success because your investors and other stakeholders will beat you to death if you do not beat your projections. A humble product becomes a brand when it has by its side a sea of customers who keep returning to them; take top ten companies in any sector and you will realize that all of them have done a phenomenal job in retaining their bases. You always get to choose which segment you wanna target .. thing here to remember is that same choice is also available with the customer .. in the same price range whom does he or she want to do business with, is up to them.
The real question then is; what is it that gets the customer to keep making a brand a provider of their choice? If 100 people were asked the reason, at least 95 of them will list below 5 in their top 10 reasons in different order of priority. Here is how I see the sequence.
- Price
- Usefulness/Relevance
- Reliability
- Ease of use
- Experience.
If you try to club these further .. you’ll be left with just two broad components.
- Product construct ( Price and features)
- Customer Experience (Service, value and everything else in between)
Proof of price and validity of usefulness gets answered conclusively by the rate of acquisition. If people are buying you; you have certainly got some bit of it right! Keep looking for ways to optimize and get better but the fact that you’re selling gives you a reason to remain in the business. But always remember what got you here .. won’t get your there ( there being a higher place, in this argument)
Then comes the complex question; how many are you really retaining in the long run? Or simply put why customers who saw value in pursuing you initially, have pushed you out of their lives, eventually? What went wrong? With price there is only so much elbow space for you to do things, because you are constrained by viability and innovations, powerful ones, do not spring like mushrooms after rain, every day, sadly, if it did you could broaden the horizon. The other part, however, which is ‘customer experience’ is limitless – You get to play the part you choose in the theatre of service. This mind you, is not as much about throwing money at the problem as much as it is about applying thought and building solutions. Here you can get as creative as efficient and as smart as you perhaps would want to be. Money makes the world go around and service quality is not an exception to that rule; budget may limit you to remain minimal. Which is why in my view you can pick these three elements to make a difference. (I’m no expert at this .. I’m learning the trick of the trade)
Education – You need to understand that what is simple and intuitive in your assessment may appear complex and limiting in your customer’s worldview. Users will always think differently about your product and services simply because they have not partnered in designing, development, or roll out of your services. There are other things that they do all day long, unlike you. To take your message across you will have to create a map of understanding, one in which the customers has to make little or no effort in getting ahead. Every communication that you make with your customer is an opportunity for you to make your customer more knowledgeable about your product and services. We love what is easy and customers are no different, the day your customer learns your services well enough it will become the reason for them to stick. Let’s take an example .. why do most windows users willingly stick to it despite knowing that a Mac is a better operating system? Familiarity ( price also is) is the reason.. you have to make your users as familiar and friendly with your product as possible.
Service – Moment of truth is when the rubber meets the road. No matter what you conceive how well you think you have executed it .. it will break down every once in a while and when it does you will need people to fix it swiftly on one side and on the other you will need to work with those who are impacted – service recovery! Customer service is not only about sorries or thank you(s) it, as a matter of fact, is also everything else in between. I’ll link two more articles that I have written on customer service here for you to go thru – write-ups clearly defines the design and their significance – DO MAKE TIME FOT IT.
#1 Customer Experience – It matters!
#2 Customer Feedback, should you care?
Close looping – People and organization do not fail in constructing a comprehensive coherent design, what gets missed, more often than not is the fact that different pieces of the puzzle do not come together in time for the storyboard to get complete – for the customer to read effortlessly. Creating a list of sweet adjectives is one thing, calling them ‘values’ is another and upholding them in every task that is undertaken is a different ball game, altogether. If even one activity in your organization places your own interest over your customers .. you aren’t as customer-centric as you claim to be – truth be told. Simplest examples could be:
- Lucrative deals that conceal conditions.
- Keeping revisions from your customers.
- Benefits that are promised but not processed in time.
- Choosing to design systems that require ‘lesser effort’ despite every logical argument pointing towards the alternative approach.
- Counting coins… going back on stated commitments.
Orgs ignore to value their commitments after that coveted purchase has been made by the customer. Litmus test – “Benefits not received” if this thing makes even a portion of your customer feedback – you clearly haven’t done a good job in getting everyone in your organization to understand ‘customer centricity’. People have creative ways of explaining such slippage, they blame it on systems or lack of it, some even have the audacity of pushing ‘was busy’ argument in for such mayhem etc but for all you and I know, it is never about excuses. At the very core it is about that individual or department or organization caring little – just that, nothing more .. nothing less! This is not a situation however that can’t be corrected but it will certainly take the investment of ‘giving up greed ’, not getting ‘seduced or sucked into mindless urgency’ and building a ‘culture that values customers more than everything else’ .. even profits in the short term. You will have to learn to wait till you are ready, make arrangements for your workforce to abide by those principles. Play by the rules .. win but always remember that winning fairly is more important. Ends do not justify the means.
Basically, close looping, in this context, means that you will have zero difference between your thoughts, words, and actions – not an easy thing to attain but whoever has ever got there has remained a darling to their customers.
On that note… I leave you to think and correct whatever is broken because there is never a better time than NOW to reboot…
Thanks for the encouragement!!
Well written Lav K with a clear perspective. In rat race where more focus is to get customers with all effort and cost, focus toward engagement has lost ground and for companies to win, its important to REBOOT….
Keep on writing such articals atleast it may be helping many individuals to put their small effort toward customer centricity.
Very Useful article Lav , however would like to add one more point in addition to what you have already embedded out of my own experience, proactively contacting the customers to get their vibes and understand what's going in mind. It also helps improve relation with customer and acts as catalyst to add on to your base while improving CXX.
Thanks, Kamesh, couldn’t agree more!
The development of the Customer Eco System would start from here and the entire journey would be a bliss !
Thanks!
Thanks, Rajeev! You are a champion.
So Valuable information.
Close Looping this I have implemented in my current organisation and it impacted very positively in CSAT. This happened because of your guidance.
Sir I always remember one thing that you use to tell us when we were struggling for CSAT "मुझे रिजल्ट से मतलब नही है जब तुमलोग दिल से मेहनत कर रहे हो तो रिजल्ट आज या कल आ ही जाएगा" and these lines always boosts entire team and we succeed.