Allegiance Blog

In the current economy, there is a very real and growing concern about how to gain and to keep customers. This was apparent at the 2008 North American Conference on Customer Management (NACCM) this year, with attendance lower than it has been in some time. The irony is that much of what was presented provided insight on how to reach out and hold on to customers during tough times.

In stressful times such as these, many companies tend to pull away from their customers, and may even cut back on ‘satisfaction and loyalty’ programs to try and improve their bottom line. This, unfortunately, is a mistake because it cuts at the very heart of what we all need to be doing during this time – engaging customers to the point that they are willing to ride out tough economic times with us, rather than viewing us as yet another business that really doesn’t care about its customers and is willing to drop them or cut out the programs and products they care about most as soon as times get tough.

This was part of the overarching message at NACCM, including a conference speech I gave on engagement—that it’s important to continue to invest in improving customer engagement. However, one must be smart about how one goes about it. And the five most important take aways from this year’s conference were:

Engaging your customers (moving beyond ‘satisfaction’ and ‘loyalty’) will create a relationship between your customers and your company and/or its product that will help you weather the economic storm or even any mistakes your company may make – engaged customers really do stick with you and spend more money!

Use tools that are as effective as possible with the least expense (web-based tools are ideal for this) – tools that will not only provide you with data, but will help point you toward what is really going on with your customers

Don’t just ‘survey’ your customers – use tools that will provide you with leading indicators that will allow you to predict how a much larger group of customers will react based on the responses of a smaller group.

Don’t forget your employees! Engaged employees have a positive effect (a ‘spillover effect’) on the engagement of your customers.

Engaging your customers means taking action –Even small improvements can mean an increase in your customer’s share of wallet, positive word of mouth and referrals and increased retention and productivity from employees

The key in all of this is to overcome the reactionary fear that comes with a downturn in the economy and to look beyond. By spending smarter and in the right areas (what area is more important than those people who allow us all to be paid?) we can do more than survive…we can continue to thrive.

Kevin Mellander, Director Customer Care, Allegiance

Here at Allegiance, we spend a lot of time talking to customers and potential sales prospects about engagement. But if you’re new to the engagement arena, you may ask: What is engagement? And why should my business care about it?

Since we’re going to be blogging about engagement and other related topics moving forward, I thought I would take a moment to explain what engagement is and why it’s so important for businesses today.

Allegiance defines engagement as: The “emotional bond” or “attachment” that customers and employees develop with your business during repeated, ongoing positive interactions with your company. This bond goes beyond a single moment in time and is instead, defined by the enduring behaviors, attitudes and heart of your employees and customers.

Or, put another way, when customers are engaged with your business, they are emotionally connected to your organization, passionate about your products and services, as well as aligned with your organization’s purpose and direction.

Although the underlying idea of engagement itself isn’t necessarily new (i.e. for many years, companies have been focused on building customer satisfaction, trust and loyalty) the concept of managing customer and employee engagement like a tangible business asset—as real and as vital as inventory, case, intellectual property, etc.—is. In addition, researchers have found that businesses that do manage their customer and employee engagement like an asset enjoy 1) higher levels of employee and customer loyalty; 2) positive word of mouth; 3) reduced turnover and training costs; 4) receive higher price premiums for their services and products; and 5) greater share of wallet and cross selling, all of which lead to higher company profits and faster growth than those that don’t.

Engagement is also important because successful companies are realizing that the traditional axes of competition—product, price, place and promotion—will no longer propel growth, but will simply allow parity with the competition. Thus, to effectively compete in today’s market, companies must have employees and customers that are not only satisfied, not only loyal, but also engaged.

To learn more about engagement, read the Allegiance white paper titled: “Discover Engagement” (see http://www.allegiance.com/library.php)

Kimberly Carroll, MarCom Manager, Allegiance

I got a very complimentary email from a customer not too long ago thanking both myself and my team for getting back to them quickly. While this e-mail was very nice and I was really glad that our customer was happy, it did make me wonder: What kind of customer response times are other businesses providing that so many businesses and consumers today are left feeling grateful for anyone who gets back to them quickly? I’m assuming it’s probably not good.

I believe in treating customers the way that I would like to be treated. If it’s going to take some time, let them know – don’t ignore them in the hope that maybe they’ll go away. If we make a mistake, admit it and correct it; don’t cover it up. Customers are smart. And even though some businesses think that mistakes and excuses will fly, well, they don’t.

I recently read a research report that found that 20-25 percent of customers who wait minutes or hours for a response from a company won’t purchase from that company again. That number goes way up—up to 45-55 percent—for customers who are forced to wait days or weeks. If for any reason a customer waits months (heaven forbid!) for a response, the company they’re dealing with can say goodbye to 80% of them!

I hope we’ll all respond to our customers at least as well as we respond to our friends, family, coworkers, etc. If you already think that you do, perform a quick check. If no one is any longer speaking to you, check your customer response times…and focus on getting back to your customers more quickly.

Kevin Mellander, Director Customer Care, Allegiance

The most expensive things in this world are those that are rare. What you treasure and that you protect the most are those things that cannot easily be replaced. If you think about it, the highest thing you and your customers value in common is the most important element in your company’s products and services.

I most value my time. Time is rare indeed. It is fleeting. It cannot be preserved and saved for later. You either make the most of the moment you are in or it is lost forever. How can you best measure how you are valued by another person? Measure how much and the quality of their precious time they spend with you.

Allegiance has spent significant time and money writing and speaking about engagement. Engagement is the emotional bond that can (and I propose must) be built between an employee and his/her company, as well as between a company and its customers. We have worked hard to build technologies that can measure this bond. We have worked equally hard helping our customers not only implement these technologies but also to work with their people to improve the processes surrounding the measurement and improvement of engagement.

Lately, we have changed our thinking about engagement. We have begun to understand that engagement isn’t some intangible concept, but like time, it is an equally precious resource. In fact, engagement IS time.

Look at your most valued customers. They are usually most valued because they are engaged with you—and therefore spend their money with you. How do you know they are engaged? It is because they spend their precious time with you, usually in providing feedback about your products and service levels.

Look at your most valued employees. Once again, we value them because they give of their time. These most valued employees often give over-time. They get things done, quickly and timely, and as a result, we profit from them.

May I suggest a few time-based things you can do to increase customers’ and employees’ engagement:

Appreciate their time by word
When a customer or an employee spends time providing feedback, celebrate! Take time to thank them vocally as quickly after they spend time with you as possible. Follow up (with more time) to send them a note of appreciation. The more time and effort you spend on the note the better.

Appreciate by spending your time
Spend some time to evaluate the suggestion and evaluate its potential positive impacts on your business. Further explore how it might impact other less obvious elements of your processes. Then make the changes necessary. And of course, communicate back the results and how much you appreciate those results.

Reward
Share with them some of the rewards of the improvement. This may not always need to be monetary. Customers may appreciate even more the company that spends their time to reward engaged behavior. Perhaps you can reward a customer who improves your bottom line by offering your best consultants’ or executives’ time to analyzing and improving their business.

John Epeneter, VP Product Management, Allegiance

Customer loyalty is built on customer relations. The front desk clerk, the counter clerk or even the security guards can make or break your business based on the impression they leave with customers. Whether you are in a service-oriented business, manufacturing, education or the health care field, your goal is to make that first impression lasting and gain loyalty from customers.

No matter what type of business you are in, the following are standard guidelines in handling customer relations:

1. Make the customer feel like royalty when attending to them. Pamper your customers. You must have well-oriented and well-trained customer relations personnel to assist them. Everyone in the selling area or in the place where customers are expected to move around must know their job. Keep your customer relations personnel updated on how to handle customers. This has proven to be an effective way of keep customers and get them to return. Make customers feel like they are part of the company, or a member of your corporate family. Value them.
2. Handle complaints properly. Each one of us has been customers of various establishments. We know that a customer is always right , and as companies we should stand by that principle. The basic steps in handling customer complaints are to listen, validate the complaint and act on it promptly. The key to handling customer complaint is to act quickly. It is said that one dissatisfied customer equates to hundreds of thousands of lost sales, since word of mouth travels. Protect the company from losing more because of one complaint.

The performance of the customer relations department plays an integral part in helping the company sell whatever product or service they are offering. Needless to say, customer relations should be a paramount concern, especially for your front line workers.

One way to benchmark the level of satisfaction of your customers is through a customer satisfaction index. One of the leading customer satisfaction indexes in the world is the American Customer Satisfaction Index (ACSI). The ACSI helps determine how satisfied consumers in the US are, so that consumer behavior can be understood. ACSI personnel question around 80,000 Americans per year regarding how satisfied they feel about any of the products and services they may have used for that year. Even the satisfaction of the public with government services is rated by the ACSI.

You may access information about the ACSI every quarter, after survey results have been collected and analyzed by ACSI analysts. Some of those who use the ACSI information are:

• industry trade groups
• market investors
• market analysts
• corporate and organizational decision makers
• and academic researchers.

Ordinary consumers may also opt to read ACSI results so that they can be better informed about what products and services to buy the next year.

To get their data, the ACSI personnel conduct telephone interviews based on the Computer-Assisted Telephone Interviewing system. Respondents are usually randomly chosen and screened first via the sampling method called random-digit dial technique. The ACSI generally concerns itself with customer service satisfaction about over 200 companies that operate in 10 economic areas and 43 industries all in all. Because the ACSI has been proven to be quite reliable and credible, organizations and interest groups from other countries have also begun adopting the ACSI in their countries as well.