Allegiance Blog

For a good number of the Vice Presidents of Sales, the economy is forcing them to rely upon cross/up-selling current customers to generate anywhere from 10% to 50% of their annual quota.  One of their big concerns is the increase in customer attrition.  Given the current cost and difficulty of acquiring new customers, customer attrition is not only making it very difficult to meet sales quotas but it is also eating into the company’s overall profitability.  

An old idea that is gaining new popularity among sales managers is the idea of using customer feedback tools (surveys, Twitter, etc) to help identify customers who are likely to defect to the competition and rescue them before it is too late.  Although not fool proof, I’ve seen companies identify and rescue 6,300 customers over a single year representing over $2.2 million in recovered revenues.  

Care needs to be given to basic survey administration best practices to avoid the problems of survey fatigue, useless data, and to ensure at-risk customers are contacted in a timely and proper manner.  For tips on avoiding the most common customer feedback pitfalls, see Bob Thompon’s post “Five Voice of the Customer Pitfalls.”

In my last blog post, ‘Customer Feedback: The Key to Creating More Value’, I dispelled some of the myths about collecting customer feedback. I also promised that in my next post, this one, I would tell you how and why, if you listen to customer feedback, it can show you where and how to gain a competitive advantage, and improve customer loyalty and engagement. So, here I go:

While there are several great examples that come to mind on how companies are using customer feedback to gain a competitive advantage, since there isn’t enough room in this blog post for all of them, I’ll just share one. (So as not to make this blog a promotional piece, I picked a neutral one).

In the book ‘What Customer Really Want’, author Scott McKain tells a great story about how a coach bus company that transports music stars across the nation to their concerts (i.e. clients either lease or purchase its buses), was originally planning to improve the interior of its buses because it believed that if it did, its customers would be willing to pay more, and the company would make more money.

However, in the midst of picking out fabric, flooring, etc., the company realized that it had never asked its customers what they thought about its plans. So, the company did. To the company’s surprise, it found out that while its customers did want nice interiors, the single most important factor to them in selecting a coach company was the bus driver! (i.e. Someone who could get these music stars to their destination safe, especially if they had to drive through the night. And, someone who would also serve as a good ambassador for the band with fans).

The company immediately launched a driver education program to teach its drivers how to communicate more effectively with customers, and how to retain and grow customer relationships. The company also changed its reward system so that drivers were compensated according to how well they served the customer, and how well they cultivated long-term relationships with them. Once the company did that, it moved from fourth in the marketplace to first, and grew from 28 to 56 coaches.

My point is if you want to grow your revenues and increase your customer retention, customer loyalty and engagement, you have to ask your customers for feedback. It’s the only way to find out what they really want, where and how your company can improve, and yes, even make more money and gain a competitive advantage.

Kimberly Mathie, MarComm Manager, Allegiance

Arjun Sen, president and founder, ZenMango offered some great advice to companies today on retaining customers as part of the online Engage eSummit presentation that he gave titled: “The Leaky Bucket: The Secret of Eating an Elephant.” His advice:

• Know your customers – Who are they? What’s most important to them?  Etc.
• Make sure your employees’ point of view matches up with your customers’ point of view (and that all of your employees understand why each customer is important as well as the role that each of your employees play in retaining customers)
• Unite your marketing and operations teams and ensure they have a shared vision
• Realize every customer counts – Treat them that way; reward your employees for doing so
• Understand your leaky bucket (why customers are not coming back) and fix it (i.e. Identify your customers’ breaking points and decision to return points. In addition, go through the customer experience yourself and see and feel the pain through the eyes of your customers.)
• Improve and enhance your customer experience

Chris Cottle, VP of Marketing,  Allegiance