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6 posts from June 2015

Does the fact you have info about your customers' behavior change their expectations?

If you have a restaurant and customers use Facebook to announce their presence, do those customers expect the restaurant to notice? What if they are checking in frequently? Do they feel the restaurant should acknowledge them?  IStock_000021552541XSmall

We don't have good answers yet, but as this Harvard Business Review article points out, large chains like Starbucks now have access to this information and can integrate it into their loyalty programs. We expect that as customers experience such benefits at our competition, the customers will expect us to catch up at some point. 

Harvard Business Review: The Internet of Things is Changing How We Manager Customer Relationships, 2015-Jun-5 by Ric Merrifield

Now you can have visibility into everything. Not only can you tell that Customer A (who has a shopping app) went into a Lord & Taylor store to buy an expensive pair of shoes (which you could know with CRM). In addition, you can know how long they were in the store, where they walked, and whether they lingered or went straight to the shoe department and bought the shoes. Then, you can compare that visit to every visit to that store that Customer A has had (since getting the app), and you can at least infer what is most valuable to her. If she is always a get-in, get-out kind of shopper, speed of service may be her #1 thing. If she spends a great deal of time shopping, maybe price or product selection is her thing. If she buys a lot at the store, maybe she wants some form of recognition for her loyalty (whether it’s points or just a “welcome back”). If you compare online experiences with in-store experiences and weekend vs. weekday behaviors, your picture of the customer becomes three-dimensional very fast.

As exciting as it can be to talk about this and to see that it is happening right now in broad daylight, talking about how to assess customer experiences and how to engage customers differently when they have this information gets complicated quickly. The important thing is to acknowledge that the measurements of yesterday may need an overhaul, and to understand where your customers are on the acceptance-expectation path so you can try to stay with, if not get ahead of, them.  An increasingly common method for getting a handle on this is documenting the customer (and employee) experience journeys.


Why we will always lose customers unless we have a strategy to retain them.

Two of my Facebook friends are deceased now, but they are still in my Friends Count. Of course, I appreciate seeing their names although I don't visit their profiles. I do remember them fondly when I see their names in the list. 

IStock_000019653085XSmallDeceased customer names in a marketing database? Not such a good idea. Unfortunately most marketing databases are cluttered with the names of people who moved away or aged out of our market or just rearranged us out of their lives. 

We compete not only with chance events but with competitors who are stealing our customers. If we don't have a strategy for retaining customers... checking in with them, ranking them, scoring them and wooing them back, we'll have no idea where they went. Having no strategy to retain customers means that we don't care when they leave. And that means our operating expenses will be higher than our competitors who do care. 

Canalside View: Marketing Crack: Kicking the Habit, 2015-May-13 by Martin Weigel

Laurence Freedman (also a military historian) too, makes the same point in his magnum opus Strategy: A History:

Strategy is required when others might frustrate one’s plans because they have different and possibly opposing interests and concerns… The inherent unpredictability of human affairs, due to the chance events as well as the efforts of opponents and the missteps of friends, provides strategy with its challenge and drama… ”

Because they can distinguish between plans and strategy, they’re able to focus on the long-term game, and be able to respond to events and circumstances at the same time.


Why we have to stop answering our own questions

Most of us believe we have to talk in order to be persuasive, but one of the best ways is to ask good questions, listen to the answers, and integrate those answers into the way forward, acknowledging the person who contributed. 

PeterBregman.com: If You Want People to Listen, Stop Talking, 2015-May-26 by Peter Bregman Tq150605ldl

It is easy to fall into the habit of persuasion by argument. But arguing does not change minds — if anything, it makes people more intransigent. Silence is a greatly underestimated source of power. In silence, we can hear not only what is being said but also what is not being said. In silence, it can be easier to reach the truth....

I could tell what George was doing, because when he decided to speak, he was able to articulate each person’s position. And, when he spoke about what they said, he looked at them in acknowledgement, and he linked what they had said to the larger outcome they were pursuing.

Here’s what’s interesting: Because it was clear that George had heard them, people did not argue with him. And, because he had heard them, his perspective was the wisest in the room....

“When you ask a question into a group,” he told me, “think of it as a competition. If you answer your own question, you’ve lost."


For the next level in building customer loyalty, go from managing relationships to engagement to success

At the leading edge, our competitors are now focusing on customer success in order to grab more market share. Relationships are all well and good, but the way to know if a relationship is really working is to monitor the success of our partner. IStock_000019396834XSmall

CRM software is designed to help us manage ALL our relationships: customers, prospects, teammates, and suppliers. Now we have a new software platform called Customer Success Management. Developed for companies that depend on software-as-a-service (SAAS) subscription renewal and growth, the technology imports data from ERP as well as CRM and social media accounts to monitor growth. Now this service is moving into many companies who've already considered hooking up their accounting data with their CRM data. 

Are our customers more healthy and successful for knowing us?

Forrester Research: Customer Success: a hot new software category that helps you manage your customers, 2014-Nov-2 by Kate Leggett

Customer success organizations use an array of company and customer data to create a "health score."  Typical data used to calculate a health score include CRM data, billing data, customer support tickets, NPS from surveys, product usage data and more. The behavior of the health score at the company, subscription, and user level — its raw number, trends, and sudden changes — is at the heart of understanding and managing customer success.


Every business has to define what loyalty means for itself

I was reading about the difference between conservative and liberal worldviews, and the author classified loyalty as part of the conservative worldview. That makes sense, but I think it speaks to the traditional definition of loyalty as a sort of tribal value. 

Loyalty in a business sense is about an enterprise including in its long-term plans a commitment to recognizing and rewarding its supporters. Supporters will include customers and many other types of people who want the business to thrive. Loyalty leads to increased profits, or improved operating margins for a nonprofit. Loyalty is provided by people, not by 'customers' or 'vendors.' If we want our businesses to survive, we have to plan to allow people to show their loyalty. 

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Consultant Bill Hanifin notes that when Forrester Research analyzed what business leaders want from their loyalty technology providers, 3 of the top 6 were

  • Understanding the client's business
  • Strategic contribution to the client's business
  • Ability to design and execute innovative and differentiated programs

Loyalty Truth: What the Forrester Wave report on Loyalty really tells us, 2015-Apr-23 by Bill Hanifin

...while every company needs a well planned customer growth strategy, not every brand needs a “loyalty program.” As customer behavior trends continue to evolve, the highest mandate on brands is to deliver innovative strategies that engage customers first and establishes a foundation of trust through repeated interactions. Doing this successfully comes through working a carefully executed planning process whose outcome is to frame and define a company’s customer loyalty worldview.


Recognizing which customers can become advocates

Whenever I become the customer of a new web service, I'm often offered the opportunity to get reward points or even discounts for promoting the service on social media or for recruiting my contacts to join. While it's not offensive, it's usually pretty useless. 

  1. It's too early for me to recommend a service I just joined.
  2. I'm not the "advocate" personality type. 

Customer advocates are one of the very cheapest and most credible ways to promote our businesses. Unfortunately, satisfying customers and creating advocates are very different processes.

A 2010 case study from Harvard Business Review found NO overlap between the heaviest users and the heaviest advocates of a service. Advocates have different motivations than users.

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Over and over again, I meet with business owners who tell me: "I don't need a loyalty program because I make my customer so-o-o happy, my customers recommend me." WRONG. A good loyalty program covers all the different types of rewards that your supporters need.

The Hub: Return on Referrals: Advocates and buyers are two very different kinds of consumers, 2015-Apr-28 by Liz Crawford

Why do some shoppers advocate, even when they may not, in some cases, use the brands much? The reason is that they want to be in-the-know rather than simply seeking product benefits. According to BzzAgent’s Field Guide to Brand Advocates (2013), 61 percent of advocates claimed that “it is important to me that people view me as a good source of information.” This compared to only 24 percent of general web users. These sharing mavens see dispensing information as a source of social capital and self-esteem. In fact, according to the same study, “recognition for my efforts” is twice as important to advocates as compared to all others.