Develop Long Lasting Customer Relationships with 5 Key Tenants

Companies with a "Customer Experience" approach generally follow 5 key tenants:

1. Continuously solicit customer feedback: Customer expectations and perceptions of service are dynamic and change per customer segment across contact channels. For example, millenials expect to contact customer service via mobile and social media compared to older generations that still prefer inbound telephony. Integrating a multi-channel contact strategy is a complex challenge but it can yield long term customer loyalty if done right and based on customer input. 
2. Provide a smooth and easy customer interaction: Make the interaction as personalized as possible. For example, agents should have access to the customer's interaction history regardless what inbound support channel the customer used to initiate the contact. Customers expect companies to have a full view of their history and not have to repeat themselves or explain multiple times the reason for their contact. Nearly 96% of customers reported high loyalty if they have a seamless customer service experience.
3. Deliver a consistent customer experience across channels: This is where companies often fail. Your company's "customer experience" must be consistent and repeatable across the entire customer journey. For example, tone of voice, brand messaging, agent scripting, signage, uniforms, etc. 
4. Be proactive: Continuously look for improvement opportunities. Use customer feedback and data analysis to identify proactive improvement measures. Anticipate customer needs based on their history, behaviour, interactions, transactions, etc. For example, a large mobile operator determined 60% of new customer activations contacted customer service requesting their phone settings. This information led to a new sales process that included in-store support to transfer phone contacts from their old phone, set-up voice mail, and redesign the customer leaflet with more informative setting information. 
5. Customer Experience starts at the top: Customer experience can't be the exclusive domain of one department. A successful customer experience culture starts at the top with the CEO and trickles down to the front line employee. Every company decision, from new product development to new marketing materials, must adhere to the company's customer experience strategy and translate across to training, marketing, PR, systems, hiring, processes, and data analysis. 

Net Promoter Score

What is the Net Promoter Score

The Net Promoter Score is a customer loyalty metric expressed as index ranging from -100 to 100 that measures the willingness of customers to recommend a company's products or services to others.

How To Calculate the NPS Score

By asking your customers one simple question — “How likely are you to recommend this (company/product/brand) tour to someone else?” — you can track these groups and get a clear measure of your performance. Responses are on a 0-to-10 point rating scale and are categorized as follows:

• Promoters (score 9-10) are loyal and more likely to refer your company/product/brand.
• Passives (score 7-8) are satisfied but unenthusiastic who are vulnerable to competitive offerings.
• Detractors (score 0-6) are unhappy customers who can damage your reputation and impede additional tours through negative word-of-mouth.

The Net Promoter Score is calculated as the difference between the percentage of Promoters and Detractors. The NPS is not expressed as a percentage but as an absolute number lying between -100 and +100.

If you have for example 25% Promoters, 55% Passives and 20% Detractors, the NPS will be +5. A positive NPS (>0) is generally considered as good.

Don’t make the common mistake of placing a percent sign (%) behind your NPS score, it is not a percent.

The NPS is a non-traditional customer satisfaction metric and measuring it exclusively will not help you identify strategic and tactical changes. Yon need to also:

• Ask users if they can be contacted in the future.
• Automatically sort these users into lists (panels) of “detractors”, “passives” and “promoters”.
• Repeatedly survey these groups, each with surveys tailored to their group.
• Determine why respondents feel the way they do.
• Track changes over time.
• Correct problems and capitalize on successes.
• Build meaningful relationships with customers in all 3 groups and improve perceptions.

Benefits of using the NPS Model

• Higher Retention Rate: Detractors generally defect at higher rates than Promoters, which means that they have shorter and less profitable relationships with your company. Rescue those Detractors—turn them into Promoters—and experience higher margins.

• Higher Margins: Promoters are usually less price-sensitive than other customers because they believe they’re getting good value overall from your company. The opposite is true for Detractors, who are more price-sensitive.
• Higher Annual Spend: Promoters buy more, more often, than Detractors do. They tend to consolidate more category purchases with their favorite supplier. Promoters’ interest in new product offerings and brand extensions also exceeds that of Detractors or Passives.
• Greater Cost Efficiencies: Detractors complain more frequently and consume more service resources. In contrast, Promoters reduce customer acquisition costs by staying longer and helping to generate referrals.
• Greater Word Of Mouth: What proportion of new customers selected your firm because of reputation or referral? The lifetime value of those new customers, including any savings in sales or marketing expense, comes from Promoters. If you’re using the Net Promoter model, you’ll attribute 80 to 90% of referrals to Promoters. On the other hand, Detractors are responsible for 80 to 90% of negative word of mouth, so you can attribute the cost of this drag on growth to them.

A Customer Experience Framework

A Customer Experience is an interaction between an organization and a customer. It is a blend of an organization’s physical performance, the senses stimulated, and emotions evoked, each intuitively measured against Customer Experiences across all moments of contact.

Great customer experiences are:

• A source of long-term competitive advantage
• Created by consistently exceeding customers’ physical and emotional expectations
• Differentiated by focusing on stimulating planned emotions
• Enabled through inspirational leadership, an empowering culture and empathetic people who are happy and fulfilled
• Designed “outside in” rather than “inside out”
• Revenue generating and can significantly reduce costs
• An embodiment of the brand

I recommend the following Customer Experience framework which focuses on 9 orientation areas of the business:

• People
• Culture and leadership
• Strategy
• Systems
• Measurement
• Channel approach
• Customer expectations
• Marketing and brand
• Processes

Let's look at the Customer Experience considerations for ‘channel approach’ and ‘physical’.

Channel approach – Consider the primary moments of contact during stages of the customer experience, the appropriate functional structure required to manage the customer experience, and the customer’s moments of contact. 

It’s increasingly difficult to manage the Customer Experience as the distance between the brand and the customer increases. 

It is also important to understand the customer’s emotional readiness and confidence levels in order to move them to less expensive moments of contact.

Physical – When considering the physical customer experience, there are 11 categories:

Each of the above orientation areas has indicators that ultimately makeup the company’s orientation. There are four orientations:

Naïve – an organization that focuses on itself to the detriment of the customer. It is “inside out” either through choice or because it doesn’t know what is should be doing.

They tend to focus on themselves rather than the Customer Experience. They are reactive top customer demands. They believe the product, processes, or their services are more important than the customer. Their attitude with the customer is one of “take it or leave it” or “what do you expect from a product at this price?” Their processes are totally focused “inside out”, doing things for their benefit, rather than “outside in,” which is changing the organization to meet customer requirements.

The naïve oriented organization is organized around its products. These products overlap and are uncoordinated. It is typically a siloed organization and infighting between the silos is rife.

The organization is either in this orientation because they are:

• Unaware what they should be doing to build a great Customer Experience. They are not deliberately trying to cause a poor Customer Experience; it is simply that they do not know what they do not know. They are unaware of the impact on their Customer Experience. By definition they have not spent time thinking through the implications of what they are dong. This typically indicated they believe something else is more important than the Customer Experience.
• Aware of their orientation but simply don’t care as customers are a nuisance, and seen as a means to an end.

 Naïve organizations typically target their people on sales or productivity, use internal measures, and either do not understand customer satisfaction surveys or take little notice of the results if they do.  

Transactional – an organization that focuses primarily on the physical aspects of the Customer Experience; It has recognized the importance of the customers. However, it focus is rudimentary, as many aspects of the Customer Experience remain left to chance and are uncoordinated and “inside out.” The organization is typically reactive to customer demands.

They understand some of the basics of the Customer Experience but still remains reactive to customer demands. It has recognized that the customer is “quite” important and it has made some changes to reflect this. The core of its operation is primarily around the physical aspects of the Customer Experience, for example, opening times, answering calls in four rings, accessibility through the call centers, delivery times. It is, in reality, still “inside out” and its Customer Experience is not deliberate, but just happens. IT does not measure customer satisfaction but it is fundamentally focused on physical elements of the Customer Experience. Some employees are targeted on general customer satisfaction but this is, at best, an afterthought, compared to the important measures of sales and productivity. It has established a customer service organization but typically these employees are treated like second-class citizens.

 Organizationally is often functionally siloed, with each silo treating the customer in a different manner. Little information is shared across the functions and customers are forced into dealing with many parts of the Transactional organization to get problems resolved. “Solutions” are billed separately, showing the lack of true coordination with the organization.

Enlightened – An organization that has recognized the need for a holistic, coordinated, and deliberate approach to the Customer Experience. It is proactive in nature towards the customer and orchestrates emotionally engaging Customer Experiences. It stimulates planned emotions.

The Enlightened oriented organization understands the importance of the Customer Experience and has thus achieved enlightenment. It has converted from being reactive to proactive to customer demands. It has understood the critical nature of defining the Customer Experience it is trying to deliver. It has spent time discussing this at a board level and agreed a Customer Experience statement, which has been communicated to all employees. It realizes that over 50% of every Customer Experience is about emotions and therefore it has embedded new processes into its Customer Experience, which are planned to to deliberately evoke emotions. Enlightened organizations recognize that customers have emotional expectations, as well as physical expectations, and plan to exceed both.

The Enlightened organization has formal methods to ensure that people spend time with the customer. This applies from the most senior members of the board to the intern. The leadership walks the talk regarding the Customer Experience.  

 Natural – an organization where focus on the customer is total. It is very proactive and is naturally focused on the complete Customer Experience. In order to produce memorable and captivating Customer Experiences it uses specific senses to evoke planned emotions.

In this orientation, the Customer Experience is in the organizations’ DNA. It does not have to consider what to do as it does it naturally. It understands the critical role that senses plan and has deliberately builds these into the Customer Experience. It understands that customers have sensory expectations and then use the senses to create captivating and memorable experiences. It involves the customer in the design of the Customer Experience and has defined its own Customer Experience Recipe. It is totally proactive to customer demands and undertakes many activities, which even the customer does not see, to build a great Customer Experience.

It recognizes the amazing power of “stories” and “storytelling,” both inside and outside the organization, and it uses these to great effect to build its unique Customer Experience. Its leadership, and everyone in the organization, has been selected to meet its deliberate Customer Experience. Its culture is aligned to the Customer Experience and is seen as an enabling tool. It uses theatre as a method of producing consistency of its Customer Experience. It considers the product or service it sells of secondary importance, as it knows if it gets the Customer Experience correct then the rest will follow. It has aligned the brand and its Customer Experience and one supports the other. It has very sophisticated methods of collecting customer data, which it constantly uses to improve its Customer Experience. Its systems look at the holistic Customer Experience and provide relevant data at points of contact with the customer.  

 The below chart indicates an organization’s orientation across three axes:

• X axis = the progression of an organization’s strategy on differentiation – from traditional product features, to service, then through to Customer Relations (ie: personalization and customization supporting relationship marketing) and finally then using Customer Experience as the primary source of differentiation.
• Y axis = the organization’s deliberate use of different facets of the Customer Experience, moving from product, through physical, to emotional and finally sensory.
• Z axis = denotes how customer focused the organization is.

The Customer Experience Hierarchy of Needs highlights the basic elements of the Customer Experience people wish to have in place before they can move up the hierarchy. It is at the top two levels that companies are able to differentiate themselves and provide deliberate Customer Experience. In most cases the top two levels are emotional elements and it is the customer who should determine what these elements are and if they are important.   

Customer Lifetime Value

CLV enables you to know at which point customers become profitable, which is key to successful marketing and retention programmes, sales targeting, financial forecasts and other strategic concerns. Getting a handle on CLV helps identify the additional investment required to drive marketing campaigns, retain customers, support sales account management and optimize customer service.

To fully assess CLV for customers and then segment them, it is important to employ tools that help you identify and track different types of customers. Using a Customer Relationship Management (CRM) solution can be essential in ensuring that you organize customer information, metrics and other indicators, so that you can effectively profile and segment customers and assess CLV.

There are several different models you can use to calculate your CLV. The best model depends on your type of business and industry. If you need a place to start, then I recommend the following "simplistic" model:

Divide the total amount of marketing dollars by the amount of actual customers that come from those efforts. (Marketing Spend / Customers = Cost Per Customer)

A little better way to measure CLV is:

(Average Value of a Sale) X (Number of Repeat Transactions) X (Average Retention Time in Months or Years)

But this is still a bit misleading as averages lie. You need to look at CLV based on your customer segments and analyze this data to find correlations between the members who stay and those who churn quickly.

Finding the lifetime value of these individual customer segments will give you a very clear idea about the value each type of customer will bring to your business. Once you know that, you can make data driven decisions about how much to invest in acquiring each customer type.

There are specific steps you can take to retain customers fitting the right profiles

Segment your data and create a retention plan – With the CLV analysis completed, segment your data according to customer worth. It is important to create a separate retention strategy for each segment, according to the projected value. For example, key accounts and potential key accounts may receive a free customer magazine and quarterly sales visits to ensure they are happy, while less profitable customers would receive an online version of the magazine and phone follow-up – which cuts costs in accordance with the return

Send the right communications – A relationship can be tainted from the very beginning if you don’t offer communications to customers that are relevant and anticipated. Use marketing automation software to trigger communications based on customer behaviour – this is considered one of the most impactful ways to grow a fruitful relationship with customers and is completely automatable

Streamline processes – If your employees are manually undertaking tasks like call logging or saving emails, then productivity is limited. Simply implement the right CRM software, which will happily record and track such data automatically and subscribe customers to specific campaigns with a few clicks. Being efficient will impress your customers and free up time for more qualitative interactions that help build a stronger relationship

Get varied with media – Today there is a consumer expectation that companies should interact across a range of media, especially digital channels. Social media is becoming increasingly important, with every smart company having some sort of customer-specific presence on social media channels. Proactively handling customer service via a social media management tool integrated into your CRM system can help you to resolve issues more quickly – you are able to get to the information you need to see faster

Instill loyalty – Successful customer retention begins from the first point of contact and continues throughout the relationship. Continually exceeding customer expectations will help gain loyal advocates and in the digital world, a happy customer can spread the word to hundreds if not thousands and in certain magical instances, millions of prospects. Personalized messages that are right on target, addressing needs and reflecting preferences, help companies build strong bonds with customers and help nurture new relationships

Show you care – Taking customers’ thoughts and feedback on product ideas into consideration can go a long way to making them happier, as they feel part of the brand’s journey. Setting up a Facebook or LinkedIn Group for customers is simple and easy to manage and can be a great source of upsell and cross-sell opportunities

Empower service reps – By centralizing your entire service team's knowledge into one accessible hub of past product issues and allowing reps to customize their own filterable history feeds, you can rapidly increase the speed at which customer issues resolved. Using the right CRM, you can set up new cases for on-the-move reps within their area, to increase their productivity and escalate support issues to the right person wherever they are.

Companies that implement these steps do more than just provide a good service: they are creating an overall positive customer experience. Although ‘customer service’ and ‘customer experience’ may seem to be the same thing, they are not. While customer service is the delivery of service to customers before, during and after a purchase, customer experience is the sum of all involvement a customer has had over the course of the relationship, taking in all interactions with your brand.

Providing a positive, hopefully excellent customer experience will help a company to increase CLV. Keep in mind that CLV need not be static. Improving the customer experience helps a business expand its customer relationships, whether more purchasing or cross-selling and upselling and thus improve CLV. This effort should be focused in the most desirable segments. Having an effectively configured CRM platform can be crucial to delivering this CLV, enhancing customer experience, which in turn converts customers into loyal brand advocates and builds long-term overall profit

Improve Your Inbound Customer Service with the Universal Call Path

What is the Universal Call Path?

• The universal call path is a blueprint for phone conversations.
• It helps CSRs so they can reliably and predictably generate extremely positive reactions from customers.
• Results from using the universal call path include:
  • All CSRs sound consistently nice, helpful, and knowledgeable.
  • The CSR team sounds uniformly professional.
  • CSRs, like musicians in a symphony, can easily be monitored.
  • CSRs are easy to coach, because clear definitions exist of poor, average, good and excellent work.
  • Calls are shortened, having the effect of reducing costs while increasing customer satisfaction through faster service deliver.
  • Calls consistently conclude on a very positive note.
  • CSR job satisfaction increases.
  • Training of new CSRs is faster.
  • Employee compensation is more accurately pegged to performance.
  • “Conflict” calls and other challenging and exceptional conversations are managed in a calm, reliable, and routine manner. 

Let's take a closer look at the Universal Call Path

Question 1: When are customers happiest with the service they’ve received?

Answer 1: Customers are happiest when they think CSRs have gone out of their way for them in getting information, solving a problem, and making it easier to do business with the company.

Question 2: How do customers express their happiness with CSRs?

Answer 2: They express their happiness in three ways:

• they thank the CSR in a strong way
• they “sing” by elevating their voices to new peaks,
• and they express their intention to do more business with the company.

Question 3: How can we induce customers to feel happy with us all the time?

Answer 3: Always seem ready, willing, and able to go out of your way for them!

The Universal Call Path is comprised of three parts

The Promise of Help

This phrase sends two crucial messages to the customer:

• Please be assured that you’re going to get what you call for.
• I’m going to take pleasure in helping you.
• The customer can relax and let the CSR get down to business and calls are shortened. 

The offer of Additional Help

This phrase performs two essential functions:

• It signals that the business of the call has been completed.
• It volunteers additional help, and in doing so, it makes a positive impression on the customer. This phrase, when combined with the promise of additional  help, conveys the idea that we’re willing to go out of our way for the customer.

The volunteering of help helps make us sound sincere.

Additional Elements of the Universal Call Path

The UPC incorporates two additional elements:

• Tone: An agent's tone must be synchronized with our words to help them sound more sincere.
• Pitch: Pitch, in speech, is the relative highness or lowness of a tone as perceived by the ear, which depends on the number of vibrations per second produced by the vocal cords.