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Consistent Treatment is the Key to Loyal Customers
A discussion of how high service standards delivered consistently across the company create a loyal customer base.
Posted Aug 10, 2000
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With more competitors, shorter product life cycles, new distribution channels and an explosion of new technologies, customers are being pursued more aggressively than ever before. CEOs and senior management are focusing on customer relationship strategies as a key weapon for competitive differentiation and building shareholder value.

The confluence of industries is also radically increasing the number of competitors. Banks are now in securities and insurance. Retailers are in the finance business. Telephone companies have hooked into cable TV. An offshore drilling company transformed itself into a fish food company and is now emerging as a player in the Internet search engine business. The lines of business have been blurred, and that is forcing organizations to take a much harder look at who they must compete against.

Shorter product lifecycles have prevented companies from enjoying the sustained financial benefits of being product innovators. Not only can competitors bring copycat products to market quicker, new generations of products are introduced much more quickly.

There has also been an explosion of new technology-driven channels to reach the customer. Organizations must figure out how to effectively integrate the telephone, the Internet, branch offices, mobile sales, kiosks, ATMs, interactive TV, wireless and related options with conventional outreach methods to build customer loyalty. New technologies have also changed the way organizations operate and produce, enabling new competitors to emerge virtually overnight. Your competitor may not be a start-up across town, or in a neighboring state. Check cyberspaces. Virtual companies--cleverly foregoing the fixed costs of buildings, furniture, administrative staffs and the related overhead--can be anywhere, and painfully difficult and costly competition.

Consistency Counts

The challenge lies in the fact that these new technologies were not designed to operate as part of a coordinated plan, but rather in a silo environment. The need to drive consistency in the customer relationship across these channels is paramount to the success of a relationship strategy. Perhaps no industry is more focused on relationship-based strategies than the telecommunications industry. They are in the midst of the greatest marketing and selling event of the century. The transition from transaction- to relationship-based strategy will be characterized by highly personalized and proactive communications. Problem resolution must recognize the whole relationship, not just the transaction at hand. If you want to keep your customers, youmust know what they want, and give them good service. It sounds so simple until you begin to define the content of good service. Giving the customer what he or she wants means building individual relationships with each customer. Delivering good customer service becomes very challenging when you realize that one size will not fit all. Not recognizing the individuality of each customer is frequently at the root of customer defection.

Enterprise Customer Management addresses how an organization will transform the experience that a customer has with the organization into customer loyalty. To accomplish this, the enterprise needs to synchronize the actions of different business units, supporting operations, channels of customer interaction, products, support functions and the overall management of the customer relationship.

Emphasize Service

Many past customer service initiatives have focused on improving transactional efficiency, such as answering the phone faster. Even if this goal is reached, there are many other issues that need to be addressed to strengthen customer relationships. Do customer service reps have the skills and information needed to offer on-the-spot solutions? Are they empowered and authorized to fix problems?

Interestingly, many companies are compensating customer service reps based on how quickly they handle each call. The metric of how fast can you get somebody off the phone measures a notion of transactional efficiency, but may not be an appropriate metric. If the goal is to build a series of positive experiences with customers, there is a need to think about service in different ways. A measurement that captures how the customer/company relationship has been enhanced would be in alignment with the organization's customer management vision.

The ECM approach directly aligns organizational changes with customer desires. Recognizing that not all customers are equal, some deserve to be treated differently, is the key. The theory is: If you recognize how individual customers wish to be treated and have the information and means to deliver the appropriate responses, you will have a loyal customer today and tomorrow. Delivering personalized forms of service can be the ultimate competitive differentiator of business--creating a relationship so strong that repeat business, cross-selling, and up-selling can all be optimized.

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