Wednesday, February 18, 2009

How do you earn the customer’s loyalty?

This question has spurred hundreds, if not thousands of books, articles, and programs during the past few decades. In the never-ending quest to find the “magic theory“ which would instantly transform every customer into a loyal lifetime customer, we have lost sight of the basic fundamental truth about customer loyalty.

Customer loyalty is earned by practicing the three components of customer care. We must understand, embrace and embody this powerful truth from which customer loyalty is derived.

The three components of customer loyalty are customer service, customer satisfaction, and customer retention. Together these components form the cycle of customer care. These components are all separate, vital, independent entities, yet, each is interconnected and extremely dependent upon the other. Only when all of these components are working together in harmony and unison can the pinnacle of customer loyalty be obtained.

Let us briefly examine each element of customer loyalty.

Customer Service:
Customer Service is the act and spirit of serving the customer. Customer service is not only how you serve the customer it represents the true essence of a company’s existence.

The degree to which service is provided is a direct manifestation, reflection, and the execution of a company’s values, philosophy, and ethics. The employees’ beliefs, attitudes, and behavior have a dramatic and profound impact on the level of service that is provided.

Customer service is the foundational building block upon which customer satisfaction, customer retention, and ultimately customer loyalty is built.

Customer Satisfaction:
Customer Satisfaction is the achievement of meeting the customer’s expectations. The level of customer satisfaction is directly proportional to how well a company anticipates, understands, and meets their customer’s expectations.

Customer’s expectations are constantly changing. They are always in a state of flux and forever evolving. Thus, customer satisfaction must never be taken for granted. Companies must vigorously strive to define and exceed the customer expectations at all times to insure a high level of customer satisfaction.

The customer’s expectations encompass all aspects of a service experience. Expectations are formed prior to, during, and after each interaction with a company. Some of the factors which effect the customer’s expectations are advertising, prior experiences, influences from other people, personal beliefs and attitudes, preconceived impressions, and the overall atmosphere of the experience.

A high level customer satisfaction plus excellent customer service will produce customer retention.

Customer Retention:
Customer retention is the process of building relationships with current customers. Customer relationships are born by fulfilling the customer’s wants, needs, and/or desires. The relationship is then natured by customer service. The relationship blossoms and matures through customer satisfaction.

True customer retention is beyond merely initiating the latest business strategy or technique. The process is more involved than relying on an advertising campaign to foster customer retention. Retaining customers is even more complex than implementing any type of repeat buyer or reward program.

Customer relationships, like any other, require a strong unwavering commitment, complete dedication, and continual perseverance to survive and grow.

The deeper the relationship, the stronger the bond between a customer and a company, the greater likelihood the customer will continue to do business with the company. The longer a customer is retained, the more loyal they will become.

Do you want to earn your customer’s loyalty?

Improve your customer service, customer satisfaction, and your customer retention.

“Repeat business or behavior can be bribed. Loyalty has to be earned.” - Janet Robinson

Wednesday, February 4, 2009

Who has earned your loyalty?

The other day I asked myself, “what businesses have earned my loyalty?“ Trying to answer this question prompted me to ask another; "Why do I feel loyal to them?"

The Compact Oxford English Dictionary defines loyalty as “a strong feeling of support or allegiance.” In other words, as a consumer, what businesses do I feel a strong allegiance to? What have they done to earn my continued support?

I chose a simple exercise to answer these questions. First I listed each business I deal with on a regular basis. Then I add a comment about my feelings of support or allegiance, good or bad. Instead of listing the business by name I listed them by the service they provided.

Here is an excerpt from my list.

Electric Company - I feel no allegiance to them at all. I remain their customer simply because I have been too lazy to change providers.

Telephone Company - Another business I feel no allegiance too. My wife and I have recently been discussing changing telephone companies.

Automobile Insurance Company - This business I feel a sense of semi-loyalty. We have been their client for over 8 years. We remain clients because of convenience more than from any great feeling of satisfaction.

Hair Stylist - Total loyalty to this business. Every 6 weeks or so, for the past 4 years, they have continued to earn my repeat business with competitive pricing, quality work, and personalized friendly service.

Credit Union - Feeling extremely frustrated with them right now. For over 15 years we had felt a great deal of loyalty to them, but this changed recently (see blog article: “Eight Minutes to Lose a Customer”).

Grocery Store - I feel more loyal to their sale pricing than to the store itself. Usually our weekly grocery shopping is spread between 2-3 different grocery stores. The bulk of our spending depends on who has the best sale that week.

Restaurants - My loyalty is spread among 4 restaurants with varying cuisines. On a scale of one to ten, with ten representing my ultimate loyalty, these restaurants rate around a six or a seven.

Department Stores - I feel no loyalty to any particular store. My store selection is determined by where I can receive the best price on the items I want or need.

Automobile Repair Shop - This business I do feel some loyalty to. The owner has previous done excellent work on several of my vehicles.

Gas Stations - Again, I feel no loyalty to any particular brand. My spending is dictated by price and / or convenience.

And the list goes on…

When I completed this exercise I was surprised by how few businesses I actually fell a strong allegiance to. Apparently, there are only a few businesses in my life that have really earned my loyalty.

"You don't earn loyalty in a day. You earn loyalty day-by-day" JEFFREY GITOMER

I invite all my readers to compile their own list and share their results. I would venture to say nobody can honestly list more than ten businesses that have truly earned their loyalty.

Is the lack of loyalty I feel more a reflection of my attitudes and expectations or is it merely a response to the service which I typically receive?

Stay tune for the answer in my next blog article: How to earn the customer’s loyalty.

Tuesday, January 27, 2009

Letter to My Readers

Recently it has been brought to my attention that a few of my blog articles contain a critical undertone. For this I apologize to my readers. My intention is not to create another blog/website dedicated solely to ranting and complaining about receiving poor customer service, but to offer practical solutions, which have been perfected over time and through experience, that will improve all facets of customer service.

My goal is to provide a platform where my articles will enlighten the reader while stimulating his desire to excel at serving others. Occasionally I will write a life story, as an example, to illustrate my point.

As a Chinese proverb states, "Better to light a candle than to curse the darkness."

A consumer’s emotional spectrum ranges from the high end--satisfaction and loyalty, to the low end--frustration and hostility. Sometimes each end of the emotional spectrum is experienced by the consumer during a single transaction or encounter with a company. Leaving the consumer totally confused and with mixed emotions. Usually though, the consumer’s emotional needle leans and stays more towards one end of the spectrum during and after each encounter or transaction.

Being a consumer, I, too, participate in this roller coaster ride of emotions. With my passion for and expertise in teaching customer service, my personal service experiences are magnified three to four times the norm. My emotional needle tends to gravitate towards one extreme end or the other. Either being totally satisfied or extremely frustrated. Lately, most of my service experiences have my emotional needle hovering near the low end, like a gas gauge registering barely above the empty notch. Frustration, at the lack of good quality customer service, has become my constant and unwelcome companion.

As a business coach, I must be diligent in my pursuit of objectivity, poised in my demeanor, and strive to constantly maintain a professional manner at all times. It does not matter if I am giving a speech on customer service, conducting a training course, or writing a blog article, I must guard against personal frustrations creeping in and overwhelming my message. I realize being overly critical or writing with a spirit of criticism will have a counterproductive effect on my readers. In future articles I will make a conscious effort to write more informatively and less critically.

In this article, contrary to what I wrote earlier, you will not find any “how-to” solutions. Instead I implore the reader to invest some time reflecting upon the customer service he or his company delivers. Begin by asking two stimulating questions: Have any of your customers ever felt frustrated with you, your product, your service, or with your company for any reason? Has their frustration caused a shift in their level of satisfaction or had a negative impact on their loyalty towards you, your product or your company?

If the answer is yes to either question have no fear. Help is on the way.

In the coming weeks we will journey together along the path that leads over the hill of customer service, through the woods of customer satisfaction, and across the river of customer retention, ultimately reaching our final destination, the valley of customer loyalty.

Friday, January 9, 2009

The Men's Retreat

The following article is an excerpt from a letter I wrote describing my experience at a recent men’s retreat.

How does this story relate to customer service, you may ask? Well let me tell you. This story is an excellent illustration of customer loyalty. When a business has built a strong relationship with their customer and earned the customer’s loyalty, the customer will overlook, minimize, and otherwise ignore minor inconveniences, mistakes, and problems when they occur.

In this case I am our church’s customer. The bond which has developed between my church and myself is anchored firmly enough to withstanding the interesting developments of an adventurous weekend. Like a customer my preconceived thoughts of how this weekend would play out, failed to materialize. Unlike real life, where all too often, the relationship between a customer and a business is not firmly secured, I felt satisfied enough to give this event another try.

In November our church put together a two day Men’s retreat. This is the second year for this event. Last year I was unable to attend because I was in Cincinnati, Ohio working. This year I had every intention of participating, unfortunately, as the close of registration drew near I found myself in an unusual situation. Somehow I had managed to commit myself to attend three different events this particular weekend. When our associate pastor heard I would not be attending, he expressed genuine sadness and disappointment. This expression of love overwhelmed me. Two days before the retreat, after scrambling desperately to rearrange my schedule, plans fell into place. As it turned out I was even able to carpool with four other guys to the retreat. The retreat was held the weekend of Nov. 14 - 16th, at a working ranch approximately 2 hours east of Dallas. The ranch is located not too far from the Louisiana border.

We bunked in a large log cabin with three different sleeping quarters, two downstairs and one upstairs. The restroom and shower facilities were located inside between the sleeping quarters. Inside running water in rural Texas? I was dumbfounded! There was a large open area inside the cabin. The mess hall was in another building located fairly close to the cabin.
About eighty guys from church attended. The first night after dinner we gathered around a bonfire for some fellowship. The bonfire pit was located on a small hill 100 yards behind our cabin. The peaceful tranquility of the moonlit night, with the stars glistening upon us, with the night air filled with sounds of wood crackling from the fire, and the joyous sounds of country living went unappreciated due to the fridge temperature. The weekend before the temperature hovered around 75 degrees, now winter was rearing its ugly head with a bone chilling 35 degree temperature. The wind decided to dance among us and through us further enhancing our misery. Please do not get me wrong. I am not complaining. With three layers of clothing and a warm coat I was far from totally frozen. This being a church activity, no one thought to bring a bottle of brandy to warm our insides. What a shame! Well it would not have done me any good anyway, I stopped drinking last April.
How I forced my semi-frozen limbs to carry me back to the cabin, I will never know. At last warmth! The reprieve only lasted temporarily. My bunk was situated next to a window. I had planned on bringing my warm sleeping bag, but at the last moment decided all I needed were a couple of sheets. After all, we were sleeping inside. I figured, surely the cabin was heated to 70 -75 degrees. Wrong. Either the thermostat was broken or they purposely set it at 55 degree. (At least that is what it felt like). I awoke after a fitful night, sleeping in my coat, to a desperate need for several hot cups of coffee.

Breakfast consisted of scrambled eggs, biscuits and gravy, sausage, and hot coffee. I was in heaven. When breakfast was finished, we all gathered back in the cabin for some worship time and a message from our pastor. After lunch we had our choice of different activities. Horseback riding, hiking, a rope obstacle course, fishing, or swimming were on the menu. Although the weather was gracious enough to warm up to around 50 degrees with no wind whistling about, swimming was not on anyone’s agenda.

I skipped lunch and took a nap. When I awoke the guys were starting to go off to the different activity areas. I decided to take a long solitary walk. I would use this time to reflect upon different areas of my life. Fifty yards past the cabin’s front door my time of reflection ceased. One of the guys (Daniel) whom I had meant the previous night was also out walking. He was waiting for the horseback riding to begin in 45 minutes. After some discussion we decided to walk together, the ¼ mile, to the horse corral and then hang out till he rode off on his horseback riding adventure. I had not signed up for this activity and all the available slots were full. Anyway I am not an avid horseman. In my 51 one years of life, only twice prior have I been on a horse. I know this is hard to believe. I live in Texas and do not own a pair of cowboy boots nor ride horses. What kind of Texan am I?

As we were conversing (guys don’t gab, they converse) another guy showed up to wait for the horseback riding to begin. A few minutes later he asked me if I wanted to take his place riding, because he wanted to try out the rope obstacle course. Well, I said “why not“? Thinking I could somehow control a beast that is much larger than myself. The joy of foolish ignorance.
Our pack leader finished his instructions with saying, “just sit back and enjoy the ride.” Then the moment of truth arrived. It was time to pick our horses. I forgot to mention the funny little helmet we were required to wear. I was not worried about falling and hitting my head, I was fearful of falling and breaking a leg or an arm. The horse I picked appeared calm and gentle. I looked deep into his eyes, summoning all the powers of the “Jedi “ mind trick I learned from Star Wars, while trying to hypnotize this beast into submission, all the while fervently praying I would survive this encounter. Now, time to mount up.

Left foot in stirrup, and then propel your right leg up and over the horse. Easier said then done. With my left foot locked three feet in the air, firmly secured in the stirrup and my body crying out “You don’t bend this way”, my right foot refused to move higher than one foot off the ground. Three strikes and your out! Right? Not in this case. On my fourth attempt I was assisted up onto the horse (in other words, someone lifted me). If horses could laugh, mine would have keeled over. I hope this was not a prelude to what was in store.

High oh silver! Off we went, 15 horses single file, majestically strolling calmly out the corral gate and down a well worn path. I can handle 30 minutes of this, I thought. Slowly, the well marked path started to disappear until only a faint outline existed. I realized our guide was not kidding when, during his instructions he said, “I like to change up the trail”. Up a small hill we went, under low hanging tree branches, through tall grass, till we reached the summit. Then the fun began. My horse instantaneously transformed it’s self into a demon. No more gentle walking for this horse, now we were going to gallop quickly down the hill. Holding on for dear life and crying “whoa horse” while pulling back on the reins was my futile effort to slow this horse. Apparently this procedure had the opposite effect on this creature, he galloped faster. Fifty yards later (seemed like miles), when we reached a small valley, the horse finally slowed back to a normal walk. I swear this horse snickered at me.

Three, four, five minutes passed as we continued our leisurely pace, following the other riders single file over the unseen trail. Down into a small ravine, through a nearly empty creek, my horse behaved superbly. Then as I was starting to relax, once again a demon possessed this beast. Galloping up the creek’s embankment, under even lower hanging tree branches, off this horse rode. Bouncing up and down in the saddle, thinking each time I rose up, surely this time I was going to fall off and be trampled by the riders behind me. Eventually, we reached a cattle pasture where the horse casually slowed back to a nice calm walk. Praising God for keeping me upright, my heart rate began to return to a somewhat normal rhythm. The possibility of having a heart attack did cross my mind.

Walk awhile then gallop some, walk awhile then gallop some, this frightening pattern continued throughout the remainder of the ride. Someone forgot to tell me this horse had a Dr. Jeckell/ Mr. Hyde complex. Mercifully, I arrived back at the corral in one piece. Amazingly still upright in the saddle also. Maneuvering next to the metal fence which surrounded the corral, I used the fence to help with me dismount off the horse. The dismount procedure went a lot smoother then the earlier mounting fiasco.

Gingerly walking away, the idea light bulb went off inside my head. Horseback riding can definitely be used as a birth control method for guys. Bouncing in the saddle creates a major “discomfort“. The creative wheels began to grind. How can I profitably market this profound revelation?

Several fellow riders mentioned they thought I was going to bite the dust during the ride. “No worries,“ I replied, mustering the final reserves of my manly dignity. Laughing, trying desperately to hide my bruised and battered ego, I told them, “I was only demonstrating the finer points of horsemanship“. Next time I am demanding a horse with a built-in shoulder harness seatbelt (like the racecar drivers use). Or better yet maybe I should stick to riding motorcycles. I know I can control them.

After our wonderful horseback riding experience, Brian and I decided to venture over to the rope obstacle area. Thirty feet up, among the tree branches several rope challenges were set up. One, where you walked across a rope, stretched between the trees, approximately 50 in length, your body dangling in mid-air, while you clutched (for dear life) the rope above you. Hand over hand, shuffling your feet, inch by inch until you reached the safety of the tree platform. Boy did this look like fun! Another event was where an attendant strapped you into a harness, and then attached the harness to a rope which was suspended between two trees. The other tree about 300 yards away. You were then launched off the tree platform, to zip along the rope high above the ground, hanging on for dear life, as you proceeded to fly through the air for 300 yards. This glorious contraption is called a Zip Line. Various other courage testing events, similar to these, were available.

With my feet securely planted on the ground, I watched, amazed as my brethren attacked these activities demonstrating a degree of zeal and faith unsurpassed by even the most professional daredevil. Where their faith came from, to perform these death defying feats, I haven’t a clue. Their faith was it grounded in their own abilities, or placed in the harness that secured them to the ropes, or did they all just trust God to keep them from falling out of the trees?
Considering my aversion to heights and combined with the horseback riding experience I had just endured, the burning desire to join these brave men, up in the trees, was nowhere within me. Yes, I had come to the retreat to draw closer to God, but I reasoned God would understand if I remained physically and securely on the ground.

Walking back to the cabin I reflected on how my life has dramatically and completely changed. Not too many years ago. if I were to attend a retreat, with a group of guys, there would have been a party atmosphere. A party overflowing with booze, raucous behavior, swapping lies, guys boasting about conquests with women, playing cards, and hopefully shooting pool. A strong Bloody Mary, with two aspirin, to minimize the hangover would be our breakfast of choice. Lunch would consist of plenty of beer with maybe some food. Dinner the time to break open the good strong liquor. Junk food would have been the preferred cuisine.

This retreat was about building strong relationships with other men who share a common faith and who are genuinely concerned for each other's well being. Coming together as a group we can share testimonies, confessions, worries, concerns, and fears while encouraging, supporting, lifting up, and praying for one another. Trust, honesty, and love are the cornerstones of this gathering.

Dinner that night found us back at the fire pit. We grilled hamburgers and hotdogs as the darkness descended. Soon, ten feet from the fire darkness fully engulfed us. Stumbling blindly between the picnic tables we attempted to fill our plates with condiments. A flashlight balanced in one hand, your plate precariously balanced in the other, we all somehow managed to load up our plates with food. Thank God the temperature had risen from the previous night. Now, we were only cold, not frozen. At least the wind was gracious enough to leave us alone tonight. By mutual consent we all returned to the warmth of the cabin after we finished eating. No standing around the fire till midnight tonight.

After diner we gathered in the cabin for an enjoyable, spirit filled, time of worship and fellowship. During this time (Brian) the guy that drove four of us to the retreat, said he needed to leave that night instead of in the morning, as originally planned. He was apologetic about his change in plans. There were several people who stepped up and volunteered to have us carpool back to Dallas with them. This is a example of what I mean about the guys caring about one another.

Returning home Saturday night with Brian was actually a blessing. This would allow Kathy and me to attend church on Sunday morning and then spend the rest of the day together. The original plan had me returning in the middle of the afternoon Sunday. This was ok, except Sunday was our wedding anniversary and I felt spending the day together was preferred. Especially considering last year, on our anniversary, my plane did not arrive in Dallas till 8:00PM. I had been gone from home working in Ohio and Kentucky for 6 weeks.

With no cell phone signal out at the ranch I was not able to reach to notify Kathy of the change in plans. That’s ok I thought I will surprise her. She will be overjoyed when I come through the door. It was close to midnight when we arrived back in Dallas. When Brian drop me off in front of my house I realized my house key was setting on top of my dresser inside the house. No problem, I will knock on the door. When Kathy answered the door she was more frightened by my sudden appearance than overjoyed to see me. Her words, “You scared the s… out of me,” greeted me at the doorway. Apparently, surprising her was not one of my smartest moves.
The weekend of the Men’s retreat was a unique experience. Not one soon forgotten. New friendships were forged, current relationships were strengthened, and beautiful memories created. These were but a few of the remarkable benefits I received from this weekend.

The excitement, adventure, and memories that next year's retreat will bring I can hardly wait to see.

Tuesday, January 6, 2009

Self-Service: A Blessing or a Curse

Around forty years ago I began to notice subtle changes in the way businesses interacted with their customers. In the constant corporate quest for cost saving opportunities, combined with the never ending drive to find a competitive advantage, and the emergency of the technology revolution, the self-service concept was forever transformed. Like a caterpillar emerging from it’s cocoon.

One of the major self-service innovations can be attributed to Clarence Saunders. He founded America's first true self-service grocery store, Piggly Wiggly in 1916. His self-serve concept, at the time, truly revolutionized the grocery industry. Shortly other grocers would adopt his concept. The self-service grocery store became the norm, not the exception. In the coming years every industry would seek ways to incorporate the self-service concept into their business model.

The expediential rise of self-service directly correlated to the advancements in telecommunications technology and the development of the computer.

The introduction of ATM’s in the 1970’s was a prime example of this newest technology being incorporated as a way for banks to save money. Even with the relatively expensive computer technology of the late '70s and early 80s the cost of processing deposits and withdrawals via ATMs proved to be less than the cost of training and employing tellers to do the same work. Customers enjoyed the ease and the convenience of these machines, while having the new found ability to access their accounts 24 hours a day.

During this time period gas stations started to offer their customer’s a choice between full-service and self-serve, where you pumped your own gas, then paid the attendant. Self -service was promoted as a way for the consumer to save money, usually around a nickel a gallon. For my younger readers - full service meant an attendant pumped your gas, checked your fluid levels (oil, brake fluid, power steering fluid) , cleaned your windshield, and if requested checked the pressure in each tire. This was the standard procedure every time you got gas. In reality self-service saved the gas station money in labor costs.

Retailers big and small embraced the self-serve concept. Stores were designed with the concept of consumers shopping by themselves, leisurely finding the merchandise they wanted, with little or no interaction between the consumer and a store employee, then paying for their selections in the checkout area. Retailers saved money by having fewer employees. The prevailing corporate thought was, consumers would spend more money if they wondered through the store by themselves. The self-service bandwagon began to pick up steam. Self-service became the norm, not a choice. Businesses even began to charging extra fees for interaction with a live person.

Then along came the internet. Bang, in just a few short years (seemed like overnight) the internet launched the concept of self-service into a whole new stratosphere, unimagined 20, 15, even 10 years prior. The self-service revolution Piggly Wiggly created paled in comparison. The internet has forever changed the way commerce is conducted.

With a few mouse clicks and a few keystrokes you can purchase almost any item with no human interaction what so ever. Place your order at anytime, 24 hours a day, whether you are dressed or in your pajamas, it does not matter. One to three days later, the merchandise arrives at your front door. Laptop computers, cell phones, Blackberry’s and iPods allow you to conduct business anywhere in the world. The internet is the ultimate example of self-service.

The internet offers today’s consumers an unprecedented access to information about any product or service they desire, combined with a level of convenience, choices and options unmatched in history. Businesses save money on overhead, reach more consumers, and can offer a greater selection of merchandise via the internet. Win-win scenario for everyone right? Not totally. Customer loyalty suffers in this self-service environment.

Customer loyalty is derived from customer retention. Customer retention is created from the customer having repeated satisfying experiences with a company. High customer retention forms the foundation for a high level of customer loyalty.

When a business allows the purchase experience to be accomplished with no or little interaction from them, they rely on a combination of extremely volatile, very competitive factors to build customer satisfaction, such as item price, location, website, and the quality of the purchased product or service. If one small transaction detail fails the consumer’s satisfaction plummets. The self-service consumer is driven manly by price. Coupons, discounts, special promotions, free offers (like shipping), and a host of other marketing gimmicks the merchant must continually resort to, hoping to retain the consumer. This is true for a brick and mortar locations as well as the virtual world of the internet. If price is the chief decision factor, then a business’s ability to build long term relationships with the consumer is next to impossible, thus customer retention and loyalty suffers.

How then can a business improve their customer retention and loyalty in this self-service world?

By delivering exceptional, memorable, personalize customer service while embracing the four pillars of customer retention: Preparation, Execution, Follow-Through, and Passion.

Preparation means to properly prepare to serve the consumer, while anticipating the consumers’ wants, needs and desires. This is the time to construct a game plan, develop strategies and to practice perfecting customer service skills. For businesses with physical locations, questions such as …. Is the merchandise stocked, facilities clean, store well organized, employees trained, store properly staffed, restrooms clean?, need to be asked. For website businesses, ask these types of questions…is the website easy to navigate, consumer friendly, informative, easy to use, do you have a help menu, is the purchase process simple, what else can be done to improve website appearance, can consumers get real-time help? Every business needs to consistently ask themselves, what else can be done to further enhance the customers’ experience? Remember, you never get a second chance to make a good first impression.

Execution means exceeding the customer expectations at all times, in every situation, and with level of professionalism which leaves the customer anxious and eager to return for more. Game plans, strategies, and training are all set in motion during execution. The goal is to deliver memorable service and to excite the consumer with the overall experience. Every aspect of execution either lays the foundation for a long term relationship or burns the bridge to future repeat business. The goal is simple - 110 % customer satisfaction, 100% of the time.

Follow-through means the transaction process never ends. The road to customer retention begins after each transaction. Communication is the most effective way to build a loyalty based relationship and to stay abreast of the consumers’ ever changing needs, wants, and desires. A business must strive for constant communication with each customer either through phone calls, letters, or emails. Better yet, use all three methods of communication. Due to lack of human interaction, follow up communication is essential with all internet transactions. Besides your monthly bill, when was the last time you heard from your electric company, your phone company, your insurance company, your mortgage company? How about your doctor, your barber, the car dealership, or your favorite restaurant? How can any business expect customer loyalty when they do not demonstrate enough desire to keep in contact with them?

Passion means to have a enthusiastic dedication, a focused determination, and single mindedness of purpose in serving the customer. If you are not in business to serve your customer, what are you in business for? Passion mixed with conviction illuminates a businesses core customer service beliefs.

Preparation plus Execution Determines the Level of Customer Retention.

Follow -Through plus Passion Determines the Level of Customer Loyalty.


Self-service should always be a choice that the consumer chooses for their convenience. Not a cost saving concept businesses force feed consumers. In this highly competitive, instantaneous, technological driven society, businesses need to promote, encourage, and foster an environment of human interaction whenever possible. If customer retention and loyalty are important, businesses need to take a page from the past and embrace a business culture that creates a marketplace where self-service is the exception, not the norm.

Monday, January 5, 2009

Eight Minutes to Lose a Customer

During the month of December, our credit union has a policy that allows a member to defer their December loan payment. It is called a Christmas extension. This year my wife and I decided to exercise this option.

During the past 15 years, that we have been members of this credit union, my wife has done the banking. I can count on one hand the times I have entered the bank. Due to her recent surgery dealing with the credit union fell on me. No problem I thought. I will call them and arrange everything over the phone. Save myself some time and a trip across town.

Ring, ring, ring. Finally, their phone was answered by that annoying mechanical voice that is inherent in every automated phone system. The computerized recorded message telling me, “You have reached …Please listen carefully for our options have changed. If you know your parties….”. In frustration I pushed zero for the operator, praying I would reach a live person. Mission accomplished. The operator answered in a hurried, but semi-friendly greeting. I asked to speak to one of the loan officers. The operator’s reply was, “Please hold”.

Why do businesses use an automated phone system? Does this system save them enough money or increase their efficiency enough to warrant the aggravation, frustration, and hassle that customers experience when dealing with an automated phone system? Why can’t a live, upbeat, friendly person answer the phone? What message are these systems sending to your customer? Do they convey the impression your company is easy to do business with and cares about customer service?

One minute turned into two minutes, and then stretched to five minutes while I patiently waited on hold. During this time a recording repeatedly interrupted the deafening silence every minute with the informative message of,”Thank you for your patience. We are doing everything we can to make your wait shorter. We will be right with you”. After eight very long minutes the operator came back on the line and said, “The loan officer has someone in their office, would I like to leave them a voicemail“? Calmly, my patience almost totally diminished, I told her to transfer I would leave a message. The message to the loan officer was short and sweet. I asked her to call me, to discuss our loan.

My mind pictured the vivid image of a extremely crowded bank, filled with long lines, a long wait and hurried employees. I had hope with a phone call to the credit union would avoid this trip. One hour later and no return phone call from the loan officer, off I went, across town, dreading the hassle which awaited me.

Upon entering the front door, on my left were the teller counters, one my right were several new enclosed glass offices, and directly in front was a circular workstation with a receptionist. As I approached the receptionist I looked around. Where were long lines, the hurried employees? One person waited in line for a teller, one person waited (I assume) for someone from the offices. This made no sense. Why was I put on hold for eight minutes if they were not busy? Why hadn’t a loan officer returned my call? My answer was forthcoming.

Waiting for the receptionist to finish assisting the customer in front of me, I observed her answering two incoming phone calls and placing both of them on hold. When she was finished, totally ignoring the blinking lights on her phone she ask me, “how can I help you“? Instead of asking for a loan officer I told the receptionist I was interested in a Christmas loan extension. After giving her our loan number she quickly produced a form for me to sign. Transaction completed in less than five minutes. Leaving her desk I watch her nonchalantly answer the waiting calls.

Leaving the credit union, frustration engulfed me. Was the receptionist’s lack of phone skills due to improper training or was this an example of the credit union’s underlying attitude toward customer service?

We had joined this credit union 15 years earlier to receive attentive, friendly, personalized service. We were tired of being treated as a replaceable number with our large, national bank. We wanted to have a personalized relationship with our bank. Through the years (and numerous accounts later, including checking, savings, car loans, personal loans, we even encouraged our children to join.) I thought we had established a mutual relationship. Apparently, the relationship had changed. This latest example of poor customer service was the latest in a series of incidents which began about 12 months ago. This encounter further illustrated that this credit union now views each member as a replaceable commodity.

Eight minutes is all it took this business to lose a valuable customer. Is your business losing long-term, loyal, valuable customers from 6, 7 or 8 minutes of poor service?

By the way, two weeks have past and still no return phone call from a loan officer.

Wednesday, December 31, 2008

Image

What image do customers have of your business?

The Merriam-Webster Online Dictionary 2008 defines image as a “mental picture or impression of something”.

With this in mind, what is the mental picture or impression your business is projecting to customers? Is your mental picture of your business the same as your customers’? In other words, do you see your company through the customer’s eyes?

Here is an example which illustrates this point.

Recently I was contacted by a Limousine service company to possible due some work for them. The owner and I emailed back and forth a few times before we set a date to meet. Through our email correspondence and researching the company (the power of the internet) a mental picture of their company was formed.(This is the same way customers form their opinions).On my way to our meeting I envisioned a professional looking facility with shiny, highly polished limousines parked side by side, on the pavement, waiting anxiously to be rented. I also expected the employees to be well dressed, at least in business casual attire, while demonstrating an attitude and demeanor that reflected the nature of a Limousine service company. With the rental prices this company charged, the affluence of their clients, and the longevity of their business my perceived perception was this must be a first-class operation. Boy, I was wrong.

The first clue, my perception was wrong, is when I realized their office was located in an industrial area with construction and manufacturing companies. The second clue came when I found the address, the chain linked fence, topped with razor wire that surrounded the property did not correlate with my preconceived image. Unfortunately, reality continued to deteriorate my perception. The gravel/dirt parking lot held no extra parking spaces, the small lot being presently full of dusty limousines and (I assumed) employee's personal cars.

The front door to the office, which appeared to be an old warehouse, was locked. I pushed the intercom button next to the door. No one said hello they just unlocked the front door with a buzz. The lobby area consisted of a couple of desks to one side and a small waiting area with a couple of old couches in front of a TV. Threadbare carpet, dirty linoleum flooring, and an old musty feel engulfed the waiting area. Quite a contrast to the image I had created.

After a about five minute wait, a lady dressed very casually, strolled through the rear door which had a hand written sign stating “employees only“. Upon seeing me she gave me inquisitive look and a frown (her look said, what do you want?). I told her I had an appointment with the owner. She replied, “He is in a meeting”, as she continued on her journey out the front door. I was 15 minutes early for our appointment, so I decided to wait in the lobby. A few minutes later a guy (dressed extremely casual) came out of the back room and sat down at one of desks and preceded to eat his lunch, totally ignoring me. By now, I am seriously wondering is this a reflection of how they really treat their clients. Hopefully, they show more respect then they are currently demonstrating. Several minutes later someone else entered from the “employee only” door. This time the guy was wearing a mechanics uniform. He acknowledge me and after telling him I was there to see the owner he told me “to go on up”. Up where? I thought.

I ventured through the “employee’s only” door to find myself standing in a repair shop. Numerous limousines were in various stages of repair or broken beyond repair, from the clutter and disarray I can not be positive which is the case. There were some wooden steps off to my right, I assumed these lead to the offices. At the top of the stairs I found a small reception area and four offices. After again, announcing I was there to see the owner, I was told to wait he would be with me when he is done. Not being offered a place to sit, I stood patiently waiting. I was astounded by the sloppiness, the rudeness and the absence of common decency shown by all the employees I encountered.

When I left I felt sad. Sad that the owner of this business failed to realize the mental image he has of his business is not the same as the actual image his business is projecting. His employees are communicating an atmosphere of un-professionalism to his clients, current and potential ones. As he pointed out several times 98% of their business is done by phone. Appearance does not matter because people can’t see your business over the phone. I disagree.

Image is even more important when dealing with clients by phone. The clients may not be able to see the business, but they can and do feel the atmosphere that the business creates. When employees lack pride in their company, themselves, and/or their jobs this is communicated loudly by phone. The employee’s attitude, demeanor and friendliness are also highly visible through the phone.

Whether you conduct business over the phone, internet or you have a brick and mortar location the image customers have of your company will have a huge impact on dictating your level of success.

I heard someone once say “image is everything”. Well I can’t agree it is everything, but I will say image is very important in building customer loyalty.