Inside Strategic Relations; January 15, 2006 Edition
From the Center for Strategic Relations, a twice-monthly supplement to Applying Strategic Relations, mailed at your request
More From Transactions
In the last lesson, you learned the one magic secret to getting the most out of this newsletter and the business relationships you'll create this year.
In the next lesson, you'll learn just that . . . how to rebuild damaged relationships with customers , even if your company has made all the mistakes. Including three relationship rebuilding ideas you can train every employee to do without effort.
But first, why is it so important to build customer relationships in every transaction. Today's lesson will share the three places you can improve customer relationships without effort or adding any other "processes" to your business.
You know how to make customers happy, improve loyalty, and even track to make successes repeatable. And, still repeat purchases haven't increased, customers still leave for inferior solutions, and referral business is too low to measure.
How can building customer relationships be easier for front line staff so they will actually do it?
Too often customer relationship management is haphazard if implemented at all. Employees don't buy into its value because there is no immediate payoff, or even worse, because they feel "it's not my job to sell, service, or support. "
While an individual may not be paid to serve one of those critical rolls, it's everyone's responsibility to do what is necessary to satisfy customers . What can you do so that everyone builds customer relationships instead of neglecting them?
First it's critical to understand why you should build customer relationships with every transaction:
Reinforcement of the decision to purchase. Relationship building methods reinforce the decision to purchase by showing it's the right decision, how that decision fits into customer objectives, and establishes service expectations. Studies show a customer who purchases twice is five times more likely to buy again than someone who only purchased once. What can you do to increase purchase frequency at an initial transaction?
Already interacting with customer. There is no better time than the present and since at a transaction (monetary or otherwise) you are already communicating with a customer, why not improve their experience. This can be as simple as collecting positive experiences with your product, the reasons why they are purchasing today, or collecting a secondary preference that improves future interactions. What else can you do to improve a customers experience when you've already got their attention?
Measure interaction points. There are non-communications events that happen at every transaction including, time duration, predetermined outcome, and monetary value. Each of these elements (and several more depending on your organization) must be measured at every interaction. These metrics show the effectiveness of the transaction for both customer and business objectives.
To setup future sales or referrals. Every customer knows more people just like them, possible decision makers who would buy what you have to offer. If you could generate one lead from every transaction, a qualified lead likely to convert, how much new business could that generate each year? Use transactions to prepare customers for future purchases or referrals by telling them who else has referred business, recommend related products bought by similar people, or ask them to pass along a gift to a specified colleague, to name a few.
It's a customer initiated action with the lowest point of resistance. At the point a customer says "Yes" they have completely lowered barriers and are least likely to resist answering other questions. That's why building relationships at each interaction is ideal, customers are most likely to cooperate. Build relationships after a buying transaction is to provide a gift, discounted up-sell offer delivered with the original service, or to provide training at no-charge that helps customers get more from what they have just purchased. There are actions you can relate to service and fulfillment transactions, it's just a matter planning before the process.
Allows you to set expectations for product performance easily reached. Underselling the specific benefits of your product or service at a transaction allows customers to be surprised by the value you bring. There is no better place to remind a customer about what they get from doing business with you than at a transaction. This relationship building strategy undersells the benefit while keeping the conversation in the terms of customer's desires. Ideally, you'll provide additional resources which set a customer up for measurable results while reinforcing expectations set during marketing and sales phases. How can you set customers up bigger results than promised?
Often a positive experience for all involved. Most monetary transactions have some positive aspects no matter how uncomfortable they might seem. Your sales person is excited to bring on the new customer, and the customer is happy to find a solution. If you take action to build customer relationships at the point of a positive transaction, your company will be directly associated with the experience and be seen as more positive. Social psychology shows that people connect physical experiences to ideas more firmly when in a state of strong emotion. What else can you do to help customers feel great about doing business with you?
Without a formal customer relationship program, you'll spend more on selling and marketing efforts because you'll miss hundreds of opportunities to build loyalty "in-process. " By involving every employee in building customer relationships at each transaction, you increase the value of communications with customers making each interaction point more valuable.
What can your front-line employees do today to increase customer loyalty, generate repeat purchases, or better set expectations?
