Working towards 'top box quality'
Business Times (Malaysia) 07/09/01
by Ron Kaufman
What is customer loyalty? Is it just having happy customers? Or happy customers who come back? Or happy customers who come back and also tell their friends? Or happy customers who come back, tell their friends and also tell you how you can improve even more? My answer... YES.
For years I have been teaching that "customer satisfaction" is obsolete.
As an organisational goal it is antique. Customers expect satisfaction today, and many companies can deliver it.
Merely "satisfying" your customers is no longer enough to ensure that you will receive their praise and future business.
Motorola is one of the original benchmarks for "Total Customer Satisfaction". Their persistent pursuit of "TCS" is legendary, with "Six Sigma" quality programmes and "10X" campaigns for cycle time reduction.
Motorola realises that traditional "customer satisfaction" only measures a customer's opinion for a fleeting moment in time. But good customer relationships are not fleeting. They are continuous. They have history, and present moments, and rich, fulfilling futures.
So Motorola has created a metric to track "customer loyalty", and not just "customer satisfaction". They still ask for a rating of "Overall Satisfaction". But they also ask if the customer intends to purchase again from Motorola. Finally, they ask whether the customer will recommend Motorola enthusiastically to others.
Motorola's new target is real customer loyalty, which includes high satisfaction, a commitment to future business, and sharing positive-word-of-mouth. Motorola is a powerful company. And they won't be "satisfied" until customers check the "top box" in all three areas.
How can YOU apply these lessons? When you survey your customers, don't just ask "Are you not satisfied, somewhat satisfied, very satisfied, etc."
Take the initiative to find out whether your customer is planning to buy from you again in the future. If so, how soon? If not, why not? And then ask if your customer will "refer you enthusiastically to others"? If so, why are they enthusiastic?
If not, what needs to change for Customers to become Advocates for your products and your service?
During a full-day programme for 519 participants I was conducting in Manila, organised by the Young Entrepreneurs Organisation, sponsors Citibank signed up 57 new Gold Card members, Qualcomm gave away a cellular phone, and MicroWarehouse, a distributor of 3Com's Palm handhelds, raffled off three of the personal digital assistants.
We were having a great time with the raffle, so I looked to the audience and asked, "how many of you actually use a Palm, and have it with you here today?"
Fourteen people responded, and I invited them up on stage. As they lined up with their Palm PDAs in hand, I handed the microphone to the first person and said, "please tell us how you feel about your Palm".
This was totally spontaneous and unrehearsed. The first fellow took the microphone, shook his Palm device towards the audience and said, "this is my life!"
The second person took the microphone and blurted, "I couldn't live without it. All my activities and information are right here!"
The third person, an attractive woman, said, "this holds ALL my secrets".
The crowd roared. Then she added, "fortunately, it's password protected".
The crowd roared again.
This continued down the line until all 14 owners had given their short but potent testimonials.
My eye caught the sponsor's face in the back of the room. He was GLOWING with delight. And for good reason. Positive-word-of-mouth is more trusted, remembered and acted upon than any other form of advertising. Asking for your testimonials from your customers makes good sense. Sharing those words with others makes good business.
You can act on this today. Ask your loyal customers for positive comments about your products and your service. Then post these testimonials where other customers and prospects can enjoy them.
One of the great challenges in business is to get everyone thinking, speaking and acting as a coherent and communicating organisation, presenting "one shared voice" to the customer.
But the challenges we face are integral to the nature of companies today. Exacting engineers are hired for a very different purpose than the extroverts working in sales.
Detailed accountants are trained differently than the expansive players in marketing and business development. The people in production are measured and rewarded differently than the team in after-sales service.
So what can YOU do to build an organisational culture where people really understand each other and everyone sees the need to work together?
Here's one set of proven and effective ideas. Try them!
* Use cross-functional teams to tackle persistent problems
* Schedule time for "attachments" between departments
* Involve people throughout the company in shared training programmes * Send cross-functional groups on "mystery shopping" tours
* Get every department involved in customer focus group meetings
* Create a recognition programme for cross-functional improvements
* Implement a reward scheme for overall company performance
* Communicate customer issues to everyone via newsletter, e-mail, bulletin boards, etc.
What's YOUR proven idea for building a coherent and communicating culture? How do you get the fellow in "sales" to realise he is also a part of "customer service"?
There is a range of good books on the topic of Building Customer Loyalty. Here are three available at Amazon.com:
The Loyalty Effect: The Hidden Force Behind Growth, Profits, and Lasting Value, by Frederick F. Reichheld, Hardcover, 336 pages (March 1996), Harvard Business School Press
Customer Loyalty: How to Earn It, How to Keep It, by Jill Griffin, Paperback - 256 pages (June 1997), Jossey-Bass Publishers.
Customer Satisfaction Is Worthless, Customer Loyalty Is Priceless: How to Make Customers Love You, Keep Them Coming Back and Tell Everyone They Know, by Jeffrey H. Gitomer, Hardcover - 256 pages (September 1998), Bard Press.Copyright 2001 Business Times (Malaysia)