Is your organization leveraging a proactive customer retention strategy or reacting to customer “surprises?”
Customer retention, in my playbook, involves all activities in which a company engages over the duration of each customer’s relationship lifecycle in order to:
1) Reduce rate of customer defection to another product, service or company;
2) Increase utilization of products and services;
3) Optimally serve that customer during the course of that relationship;
4) Create and drive value throughout the customer’s organization for growth, expansion and sustainability- yours and theirs; and
5) Make your customers more successful.
~ Babette Ten Haken
First of all, create a proactive customer retention strategy in order to leverage execution of that strategy. What does your current customer retention strategy “look” like, from a boots on the ground perspective?
A proactive customer retention strategy involves more than after-the-fact complaint and error resolution.
What happens when inside customer service and external field service teams get “the call” indicating a problem? If IT engineers wait for an anomaly to occur within a system that is not supposed to fail, there will be a big problem when that failure occurs.
Measure the percentage of your current customer retention activities involving smoothing things over between service agreement renewals and/or throughout a project. Consider the frequency of detecting discrepancies in customer drawings after the fact, rather than prior to project start. Reactive error resolution is costly and results in rework which erodes productivity and profitability.
Manufacturing, engineering and IT-intensive organizations with whom I’ve spoken send periodic surveys to customers in an attempt to better serve – or stay close to – their customers. However, if that survey is the first time the vendor/supplier discovers a problem, it is too late. The problem has been festering for a while.
Then there is the question of lag time in analyses of customer satisfaction and customer experience surveys. How can your organization be proactive and deliver value to your clients when you are chasing that value rather than creating it?
Voice of the Customer (VoC) bridges the gap between reactive problem resolution and creating a proactive customer retention strategy.
It just could be that you under-utilize valuable employees in your organization. These folks can do far more than react to and fix customer complaints. They are quite capable of listening not only to the Voice of the Customer (VoC) but also reporting, designing, measuring, analyzing, improving and controlling delivery on customer needs.
Voice of the customer (VOC) is a term used in business and Information Technology to describe the in-depth process of capturing customer’s expectations, preferences and aversions. Wikipedia
Your VoC team members reside in departmental silos deep inside your organization: in customer service, engineering, field ops and IT tech service. They are frustrated in their attempts to communicate with management about what they “see” and “hear” each day. Their favorite after-the-fact phrase? “I told you so.”
These valuable employees are your front line communicators to the boots-on-the-ground customers, the end users of your product and service delivery.
Customer conversations represent not only the Voice of the Disgruntled Customer but also the key to new product development and competitive differentiation. When employees are trained how to listen for VoC, your organization captures design specifications and identifies market opportunities.
A proactive customer retention strategy expands Customer Experience (CX).
Read this definition of Customer Experience (CX). Now re-read the definition of VoC. Do you “see” the similarities and areas of overlap between the two methodologies?
In commerce, customer experience (CX) is the product of an interaction between an organization and a customer over the duration of their relationship. This interaction includes a customer’s attraction, awareness, discovery, cultivation, advocacy and purchase and use of a service. Wikipedia
When the employees responsible for maintaining customer lifecycle relationships work cross-functionally, your organization delivers a rich tapestry of customer experience. Your VoC knowledge base enables teams to create value for current and future employees. This scenario calls for engaging all of your employees as customer experience ambassadors and Voice of the Customer practitioners.
In order to develop, implement and stage a continuously proactive customer retention strategy, start by maintaining cross-functional relationships between each employee in your organization who will “touch” that customer.
Make a strategic and tactical pivot. A proactive customer retention strategy focuses on eliminating customer “surprises.” Engage employees to be listening and collaborating on behalf of your customers.
Why continue to react to what has already happened? Instead, leverage VoC in your CX strategy. Create a solid base of retained customers who look forward to doing business with your company for a long time.
Babette Ten Haken is a management consultant, strategist, speaker and coach focused on customer success for customer retention. She traverses the interface between human capital strategy for hiring and developing collaborative technical and non-technical teams. She serves manufacturing, IT and engineering intensive companies. Babette’s playbook of technical / non-technical collaboration hacks, Do YOU Mean Business? is available on Amazon. Visit the Free Resources section of her website for more tools.
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