By Joshua Strutt
Strategy Analyst, Retail Doctor Group
Is there nothing better than hearing retailers talk about the new age of the customer? Developing their loyalty programs and of course the golden implementation tactic that is enhancing their customer relationship management platforms. We think back 10+ years ago when business started to figure out this vision apparent, but in this time, again have we pushed our heads into the clouds and forgot about the basics?
Customer satisfaction and financial results are not necessarily the same thing. Whilst the use of systems like NPS is a good measure of customer satisfaction done well, what you really want to know is, was your customer satisfied, and at the same time, did your team maximise the sale opportunity? e.g., did they open the sale, did they probe, did they add-on, did they close?
It is entirely possible to have an increased customer satisfaction and a decreased economic return.
Equally, internal customer measures are another important measure of customer satisfaction, “happy staff = happy customer”. But this doesn’t necessarily equate to an economic return. You can go broke having lots of happy customers and staff if you are not maximising the commercial relationship – this is the paradox.
Some CEOs may define their reign as beginning with the improvement of customer service levels charging into the fray with quixotic-like fervour. Galvanising the troops into a fever-like pitch where all that matters is the customer.
While this motivation is inspiring to hear, there needs to be a clear plan in place for customer relationship management. Whether you are the incoming executive or area manager or just trying to get a gauge for where to start, we recommend that this should commence with some simple common-sense management (CSM) before implementing customer relationship management (CRM). Now, please don’t misunderstand, we are great advocates and exponents of CRM platforms and regularly advise our clients in this field.
However, first things first, let’s discuss some of the Business Fitness™ tips that are necessary before implementing programs from loyalty and customer relationship management to investing in more direct customer contact models.
Business Fitness™ tip number 1 – Establish and define your strategic customer service differentiator.
What do terms such as exceeding or enchanting or even satisfying customers even mean?
We recently conducted some research of one company’s staff alignment to their goals. We asked the staff a simple question around their perception of what exceeding customer satisfaction in their business actually meant. We received a staggering variance in the answers amongst the front-line staff, a clear indication that a lack of benchmarks existed in the business.
Despite all good intentions, here we see the very start of the inconsistent customer service delivery. At this point, investment in elaborate customer tracking, targeting and platforms of this ilk would quite possibly be an extravagant use of investor funds and using common sense to get the basics right first will make this investment much more valuable in future.
Business Fitness™ tip number 2 – Measure the starting position of your customer service and satisfaction levels.
The more elaborate mechanism is to measure a weighted hybrid of mystery shopping, staff attitude (happy staff = happy customers), customer exit surveys and sales results – and by way of a shameless plug, these are all services that we offer at Retail Doctor Group. Once you have a good understanding of where your service and satisfaction levels currently are, you will have some strong factual indicators of where the areas of improvement lie and where training and goal setting should be focused.
Knowing what you need to beat and your areas for improvement is simply common-sense management. Nothing gels a team more effectively than uniting under a common goal.
Business Fitness™ tip number 3 – Talk to real customers.
Surprisingly, very few retailers do enough of this essential activity. The ‘fitter’ retailers get to know their customers. They search out real life customer experiences with their organisation and its people. They capture these experiences, understand their why, learn from them and adapt the business to ensure it is correctly positioned for the target market. With the reach of social media, it is becoming simpler to gauge customer opinions, learn of their experiences and find out their likes and dislikes. This is often the most effective means of creating and influencing a truly real customer centric company culture.
It is simply common sense to know your customer before developing a relationship with them.
The key is to start with an honest self-appraisal of your business. Knowing who you are and what you want out of your business and then aligning this with your customers’ needs and wants is key to creating customer service excellence.
“The reasonable man adapts himself to the world; the unreasonable one persists in trying to adapt the world to himself. Therefore, all progress depends on the unreasonable man”.
So wrote George Bernard Shaw. He was so right.
Josh Strutt holds an MBA from Swinburne coupled with a deep background in retail implementation. He is our resident analyst who works on client projects and industry data interpretation. Josh is Retail Doctor Group’s Strategy Analyst and the go-to person for understanding how to efficiently run daily retail operations for big picture growth.