Paying Attention to Your Customers
Many organizations invest heavily in expensive market research to assess customer satisfaction while ignoring a gold mine of customer information that's already available from their records. There's a wealth of customer feedback right in front of their eyes about market trends, product problems and consumer preferences. If they could only evaluate and understand this data they'd have a much better grasp of the needs and concerns of their customers without recourse to market researchers.
Getting new customers is always important, but studies consistently show that it is five to seven times more expensive to acquire a new customer than it is to retain an old one. Existing customers send a constant flow of information to businesses that can be turned to advantage in retaining them.
Furthermore, if a business knows its existing customers well enough, it has a much better chance of creating opportunities to cross-sell and up-sell. The existing customer base is too often overlooked in the haste to sell 'more of the same'. The most likely purchaser of new products is an existing customer who already knows and trusts you.
So businesses that want to know their customers are beginning to look at how their customers treat them. Think about it. The way a customer responds to the business is the best possible indicator of customer satisfaction. It is an accurate and honest measurement of their feelings, and it should form part of the information your customer relationship system is capturing.
Begin by mapping your entire organization and identifying every location that contains or gathers customer information. Where do your customers communicate with you? Where do they interact with your business? Work through every communication channel, and chart the flow of each bit of data, from where it comes into the business to where it is retained or recorded. This includes the usual communications channels such as telephone, emails and incoming mail, and extends to less obvious ones like purchasing data, account payment records and website hits.
Now look at how the data gathered from customers can be integrated into a useful source of management information. What does each source of data tell you and how can it relate to your business strategies? Think in terms of what data exists where, and how best to organize and process it. Every section of a business will have its own perceptions of which customers are satisfied with what they get from the company. Remember that the individual members of your team will have their own ways of gathering and analyzing data.
The sales force will have no trouble identifying satisfied customers. They're the ones who return time after time to buy something. The service department will say it's the people they hardly ever hear from. The accounts department will say it's the customers who pay their bills on time. All this information helps to build an understanding of the people who buy from the business.
Look at customers' purchase histories. Has their total spending increased, decreased or stayed the same? Are they buying more of the same items? Are they buying new items? This also tells a business a lot about whether it's satisfying its customers and what they really want.
What you'll gain from this process is a new way of looking at your customers - not from the perspective of how you're treating them, but by analyzing how they're treating you.