2/17/2010 12:44:00 PM
Are we offering customers real value?
With the New Year in full swing and as we embrace new plans and objectives with gusto, it’s important to take a step back and ask: how well do we understand our customers and are we offering them real value? Businesses with a successful customer relationship management (CRM) strategy are more likely to emerge from the downturn in a stronger position.
Interaction with a customer should generate value for them and ultimately deliver a superior experience. However, generating value is not just about getting more sales. A bad customer experience resulting from a mis-sold product, whether intentional or not, is going to destroy the total value a business can expect to receive from that customer in the long term.
What’s more, in a competitive market, businesses tend to adopt a strategy of customer acquisition rather than retention, but it’s crucial to balance both. Retaining existing customers will continue to be a key priority for telcos, especially since attracting a new customer costs five to seven times more than retaining an existing one.
The key to addressing all of these issues is to offer unique and high quality services, tailored to individual needs. While CRM enables us to do this, using it to improve the sales and service experience is not just about accurately predicting what each and every customer is going to do.
It’s about being able to group and target people more effectively, and increasing the chance that every transaction will be positive and offer a good experience. This can raise the probability that something is of interest to a customer, from typically less than 10% to up to five times more. Clearly, the longer term impact and financial returns can be huge.
Businesses should constantly look at ways to develop how consumers are using existing services, while also monitoring usage to help identify opportunities to adopt new services. We can do this by interpreting customer characteristics such as current patterns of phone usage and even the strength of their longer term relationship with their service provider. Only through these insights can we provide customers with offers that are truly relevant and that complement their lifestyle.
We need to ensure that every interaction with a customer – whether via the internet, social media or call centre – delivers, if not exceeds, expectations. By using CRM to understand what consumers want, operators and businesses alike will be able to offer value in a timely and relevant way. This will enable businesses to drive revenue, reduce churn and survive and prosper in 2010 and beyond.