Customer Retention Is Critical…Here’s What You Can Do About It

Brand loyalty is at an all-time low, and there’s an estimated $1.3 trillion in revenue that’s very much in play out there as a result. Yes, it’s true. The level of customer dissatisfaction in today’s U.S. marketplace today is unprecedented, meaning there’s big money at stake.
And while that’s not good news for some, it’s great news for the small business entrepreneur who can see where some other company’s loss is his or her gain…and who has the courage to ask the question, “What is good customer service?” and then change something for the better as a result.
What the Customer Research Says
First, studies show that it’s at least six to seven times more expensive to acquire a new customer than it is to resell or retain an existing one. So NOT implementing customer or client retention strategies is simply a matter of being penny-wise and pound-foolish, something few businesses can afford in this day and age where having the competitive edge means even the smallest effort toward improving customer service goes a long way.
Second, word-of-mouth advertising—especially with the advent of social media—is a more powerful force than ever before. What comes around goes around, faster and further than ever thought possible, and we all have to manage the good with the bad that comes as a result…as proactively and wisely as we can anyway.  In an ever-connected world, customer perceived value is every bit if not more important than actual value, in many cases.
Lastly, Gallup’s research into customer satisfaction metrics has found unequivocally that “better” is of greater import to today’s consumer than “faster.” In other words, quality customer service is paramount, even when you’re moving slower than you or your customer might like. Presentation, the so-called “how to” of execution, just might be more important than you know.
But while that’s all very informative and some might even argue obvious, here’s the real concern…
According to Accenture’s latest ninth annual Global Consumer Pulse Survey more than half of U.S. consumers (51%) switched product and service providers across a full range of industries last year, representing an all-time high in this growing phenomenon. In fact, it’s a full 5% increase over the year prior, prompting Accenture’s Global Managing Director of Sales and Services, Robert Wollan, to say in a recent interview, “It’s significantly bigger than you would expect. We’ve seen no slowdown or decline in the concept of switching. This is a trend that is here to stay.”
The Takeaway for Small Business Owners
It all boils down to this one reality…
Companies aren’t doing all that they can when it comes to building customer loyalty, and they’re putting themselves at risk on a number of levels as a result, not the least of which is profitability. Things like brand image as well as personal and professional integrity, especially where small business owners and entrepreneurs are concerned, are also very much at stake.
Ignore customer service best practices and how your customers do or don’t feel about you and your company or business, and you do so at your own peril.
Wait, There’s Good News!
Fortunately, the Pulse Survey findings did leave room for tremendous optimism, especially given one in particular. And here it is…
Despite the fact that customer fickleness is higher than ever and just when it seems like customer loyalty is out the window, 81% of consumers said their provider could have done something different that would have changed their decision. Customers jumping ship when they’re the least bit dissatisfied is not necessarily a foregone conclusion, it seems, not if companies and businesses do their job right and take their customer service responsibilities seriously.
Retention Strategies to Enhance Customer Satisfaction
The Survey’s findings also outlined pretty clearly where exactly it is that companies and businesses are failing when it comes to customer or client retention and satisfaction. So we’ve put together some tips based on those key customer loyalty concepts, those that we think will help you to enhance the likelihood that even the most dissatisfied customer will give you that profitable and precious second chance.
Here they are:
Multiple Contacts
More than 90% of consumers said they were frustrated when they needed to contact a company more than once or maybe twice regarding the same issue. Whether you’re a one-person shop or have a small staff, the message is clear: Handle your customers’ concerns and problems promptly by ensuring their first point of contact has either the authority or ability to formulate a plan of action or correction and to take steps in the right direction promptly. Additionally, it’s important to make sure everyone is in the loop when it comes to the status of a complaint or any other issue as it unfolds, preferably in real time.
Using even the most basic tools like email, keeping a log or installing a web-based group chat platform like Campfire can help greatly to improve response time and efficiency.
Hold Times
Ninety percent of customers said being put on hold for a long time was a deal breaker. While ensuring every customer receives full attention at every minute of every day may not be realistic, especially if you run a small shop, there are ways to manage their expectations when you’re busy helping someone or doing something else.
If it’s just you, ask the customer when would be a good time for both of you to talk so that you can give them your full attention. If you have a small staff, create a signal you can give someone else to touch base with a customer who might be on hold, even if it’s simply to ask him or her if they’d prefer to wait a moment or not. That person can then also provide the customer with a reasonable expectation of when you or anyone else they might need to talk to will be available. And if you’re a little bit larger operation, why not invest in a phone messaging option that relays hold times and gives the customer the option to leave contact information so that you can promptly return their call?
Plus, don’t forget there are other platforms you can use to address customers’ needs more immediately, many of which are now more commonly preferred, such as email or via online chat.
Repetition
Consumers gravitate toward businesses that take the time to get to know them, so it stands to reason that 89% of them say having to repeat their issue over and over again to multiple people or even the same person who has no recollection of what it is they want and need is a downer. The need for repetition on the part of your customers is not the hallmark of personalized service. That’s why keeping careful records of each customer contact is so important. Moreover, they need to be kept in such a way that all of the involved parties can access them at a moment’s notice and be appropriately responsive, even if it means some degree of investment in technology.
Bait and Switch
A full 84% of respondents said companies promise one thing and deliver another. What ever happened to the old credo that says “under promise and over deliver” is the rule of the day? On this score, it’s all pretty simple actually. Don’t say you’ll do something and then NOT do it. In business, no matter how large or small, integrity—or the lack of it—always has been and forever will be a game changer.
Additionally, certain words carry more weight with consumers than others, like “free,” “guaranteed” or “overnight.” If you use loaded words, and there are plenty of them, make sure you’re ready to fulfill the oftentimes significant commitment that is implied. Otherwise, keep the overblown promises off the table, which is right where they belong.
Inconsistency
Close to 60% of consumers report that getting a different response from one person or via one channel versus another is maddening enough that it’s grounds for them to vote with their wallet and switch providers of a given product or service. In any business, there’s usually some degree of repetitiveness over time where customer complaints and concerns are the issue, and you need to take careful stock of what those are. Then use them to your advantage.
Create standard steps for resolution and then communicate all of that in writing to and train your staff so that there is consistency across the board. This is also a great exercise even if it’s just for your own edification. Taking time to think through what typical challenges might look like and then formulating workable and affordable solutions that are easily implemented step by step saves lots of potential headaches and confusion. Also, you’ll want to make sure there are clear boundaries on what can or cannot be provided in the way of compensation, shipping costs, etc.
Validation Is Key
Finally, as is true in most relationships, validation is what’s most important. Consumers need to feel like their concerns and frustrations are being heard and that their feedback is appreciated.
As a result, it’s never been more critical for business owners of any size, shape or form to acknowledge and take seriously the issue of customer retention and satisfaction. Sure, losing a customer or even one sale can be pretty devastating, but it might not hold a candle to the potentially social media-driven and overall impact you could suffer among your future prospects in the court of public opinion, especially if it’s due to an obvious lack of effort.
To gain even more insight on how to retain customers, how today’s consumers are behaving in this relatively new “Switching Economy,” and how your small business or company can play to win, visit http://www.accenture.com/ today!