White Glove Service Is the Hot New Retention Strategy

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Customer Service
Customer Service
Organizations in B2C and B2B industries are offering personal "concierge" service for their high-value customers.

In a journey to reinvent its relationships with customers, the New Jersey Performing Arts Center launched a personal representative program three years ago for its 4,000 highest-value customers. The program features such unique services as a private toll-free number, a gift-giving service, and unique win-back promotions including private box seats and invitations to catered receptions.

Additionally, NJPAC has designated a team of its best service representatives with the primary responsibility of building lasting relationships with its high-value customers. Since launching the program NJPAC has been able to reverse churn, stabilize the number of households attending concerts, and increase the price paid per ticket.

With customer loyalty on the wane today, NJPAC is just one of the many organizations leveraging concierge-type service to retain high-value customers and create greater profitability.

According to the recent American Express Global Customer Service Barometer, a survey conducted in the United States and 11 other countries to explore the attitudes and preferences toward customer service, Americans will spend 9 percent more with companies that provide excellent service; and 98 percent of consumers said personal experience is the most influential factor in doing business with a company.

With these recent statistics, it's not surprising that companies across industries, including NJPAC, Eddie Bauer, and even Lockheed Martin, are offering concierge service, which aims to deliver unique service experiences to top customers to build loyalty and customer retention.

Jeanne Bliss, president of Customer Bliss, attributes the rise in companies offering high-priority service to the realization among a growing number of organizations that different customer groups have different needs, and that means providing service based on their needs and value. "Finally, after all these years, more organizations are being deliberate in how customers are organizing into different classes," Bliss says "There's much more rigor and understanding that not all customers are created equal."

Linda Jenkinson, chairman of Les Concierges, says she too sees an increase in interest for this type of service. "In this global crisis and financial environment, companies are really starting to cherish their customers. They're starting to take the budgets used for marketing and management consulting to spend on customer support."

Jenkinson says enthusiasm for high-end personalized service started to increase about three years ago and sees interest in concierge service on the rise in the hotel, retail, high-tech, and even the defense and bio-tech industries.

Many organizations that offer high-touch services use segmentation to help build out their program. These firms will often identify their top customers, assign them to a group based on the level of value defined by the client, and then develop an individual treatment program that includes rewards or concierge services. The concierge representatives then assist customers with varying levels of service, ranging from securing dinner reservations to arranging for the chef to visit them at their table, for instance.

Different customer groups have different profitability profiles, which require varying degrees of treatment models, Jenkinson says. High net worth groups, for example, may require more than dinner reservations to keep them satisfied. In one recent case a client staying at a hotel in Paris requested a four-handed massage. The concierge representative arranged for two high-end spas to each send a masseuse to together give the customer the four-handed massage.

Jamie Comiskey, vice president of client services at VIPdesk, says that years ago concierges would only receive requests for help with booking airline tickets. Today, the types of service requests have completely changed. One recent request was from someone needing his car towed, another involved a customer who was traveling abroad and became ill. The concierge worked with customs and the local embassy to get the customer medicine and then arranged his travel home. "[The requests] range from the sublime to the ridiculous," Comiskey says.

Despite the nature of the requests, concierge service helps organizations retain customers and increase their profitability. Jenkinson cites a private golf club as an example of how concierge service can increase retention. The club recently deduced that if a member stayed for two years, he would ultimately stay a lifetime. If members use the club's services three times within two years, they typically renew. "The issue was the club acquired new customers, but typically lost the same number in two years," she says.

Working with Les Conceirges, the club reached out to new members to offer a range of personalized services like arranging for concert tickets or inviting them to an exclusive wine program. As a result, the club renewed its members at the two-year mark 78 percent of the time. "[Priority service] has a major financial impact," Jenkinson says. "When people are looked after, they're loyal."

EXPERT OPINION
EXPERT OPINION