Think Customers: The 1to1 Blog

We have built up great relationships with our clients, and will continue to do so. We have gone the extra mile to help our clients. Adding new services has helped maintain and expand our client base.

Timing is everything.... Check out the just-posted editorial from our CEO on exactly this topic. http://www.jacada.com/c-level/msg_ceo20081120.htm

John,
Thanks for the link. The publication's authors include many well-recognized industry experts.

This is an extremely timely and important topics and worthy considerable thought and discussion, and then, appropriate actions.

I would like to point readers to an 84 page, multi-author, just released publication by Ogilvy's Customer Futures Group that deals with "The Importance of the Customer Experience in a Down Economy.

It is available as a free download by going to:

http://www.customerfutures.com/Group/Group.aspx?ID=85251

John Todor, Editor

At the risk of stating the obvious, there has never been a more critical time to delight customers and exceed their expectations. Shoddy delivery, be it in services or products, will doom the organization.

Thankfully technology can provide some answers. It is easier to ensure the flow of customer data across the entire organization and create a more holistic view of (and then solution for) your customer. Additionally, it is easier to bring your customers inside the organization to help steer development of services they really want -- and will more likely pay a premium for.

The issue, in our experience, is the classic internal hurdles like siloed thinking, inconsistent views of a customer between sales and marketing, reticence to put the customer versus the company first.

Being unwilling, unable or just not seeing the value of co-creation with your customers will no longer be a tenable business option. Be aloof at your peril.

Staying close to customers and understanding their needs are critical in any economy. Implementing a social media strategy as part of your overall marketing initiatives is imperative and offers an excellent way to engage customers, attract new ones, and stay close to the nuances of your market. Create a blog, participate in the commentary in others, develop compelling content, and utilize tools such as Twitter to establish your organization’s digital persona and brand.

Social media will be and should be a critical part of any customer strategy if companies expect to survive this economic downturn. Why? Because it’s the best way to connect with those that will help the organization succeed (employees, customers, partners, investors) to come up with ideas and feedback to better the organization. Companies can no longer ignore those voices.

Do whatever you need to do to make sure your current customers are happy customers. Once a customer buys from you, wait a week, then write them to find out if they are satisfied and if not, find out what dissatisfied them about the product or service so you can address it. You need to know this, so you don’t repeat the bad thing and can keep doing the good thing.

You don’t want to be relentless, but you do want to stay in touch. Periodically, send them things, articles related to their purchase, a post card, containing something that would be of value to them (with no selling-related commentary).

It's all about perceived product value.

For existing customers, demonstrate the value of the product they've already purchased to ensure their continued brand loyalty. This can be in form of added features, utilization of the product in a way your customers may not be aware of, or simply reiterating the benefits of their product. This bit of feel-goodery goes a long way in assuaging any fears the customer may have about their purchase and will help ensure repeat purchases.

For new customers, purchasing is an emotional decision. If we're able to make them feel comfortable with the purchase and demonstrate exactly what the product does for them in their specific case, they're more likely to purchase.

Sadly, in these times of economic crisis, lower price point is more of a sell as well.

Like most companies, we have an amazing wealth of knowledge that touches us each and every day. Customers who can help us continually improve our solutions; shareholders who have led Fortune 500s through difficult economic times; and our own employees who can help us identify ways to cut costs and improve efficiencies....

Build networks to collect all of this intelligence in a way that can help drive true business value. It's these types of connections that are going to be pivotal in getting through our economic downturn.

To survive and thrive in an uncertain economy the top strategy I suggest is focusing on existing customers and growing the relationship you have with them. This can be the foundation to economical business growth – growth from repeat business and also word of mouth, which can bring in new customers. Make a special effort to reach out to existing customers and listen to what they need; what would help them in business or life? Listen to the ways you could make their life simpler. A few ways to execute this strategy are by calling a few customers each week and listening, another method is to gather 12 of them together in an online chat area to listen, connect, and learn…. I will be nurturing existing relationships in my own work -- to sustain and add value to the relationship I have with them.

Client service and client satisfaction are the keys to creating, building and retaining those critical client relationships that empower, build and support businesses. In tough economic times, a good way to communicate with your client base, as applicable by industry, is to connect with their concerns, issues, and their goals for retaining or recruiting new clients -- in effect, how can you help your clients get business. Whether it is through continued high-performance service, overextended client communications strategies, or extra outreach efforts to help address client concerns, the goal must be on promoting your business, retaining your business identity, and substantially solidifying your position as a vendor or business colleague that will help produce a true benefit. Build your value, take nothing for granted -- and do not assume today's business environment is business as usual. Think different. Communicate with your clients. How can your services help your clients save money? What can you do to aid your clients in their own client recruitment and client retention strategies? How can you help your clients during this economic time? What is it about your services that elevates your company from being just a vendor or service provider to being a true partner with your clients?

I think continuing to strive for customer centricity through workforce optimization is perhaps the most useful customer strategy for survival. At a time when customers are more fickle and impatient than ever before, companies cannot afford to make promises that they have no intention of keeping. They need to recognize that their customer service organizations (where call centers are the hub) are the primary touch point through which they fulfill their brand promises, and treat these organizations as an integral part of their business strategies.

Delivering on the brand promise by implementing processes and success measures across the organization that are driven by their customers’ wants and needs defines a true customer-centric enterprise. Of course, technology is one important piece of this puzzle.

An industry research company recently published a report on prioritizing technology investments during uncertain economic times. The content reinforces the importance of investing in technologies that will create opportunities and positively impact organizations’ goals. What’s most interesting about this is that it recommends investing in workforce optimization technologies in times of economic downturns.

We’re finding that increasingly companies are embracing and implementing WFO business strategies and solutions—such as quality monitoring/recording, workforce management, performance management, eLearning/coaching and analytics—to know more about their customers’ experiences.

WFO can manifest itself in many ways—from technology to business processes to personnel. All are interconnected. 2009 presents great opportunities to invest in the customer experience even while reducing costs overall.

My first response is to actually have a customer strategy. The majority of businesses do not have one. They have fine words and sometimes fine deeds, but rarely is a consistent customer strategy understood and implemented throughout the organisation. It requires a joined up way of thinking about every key aspect of customers, from who they are and the customer experiences that they desire to shaping all business strategy and major decisions around the customers. The companies that really get this will be the ones who survive and thrive. Just trying to provide a good customer experience is no longer enough. In fact, it’s now an essential requirement to even be considered as a supplier and will no longer guarantee that you'll get the business.

The most important thing marketers can do in this economic climate is avoid the temptation to cut and run. Making adjustments is appropriate but we must continue marketing! It’s a great opportunity to identify the programs that are working and give them priority. Marketing during a downturn will ensure that companies come out on the other side in the best possible position.

The customer strategy that will be the most useful to survive or thrive in this uncertain economy are those strategies that significantly impact EBITDA or cash flow. Companies looking to survive in an uncertain economic time should seriously consider customer strategies or impacts against four key areas: working capital, SG&A costs, direct costs & revenue enhancement.

Of the four areas, revenue enhancement looks to be the most likely for opportunity. For example, when the market contracts, companies will drop their prices to capture market share. Companies should seriously consider looking at products, customers, or SKU profitability against sales and net margin and adopt strategies and communication tactics for customers, products, or SKUs where the sales and/or net margins are negative. Can you move unprofitable customers, products, SKUs to be profitable? Are there alternative products that would provide the same customer benefit but would improve a company’s net margins. In short, companies should focus on balancing the value of the customer with the value to the customer across sales, marketing, channels, service, products, and SKUs to ensure proper optimization of costs and revenues.

Retention.
Customers are more price-sensitive during economic uncertainy. They are easily persuaded to go for the lower price tag, unless there is a good reason for them to remain loyalty. This is the time to reach out and remind your existing customers that you know them well, you value the relationship, and you are open to dialogues.

I use 5 steps to map out a customer journey, and the last one -- support (technical help, nurturing a dialogue, adding benefits that are valuable in the eyes of the customers, just to name a few) and continuous communication -- is most overlooked by companies. The culprit usually lies in the lack of communication across and within a company, e.g. sales are not connected with the call centre, product development not able to pass on info to the front line people or training folks. I call this the Brand Schizophrenic Symptom. To tackle this challenge requires multiple levels of change management.

Companies also need to be very clear about their focus, i.e. is there a typical segment that is key to the company's survival, during and beyond this economic chapter?

The key to survival is to build stronger relationships with my current customers. Finding creative ways to explore opportunities to further the relationships with them will be my main focus. Making them "like me and trust me" more is the key to surviving the current downturn. I still look to build new relationships on the way to adding new customers, but reinforcing current relationships will hopefully allow me to build happier, more profitable, longer lasting partnerships with my best customers.

More value at an compelling price; continue to innovate, especially now; pay close attention to your customers’ needs; be prepared for customers that will have their own business challenges and work to adapt to their needs as best as possible; and adapt your messaging to the economic downturn and explain how you add value for your customers in this context.

During uncertain times, customers have limited budgets but they still need to get projects done. They still need to look at potential solutions…as they plan their strategies for the coming year and beyond. This is when we can be a true strategic partner to them and help them. Not every client will have budgets allocated for their initiatives and lot of them may be planning without much surety if they will have budget in the coming year. What this means is they will be looking for external partners that can go above and beyond to assist them – our strategy is to offer some pro bono advice and consulting to help clients prepare business cases and plan for their initiatives into the coming year. We will continue to work with our clients in a strategic manner and be advisors to them even in such uncertain times. During such uncertain times is when truly great companies leap ahead of their competitors by being flexible and over-servicing their customers ultimately creating positive energy about themselves.

Anything focused on customer retention and protecting the customers you have today. Everyone knows it costs more to get a new customer but how you interact and engage with your best customers is crucial to gaining short term revenue. I think everyone is confident that over the long term that the economy will recover - but anything that can increase short term (next three to six months) loyalty and purchases should be executed on.

As the economy shrinks, we see two strategies emerging:

First, in an effort to be more efficient and manage marketing spend more effectively, companies are measuring more and putting greater reliance on metrics, especially their KPIs. One area getting more metrics attention is testing, both of offers and targeting. Companies want to know exactly what increases responses. Overall, we see more focus on measurable activities and a letting-go of non-measurable ones.

Second, we see our smarter client companies shifting budget from acquisition to retention. There is less branding spend and more direct marketing to existing customers. In fact, a keynoter at a recent partner user conference used the phrase “retention is the new acquisition.” Tactics to hold onto existing customers, for example win-back campaigns and early warning systems to spot potential defectors, are high on client wish lists.

The moment the economy softened an end was put to our several-years-long “rising tide floating all boats” period. Our customers strategies include getting closer to their customers, focusing on their most profitable segments, curtailing non-performing or not-yet-performing pieces of their businesses, delaying or cancelling new programs, and holding on to cash wherever and whenever possible.

We speak with customers every day who are looking for ways to increase productivity at the individual contributor level. Our customers seem to fall into two groups in this regard. One group is looking for ways to help them and their people do more than they had been doing before. The other is looking for ways to do more than before but with less expense and resource.

There is one guiding principle that has to be considered before anything else. If you’re not treating your customer as a partner, start doing that right now. There are multiple implications to changing to this approach, but the two that will matter in a downturn the most are probably transparency and compromise. Be prepared to be straightforward and let the customers know your situation as well as you finding out theirs. And be ready to compromise. For example, if a customer can’t meet a scheduled payment, work with them rather than send them to collections. Help them find alternate financing if financing is necessary and they don’t meet your standard financing. This period requires give on both sides and treating customers as partners, rather than just paying clients will make a difference. Price is going to be a top of mind concern so make sure that you address pricing with your newly minted partners – especially the most valuable ones.

Make sure that communications is at the top of the list in how you deal with those customers. Not just the “why don’t you buy from us” communications, but of the type “how are you doing?” or “what can we do for you?” or “here’s some information e.g. practical tips or valuable advice that might be useful to you during these times, specifically-targeted-customer/partner.” In other words, you’re taking a measure of business leadership, not just being the company that they are getting discounts from (though those are good too). Finally, find out how they want you to communicate with them – nobody likes too much communication.

I think that the most important aspect is that people want to reduce risk. People want to do business with people they trust. It is not just about giving the best price, but more important, really listening to customers and being a friend for them in this time of uncertainty. Ask them how you can help them, take the time to really understand what they are going through, and give them the best advice you can. Not as a salesman looking for a quick buck, but as a friend. People change jobs, companies get started and closed, but relationships are for a lifetime. The relationship is above any business transaction. If you mean it and act it they will see it and you will not have to worry about sales. They know you need their money and that you need to make your sale to stay in business, let them have a chance to be as good friends to you as you are to them….

There is a famous saying that when you are down get out and start giving. The excitement and good energy you spread will help you as well. It is hard for people sometimes to help themselves but when you help others you suddenly know exactly what to do and are full of enthusiasm and energy.

My businesses and those of my clients are primarily business to business. Our number one customer strategy right now is to stay visible to our customers, engaging with them in frequent and meaningful dialogue (not just contacting them, customers hate to be contacted, they want to be engaged under their terms) about their business and the changes and challenges they see ahead. With this information our goal is to move more swiftly than our competitors to take these customer needs, wants, insights, and expectations and deliver the services that add the greatest value for their company and ours. This is a process we regularly go thru in good times and bad, however given the level of gloom and uncertainty in most business right now it is more important than ever to be seen as understanding and responsive to your clients changing needs.

While other companies are freezing travel and pulling back on participating in conferences and events, we are making every effort to show up where our clients and prospects find it valuable to show up and engage with them in building business strategies to meeting our future challenges and opportunities together. We want to be viewed as an integral part of their team and a value added partner to achieving their future business goals.

My opinion, which doesn't change depending upon the status of the economy [is this]: Recognizing and respecting your existing customers with targeted communications based upon their needs -- not ours -- is the most useful customer strategy because this will yield the greatest return on investment both in dollars and human resource. What does change in a down economy is senior management focus. When times are good, marketing mistakes are easy to bury and poorly managed companies can ride the economic wave. Tough times call for critical thinking and letting go of pet programs that have outlived their usefulness. It's our challenge as customer advocates to make sure the voice of our best customers is heard since conventional wisdom often tips toward new customer acquisition.

We approach every project and prospect as the most important one that we will ever do. We are supremely focused on customer success and satisfaction.
We harness this strategy by communicating this commitment to all our employees, our existing customers, and to our prospects in the market. Buying from Kognitio and working with our staff comes with a zealous commitment that we will help you succeed beyond the level that was envisioned. It is very simple - clear open communication, a commitment to success and a view that we can take our customer's vision to a new level.

A critical aspect of customer strategy is a concept that goes beyond just customer retention. Increasing customer engagement is key to growth. Yes, it is possible that company managers who really understand why customers do business with them will be able to shift people from moderately committed (swing group) to highly committed (engage group) and therefore realize those benefits. Engaged customers buy more product, even during tough economic times, they are better advocates for the business, and they stay longer in a relationship. So, when most marketers see their budgets shrinking and customer acquisition dollars vaporizing, it is still possible to grow revenues through increasing customer engagement.

HP...will continue to invest in 1:1 sales relationships with our key customers, across all segments, to survive and thrive during our incredible economic times. Our sales team will continue to educate and deliver products and ideas that reduce costs, save resources and deliver results inside their organizations around ways to best manage printing inside their businesses, including some thoughtful and innovative approaches to ‘going green.’

Customer Strategy is now more important that it has ever been during these times. What a company has an abundance of and wants to keep are customers. So by facilitating a conversation with them a lot can be learned about customer service issues, research and development, and social CRM strategies, as well as assisting them during these times to be more efficient with your solution.

In the long run you will learn from your most valuable customer ecosystem to sustain and grow the relationships you currently have and also be armed with information to go out and find others like them. The key is utilizing tools and practices that allow you be a part of your customer’s networks, which will enable two way engagements.

The message would be different depending on the audience.

For C-level: Markets will take an up turn. It’s not if, it’s when. Look to be in the best position to outpace your peers when this occurs. Now is the time to focus on core competencies and free up capital. Balance approaches are key. Over focus on cost cutting will damage customer relationships and leave you in the dust when the up turn occurs.

For Management level: It’s time for a paradigm shift. Insanity is doing the same thing and expecting different results. A successful customer strategy requires a different way of capturing and quantifying the customer experience.

I think the best strategy one can take is to "do right" by your clients in the current economy by being overtly sensitive to existing budget constraints and performance goals and helping them reach those goals on a reduced budget. The point here is to work in partnership with your clients and put their interests first. This will build trust and create a stronger long-term relationship once the economy improves and your pricing power increases. Companies that look for short-term financial gain from customers will suffer from increased customer churn in the short-term as companies cut inflexible programs entirely. These companies will also suffer long-term given they will have to rebuild their customer base once the economy turns around, creating significant advantage for companies who have retained clients through the down-turn with creative problem solving and budgetary flexibility.

The new HBR includes a short article on this topic with an instructive Whole Foods example:

Change with Your Customers - and Win Big:

"Downturns naturally reshape customers' needs. While competitors mindlessly cut costs, you should divide your customer base into new segments, whose emerging needs you can serve - and invest in - profitably. You'll increase market share and market capitalization."

http://harvardbusinessonline.hbsp.harvard.edu/b02/en/common/item_detail.jhtml;jsessionid=WPKGWERJBPQMWAKRGWDR5VQBKE0YIISW?id=F0812B

Provide true value, transparently. Make the customer experience flawless. Then get out of your customer's way.

The most useful customer strategy is to give them what they want. While this is a cliche, there's no excuse for failing to do it. It's easier to find out what customers want than ever before.

New media tools such as blogs and social networking sites are an effective means of finding out what people really care about. As Junta42's Joe Pulizzi mentioned on ASBPE's Webinar on Monday, 90 percent of all purchases begin on the Internet. How do you know if these people like or dislike what they're paying for? More likely than not, they're probably blogging about how great it is or tweeting about how much they hate it.

I think the uncertain economy is making companies more open to trying new things on the Internet. For one thing, Internet marketing initiatives are generally inexpensive.

Here is some anecdotal evidence: Tonight my company's marketing director asked me to set up a LinkedIn group for my publication's subscribers. Even a couple of weeks ago I was pretty doubtful that this was something my company would ever do.

The best way to thrive now is the same as it was 'then.' You must always put the customer first. In tough times businesses sometimes forget this and begin to take short cuts to save costs or streamline operations. Streamlining is fine as long as it doesn't detract from the customer experience. Sure, go out and shop for better insurance rates, or negotiate better terms for your vendors, but don't detract from the customer experience.

These days getting a customer to spend money with you is tough. By focusing on them you give them a reason to spend with you rather than your competitor. For us, this means continuing to add rose petals to our aromatherapy baths, it means offering free drinks and snacks, it means continuing to take care of the customer just the way you did when times were good. Actually, it means taking care of them better than you did when times were good. Cut out these perks now and your loyal customers will be gone by the time the economy recovers.

Outwardly focused executives have the upper hand during trying times. Finding ways to connect your customers for the advancement of each of them is not only selfless, it's the way it has always worked. Self promotion just barely works during boom times. Our organization concentrates all of our efforts on encouraging our business community by hanging tightly to the belief that people still do business with and refer business to those they know, like, and trust. We have a large database of customers that we know, like, and trust. If we like them then we know others will too. So far this is working so we aren't going to change regardless of economic conditions.

In these uncertain times, we must understand that our value proposition may have to change, at least temporarily. Recognize that our customers are all feeling huge pressure. While we may have long-standing relationships, the fact remains that our customers may not be able to buy from us right now. How do we keep adding value if they can't buy our products or services? By thoroughly understanding what their current needs are and helping out in any way we can. If they're moving, help them move. If they're redecorating or somehow changing the look or structure of their business, give them a hand. If they have operational challenges, offer some guidance or resources you may be familiar with. What they need right now may not be our product, so in order to continue to be the provider of a solution, we have to address the current problem(s) they face. This dedication and loyalty won't go unrewarded when business picks up again.

Customers have always wanted value and it’s all the responsibility of all employees to create value for the customer, not just for marketing or sales or the call centre.

Somehow, as we have gained the immediacy and expediency of digital marketing, we have forgotten that in addition to price, there is an entire value chain that reinforces the brand and actually has greater importance to customer relevancy. It’s up to us to learn what components in that chain are more important than others, how that value is perceived relative to the competition, and how we go about optimizing it.

Indeed while value is derived from the brand’s price it is also sourced from its convenience, quality/reliability, image and fun/escapism benefits. In addition to those purchase relevance triggers, we must also focus on consumption triggers by understanding the solution the brand provides, the support/knowledge network surrounding the brand, and the societal benefit the brand creates. All of these components can be emphasized in either the long term or in the short term.

Therefore the first thing I would suggest is to revisit your brand value chain and understand how strong or weak it is, especially in the context of the new economic conditions. Some portion of your customer base may no longer have the means to support your brand, be new to the brand or have new priorities.

What remains consistent however, is the more one relies on price (in the guise of DM or ecommerce relevancy) to drive business, the weaker/more precarious the brand value platform becomes. Challenge yourself to include as many of the brand value chain elements in your offer communication and give it more prominence than the price. Dell has successfully reconfigured their tactical promotions giving significant prominence to benefits over price.

Complicating matters is the fact that the ground has ‘shifted’ (more like heaved) at a time when we have pervasive social networks and interconnectivity that didn’t exist just a few years ago. And so the brand’s role in the community takes on much greater importance.

With the financial crisis spillover onto Main Street, people are scared, angry, and skeptical. They are searching for stewardship and a sense of community in the rebuilding efforts that lay ahead. For marketers this means brands need to support their constituency as much as they seek that support themselves. In the process brands will earn a level of customer trust, relevancy, and intimacy that will be invaluable for future success; it's what I call Share of Life marketing.

Tangible steps to be taken by brand leaders for the immediate crisis of confidence:

1. Stewardship: A brand's values help define the brand value.
Recognize that enterprise value stems from the user base and not the investor base, that Return on Customer drives Return on Investment.

Give the brand community a reason to support your market offering. Customers need to hear CEOs give voice and action to their principles of human resources and community support and how the enterprise they lead plans to be part of the rebuilding solution.

A corporate stewardship pronouncement will boost the rank-and-file morale. Pay particular focus to customer-facing employees to ensure that service support is at its highest levels. Consider deploying a CEO-driven customer service rewards program to bridge the next 4-6 months so that everyone understands you are serious about customer service. Share stories (not statistics) of the impact service delivery has on customers; preferably in the customer's own words or better still on video. Consider redeploying retired or surplus/underutilized employees as secret customer service observers.

2. Leverage. Use current customers to drive acquisition of new customers and/or generate higher sales multiples. For example:

a. Allow brand users to herd and share in the benefits of conjoined purchases. Instead of (Buy One Get One) BOGO's directed to an individual, engage the customer's clan and turn it into mother-daughter, or boy's day out/girl's day out shopping event. Or set a purchase threshold above which the shopping party earns some discount or reward. Create themed events that capture the spirit of a shopping party with contest prizing geared around the group as opposed to the individual shopper.

b. Engage the larger constituency by promoting some local community/social benefit tied into brand purchases, i.e. $x for every purchase this month goes to support your choice from this group of charities. Blend national and local good works programs to maximize relevancy. Have customers vote on which good works program they wish to support. Don't put a cap on the donation amount (to avoid looking like a scrooge) but do commit to a minimum or matching formula. Try to engage good-works partners to help promote your efforts to their constituency.

c. For B2B, consider implementing a customer appreciation program rewarding customer referrals by sharing some of the incremental profit, perhaps yielding longer payment terms (net 35 vs. net 30) or awarding soft benefits. The intent is to demonstrate the value of the solution based partnership to your customers.

3. Social Media. Now you really have something to talk about.
Share your stories with the community. Give your brand constituency progress reports with the same frequency and importance given to your shareholder community. Update the constituency on the impact their support is having with their charitable causes. Solicit their input on new product development, packaging, and promotional ideas. The greater the inclusiveness, the greater the customer's ownership of the brand, the greater the partnership.

While this dialog is taking place, consider a program allowing customers to self select/self create promotional events. For example if the CRM assessment indicates the customer is to be targeted with six promotional events skewing toward particular upsell/cross-sell products, why not let them create their own events on their timelines. Keep track of the activity to ensure compliance within any overarching constraints (i.e. number of events, timeline for completion), but take this opportunity to change the focus of marketing initiatives from a campaign-centric to a customer-centric approach.

The ground may have shifted, but the path to success is the same: brand value derived from customer relevancy, solution innovation, co-creation and co-dependency.