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Driving profitable customer behavior
Boosting customer satisfaction, retention, and loyalty are important goals. But achieving them doesn't mean you're particularly profitable, although satisfied and loyal customers tend to drive profitability. The point I am making here is the need to encourage customers to behave in a way that maximizes profits. Of course that requires repeat purchases, and upselling and cross-selling within your product/service portfolio. But if it costs you $10 in customer service time for every $5 of incremental revenue, you're not driving profitable behavior. You're losing money.

CCOs have proven adept at establishing loyalty programs that reward purchases of the most profitable products/services based on incentives such as membership points that can be redeemed for merchandise, gift cards, etc. This approach builds add-on sales and provides a sense of identity as a "member," which strengthens a feeling of customer loyalty due to entitlement. Another aspect of profitable behavior is enabling a greater degree of self-service for customers, so they have alternatives to speaking with your more costly CSRs. Things like online ordering, FAQs for problem resolution, and online chat all save customers time in obtaining the information they need -- and will save your organization time and money.

Even a short hold queue is bound to frustrate customers, no matter how loyal they are. On the other hand, self-service capabilities enhance the customer experience, leaving the impression that doing business with your company is easy.

Create a customer-centric culture
Customer centricity is not a one-hit wonder. The commitment to customer satisfaction, retention, and loyalty should be part of the identity -- the DNA -- of an organization. Adding customer centricity to a company's mission statement is the easy part. Implementing it throughout the organization entails some heavy lifting, such as developing performance metrics to verify that customer-centric processes are in fact being followed, and providing incentives for employees at all levels to comply with best practices for their positions that promote customer satisfaction, retention, and loyalty. Even hiring practices must be reviewed to ensure that qualities associated with customer service orientation are part of screening process for new hires.

Demonstrate your value
Customer satisfaction, retention, and loyalty are soft benefits because they are not directly tied to hard costs (revenue and expenses) like sales and payroll are, for example. But CCOs and others with similar responsibilities recognize they must justify their existence by showing the bottom-line impact of what they do, and that means showing contribution to revenue and reducing costs.

Most CCOs have developed a methodology for verifying contribution to revenue and cost savings. For the former, they can point to increasing sales year over year among existing customers, improving the rate of newly acquired accounts, and reducing churn. For cost containment, CCOs can point to fewer calls from unhappy customers, fewer poorly handled onsite customer visits, etc. The more skilled CCOs also provide data from customer surveys that show high levels of satisfaction and loyalty, which serve to increase brand equity and customer lifetime value.

Armed with these strategies and tactics, CCOs not only survive, most are thriving. And for good reason: Keeping your customers happy is always a good business decision.

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About the Author: Curtis N. Bingham is founder and executive director of Chief Customer Officer Council