Features and tRends

(August 2009)

Year of the Customer
Five Tips for Putting Your Customers First
By Steve Kleber, President and Founder of K&A

There is no question that 2009 has been a tough year. But as we turn the corner to 2010, now is a pivotal time to evaluate your company’s approach to its customers and to restructure your services centered on them. In a time when companies need to look toward future success, your existing customers are your biggest asset and the heart of most businesses.

To retain your existing customers, it’s important to give them more than they ask for. Think of the phrase “expect more, pay less.” Put this fundamental concept into practice by making 2010 the year of the customer.  And remember that superior customer service should be at the root of each of your company’s operations. No exceptions.

K&A researched five of the most compelling ways to help you make 2010 the year of the customer.

1. Implement a Shift Toward Positive Momentum
At the start of 2009, consumer morale was at the lowest low since The Great Depression, according to Nouriel Roubini, professor of economics and international business at New York University. However, as spring began to bloom, confidence rose and many saw the opportunity to invest and commenced to purchase properties and other holdings at well below market value. Fast forward. A recent AP article reported that sales rose for a fifth straight month in June 2009 and the unemployment rate dropped for the first time in 15 months this August.  

As confidence continues to solidify in the marketplace, consider using it to leverage and position your brand at the forefront by demonstrating value.  Focus on your customers’ wants and needs and establish your position as an ally. Take pointers from Jet Blue’s loyalty program, which offers points for every dollar spent. In this economy, the more your customers get for their dollar, the more likely they are to continue to invest with you.

2. Communicate That Customers Have the Power
In today’s economy, it’s imperative to frequently engage with your customers. Show them they are in charge. Be proactive in finding out where your customers get their information and then actively participate in those spaces, which is likely to involve online destinations. Our society no longer relies solely on print advertisements and broadcast media for advice. Shiv Singh noted in a recent blog titled Going Social Now that social media continues to grow, and as it does the conversations about brand affinity affects purchasing decisions. These online social communities now carry weight in the decision-making process and online platforms such as Facebook, Twitter, YouTube and blogs are where many customers now go to get trusted advice.

In 2010, reaching out to your customers will be critical and engaging in social media will likely remain an important part of an integrated marketing strategy. As customers continue to look for security, they want to be part of a community. Being a part of the conversation and creating a community is essential, but remember that navigating the waters of unfiltered opinions can be tricky… so make sure to refer to communication experts before jumping in. 

3. Maximize Your Resources with Loyal Customers
You know the old saying -- you can’t be in two places at once. Incidentally, the same holds true in business. In a recent article in Businessweek, Steve Mckee asked readers to “identify customers they don’t want.” Focus in on the loyal customers you already have. They know your offerings and services. They know your brand, and in this environment, a little bit of comfort goes a long way. Don’t spend precious resources casting too wide a net simply hoping for a return.

The popular business blog Hipkin’s Hip Shots lists five reasons why loyal customers are your most important profit drivers:

  1. Keeping customers, and especially best customers, allows you to recoup your acquisition cost and generate a positive ROI.
  2. Loyal customers are more likely to buy more things from you.
  3. Loyal customers will pay a higher price. They understand your product and see its value.
  4. Experienced customers cost less to service. Because they know how your product or service works, they need less handholding.
  5. Loyal customers are much more likely to be advocates. They will happily tell their friends and associates about your product. This brings in more customers with limited to no acquisition cost.

Cater to customers by providing your expertise and helping them with tough decisions. Reach out to them. Let them be your ambassadors. Focus on how you can improve your existing relationships.  

4. Know Where to Cut and Where to Grow
Everyone is trying to trim the fat off their expenses and help their bottom line, yet one area that should simply be left alone (if not increased) is customer service. Even in the toughest of times, people want to be treated well—particularly high-yield customers. Harold Sirkin noted in a recent BusinessWeek article that in the airline industry, “Typically, 2% to 3% of an airline’s total customers account for approximately 25% of its revenues, mostly because they are paying far more than other passengers.” These high value customers can be vital to your business, yet they expect the ultimate in convenience and customer service. Communications Specialist Katie L. Reim argues that word-of-mouth is often considered one of the most effective forms of promotion. Maintaining quality relationships with high value customers will likely continue to bring in even more high value customers.  

5. Keep Customer Service a Top Priority
So far, we have established that there is momentum to maximize, that customers are invested in communities, current customers are one of your strongest resources and customer service should not be on the chopping block. Why is all of this so important in 2010? Simply stated, if you don’t focus on your customers, you might just lose them. Offer more, ask for less. Interact with your customers and get to know them. Make this “The Year of the Customer” and grow those relationships. If your competitors tighten-up and focus solely on their business and not their customers, the potential to increase market share will be even greater.

In the upcoming year, cater to your customers’ needs and wants so that as the economy rebounds, your business will be in the forefront.

For more information or personalized guidance on how to best market to your customers and develop proven loyalty programs, contact Steve Kleber at skleber@kleberandassociates.com or 770.518.1000.

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