By Shaun Smith
Traditional measures of customer satisfaction have little to do with financial performance. According to research 80% of customers who switch suppliers express satisfaction with their previous supplier. Revenue growth has everything to do with advocacy, the extent to which customers prefer a supplier and then refer others to it.
The principles of customer advocacy hold true whatever the nature of your industry and customer base. The fact is that delighted customers have an affiliation for the brand that translates into bottom line growth. So how do you create a level of customer satisfaction that is so strong that customers become your best sales people? The answer lies in creating a customer experience that is so distinctive and valuable that it goes beyond satisfaction – and beyond loyalty.
Customer advocacy requires you to know who your most profitable customers are and to consistently deliver a customer experience so as to create a high degree of trust in your brand. Only then will these loyal and highly profitable customers be prepared to recommend your organisation to others. In his HBR article ‘The one number you need to grow’ Frederick Reichheld argues that the only measure of performance that really matters is the ‘Net-Promoter Index’. This is the result of subtracting those customers who are dissatisfied from those who are highly satisfied. Our term for this is the ‘Advocacy Index’ and our customer experience management survey measures this to determine the extent to which your firm will grow organically through attracting and retaining profitable customers through word-of-mouth.
By focusing on delighting highly profitable customers, companies keep them loyal and eventually turn them into advocates who attract others who value the same things.
Getting people to deliver the customer experience
The ‘people’ factor is one of the most important determinants of customer loyalty. The question is, how do you electrify and energize people in your organisation? How do you align them with your customer-focused strategy? The answer lies in the following four key factors that are critical to successful employee alignment:
Recruit the right people
If you wonder what getting and keeping the right employees has to do with getting and keeping the right customers, the answer is everything” says Frederick Reicheld in his book ‘The Loyalty Effect’. What’s critical is that you first identify the fundamental behaviors and values your brand requires and then recruit people on the basis of those behaviors and values.
Train them right
Develop training that teaches people not just what the core behaviors are but how to live them for customers. Focus on training that enables people to turn brand values into competitive advantage.
Reward the right brand behaviors
The soft stuff needs a hard side. You need to develop metrics for evaluating the use and impact of core and specific brand behaviors and then align reward and recognition systems with these metrics.
Demonstrate the right brand behaviors from the top
Senior managers need to set the example. The way they treat employees is reflective of how employees will treat customers. Leaders must communicate a sense of purpose and constantly reinforce the values of the organisation. They must also remember the connection between what colleagues want and what customers want. Above all, they must encourage colleagues to observe and challenge the organisation through customers’ eyes.