Archives for posts with tag: Customer satisfaction

Not to rehash previous posts in their entirety, but I once more take the approach that marketing is the process of getting your product to and into the market—a larger discipline that includes R&D, sales, and customer care, not just promotion and advertising. Marketing also includes pricing and margin optimization, which can often mean needing to reinvent or reposition existing products with a new spin.

To be successful, marketing needs to take the customer’s side—to paraphrase a saying that has popped up at the top of my LinkedIn feed for the past week, marketing needs to listen to learn, not just listen to answer. What is the psychological driver that causes product adoption? Yes, a need is surely a driver, but among myriad choices, what differences matter to whom?

Therefore, both customer satisfaction and customer loyalty are critical measures of marketing’s success. However, satisfaction ≠ loyalty. You can have extremely satisfied customers, but if they buy based on price, and you raise your prices, they may not stay loyal. Thus, loyalty measured in price elasticity is an important metric to track.

Which brings me to Delta Airlines’ brilliant decision to revamp its frequent flyer loyalty program, and start rewarding travelers based on how much they spend, not on how far they travel. This shift has received tremendously negative attention in the press, I’m guessing because muckraking is fun, and business acumen is not required to write a compelling story.

Let’s first cite a different example. Grocery retailers reward their worst customers the best—those who spend the least get the quickest lines. But those who spend the most need to queue up in long lines while the ice cream is melting in their shopping carts. Grocery retailers are well advised to treat “high rollers” just as well, if not better than the “quickies.” The tactics supporting this strategy would be quite simple to implement.

Delta has grasped this. To date, like all airline loyalty programs, bargain shopping has been the most efficient way to maximize the value of a frequent traveler loyalty program—in fact, infrequent travelers are rewarded the best, needing just a few cheap cross-country flights to earn the right to a free flight. Those who need to travel last-minute, and thus pay the most, get no additional benefits. Their ice cream is melting.

Instead, Delta will be re-programming travelers’ mindsets from spend-less-get-more to spend-more-get-more. Bargain hunting will die a quick death with those who want to maximize the value of their loyalty program membership. And Delta’s profits will soar. They may lose some travelers, so revenues may stay flat, but margins will be better. Less work = more money; employees and stockholders love this!

And I even question the loss of travelers. Most airports have one anchor airline, maybe two. But in the end you need to get to where you are traveling in the most efficient and expeditious manner, regardless of who you want to be loyal to. My own attempt to switch from US Airways to United Airlines—because I desperately want to stay with the Star Alliance loyalty program after US Airways merges with American Airlines’ One World loyalty program—has been an utter failure, because US Airways dominates PHX, and can get me to most destinations more quickly.

I bet that’s what Delta is counting on: increased happiness from its best customers (those who spend the most, most frequently), and the inability of the least good customers to make serious changes to their travel needs, while still giving them the ability to earn the same level of rewards they are used to (by simply spending more).

That’s pretty damn good marketing—the process of getting your product into the market at a higher profit margin, while offering the disenfranchised the opportunity to stay engaged.

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The premise of Angie’s List is extremely appealing: accurate reviews that you can trust, because reviewers pay to participate. This simple reversal of the usual relationship—where the vendor pays to participate, but users can post for free—significantly cuts down on fraud, or should.

My wife has been subscribing to Angie’s list for about six to nine months now. She has sourced many contractors to provide quotes, and has selected quite a few of them for regularly recurring engagements.

The relationship is fantastic until the time comes for the contractor to actually perform the job. Each one has either performed poorly, or not at all. Examples of failure include doing a job not in keeping with the quality promised; not returning for work after a schedule had been agreed to; or repeatedly missing the same first rescheduled appointment (because the contractor keeps not showing).

One contractor showed up on time, but had forgotten he’d already agreed to the job. He showed because he thought he was coming over to give an estimate instead of doing the actual work, after he’d already been by the week prior to give an estimate where he was awarded the job.

So far the failure rate is 100%. How can that happen, considering that real people are posting about real experiences with these businesses?

My wife and I theorize that that these businesses have become too successful too quickly. We make this assumption because many of the contractors have told us that most of their business now comes from Angie’s List. They actually make a point of telling us this to communicate “social proof,” to imply that it’s safe to buy because a lot of people have chosen this service and are very satisfied with it.

We are guessing that most haven’t yet learned to say “no” when they can no longer perform their jobs at their usual high quality. They like the money, but they can’t seem to grasp the importance of customer satisfaction—weird, when considering that their businesses grew because of customer satisfaction.

And that’s a real problem everywhere: thinking the sale is over when contracts are signed, and as a result putting growth ahead of customer satisfaction.

Last week CMS Wire ran a webinar called “Rethinking Web Engagement – Leading with Content Marketing.” On the broadcast Robert Rose showed a revised shape of the sales funnel; not funnel- but hourglass shaped.

Rober Rose Sales Funnel

Copyright 2012 Robert Rose

To readers of this blog, the concept that the sale is not complete and the brand in jeopardy until the customer is satisfied, is not new. But the visualization is a wonderful reinforcement and reminder that customers are our least plentiful asset. And they are the fulcrum around which our businesses revolve.

Word of mouth marketing is still the most powerful marketing out there, and that’s what Angie’s List is monetizing for itself. But Angie’s List seems to be misunderstood by contractors for preselling customer satisfaction, instead of reselling customer satisfaction ratings.

You can buy customers, but no business can buy customer satisfaction; you have to create it (and maintain it).

This blog is not about customer service, it is about marketing and branding. Marketing and innovation are the only two functions of a company (thank you, Peter Drucker, written in 1954!). Successful execution of both creates a brand.

Marketing is the process of getting your product into the market: that includes sales, promotions, advertising, distribution, etc. But it doesn’t stop there, because you have to close the loop—you need to nurture your customers and provide a continuously satisfying relationship, in both B2B and B2C. You need great customer service because the customer owns your brand!

Back to Salesforce (see previous post).

It was time to renew our Jigsaw subscription (Data.com, owned by Salesforce.com), so I sat through a demo of new features (there weren’t any as yet). The first strange thing—but not the point of this post—was my Jigsaw account manager was giving the demo, but a renewal manager was handling the renewal. Why do I need a Salesforce.com account rep, a Jigsaw rep, a renewal rep, and soon a Radian6 rep (more on that below), when they’re all working for the same company? It makes for a crappy customer experience, and Salesforce.com clearly doesn’t grasp the “Merger” part of M&A.

At the end of the demo I was asked if there’s anything else I would like to know or would like help with. As a matter of fact there was. I would very much like to see how Radian6 integrates into Salesforce; I would like to see a demo.

The renewal manager assigned herself the “action item” to alert the right person and get that set up for me. The next day I received the following email (the Radian6 rep was cc’ed):

Hi Marc,

I wanted to follow up form our call yesterday and put you in touch with your Radian6 Account Executive, [Name].
She will be able to answer any questions and basically take it from here.

Thanks,
[Name]

Customer satisfaction opportunity missed!

The renewal rep made follow up my responsibility—something I could have initiated on my own with better results. What really happened was that expectations were set by Salesforce staff, then not acted upon.

I was told to satisfy myself.

What should have happened was the renewal rep call the Radian6 rep and hand me off as an opportunity (as an existing customer). Then the Radian6 rep should have called or emailed me with relevant information and set up a demo. Result: happy customer.

I took the bait and responded to the Radian6 rep, not bothering to wait for her to make the first move. Worse still, now 24h later, she still hasn’t responded.

Salesforce.com is well on its way to becoming a mainstay on this blog for how to fail in marketing and brand protection.

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