4 Simple Steps to a Complete Customer Experience Makeover

Almost every savvy business executive recognizes that in order to set their business apart from their competitors, they need to provide an exceptional customer experience. It is understood that it is no longer enough to compete on products and services; how a business delivers to its customers is as, if not more, important than what is delivered.

The best customer-experience efforts begin with a customer’s perspective which is driven by the customer’s wants, not a business’s traditional organizational structure.

THE BUSINESS’S FIRST STEPS TOWARDS A COMPLETE CUSTOMER EXPERIENCE MAKEOVER

1. Recognize the Customer Across all Channels
Every channel (i.e. in-store, website, social media etc.) the customer interacts with should recognize the customer immediately, so that the customer doesn’t have to provide their information to the business more than once. A CRM application can help with this.

2- Deliver a Personalized Experience to the Customer
It is essential that businesses distance themselves from dated marketing tactics that encourage mass communication. In order to intrigue and retain a customer, marketers must communicate in a relevant, compelling and personalized manner by moving towards the relationship era of marketing. Marketing automation tools (personalized microsites and automated personalized communication) can help with this.

3- Capture Customer Feedback and Take Action
Everyone knows the importance of customer feedback but not all businesses know how and when to collect it efficiently and most importantly, to make real-time changes and take instant action where necessary. An Intelligent feedback application can help with this.

4- Train Customer-Facing Employees
Customer-facing employees can be the best medium in a business to deliver exceptional customer experience if given proper training. Businesses should spend sufficient time to train their employees with:
• The principles of customer experience.
• The concept of delivering memories not only transactions.
• The basics of customer recognition and segmentation.

Research indicates that 80 percent of customers who have stopped doing business with a company say that it is due to a bad customer experience. Whereas, companies that are consistent in providing positive customer experience across all channels are able to build stronger customer-relationships, maintain customer loyalty, benefit financially and receive customer-referrals. So what are you waiting for? These simple steps can take you from likeable to loved! For more information on the topic contact us at info@urbanbuz.com.

 

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What is Your Data Capturing Strategy?

Once you decide to implement a customer loyalty system and you have all the involved people aligned around the four main benefits of having such a system (see The Four Basic Benefits of a Loyalty Program), then you can start working on the strategy.

Typically when thinking about customer loyalty, businesses immediately start discussing points and how-to-capture-more-customer-data-300x206rewards, which really undermine the power of a customer loyalty system. Before even thinking about the incentives and the rewards, you need to figure out your data capture strategy.

A data capture strategy defines how you collect and manage information about your customers. A well thought of data capture strategy will deliver high quality customer data, allowing you to better understand your customers and enhance your relationship with them.

Capturing information about your customer does not mean you need to gather up every type of demographic data from every single person. You only need to capture the data that’s “relevant” and “relative” to your business and your sales objectives. You also need to make this data capture meaningful to your customers as well. You can’t just start asking for volumes of information unless it seems important to them as well.

One Golden Rule we recommend is this: Only capture data that you can actually USE to trigger a marketing campaign or make a decision about a “next step” within a marketing sequence.

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There are three basic guidelines that should guide your data capture strategy:

  • Depth – The amount of data you have about your customers to make your communications relevant

 

  • Breadth – The volume of customers you have on your database and can therefore have a conversation with.

 

  • Quality – The deciding factor. Your database may be full of customer records appended with all manner of information, but if it’s inaccurate it’s useless

 

 

Depth

It is important to identify what information you require to allow you to meet your objectives. At UrbanBuz, this is one of our starting points and this is something we call defining your “ideal” customer profile.

A good practice is to start by working out what information is most important. From there, you can then investigate where this information is currently captured or where it may be in the future. Don’t fall into the trap of collecting data because you think it might be useful. If you can’t think of a use for it now, don’t collect it. Asking for too much data may alienate your customers.

You can also use transactional data to get a far richer understanding of who your customers are than they actually want (or are able) to tell you. With sales data, you can build customer segments. You wouldn’t offer deep discounts to customers who were already loyal to your store and willing to pay full or close-to full price (that’s just giving away money). Your more infrequent customers may need different incentives to come in and purchase. Segmenting your customers can allow you to send the right offers to each customer.

Breadth

In order to maximize the number of customers who would provide you with their information, you should make it as easy as possible for customers to provide that information.

It is important not to push the customer to provide information at your own schedule. They need to do it when they feel like it. So for that you need to enable them to do that across different channels whether while browsing or waiting at the store, on your web site, on your Facebook page, or on their phone.

Also people expect something of value in return for entering their contact details. Incentivizing your audience needn’t be costly. You might provide a quick digital offer or voucher that gets emailed to them once they fill out their profile.

The key here is to make it quick and easy for customers to provide you with information at their own time by integrating your data capturing process with all your different channels from Point of Sale system to web site and Facebook.

Quality

Approximately 1 in 10 customer records you store will become out of date every 3 months. This has implications not just for the data that you collect (for example ask for a date of birth rather than age) but also for how you maintain it. A badly timed or irrelevant communication could at worst result in reputation damage to your brand. It is therefore not sufficient to just collect customer data well; it must also be diligently maintained.

You need to make sure to provide your customers with the capability to update their information and to have regular campaigns reminding them to make sure their profiles are up to date and most importantly to remind them “why” they should update their profiles.

While data collection does take some work and commitment, the payoffs can be well worth the time.

  • You can exponentially increase the response rates on your marketing campaigns
  • You can increase your per-visit transaction revenue
  • You can identify and improve your relationship with your best customers
  • You can provide useful information to all of your customers

To have a solid Data Capturing strategy in place, always make sure:

  1. Decide what data you need and prioritize
  2. Don’t ask for everything at once – build it up over time
  3. Make it easy for customers to give you information
  4. Incentivize your customers to part with their details
  5. Streamline the process from point of capture to storage
  6. Regularly remind customers to update their data and about the benefits of doing that
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The Four Basic Benefits of a Loyalty Program

History1Did you know that Loyalty programs have been used in commerce for decades? They originated in Germany where price based competition was disallowed by governmental restrictions in certain industries. In the 1930s, S&H Green Stamps rewarded grocery store and gas station customers in the US with stamps redeemable for appliances and other merchandise.

History2The modern day loyalty program was launched in 1981 by American Airlines, and was quickly duplicated by other airlines and other hospitality industries including hotels, car rental companies, and credit card organizations.

Throughout the years, both businesses and consumers have recognized the value of loyalty programs. Research shows that only 12% – 15% of customers are loyal to a single retailer, but it is that small bracket of shoppers that generate between 55% – 70% of company sales.

Some food retailers find that as much as 65% – 95% of their sales go to members of loyalty programs. Numbers show that 53% of food retailers offer loyalty programs with 3/4 of program customers using their loyalty cards at least weekly and 88% at least once a month.

History3Loyalty programs have many purposes but in general businesses think about them as a channel to reward customers for purchases and so to keep customers spending more and more with the business.

However, the greatest value that a well implemented loyalty program offers to a business is the ability to identify individual customers and to measure and understand their individual behaviors. This consumer behavior data, especially in the 21st century where competition is high and consumers are more in control, far outweighs the monetary value of providing consumers the opportunity to build a reward opportunity by shopping at one particular brand. This specific value is often misunderstood by businesses, small and big.History4

Having said that, loyalty programs in today’s business world, are considered the gateway to consumer data that would offer the business a window into a structured, measured, and targeted marketing efforts to drive business growth.

So before we start discussing the different components of what is today considered a loyalty program, let’s clarify the very basic benefits of using a loyalty program to obtain customer information, which are:

  • SHIFT – Acquire new customer
  • LIFT – Increase the spending of existing customers
  • RETENTION – Improve the natural churn rate of customers
  • PROFIT MIX – Shift spending to higher margin products

These four basic loyalty program benefits form the basis for all loyalty program initiatives.

History5You might have guessed by now from reading through this article that customer loyalty is the realm of the marketing department. So in case you were thinking about assigning this to your IT manager or operations manager, you need to stop and think about your marketing managers. They should be the ones responsible for designing and managing customer loyalty because they are in charge of establishing a connection between your brand and your customers.

Unfortunately many businesses confuse “loyalty” with “rewards”, and this is a fundamental mistake of many marketers. Loyalty stands for advocacy and commitment not points so it is really more about behavior and relationships through personalized and relevant engagement. Keep in mind the four basic benefits that you should aim to achieve from your loyalty program when you start thinking about implementing one or when you decide you need to improve the one you have.

History6

 

In order to shift, lift, and retain your customers, you need to understand them, communicate with them in a personal manner and on relevant matters. This is what your customer loyalty program should allow you to do; otherwise, it is just another discount system.

 

 

 

 

 

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Who is in Charge?

The CEO wanted to have a loyalty program so I got assigned the task of starting one. I went ahead and ordered 200,000 cards that we can give out to our customers as loyalty cards when they register to our loyalty program.

That story was told to me by the operation manager of a big brand that was going through global expansion. He was asked to setup a loyalty program globally and the first thing he knew about the subject is that he needed loyalty cards. You don’t need a crystal ball to predict how this program will do.

Unfortunately I have heard different versions of the same story from different business managers. One marketing executive told me that they had all the plans ready for a customer loyalty program and about to start executing only to be stopped by the head of IT who assured everyone that his team can setup a loyalty program by simply installing the loyalty module that comes with their Point of Sale system. One year later and there was still no loyalty program.

In general, loyalty programs are often developed with good intentions; however, businesses struggle to understand where to start and who should be driving the customer loyalty journey. The challenge is raised by the fact that customer loyalty dynamics have changed dramatically through the years and so when some businesses try to implement a program they tend to do it based on knowledge that is outdated and with an unprepared team, which results in the over-simplification of the customer loyalty initiative by looking at customer loyalty simply as points/rewards and loyalty cards and eventually causes their whole initiative to fail before it even launches.

Rewards have evolved in the marketplace from being a nice little extra for one’s loyalty to being perceived as an entitlement. Also one of the major shifts in customer loyalty is that consumers have moved away, to a certain level, from a desire for possessions to a desire for experiences. In other words, consumers are looking for a meaningful relationship with the business, which includes value and relevance.

As a result of this shift in consumer attitude, retailers recognized that without a proper “customer identification tool,” they were unable to recognize individual customers and reward them for desired behavior. They realized that to the most part what they had is “sales” data while what they needed now is “customer” data and so the traditional model of loyalty that is based solely on points and rewards is no longer sufficient.

The rising tide of expectations necessitates that loyalty marketers develop truly innovative loyalty programs, utilizing loyalty marketing best practices. So businesses need to keep in mind the question of how the program can tap into not only changing lifestyles, but also changing attitudes. The answer is not just in the rewards catalog, but in understanding the fundamentals of loyalty marketing as many confuse “loyalty” with “rewards.” This is a fundamental mistake of many businesses and marketers today.

Too many businesses take shortcuts and jump to platform selection or program execution without any “internal” preparation first. Compare the two stories I mentioned at the beginning to a meeting I had with the managing director of a well-established brand and her team. The managing director had requested her accountant along with her operation managers to give her a detailed report about their customers, their average spending, their average visits, etc. So when we got to the meeting she had a clear idea about what they had, the challenges, and where they need to be.

She hired a marketing manager responsible for working with UrbanBuz on “designing” and managing the customer loyalty program and at the same time brought in her operations managers to make sure they fully understand the program and provide feedback as they were responsible for “executing” the loyalty program with their staff on the ground. The IT team was not even in the room.

So before you even start thinking about how and what you need to do to setup a loyalty program, you, as a business executive, need to first figure out who will be driving the program. Most important of all, is top management (starting with the CEO), need to have full commitment to the initiative otherwise the rest of the teams will struggle to make this a success.

Customer loyalty is not a task and certainly not an IT project; it is a business strategy that should be at the core of your marketing team’s strategy. Having said that, the marketing or customer loyalty team is only in charge of designing and managing the program to maintain the analytics to understand what customers are thinking and analyze the information. They also have to deliver the understanding, and help, and coach the rest of the organization.

When it comes to executing the program, it falls on the shoulders of the operations team. Those are the ones dealing with the customers day after day on the ground so it is up to them to really drive the strategy designed by the customer loyalty team and make it a reality.

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