50 tips on customers *ABI 1309

Provided by Return on Behaviour  Source Web page:  Customer Experience: 50 Tips

Our comment:

Having 50 tips in the one spot has to be good.  Between the 3 areas of customer referrals, customer retention and customer service, which one do you address first? We recommend using the Low Hanging Fruit concept with a twist of lemon.  Pick the biggest issue which is impacting your business; put in place solutions for that issue, measure improvement then when solved and/or it is moving in the right direction, move on to #2 issue.

Our free plug: 

Prioritising what to do first then measuring improvement should not be left to your financial accounting systems.  They are a really poor indicator of current performance other than in a very crude, overall perspective.  In fact, financial statements can often be misleading as they aggregate the good with the bad.  You really need to implement some easy to use and cost effective measurement tools to make sure you get the most bang for your buck from your investment in time and energy and resources.  To find out how we can help you measure what you need to manage, call us on 1300 783 3091300 783 309 or email us on moreinfoplease@bir.net.au

 

Now back to Return on Behaviour….

summary of Research on Why Customers buy – and don’t buy

Ignore this research on customer behaviour at your peril!  The points to reflect upon are:

  • Can you recognise your business in this research?  If so, you are not alone.  But …..

    decide to address just one of these issues at a time and watch your business grow (this much research cannot be wrong!).

  • If these things are happening in your business, you are inviting your customers to go to your competitors.  
  • Despite all your hard work to attract a customer, you are leaving money on the table as your customer silently turns away from you.
  • You can address the concerns of unhappy customers.  The question is: are you going to?
  • Those customers who are neither happy nor unhappy are your flight risk customers.  You are giving them no reason to stay.  They can make up a surprisingly high number of your customers and are likely to represent the reason for your customer churn.

If you read this and would like to know more about how to solve these issues in your business, give us a call.  We have business development tools and packages which address many of these issues.

Facts about customer experiences and referrals 

  1. 96% of unhappy customers don’t complain, however 91% of those will simply leave and never come back – 1st Financial Training services
  2. A dissatisfied customer will tell between 9-15 people about their experience. Around 13% of dissatisfied customers tell more than 20 people. – White House Office of Consumer Affairs
  3. Happy customers who get their issue resolved tell about 4-6 people about their experience. – White House Office of Consumer Affairs
  4. Happy customers who get their issue resolved tell about 4-6 people about their experience. – White House Office of Consumer Affairs
  5. 70% of buying experiences are based on how the customer feels they are being treated – McKinsey
  6. 55% of customers would pay extra to guarantee a better service – Defaqto research
  7. Price is not the main reason for customer churn, it is actually due to the overall poor quality of customer service – Accenture global customer satisfaction report 2008
  8. 94% of customers do not want to be transferred to another representative more than once – Mobius Poll 2002
  9. 80% of customers prefer to speak with a representative at the weekends – Mobius Poll 2002
  10. 84% of customers are frustrated when a representative does not have immediate access to account information – Mobius Poll 2002
  11. Customer who rate you 5 on a scale from 1 to 5 are six times more likely to buy from you again, as to if they ‘only’ gave you a score of 4.8. – TeleFaction data research
  12. It takes 12 positive experiences to make up for one unresolved negative experience – “Understanding Customers” by Ruby Newell-Legner 

Facts about customer retention and churn facts

  1. A 5% reduction in the customer defection rate can increase profits by 5 – 95% – Bain & Company 
  2. A 50% reduction in customer base would occur if left alone over a 5 year period – Bain & Company 
  3. It costs 6 – 7 times more to acquire a new customer than retain an existing one – Bain & Company 
  4. An average company loses between 10 – 30% of its customers annually – McKinsey 
  5. A customer is 4 times more likely to defect to a competitor if the problem is service related than price or product related – Bain & Company
  6. 68% of customers leave because they were upset with the treatment they received whilst speaking to customer services – US Chamber of Commerce 
  7. Dissatisfied customers whose complaints are taken care of are more likely to remain loyal, and even become advocates, as those that are ‘just’ customers – Strauss & Seidel 
  8. The probability of selling to an existing customer is 60 – 70%. The probability of selling to a new prospect is 5-20% – Marketing Metrics 
  9. For every customer complaint, there are 26 other unhappy customers who have remained silent – Lee Resource 
  10. 96% of unhappy customers don’t complain, however 91% of those will simply leave and never come back – 1st Financial Training services 
  11. A 2% increase in customer retention has the same effect as decreasing costs by 10% – Leading on the Edge of Chaos, Emmet Murphy & Mark Murphy 
  12. Customer profitability tends to increase over the life of a retained customer – Leading on the Edge of Chaos, Emmet Murphy & Mark Murphy 
  13. In the US alone, people that switch from insurance providers represent a $7.6 billion market in annual premiums – JD Power & Associates 

Facts about customer service and contact / call centers 

  1. A good customer service strategy should balance costs, quality and revenues. Companies that restructure call centers in this way can often cut their costs by up to 35% and boost the revenue they generate by as much as 35%, thereby transforming them into strategic assets providing a competitive advantage – McKinsey 
  2. Research shows that a 10% increase in customer retention levels result in a 30% increase in the value of the company – Bain & Co. 
  3. 76% of companies motivate employees to treat customers fairly, and 62% provide effective tools and training to gain trust with their customers – Peppers and Rogers Group, 2009 Customer Experience Maturity Monitor 
  4. 70% of customer experience management best in class adopters use customer feedback to make strategic decision. 50% of industry-average organizations and 29% of laggards do. – Aberdeen Group 
  5. 81% of companies with strong capabilities and competencies for delivering customer experience excellence are outperforming their competitors – Peppers and Rogers, 2009 Customer Experience Maturity Monitor 
  6. 72% of all customers believe it takes too long to reach a live agent – Harris 
  7. 69% said they were on hold for too long – Harris 
  8. 50% of the people survey said that agents failed to answer their questions – Harris 
  9. 44% said the information they received was not accurate- Harris 
  10. 92% of all interactions happen via the phone – Gartner 
  11. 85% of consumers are dissatisfied with their phone experience – Gartner 
  12. Even in a negative economy, customer experience is a high priority for consumers, with 60% often or always paying more for a better experience. – Harris Interactive, Customer Experience Impact Report 

Employee facts 

  1. The average recruitment cost of filling a vacancy is £4333, increasing to £7750 when organizations are also calculating the associated labour turnover costs – The Chartered Institute of Personnel and Development Annual Survey 
  2. Employee churn in the private sector is 22.6% – The Chartered Institute of Personnel and Development Annual Survey 
  3. An average of £1202 is spent on employee training – The Chartered Institute of Personnel and Development Annual Survey 

Facts about customer strategy 

  1. 90% of North American firms view customer experience as important or critical to 2010 plans. 80% of firms would like to use customer experience as a form of differentiation. – Forrester’s: The State of Customer Experience 2010.
  2. 85% of business leaders agree that traditional differentiators alone are no longer a sustainable business strategy – Shaw & Ivens
  3. 71% of business leaders believe that customer experience is the next corporate battleground – Shaw & Ivens
  4. eCommerce spending for new customers is on average $24.50, compared to $52.50 for repeat customers – McKinsey
  5. Reducing time and money on explaining business procedures and costs with new customers will save overall – Marketing Management; Spiro, Rich, Stanton 2008
  6. 73% of marketing managers of various large companies credit “Repeat purchase behavior” as integral to the definition of successful customer engagement – Forbes Magazine
  7. A survey asking which is the most important marketing objectives, shows that 29.9% think that it should be customer acquisition, and 26.6% think that it is customer retention. However 62.2% admit that they concentrate on customer acquisition, with only 20.6% focusing on customer acquisition. –Emarketer
  8. 55% of current marketing spend is on new customer acquisition – McKinsey
  9. 33% of current marketing spend is on brand awareness – McKinsey
  10. Only 12% of current marketing spend is on customer retention – McKinsey

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