Post by Trade facilitator on Nov 19, 2017 1:50:53 GMT 1
Tom Peters the author of the customer oriented book, The Pursuit of Wow said that there are two things that set great organization apart from the rest, this is the fact they step out and stand out. Great organizations do things that make an edible mark on the mind of customers although thousand of books and journals have been written on how to provide excellent customer's service and leaders have often touted the fact that they are in business to cater for their customers but the delivery of excellent customer service have often been below performance especially in developing economies such as ours. The growth of any organization, either profit or nonprofit, public or private is highly dependent on their ability to maintain a high proportion of valuable customer and the ability to be able to add to the reservoir of customers from time to time. In the quest to generate this critical mass of customers through the provision of excellent product/ service, unparallel delivery of this product during or after sale and impeccable ability to respond to any infraction that may arise, there is need for different organizations to understand what it takes to gamer the best crop of consumer that will add value to the organization. There are some guiding principles that will help organizations and their leaders in their quest to reap from the Wow effect they are having on their customers, the main four ones will form the fulcrum on which this article will revolve
Maintaining Excellent Customer Base
Not all consumers are reachable and not all customers are profitable, in the quest to gather, nurture and maintain a critical mass of valuable customer that will contribute positively to the organization, there is need to properly identify what is needed from the customers in exchange for the products/ services that is being rendered and tailor the offering and its delivery towards set objectives. Doing this entail the following Strategic importance… this is three dimensional, organization should seek consumers that desire its value proposition, are expected to grow and possibly be an opinion leader. In doing this organizations and its leaders should seek out customers that appreciate the service being provided and are willing to grow along with the brand because of their affinity for the brand. This horde of customers will become the brand disciple and will advocate for it by molding the opinion of others. Having customer with this attributes help to reduce marketing cost, improve the probability of extending the brand and shoring up the bottom line.
Customer significance… size does not really matter but the percentage of revenue and growth. Some big account may demand higher services that can lead to high operational cost nevertheless there is the need to have accounts that will continuously deliver over a long period of time and will add value to the organization. There is no point having a large customer base that deliver little in term of return but expected to be served like a King, also it will be foolhardy to have a handful of profitable customers that is so troublesome to the extent that other valuable customers are neglected.
Customer profitability… focusing on a core of loyal customer that are profitable and then put strategies into place to make others profitable and getting rid of those who are not profitable. Building relationship with the core profitable lot among the loyal customers is very important but beyond doing this for the customer it is also an avenue to showcase the excellent service been enjoyed by the few profitable customers to other potentially viable ones. Those who are not profitable now should be divided into two broad sections of those that have potentials to be profit in the nearest future and those that do not have any potential, those with potentials can either be targeted with another product or encouraged until they come of age and become profitable while those perceived not to be profitable should be systematically steer away through any of the 7P strategies.
The loyalty coefficient… it will do a lot of good for an organization to have a high net worth of loyal customer on whom they can base their growth upon, generating a critical mass of the customers described above is very important, from inception the number of customers that will make purchase and are likely to repeat their purchase is very important to an organization. Improvement in market share, either through development, penetration, product development, and diversification or through other inorganic means is important to the survival of any organization. The number of customers that have stayed loyal to a brand, the percentage of those that have exited and those that have gain entry into that category is very important to build scenarios that will inform strategic plan for an organization.
Harvesting from Valuable Customers
Apart from having the knowledge of how to use the four basic elements above to make inroad into gathering valuable customers, there is a need to constantly conduct research in other to understand the satisfaction level of this customers periodically. Also there is need to continuously add more value to how an organization deliver its products and service, this may be done with the following: provision of adequate and constant training for the personnel.
Improvement in communication between the organization, its employees and the customers.
Deployment of necessary Information Systems that will integrate all the activities with preference for customers in store.
Having a base of valuable customer is a very good way to beat the odds when the chips are down; it allows organization to ride on their back for future success.
Action Point
You will need to understand the Pareto principle of 80:20 very well, but you may need to stretch this principle further if you want to benefit from it more, the ideal situation in today's economy is to understand the 60:20:20 principle and understand that 20% of an organization consumer will account for 80% of the profit today but there is another 20% out of the present customers that will step into their shoes in the nearest future, so identify them and treat them well.
Maintaining Excellent Customer Base
Not all consumers are reachable and not all customers are profitable, in the quest to gather, nurture and maintain a critical mass of valuable customer that will contribute positively to the organization, there is need to properly identify what is needed from the customers in exchange for the products/ services that is being rendered and tailor the offering and its delivery towards set objectives. Doing this entail the following Strategic importance… this is three dimensional, organization should seek consumers that desire its value proposition, are expected to grow and possibly be an opinion leader. In doing this organizations and its leaders should seek out customers that appreciate the service being provided and are willing to grow along with the brand because of their affinity for the brand. This horde of customers will become the brand disciple and will advocate for it by molding the opinion of others. Having customer with this attributes help to reduce marketing cost, improve the probability of extending the brand and shoring up the bottom line.
Customer significance… size does not really matter but the percentage of revenue and growth. Some big account may demand higher services that can lead to high operational cost nevertheless there is the need to have accounts that will continuously deliver over a long period of time and will add value to the organization. There is no point having a large customer base that deliver little in term of return but expected to be served like a King, also it will be foolhardy to have a handful of profitable customers that is so troublesome to the extent that other valuable customers are neglected.
Customer profitability… focusing on a core of loyal customer that are profitable and then put strategies into place to make others profitable and getting rid of those who are not profitable. Building relationship with the core profitable lot among the loyal customers is very important but beyond doing this for the customer it is also an avenue to showcase the excellent service been enjoyed by the few profitable customers to other potentially viable ones. Those who are not profitable now should be divided into two broad sections of those that have potentials to be profit in the nearest future and those that do not have any potential, those with potentials can either be targeted with another product or encouraged until they come of age and become profitable while those perceived not to be profitable should be systematically steer away through any of the 7P strategies.
The loyalty coefficient… it will do a lot of good for an organization to have a high net worth of loyal customer on whom they can base their growth upon, generating a critical mass of the customers described above is very important, from inception the number of customers that will make purchase and are likely to repeat their purchase is very important to an organization. Improvement in market share, either through development, penetration, product development, and diversification or through other inorganic means is important to the survival of any organization. The number of customers that have stayed loyal to a brand, the percentage of those that have exited and those that have gain entry into that category is very important to build scenarios that will inform strategic plan for an organization.
Harvesting from Valuable Customers
Apart from having the knowledge of how to use the four basic elements above to make inroad into gathering valuable customers, there is a need to constantly conduct research in other to understand the satisfaction level of this customers periodically. Also there is need to continuously add more value to how an organization deliver its products and service, this may be done with the following: provision of adequate and constant training for the personnel.
Improvement in communication between the organization, its employees and the customers.
Deployment of necessary Information Systems that will integrate all the activities with preference for customers in store.
Having a base of valuable customer is a very good way to beat the odds when the chips are down; it allows organization to ride on their back for future success.
Action Point
You will need to understand the Pareto principle of 80:20 very well, but you may need to stretch this principle further if you want to benefit from it more, the ideal situation in today's economy is to understand the 60:20:20 principle and understand that 20% of an organization consumer will account for 80% of the profit today but there is another 20% out of the present customers that will step into their shoes in the nearest future, so identify them and treat them well.
