In a competitive, global economy, companies can no longer sustain the 3x investment required to attract new business. Instead, companies must drive more business and higher value deals from existing customers. In the era of the always-on customer, companies recognise that customer engagement is set to overtake productivity as the primary driver of profitable growth.
There's a high price to winning net-new business. Estimates typically put it somewhere between 3x and 5x times the cost of retaining existing business. To attract new business, you need to identify new opportunities and market your business to a totally new group of people. More resources are required to turn a prospect into a customer and to understand their needs. Importantly, when an existing customer is fully engaged, they’ll buy higher value goods and services from you and advocate for your brand.
The buyer is changing
Thanks to technologies such as social media, mobility and the cloud, customers are empowered to own the buying process. And they won’t remain loyal simply because they’ve done business with you before. You must continually meet or exceed their expectations.
Any company that wants to drive more business from existing customers must be capable of anticipating and exceeding their requirements. To remain competitive, your company must provide exactly what the customer wants – every time. This calls for a whole-of-company obsession with knowing what customers want before they even know they want it.
Make the most of every customer moment
Previously, one or two departments were held responsible for the customer experience – usually Customer Service and/or Marketing. Few in Shipping ever thought they would be tasked with providing an “exceptional experience” to customers phoning in with queries about product delivery. Ditto to the finance department when dealing with customer payment queries.
All of that is changing now, as companies realise that any employee has the ability to positively or negatively impact customer relationships. Customer engagement is no longer the province of one or two departments. Every employee must be empowered to recognise a customer engagement opportunity and act on it.
Imagine the experience of the customer who phones Shipping with a query about delivery times and, in addition to receiving an accurate answer, is provided with information about the installation and service options relating to her product, just in case she experiences any problems. The customer goes away delighted because the company has been so helpful.
That's how you build customer engagement. It's a natural outcome when companies stop treating their customers as transactions and recognise them as people.
Smash down internal silos
The critical enabler for engagement is information. To stick with our example a little longer, the employee in Shipping can't offer advice without knowing what has been purchased, when, and which service options have or haven't been selected. And the best way to know all this is by being given access to the company CRM [customer relationship management] application. Whereas in the past the information existed in carefully guarded silos, it now must be made available to every employee, so they are enabled to act upon every customer engagement opportunity – whenever and however it may occur.
True customer engagement is a new way of thinking, one that challenges many of the old precepts about customer ownership. Engagement relies upon the support of the entire organisation because, by its very nature, it puts more power into the hands of all employees. It fosters innovation, introduces a little healthy chaos and encourages business agility.
This customer obsession requires an outside-in focus, rather than the old-style, internally focused preoccupation with productivity. Companies that make this transformation will win in the emerging Customer Engagement Economy.
Patrick Bulacz is the services practice lead, ANZ, at Bluewolf.