Why you need more than traditional customer loyalty metrics to map and track success was the subject of a Marketing Operations Partners and their Marketing Future Forum podcast hosted by Helene Eichler and featuring Religence CEO Linda Sharp. To give you a taste of what you’ll hear in the podcast, here are five critical considerations Sharp says you need to have:
The first consideration is about mutual success and mutual profit. Success and profit for you and success and profit for your customer.
The second consideration, because executives rightfully want to know this, is the ROI of mapping and tracking the customer experience. For example:
- For mapping, you could lower the total cost of ownership for the customer, while realizing a 2-5% savings for you.
- In tracking, you could get to revenue faster — you could cut the attrition rate by “x” percent. Many companies experience 10-15% attrition. What if you could cut that back?
The third consideration–in both cases–start at the end and work backwards. You should be acquiring customers you want to retain—work backwards! Of course that takes knowing who you’d want to keep as a customer. (See the fifth consideration.) Another example, traditionally we’ve thought about, “oh, well we’ve shipped the order.” We should be thinking about it from the customer’s point of view like, “they received the order” and quantifying the effort it took them.
The fourth consideration is work with a cross-functional team across the whole customer lifecycle. Customer experience silos are a huge problem. Lynn Hunsaker of Marketing Operations Partners has done a great piece on silos. She points out that there are two sides to the coin, of course. There are some things that are good about having silos, because it’s good for focus, but it’s bad for collaboration.
Sharp notes until Religence’s Customer Relationship Intelligence (CRI) Framework there have been no common metrics across these silos. Traditional loyalty metrics are siloed and used so indiscriminately for transactions that executives are beginning to question their validity. What this has meant is that executives and, in fact, the whole management team don’t know what the customer experience is. They don’t know what happens. People on the frontline only know what happens in their silo, at best.
CRI bridges those silos and measures profitable customer relationships development… what everyone has in common across all these functional silos. See Value customer relationships. Drive profit.
The fifth consideration focus on top priority customers — ones you’d want more of. Traditional metrics look at everybody. Religence recommends focusing on the top priority ones. It could be those who make large or regular purchases; ones who pay fast; it could be a prestige customer; a customer who could be the key to a new market that you want to get into, but at Religence the favorite top priority customers, frankly, are the most profitable.
And how do you know who they are? Here are some blog posts to help you:
- Profitability focus checklist.
- Align sales and operations for profit.
- Customer profitability segmentation methods.
- Customer Success at all costs, we say “No.”
- Customer profitability beats product profitability.
- And a popular blog on Contribution margin for marketers.
But the major thing, circling back to her first critical consideration, Sharp says to be successful, success must be mutual and profitable for everybody. Just like a relationship!
Profitable customers behave differently from ones who aren’t. They want a relationship. Why? Well, it matters. It matters to protect their infrastructure. It matters to assure their supply chain. It matters to mission critical processes. Relationships matter!
Customer Experience Wisdom: Experienced teams in sales, marketing, and customer service know what profitable customers DO versus ones that aren’t. These teams create value every day by developing relationships with customers. They are held back by their silos and lack of quantifiable appreciation for what they do. You can’t manage what you can’t measure.
Questions: Can you track what profitable customers DO–or don’t do–in time to focus where it could make a difference in the outcome? Are you ready to tap into the wisdom of your teams’ insight? And build a CRI analytical and process bridge across their silos so they can collaborate in creating value? Then, Be In Touch.