In last month's editorial, we
covered some unbelievable practices that are going on in some companies. I
urge you to read that editorial as a prerequisite to this column.
The Vital Necessity Of Customer Loyalty
Conventional wisdom dictates that customer loyalty is the most vital
aspect of every business because companies live or die from repeat
business. No company can exist without customer loyalty and retention. I
would like to draw your attention to the following eight guidelines that
are only a few of the principles that will enhance your customer loyalty.
I urge you to consider each and every one of them and incorporate them, if
you agree, into your organization.
- Keep in touch frequently. It has been proven that if you do not keep
in touch with any account for more than 30 days, you do not own that
account. Your salespeople must live and breathe with this principle.
- Build the relationship. Unfortunately, many salespeople have the
mistaken attitude of 'Let me get the business now and I will worry
about the relationship later.' That kind of philosophy is doomed to
fail because customers are smart and can figure out whether or not you
are sincere about your relationship with them. I could state
emphatically that business is all about relationship. If you don't
have it, you have no business.
- Nurture the relationship. Much goes into nurturing the relationship
once you have established a relationship. Unlike the common belief,
the relationship will not be nurtured if you constantly ignore the
customer's needs and interests. The only way to nurture them is to
genuinely show interest that you're concerned about addressing their
interests and needs on a regular and continuous basis. And'there is
no shortcut in this concept.
- Manage your customers' expectations. One of the most common
mistakes made by salespeople is to over-promise and under-deliver.
This phenomenon must be completely and categorically eliminated in
every sales department. I recall a meeting that I once had with the
legendary Jack Welch, perhaps the best CEO of the century, who once
said that, 'Sales managers should be evaluated as follows:
a. 'If the salesperson meets the budgeted numbers and upholds the
company's values; i.e., integrity, being truthful with customers on
their promises and over-delivering, then that salesperson must be kept
with the highest esteem and should be rewarded time and time again to
keep that person employed by your company.'
b. 'If the salesperson does not meet corporate budgeted sales
numbers, but upholds corporate values, that salesperson needs a second
chance.'
c. 'If a salesperson meets corporate numbers but does not uphold
corporate values, that salesperson must be fired.'
d. 'If a salesperson does not meet corporate budget and does not
follow the guidelines, that person should be immediately
terminated.'
I believe these words of wisdom coming from General Electric's
legendary CEO should apply to every corporation, and as the CEO of
your company, you need to make it abundantly clear that without
exception, each and every member of the sales, marketing or any other
department, for that matter, must live with the above principles,
otherwise, customer loyalty and retention would be nothing more than
wishful thinking.
- Anticipate your customers' needs and do something about them. One
does not keep a customer by simply forgetting about him or her once
the transaction has taken place. A savvy salesperson must anticipate
the needs of his or her customers on an ongoing basis and, more
importantly, do something about it. There are too many salespeople out
there who promise everything and deliver nothing, let alone anticipate
the needs and respond to those needs. I am sure that practically every
sales department has a few people like that, all of whom should be
terminated as they have no value and they can only serve as a cancer
to the sales department.
- Hire sales staff with character. In one of the recent documentaries
about successful coaches in pro football, Joe Gibbs, the famous coach
of the Washington Redskins, was asked the question, 'What criteria
do you value the highest before you select a football player for your
team?' Joe Gibbs responded, 'Character is by far the most
important attribute that I look for when selecting team members for my
team.' A reporter asked him, 'How do you define character?' He
stated, 'I want people who care the most about what is in the best
interest of the team and not about what is in the football player's
best interest.' Therein lies a tremendous amount of wisdom that
every employee of every company must respect. Salespeople who care
only about their own pockets have no place in any corporation in
today's highly competitive and customer-savvy environment. If the
salesperson does not care about his team or his company, the customers
or prospects will have no reason to do business with that salesperson.
Consequently, there is no reason for that salesperson to exist in any
company. As simple as this sounds, one always encounters salespeople
who don't give a damn about what is in the best interest of their
companies; they care only about their own selfish gains.
- Go the extra mile. In today's globally competitive environment,
one of the most powerful attributes that separates your company from
others is for your sales and customer service staff to go the extra
mile. Customers will always remember if your sales or customer service
department really cares about them or their business. If the
representatives of your company do not show a genuine interest in
helping the customer on a continuous basis, then there is absolutely
no foundation for customer loyalty.
- Help your customers save money. By showing the customer how to
reduce costs by recommending ideas and new processes or know-how, the
customer might change or adopt to save considerable cost. This type of
concern goes a long way towards generating loyalty.
The Anatomy Of Customer Acquisition To Customer Loyalty
Given that customer loyalty and retention are the life-blood of every
corporation, it behooves us to look at the anatomy of customer acquisition
to get a greater understanding of the process. In my humble opinion,
Figure 1 above is the process that initiates customer acquisition and
follows it through customer loyalty.
In Business, Reoccurring Revenues Are The Only Thing!
Vince Lombardi, the legendary coach of the Green Bay Packers pro football
team, whose team won several Super Bowl championships, once said,
'Winning isn't everything, it's the only thing.' This great
principle of business, coming from one of the greatest, if not the
greatest, football coach of all time, is equally applicable not only to
winning companies, but also to all companies that wish to survive in this
highly competitive economy.
In the past issues, we have covered the subject of marketing
extensively. In the May issue, for example, we addressed the importance of
Integrated Marketing. In this issue, I would like to focus on effective
advertising.
Effective Advertising Begins With Innovation
In addition to reaching the right people, any advertising program must be
innovative if it is going to make an impact on your audience. It has been
said that an average person is exposed to in excess of 1,000
advertisements per month. Consequently, the only thing that will stay in
anyone's mind is the ad that is truly innovative.
McGraw Hill Had The Right Idea
McGraw Hill's legendary advertisement, which was created some 46 years
ago, is the all-time best justification for advertising. I would like to
invite you to take a good look at Figure 2 and analyze its words of wisdom
when it comes to advertising. I think every person of reason would agree
that effective advertising is vital to the survival and growth of every
organization. In business, there are numerous success stories where
advertisements have made companies successful, and a lack of it has
prevented growth or even the existence of some companies.
We need to apply the same principle to all other advertisements. In other
words, if you are unique and innovative, you will get attention and new
business from your ads. If, however, your advertisement is the usual
boring and ineffective style, nothing will come out of it. The sad fact in
this case is that those who place useless ads and get no response don't
blame the ad, they always blame the concept of advertising by saying,
'Advertising doesn't work for us!'
Integrated Marketing Is The Only Way To Go
Having said all of the above, I firmly believe that in today's highly
sophisticated advertising environment, the only effective way to market is
to use the concept of integrated marketing, which incorporates print,
e-mail, the Internet, trade shows and assorted other components of
integrated marketing, which were discussed in my editorial in the May 2004
issue of this magazine.
If you understand that, you cannot lose sight of the fact that your
advertisements must be innovative and benefit-driven and must clearly
differentiate your products and services from your competition. If these
guidelines are followed, then success and proper lead generation will
follow.
I felt that describing the process of lead generation, which is a
direct result of effective advertising, was necessary in order to
understand how difficult it is to get quality sales leads (which lead to
customer acquisition) to help us appreciate how hard we have to work in
order to generate customer loyalty and customer retention.
As always, I welcome your comments. Please e-mail your comments to ntehrani@tmcnet.com.
Sincerely yours,
Nadji Tehrani
Executive Group Publisher
Editor-in-Chief
ntehrani@tmcnet.com
[ Return
To August 2004 Table Of Contents ] |
