Extreme Customer
Service
How competition causes businesses to change
Retailing continues to change.
Examine any decade this century, and you will see something that
changed the way retailing has been presented to the consumer.
It does not matter which industry we are discussing, someone or
some company had an idea of how to present the products and services
in a different manner. Once these ideas were implemented, everything
changed.
Need some examples? Look how
McDonalds changed fast food, or how Domino's changed pizza with
their delivery service. Prescription filling was changed by the
advent of chain stores, and then again by the mail order prescription
filling services.
At this point, every retailer
has heard, and been told many times over, that customer service
is the factor that most competition fails to utilize. A consistent
and high quality customer service continues to be the ingredient
that can set you apart. There is a saying of, "If you are unique, you have no competition." Truer
words were never spoken.
As compared to repeatedly hearing
this idea, allow me to share with you some evidence that some of
the "big businesses" are finding ways to deliver high quality customer service.
Instead of going to a local
retailer, Barnes & Noble, Borders, or Books A Million, try shopping for your next book at
www.amazon.com. And while you will have to wait for the book to
be delivered, you will be in for a pleasant surprise the next
time you go online to order another book; the Amazon web page
will now address you by name. Amazon now reports that 60% of its'
business comes from those that have previously shopped with it.
The same type of story is true
for the person purchasing a compact disc of their favorite music.
With one of the online services, not only does the service remember
who you are, but it begins to create and build an "online music store" designed
expressly to your musical taste.
A group of these and other internet
sellers of goods and services report that with this customer personalization,
the number of customers that are new has increased by 47%. Even
more noticeable is that their revenue is up 52% after one year of
this personalization.
Others are jumping on the bandwagon.
One data research company reported that 40% of online companies
surveyed were utilizing personalization with another 53% reporting
they will be using online personalization within the next year.
And, what is the payoff? Considering the cost of providing this
online personalization, these businesses report that on average
they have recovered these costs within seven months. And after 10
months, the return is 200% on their investment dollars, with a return
of 300% after only one year.
If you are not planning on creating
an "online" division
of your business, or if your business does not lend itself to selling
online, you may wonder what this information has to do with you
and your company. The point to be made is that we are observing
situations where machinery is being designed to provide what most
businesses fail to deliver.
When was the last time in your
shopping experiences a person approached you and introduced themselves
as the owner or the manager of the business in which you were shopping?
Imagine this situation; You
are selecting new clothing in a local store, and as you are completing
the sale, the sales person asks for your name, address, and phone
number. The sales person explains that in keeping this information,
they will call you the next time the store receives similar merchandise
so that you could have the first opportunity to examine the new selection.
Don't
you think you will be apt to make repeated visits to this store,
and will even go so far as to ask for the same sales person to
assist you? This is what the online services are doing, and we
now know that the idea of extreme customer service is paying tremendous
dividends.
These online companies have
done nothing more than what many of the best retailers have done
for the past century; they have found ways to promote themselves
in an effort to get the customers to continue to do business with
them. While we were unable to find statistics for online shopping,
we do know that the traditional business can spend $4.00 to retain
the customers they have today as compared to spending $20 to obtain
a new customer.
From the standpoint of achieving
results similar to the booksellers and the compact disc sellers,
traditional retailers can obtain similar results at a greatly reduced
cost. Ongoing training programs for employees have time and again
been shown to greatly enhance the impression they give to their
customers. And, according to information from one of the major business
colleges, businesses that have a high level of commitment to their
customers also benefit from lower turnover. It would seem that solving
one problem (permanent customers) lends itself to helping resolve
another (employee turnover).
Who would have anticipated the
arrival of so many unique and different ways of marketing? Yet,
with every new way of marketing, they all want to duplicate the
oldest and best way of getting the customer to return time and again
to your business, "Hello Mr. Pearcy.
It's nice to see you again. How did your purchase of last week
work out for you?"