How to implement a customer loyalty research program that drives repeat business.
When we refer to the term ‘repeat business’ we are referring to your loyal customers.
Loyal customers are those customers who actively return to do repeat business with you and who promote you to their friends and colleagues.
Reading this article will tell you exactly what you need to not just find out what your customers are saying about you to others. But how to use that information to improve your performance going forward.
1. Talk To Your Customers, Do Your Research
The problem for a lot of companies is they think they know the voice of their customer. But it comes from unreliable sources, is not statistically valid and can’t be validated. Businesses live or die based on what their customers say about them. Research from Forrester about what influences consumer buying decisions has proven that ‘word of mouth’ and a customer’s previous buying process. Are the two biggest drivers for any business selling a product or service.
Customer research provides you with the opportunity to improve the delivery of products and services to your customers.
The single best way to improve revenue is having your customers definitely come back and recommend others to you.
Ideally your customer research should be conducted by a third party. A third party calling on your behalf holds a neutral position; there is no attachment to the feedback that is provided during the conversation.
The level of detail collected and the analysis of your customer feedback is critical. It’s not always what your customers say that can be improved, it is also what they are not saying.
It’s the quality of the conversations with your customers that make the real difference.
Telephone research provides the opportunity to converse, to probe and to clarify responses.
If you want to make a difference to your customers experience. You need to understand and focus on the areas that have the biggest impact.
You want to make sure you are researching the right customers. The more the better, but think about their value to you and whether they are decision makers, influencers, and end users. All of these groups’ feedback is critical to ensuring you keep these clients in the future.
Finally, it is important to use a proven methodology. The Net Promoter Score (NPS™) is a globally proven method for measuring customer word of mouth. Our preferred method.
2. Segment Your Customers – Clarity Is Power
One of the challenges we see a lot is that we only get overall feedback. And we don’t break that down to the different levels (Segments).
See below as example. It is recommended, where possible, to go down 3 levels.
You need to research a good sample at each level.
Clarity is power; you’ll get much more detailed findings if you go down at least three levels.
3. Allow Your Customers To Talk
Even when companies do, do research they don’t do it very well. They ask too many questions and don’t let their customers tell them what is important. Allowing your customers to talk, that is getting the true voice of your customer. Not what you hope your customer might say. Unprompted responses are the most valid. Therefore, avoid giving multiple choice or put ideas in the heads of the customers you research.
Simply let them talk! Let them tell you what is important to them.
By driving a better customer experience, you will drive more repeat business and more revenue.
When creating your ‘survey script’ try not to use dropdown response options. Ensure you use open-ended questions that prompt verbatim responses, the ‘Voice of the customer’. Use the Net Promoter Score (NPS™), examples of questions, like:
How likely is it that you would recommend (business name) to a friend or colleague? With 10 being you would definitely recommend and 0 being you definitely would not recommend it? What number would best match how you feel?
For 9 & 10 Scores: What is the main reason for the score you gave them?
For Scores 8 and below: What is the most important improvement that would make you rate them closer to 10 in the future?
The objective when speaking with your customers is to understand what is ‘top of mind’ for each customer you are speaking with. What they think, what they have experienced and what they are saying, not what you think or assume.
The overall research data could easily be manipulated by simply putting an idea into a customers head.
The best example of this is a true story. Years ago, when we were conducting team research. We were as surprised as our client to find a big part of the overall data mentioned salary.
It was mentioned in nearly every conversation.
On further investigation, we discovered the researcher who had spoken to each team member had added a probing question. “How happy are you with your salary?”
And that one unscripted probing question completely skewed the data, the data had no integrity.
We researched again and there was no surprise when not once was salary or any other reference to wages or pay mentioned.
What’s the point of researching your customers if you are not willing to accept the true voice of your customer? There is none.
4. Get Professional Analytics Done
Now you have got this great data it is not about reading and reacting to individual comments. It’s about the patterns that good analysts can identify. If you want more customers recommending you to their friends and colleagues, then you need to know what makes them return.
It’s very difficult to do the analytics yourself, if you don’t know how to do ‘good analytics’.
Learning to understand – How do you identify best practice drivers? Or how do you find your improvement drivers? For example, takes time and a particular skill set.
The need to read every customer response is critical.
Text mining tools don’t drill down to the level required to fully understand the voice of your customer. Or the behaviours that drive customer loyalty.
They cannot capture what you do that has a customer describe you as professional, or responsive.
It is only by reading each response that you can clearly see the examples mentioned.
For example, by returning a telephone message within 2-3 hours had a customer describe you as very responsive. But how many said that, you don’t change for one person you look for the overall view from your statistically valid findings.
5. Workshop Research Findings With The Total Team
Now you have great analytical feedback from the great questions you asked. It’s important that you share and involve as many team members as possible. A mistake made by a lot of companies in customer loyalty programs is they only involve operations and customer facing people. Every team member impacts your customers experience, even if they don’t serve your customers directly. It’s not just customer-facing team members or the operational people.
The research findings should be presented, discussed and work shopped with your total team.
When work shopping the findings, involving all team members is critical to generating ideas and more people owning the overall data. As well, their own data and knowledge. And any new processes or systems that are created as a result of work shopping the findings as a team.
The more commitment, the more ownership, everyone feels part of the decision-making.
6. Do Action Plans
One of the biggest challenges identified by many companies, in fact the top 500 companies in the world. Identified that one of their biggest issues is the failure to implement their ideas. Action plans that identify the action, not the intention, and identifying who is responsible to implement and by when they will.
Build on the best practice drivers and decrease the variation, the areas of improvement.
It’s no good writing an action plan for just the overall findings. Although, there would be overall things that the company would need to improve such as their system or particular systems.
Based on the suggestion in number 2, each segment you chose to research, should have its own action plan. Based on the findings provided by their customers.
- The overall results
- By each business segment
- By each service area
- By each location, branch
- By each team
7. Map Out All Of Your Customer Touch Points
Mapping out of your touch points you have with your customers shows you all the opportunities you have to engage with your customer. Not doing this means you tend to develop overall actions but not one’s specific to each touch point. Every moment is critical, we refer to those moments as ‘moments of truth’
Below, we have mapped a Customer Journey when flying on a plane.
As you can see, we have started at the beginning. It is possible you saw an advertisement, then went to the website to purchase your ticket. Next is Check in, security, airport lounge, gate, on-flight service, departing the airplane, baggage collection and departing the airport.
Customer touch points – ‘moments of truth’ must include every moment you engage with your customer.
So, think about your business and break it down:
- Pre-service engagement
- During engagement
- Post-service engagement
It is often post-service engagement that is forgotten.
Every customer touch point impacts your customer’s experience.
Every moment is critical.
You can lose all the good customer engagement you have worked hard to win right near the end of the transaction. If we do not focus on all touch points.
8. Develop Service Standards Or Procedures, Whatever’s Required
Now you know your touchpoints you can identify where there are human interactions and develop service standards to cover those. Service standards provide the behaviours required to ensure the touchpoints stands out. Not doing this means your team will do what they think rather than utilise best practice.
Service standards are more about peoples behaviour and peoples interactions, and procedure is defined as a non-personal interaction.
A critical action in implementing a customer loyalty program that drives repeat business. Is to use the research findings to change and improve your system.
Why? So that, it creates a long term change.
So again, think about your business, and think about the standards you want to cover. Include, inbound and outbound as well as handling customer complaints:
For example, how do you communicate with your customers?
- On the internet?
- Face to Face?
Once you have listed your service standards, refer back to your customer research. Everything you need to know to create solid grounded service standards has been provided to you by your customer.
Your customers have supported you in creating service standards that not only have you stand out, but through implementation drive repeat business.
- What did your customers tell you is important to them?
- What do your customers say they want from you?
- What have they asked you to continue to do or to change?
Service: Distance and Close Up
Customers form many impressions about your customer service before any direct interaction with staff takes place.
By the time they arrive at the counter or are on your radar, customers have nearly always made several important evaluations about your service. Perhaps even prejudging it.
Customers assess staff in two ways:
From a distance (e.g. as they approach the counter) and closer up (e.g. while they are being served). From a distance they form a number of impressions. These initial impressions may be even more significant than the service itself, which can be brief.
Initial evaluations certainly create expectations of the service that will follow. Good or bad impressions can effectively form the basis of customers’ judgements of staff performance, as well as your own.
9. Train Those Standards And Procedures Into Your Teams
No point having service standards if you don’t train them into the teams. Behavioural training is often the best method as many people are unconscious about their own behaviour. We call this unconscious incompetence, see diagram below, training and feedback helps people move through the different steps.
The role of leaders is critical as part of the training process, are they modelling the right behaviours? Are they giving feedback, allowing for repeated practice?
We believe every leader should live and breathe the following philosophy.
As we have previously discussed in this blog every customer touch point impacts your customer’s experience and every moment is critical.
Train teams to deliver the service standards for each of the customer touch points, ‘moments of truth’.
Spell out clearly what standard of performance is required in order to deliver a 10/10 customer experience.
These service standards must be observable and measurable behaviours that can be trained and coached in others to produce ongoing performance improvement.
Each staff member must be able to understand and demonstrate each of the service standards they are accountable for.
Provide ongoing coaching and training to all staff to ensure they are implementing all standards all the time.
Provide consequences for non-performance and reward high performance.
Implement test and measurement scorecards that allow you to know your staff are winning the game while they are playing it. Displays on the wall for example, so all can see their progress.
Set your team up to win the game they are playing.
This needs to happen every day. It is the leader’s responsibility to ensure they do everything in their power to help their team succeed.
10. Ensure You Have A Test And Measure System To Record Your Progress
We have done some great work. But if you don’t know where you started and you don’t have a way of measuring your progress this can fail and fail fast.
Implementing a customer loyalty program involves knowing your benchmark – where you started and knowing how you are tracking against your goals.
Put in place measurements so you know whether you are winning the game while you are playing it.
For example, ten pin bowling….
When playing ten pin bowling you are constantly aware of your score. When you bowl the ball, you want to know your score. You don’t want to wait until later to find out.
So how do you know you’re winning the game while it’s being played?
Ideally, these actions, this Customer Loyalty Research Program would be completed three times per year (every 4 months), to measure your impact.
Go Back To Number 1
Implementing a customer loyalty program is not simple, especially if you want to do it so it actually makes a difference. Acting on these 10 areas will ensure you have a program that will drive revenue and your customers will become promoters.
Much more fun to run a business like this.