Customers have long memories and in the age of wide consumer choice corporations should remember that!

Our ‘battles’ have continued during December, culminating in an ‘interesting’ exchange with Unicom over the installation of our new broadband service.

Having waited for 10 days for the new broadband line to go live – a ‘normal’ wait apparently – we were then told that the necessary router would not be posted to us until the line was live.

When it was pointed out that due to the snow and Christmas deliveries we might not receive the router until January – but would have to pay for the line from the date of it going live – we were told by a Supervisor that it was the ‘procedure’ and could not be changed for anyone.  Even a Director would tell us the same thing.

When this was challenged, the message came back that ‘procedure was good customer relations’. So, the system rules at Unicom and we are now very unhappy customers with long memories.

Clearly all businesses have to have systems and procedures but the customer must remain King. Companies of all sizes forget that at their peril!

 It is not a difficult concept to understand. Basically it charts the profit from a retained customer over X years against the cost of acquiring a new one each year. Repeat business is much more profitable than new business.

 Harvard Business School Publishing has a model which shows the principle very simply.

 Clearly retaining customers should be at the heart of every business yet so many companies chase new ones at the expense of keeping existing ones happy. 

(For example, in the past financial institutions have been guilty of offering a lower mortgage rate or a higher savings rate to new customers only, leaving their loyal customers worse off.)

 Although this is changing it is clear that in some organisations the concept of CLV is not one embraced by everyone.

 In a recent ‘battle’ with Vodafone, when advised of the CLV of being a business contract customer for over 20 years, the Customer Services Adviser said ‘That’s nothing to do with me!”

 Retaining customers through excellent service should be every employee’s business – regardless of the department or division in which they work.

 Thought leader Seth Godin’s best-selling book ‘Purple Cow’ talked about creating remarkable products. He then turned his attention to poor customer service and cites ‘cell phone bills’ as one of the topics on which he gets much mail. What a surprise!

http://sethgodin.typepad.com/seths_blog/2007/02/starting_over_w.html

In the age of wide choice and educated customers companies should be trying harder than ever to keep customers and profits!

Are you listening Vodafone?

Obviously there are lots of other platforms – and new social media sites – but the main players continue to dominate the social media space.

That said, as the market stabilizes it is time to use the tools more strategically and concentrate on the message rather than the shiny new medium.

At Cerco we are increasingly being asked to devise a social media strategy for clients. Only this week we advised on the use of a private Twitter group for passing information around a group of multi-national and multi-discipline salespeople.

The client was astonished at the versatility of Twitter and how the real time information would supplement their intranet – all free of charge.

For an excellent article on Twitter best practice see: http://blog.spurinteractive.com/2010/03/07/twitter-best-practices-for-social-media-marketing/

Author Steve Latham makes the valid point that too many tweets are about me, my thoughts and my status.

If you are using Twitter for business, do not tell us that you are standing in a supermarket queue. Your (business audience) does not care.

We have recently witnessed two cases of ‘careless (Twitter) talk costing sales’ – to paraphrase the old WW2 saying.

In both cases the Twitterers forgot they had potential clients following them and made totally inappropriate comments, losing themselves future work and attracting much negative ‘buzz’.

So the old Marketing adage of the message being as important as the medium still holds good!

I enthusiastically embrace all the new social media tools and we encourage our clients to use them too – where appropriate.

Just because a tool exists does not mean that a business has to use it!

Twitter is a case in point. Used correctly, it is a very powerful CRM tool. Used badly, it will make a company appear ridiculous.

For an amusing video that makes this point very well see http://www.dailymotion.com/video/x8puil_twouble-with-twitter-soustitre_creation

For an easy guide to Twitter (by the excellent Commoncraft) see http://www.youtube.com/watch?v=ddO9idmax0o

The street was very crowded with shoppers, many of them tourists from France and Italy or from Eastern Europe, enjoying the reduction in sterling’s value.

Yet many of the lunchtime shoppers were clely locals who had ‘escaped’ from nearby offices to enjoy the early spring sunshine and to browse the rails.

What was interesting from a marketer’s perspective was what the shoppers were buying.

A quick review of the carrier bags that shoppers were carrying yesterday showed that the clear winners were Primark and Selfridges. Certainly both stores were very busy with queues at tills, particularly at the former.

The carriers that were glaringly absent were from the ‘middle market’ – Next, M&S, Bhs etc.

This was a physical demonstration of market positioning with consumers shopping at the top of the market and the bottom.

While these observations spring from two hours one lunchtime, it does show that is being reflected in market share and share prices – the middle market is finding the going tough.

Retailers in the middle ground need to create a reason why we should shop there. Differentiation is the key! Give us a reason to spend money with you!

Oxford St image courtesy of The Guardian

He was later quoted as saying ” We took early action in 2008 to deal with the increasingly tough trading environment and have set our business ready to manage continuing difficult market conditions in 2009. We have already taken decisive action, and stand ready to take further steps if necessary.” (Source www.diyweek.net)

However, on the radio he added that high staff turnover was a feature of their business and appeared to view it favourably as a way of managing staff costs.

It made me think. Usually businesses want to keep their staff since recuiting and training new employees is costly in both temporal and financial resources.

Making working conditions as appealing as possible in order to retain staff has always been a ‘given’ in management terms.

So could the current market conditions be leading to a new model in which companies welcome staff departures as a way of controlling costs?

This may look appealing to the accountants but has big ramifications for Customer Relationship Management!

It is no co-incidence that John Lewis is performing well in difficult market conditions. Their staff actually know something about the products they are selling – unlike the average salesperson in Wickes or B&Q.

Staff knowledge as a Key Performance or Profit Indicator? Why not!

I know in which store I prefer to buy my everyday DIY products!

Travis Perkins underperforms but Tile Giant sales up