Editor’s note: Karen Ahlgrim is executive vice president at M/A/R/C Research, Irving, Texas.
After receiving a customer loyalty report that found more than 50 percent of customers were alienated or at-risk, the client - faced with an upcoming presentation to senior management - gave his marketing research agency the following instruction: “Make sure you emphasize that the satisfaction findings only reflect customer perception, not reality.”
Reading the request, it became obvious why this firm’s customer loyalty was so low - the problems stemmed from deep within the infrastructure, mindset and culture of the organization.
Our firm has helped numerous clients design and implement customer satisfaction and loyalty programs in diverse industries. We’ve seen the good, the bad and the not-so-pretty. Many programs work beautifully when organizations are committed and rise to the challenge. But unfortunately, some programs falter when organizations fall victim to situations like the above. Across the board, successful programs share the following common traits, while programs doomed to fail share bright-red warning flags.
Successful traits
- Sponsorship from the top.
These organizations have a leader who walks the walk and ensures that critical strategies and initiatives meet the customer test.
- A burning hunger for information, from varied sources.
These organizations are not just content with internal measures. They seek feedback from customers and non-customers alike. They want to know how well they’re satisfying their customers and how this compares to their competitors’ performance.
- New information, good or bad, is a goldmine.
These organizations view every kernel of feedback as an opportunity to learn. They understand that sometimes they might discover findings they don’t like. But they realize the incredible opportunity for growth and innovation that accompanies this kind of learning.
- “We better do something, now!”
There’s no stalling with these organizations. They are quick to mobilize and take action based on customer feedback, even when that action involves wounding sacred cows or reinventing processes that have been etched in stone for years. They know that neither time nor the competition waits. Victory comes only to those who take action.
- Customer satisfaction and loyalty is a part of everyone’s job!
Research sponsors readily share the results across their organizations. Executives mandate that the findings be woven into programs, protocols and processes. These organizations integrate customer satisfaction and loyalty into the duties and goals of every employee.
They make customer satisfaction part of the everyday, not something done on the side when there’s time. And, in doing so, they place the customer at the center of their organizations - a proven prescription for success!
- Long-term customer loyalty is sustained by motivated employees.
These organizations understand that most employees want to achieve results for their customers. However, employees must be given the necessary resources and authority to get this job done, and the recognition and appreciation for getting this job done well.
Warning flags
Just as there are traits of successful programs, there are also warning flags of programs that are destined for failure.
- “Our internal data says we’re doing fine.”
These organizations choose to rely on narrow streams of information. Maybe they put all their stock in internal measures, or study only the feedback from existing customers. Either way, their view of the world is myopic, leaving them vulnerable to looming competitive challenges. If an organization only measures satisfaction with its current customers, then seeing a satisfied customer base can be a self-fulfilling prophecy. What about the folks who didn’t choose the client’s firm, or went with the competition? Much must be learned from them.
- “The research (or the customer) is wrong.”
Denial is the name of the game with these organizations. When they hear something they don’t like, they are quick to place blame elsewhere - on the research, the customer, the economy or whatever seems convenient. By ignoring the warning signs, they’re leaving themselves exposed to ever-increasing competitive threats.
- “Let’s wait and see what happens.”
Complacency, or a cultural aversion to change, poisons these organizations. They may sense there’s a problem or they may be in denial. Either way, they opt to ride out the storm rather than take proactive measures. These organizations convince themselves that next time the data will say something different, even if they take no steps to make it so. They hang their tomorrows on what worked in the past, or miraculously hope things will change by themselves.
- “Our job is to just measure and report customer satisfaction.”
Many of these organizations have sophisticated systems in place to capture the customer’s voice, but no one takes specific actions in response to the findings. We often hear the lament that “It’s not my job.” If you hold the key, whose job is it to unlock the door?
- Customer satisfaction and loyalty are the responsibility of a committee.
The word “committee” is enough to send chills down the spine of the average employee. Committees imply extra work, something on the side that eats into the regular workload - a distraction. By establishing a committee (sometimes positioned as a “team”) to analyze the results and create a proposal of items to change, these organizations imply that customer satisfaction is something separate from the work people do every day. This implies it’s the responsibility of some, but not all. And, in doing so, these organizations are destined to fall short.
Push for change
If you see any of these warning signs around you, it’s your job to challenge the status quo and push for change, fostering traits for success. Successful organizations realize the world is constantly changing, and they know that what worked yesterday won’t necessarily work today. They are bold enough to look closely in the mirror of customer loyalty research and are agile enough to act upon what they see.