Establishing Positive & Productive Customer Relationships Derek Hendrikz
Nov 21, 2014
Establishing Positive & Productive
Customer Relationships
Derek Hendrikz
The pattern of interactions and the mutual
conditioning of behaviors over time between a
company, and a customer, a supplier or
another organization.
A Relationship (in organizational context)…
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• Relationship management means attracting,
maintaining and enhancing relationships.
• The objectives of RM are to identify and establish,
maintain and enhance, and, when necessary,
terminate relationships in such a way that the
objectives of all parties involved are met.
• This is done by mutual exchange and fulfillment of
promises.
Relationship Management:
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• RM seeks to create a new value for somebody and then share it with such a
person.
• RM recognizes the key role that individuals have in defining the value they wish to
achieve.
• RM businesses are seen to design and align processes, communication,
technology and people in support of customer value.
• RM represents continuous co-operative effort between buyers and sellers.
• RM recognizes the value of customers purchasing lifetimes.
• RM seeks to build a chain of relationships within the organization, to create the
value customers want.
• One of the main principles of RM is to identify the most profitable customers so
that the business can focus on customers appropriate to its strategy.
The Dimensions of Relationship Management
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The importance of good Human Relations:
1. It reduces conflict.
2. It assist people in focussing on matters of
influence and not on matters of concern.
3. It stimulates a harmonious working environment.
4. It reduces the time spent on handling difficult
customers and employees.
5. It makes you a nice person to work and be with.
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Why should we be aware of our prejudice?
• So that we can understand the point of view and
perceptions of others.
• So that we can deal with conflict in a constructive way.
• So that can be objective in our relationships with others.
• So that we can separate people from problems.
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How to change your prejudices:
• Place all assumptions regarding a specific category on ‘ice’.
• Find similarities.
• First seek to understand before making judgment.
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Customer Life Cycle
Reach
Acquire
Retain
Loyalty
Convert
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Reach: Getting the customers attention
Acquisition: Showing them what you have
to offer
Conversion: Turning them into a paying
customer
Retention & Loyalty: Keeping them as a loyal
customer
In Layman's Terms, the Customer Life Cycle means…
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Farming vs. Hunting:
NewCustomers
ExistingCustomers
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• The National Transportation Safety Board offers a learning approach .
• The NTSB takes every accident seriously, ensuring that the same incident should never occur again.
• Work that same policy into your business, taking every customer complaint seriously, ensuring that your business will never have to deal with the same complaint twice.
• Use customer complaints to bring about new ideas and ways to improve your product or service.
• Use the same approach for customer compliments too, using compliments as a point of reinforcement for what your company is already doing right.
Pay Attention To Complaints And Compliments
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• There isn’t a simpler method for retention…• Ask customers what exactly it is they seek from
your business and how they want it given to them. • Whether you ask them via a printed survey, an
online survey, over the phone, in person, or via email, it is crucial that you just ask them.
• You’d be surprised at the detailed response you’ll receive, sometimes saving you the trouble of spending extra on expensive market research.
• Consider conducting a focus group with your customers.
• With a customer focus group, you have the opportunity to tap into their collective needs and wants and reward them for their time with discounts on their next purchase, or anything that will demonstrate your sincere appreciation.
Just Ask Them!
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• Loyalty programs used efficaciously by businesses such as the airlines industry are extremely effective for outstanding customer retention.
• Starbucks is another company that ties customer service in with a loyalty program that keeps its customers coming back for more.
• A variation of a loyalty program can be in the form of offering specialty discounts for customers in your database sent via email.
Up Your Service With A Loyalty Program
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• Not every business owner believes that “the customer is always right,” or that the “the customer is king” and they’re quite right to believe so.
• But, in situations where customers are distraught and tend to seek attention through emotional outbursts, it pays to keep calm and take control of the situation by appeasing the customer with a smile and doing everything possible to pander to the customer’s frustrations.
Service With A Smile
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o Customers are a savvy lot and they can usually sense a
sales pitch approaching miles away.
o Though they love buying, customers hate to be sold to.
Instead, adopt the approach of being a solution provider,
showing that you sincerely care about their needs.
o Lend a listening ear to your customers and let them
know that you’re not after their wallets, but instead
collaborating with them to help get what they want in a
way that will benefit both parties.
o This approach works almost all the time and is the secret
sauce for high customer retention.
Be A Solution Provider
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• Companies are always harping about providing value
to customers, but very few of them actually understand
what it means. Providing value to customers simply
means giving first and receiving second.
• Giving first could be as easy as offering a free email
newsletter filled with juicy tips that other companies
would have charged a premium for.
• It’s a great way of differentiating yourself from your
competitors and at the same time, providing great
value for free to your customers.
Be A Value Provider
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• Customers usually become fans of your business when they
remember something remarkable you did for them.
• This usually happens when customers have a problem with
something they bought from you and need to be fixed.
• The easier you make it for them to get it fixed and solve their
problems, the more satisfied customers become.
• It could even be as simple as providing human support within
three rings of a customer calling instead of sending them to
voicemail and a maze of phone menus.
Keep Your Service Memorable
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KPI for Customer Retention:
• What priority does your organization place on customer
retention?
• When was the last time your organization measured
customer retention?
• Who in your organization is responsible for your customers?
• Do you tie incentives to customer retention data?
• Do you measure customer retention using industry-
accepted methodologies?
• Does your organization communicate customer retention
rates to all appropriate people? www.derekhendrikz.com
• Lack of "outside the box" thinking
• Fear of change
• Turf battles
• Conflict with team member day jobs
• Lack of management / executive commitment
Reasons why relationships defect…
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ownership
trustworthiness
visibility
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