Great post from Frank Capek

Frank Capek has a great post in his blog, Customer Innovations - Driving Profitable Growth. the theme is "Your company does not have a customer experience… only your customers do." What a great thought, and worth remembering as we work to improve our customer's customer experience.

Why are you in Business?

There’s a whole bunch of stuff going on that we’ve predicted over the past several months;

• Fees are starting to be “adjusted” upwards

• Interest rates on some credit products are actually increasing in spite of downward rate pressure from the Fed

• Non-Bank competitors are becoming more visible

There’s a new piece of research out from the Mercator Advisory group that validates this trend and also points out that banks risk losing their position of “trusted advisor” if they persist in aggressive upward pricing.

This isn’t surprising; it’s the logical result of a tough economic environment. But these actions may beg a more fundamental question…Why are you in business?

It seems to me that there are only two ways to look at business ;

1. I make money by optimizing the value of the customer to my business
2. I make money by optimizing the value of the business to my customer

Pretty much everything else is secondary.

If you are in the first category, your focus is on delivering the most efficient value to the customer. That might mean that the customer pays more for some things than absolutely necessary, and it surely means that the company will leave no stone unturned in its search for revenue and profit. Customer retention and lifetime value are secondary concerns. I think in this kind of company, the finance guy almost always wins, and the customer often loses.

If you’re in the second category, you focus on delivering profitable products and services to the customer in a way that keeps the customer satisfied with the company, and less willing to leave for a competitor. Longer term profitability and retention are priorities. The front line sales force should have a very large voice in this kind of organization.

In the current environment, it’s tempting to argue that any “adjustments” are short term and based on external factors, but customers know better. Customers know exactly what kind of company you are by what you do with them, for them, or to them.

The question is, do you?

Excitement and Romance in Customer Service!

There's a great post on the Church of the Customer Blog yesterday by Ben McConnell on the importance of excitement in relationships, marital or otherwise. Ben talks about the need to inject some excitement and fun into the customer experience. Even though banking may not be the most exciting thing in our customers lives, there are ways to make it interesting and engaging, and sometimes even fun, that can give them more reasons to keep "going steady" with you. Check it out.

It's about love

Debbie Fields of Mrs. Fields Cookies fame said;

"Customer service doesn't come from a manual, it comes from the heart. When you're taking care of the customer, you can never do too much. And there is no wrong way... if it comes from the heart."

"There is no wrong way"... people really get it when a person is trying to help, and all the training in the world won't help people deliver great service unless they really care enough to want to help. It's good to remember on Valentine's day that in the final analysis, customer service is about people caring for each other.

Have a great Valentine's day.

Cross-sell and up-sell in a call center environment

Maritz just issued a press release on a recently completed study about the relationship between call center satisfaction and in-call sales activity. There are some interesting findings, including;

• Customers who are highly satisfied with their call center experience are approximately
  50 percent more likely to listen to a sales offer made during their call
• Customers who are dissatisfied with their call center experience are at least twice as likely to decline a new product offer during the call (after listening to the offer details)

There is also an article on the subject in yesterday's American Banker that provides a good overview.

The key takeaway is that there are significant sales opportunities in the call center environment, provided that the call center rep has earned the right to ask for the business, and the offer is relevant to the customer's needs.

It's good to find new sales opportunities in a time when every sale matters.

If you would like to get a copy of the survey results, send me an email at thad.peterson@maritz.com.

E-Trade wants your customer's savings account!

Etrade had a couple of really funny spots on the SuperBowl on Sunday. One of the spots was about their savings account offering. Imagine that, a spot for a savings account on the Super Bowl. When was the last time a bank ran an ad about savings accounts on the Super Bowl? Probably before there was television. The competition for core customers continues to increase, and with really funny, engaging creative like this, customers are going to pay attention.

Can customer experience make a merger better?

There’s a lot of news lately about potential mergers and acquisitions…BofA and Countrywide, Microsoft and Yahoo, Delta and Northwest. And there's good reason to combine organizations, not the least of which is expense reduction through greater efficiencies, and the oft lusted for…”synergies”.

It would be terrific if mergers worked out that way, but in a study of 118 deals, KPMG reported 70 of those did not create shareholder value for the combined companies or at best, received marginal returns. As if that weren’t bad enough, according to a McKinsey study, nearly nine out of ten deals over $100 million saw a median DECLINE in revenue of 12% in the first 9 months following the announcement, and only 11 percent were actually able to accelerate growth over the three years following the merger.

What’s up with that? The problem is that in spite of what we would like to think, mergers aren’t a math problem. Instead, they’re an attempt to bring disparate societies together under one umbrella for a common purpose. The work that Maritz has done in M&A shows pretty clearly that if companies want to make a merger or acquisition work, revenue, not expenses, makes the difference, and revenue is driven by people who are motivated to do what they need to do to make the business work through tough transitions.

There are three things to do to keep the revenue side cranking to make a merger successful:

1) Communicate – With customers, employees, and line managers to make sure that everyone understands what’s going on and why it will benefit them. There probably isn’t such a thing as over-communication in this environment.

2) Motivate customer facing staff with meaningful incentives – The front line will bear the brunt of customer dissonance and they also can be the source of revenue growth. Getting them to do the right things and to feel good about it takes highly focused incentive programs.

3) Actively (and aggressively) manage the customer experience – Everything that matters about the customer experience matters more in a period of transition. The customer experience has to be engineered to ensure that customer annoyance is minimized, and opportunities to deliver positive experiences are found and delivered.

Like everything else related to managing the customer experience, successfully managing the revenue side of a merger/acquisition is hard to do but it’s worth it. The McKinsey study also showed that growth oriented companies drove returns 22 percent greater than the S&P 500 post merger, and 40% faster than industry peers.

So, if your company is merging, acquiring, or being acquired, pay attention to the revenue side and the odds of achieving your objectives are a lot better.

BTW, here’s a link to a whitepaper that Maritz has on the subject.