The ROI of Customer Excellence

The return on investment of any improvement process can be incredibly difficult to track and the return on customer excellence initiatives are no different. But, I’ve found some great studies that show how improving customer satisfaction and loyalty can have some HUGE payoffs for your organization. Read on to find out more…

In a previous post, we looked at the how Philips Electronics outgrew their competition by almost 10% when their Net Promoters Scores were higher than their competitors. We also looked at how a bank’s “promoter” clients were worth $9,500 more to the bank than their “detractor” clients. We saw how British Gas was able to decrease bad debts by 90% and increase growth rates by 30% as they moved their NPS scores from 45% to 75%.

Just in case those numbers were not enough to get you started on your own customer excellence program, today I wanted to share with you a few, even more convincing statistics.

Follow this math. In a study by Adobe Digital of 33 billion website visits to 180 million retail websites (from 2011 to 2012), they found the following:

  • Only 8% of the website visits were from existing customers
  • That 8% of website visits (from existing customers) resulted in 41% of online income
  • For everyone 1% of shoppers that can be convinced to return for a subsequent visit, total revenue will increase by 10%
  • United States retailers must recruit 5 new clients to equal the repeat purchase value of a single customer (In the UK, they must recruit 7!)

A 2012 Gartner study estimates that…

80% of your future revenue will come from just 20% of your existing customers –

Shouldn’t you be able to keep more than 20% of your customers happy?

In the Harvard Business Review case study title “Zero Defections” the authors found:

A 5% increase in customer retention can increase profitability by 75%

Credit card giant MBNA increased profits 16x by reducing customer defections 10%

If you are not ready to start focusing on customer excellence in your organization, you must not be interested in a dramatic increase in your profits.

If you are ready to get started, contact us now via our website or just give us a call at 229-375-5613.

Thank you for being a part of our values driven community!

Image courtesy of www.success.adobe.com.

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