The ROI of Customer Excellence – Part 2

“A company’s primary responsibility is to serve its customers, to provide the goods or services which the company exists to produce. Profit is not the primary goal but rather an essential condition for the company’s continued existence.” – Peter Drucker

We found so many great studies on the ROI of customer excellence that I’ve decided to write a 3rd post about the value you are missing out on if you do not have a customer excellence program in your organization.

If you are still not convinced that a customer excellence program is the best place to start improvement efforts in your organization, read on…

In our first post, we looked at 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%.

In our second post, we learned that for every 1% of customers that you can convince to shop with you again, revenues can increase by 10%. We reviewed a Harvard case study showing how credit card giant MBNA increased profits 16X by reducing customer defections just 10%.

What is clearly evident from last week’s post is that repeat customers are your key to decreased marketing spend, increased revenue and increased profit.

Here are some stats to support how your customer’s experience drives repeat purchases and their likelihood to recommend you to their friends and family:

According to a 2013 study by Temkin group of over 15,000 U.S. based customers:

  • 81% of promoters were very likely to repurchase from the company versus only 16% of detractors and 44% of passives.
  • 64% of promoters actually recommended the company to others versus 24% of detractors.

Did you know that you and your company are going to screw up? Yep – it’s a guarantee. What happens to your deep personal relationships when you totally goof something up and sincerely apologize? If they believe that your apology is sincere and your relationship is a trusted one, they give you grace and forgive you.

That doesn’t happen if your relationships or your customers don’t have a trusted relationship with you. The same study, found the following:

  • 64% of promoters were very likely to forgive the company if it made a mistake
  • Only 11% of detractors would forgive the company

Your customer relationships are just like your personal relationships. You’ve got to be making deposits into their “relationship bank” so that you will be ready when the withdrawals have to made (and they will..).

I could go for days on studies, surveys and examples of how excellence in your customer relationships makes your company more profitable, grow faster and a much better place to work. I’ll stop here for now…

Are you ready to get started?

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

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