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Wired for Winning Loyalty

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Do you hear the "call of the wired"? You should. In the US alone, a whopping 70% of the population (adults 18+) now uses the Internet. What's more, reports the Pew Internet Project, on a typical day 38% of wired adults use a search engine and 30% go online just for fun or to pass the time.

Bottom line: The wired world is brimming with purchase potential and it's high time to answer the call. Are you...

  • Harnessing wired (and wireless) innovations to woo prospective buyers?

  • Tapping into the ever-evolving treasure chest of wired capabilities to transform one-time purchasers into staunch advocates?

Consider the following five firms and how each is using wired solutions to address the multi-stage challenges of growing loyal customers.

Suspects and Prospects: Create genuine interest

The wired buyer has a propensity to gather information from other customers rather than traditional media sources or from the vendor itself. Therefore, to transition suspects and prospects into buyers, sellers must find ways to spread positive word of mouth through current customers and supporters.


Three key elements drive this process: (1) simple ideas that are (2) word-of-mouth friendly and are supported by (3) tools to facilitate customer conversation.

Interactive infusion. When Proctor & Gamble launched its Secret Sparkle body spray products in February 2005, the packaged goods giant also launched, three months later, the blog, SparkleBodySpray.com. By July, the body sprays, targeted to teen girls, had captured 0.8 percent of the $10.4-billion global antiperspirant/deodorant market.

Fanning this flame of introductory success was the blog, which receives 12,000 visitors per week, reports Bruce Katsman, Secret Brand manager; the average site visitor spends an impressive 25 minutes with the brand.

What attracts this level of involvement? Four teenage site authors, writing under the identities of Vanilla, Tropical, Peach, and Rose (cleverly, those are the names of the four body sprays), blog about such teen hobbies as music, fashion, sports, dating, and party-going. Visitors can download video, music, screen savers, clothing decals, or have a dialogue with the site authors.

The site is peppered with interactive activities such as dressing Vanilla with hip clothing or building a dream date using mouse clicks to select a young male's hair style, choice of eye frames, etc. And when the visitor is ready to share her creation with a friend, the "send to a friend" button is close at hand, ready to oblige.

First-Time Customers: Pass the trier test

Loyalty research has long confirmed the importance of a seller's accuracy, reliability, and responsiveness in transacting with first-time customers. After all, first-time customers are triers, and their perception of the value they receive from their first purchase will drive their repeat purchase decisions. Bottom line: You better get it right.

Monitor magic. That's why Automation and Control Solutions, an $8 billion unit of Honeywell whose 40,000 employees provide environmental sensing and control expertise for corporations, has established a wired alert system tied to customer feedback. That means the perceptions of new customers (and established customers, as well) are closely monitored.

Anthony Pichnarcik, ACS global VOC leader, reports: "When a customer survey score falls below ACS-specified thresholds, or if the customer asks to be contacted, the system does two things: First, a detailed action alert is automatically emailed to the Blackberry, laptop, or desktop PC of people responsible for that customer, including field service leaders, customer care advocates, sales representatives, and regional general managers. Alerts highlight the question response(s) that triggered them, and contain links allowing recipients to directly view the entire survey response and associated respondent-describing fields (such as customer name, address, phone, and contract size) for contacting the customer, if appropriate. Second, the system automatically opens cases and, using business rules, assigns them to case managers and teams. Online case management enables team members to share information and coordinate response actions.

To measure the tool's ROI (the tool is provided by CustomerSat, headquartered in Mountain View, California), a pilot with a built-in control group was used. Results were impressive: After six months, cancellations were 40 percent lower in the pilot group that received surveys and follow-up as a result of alerts and cases than in the group that did not. This substantial drop in cancellations preserved several million dollars in service-contract revenue.

Repeat Customers: Demonstrate true care

In today's wired world, repeat customers expect to be known and their preferences remembered. (My pal and fellow author, Jeanne Bliss calls this the "You know me" outcome.) Empowering the front line with this capability is an often arduous, on-going challenge for many companies. Here's how one airline is solving the puzzle.

Frontline flare. Continental Airline's first big step in achieving the "you know me" outcome for its customers began in the late '90s. That's when the company embarked on its arduous, four-year journey to consolidate 45 customer databases into an enterprisewide customer data repository that would provide nearly every Continental employee wired access to customer information.

But what particular customer information could most help a specific frontline employee achieve the "you know me" outcome for a customer? To continually provide fresh answers to that question, "ambassadors" from the airline's CRM department instigate regular think-tank sessions with representatives from every "vertical" in the company, including flight directors, managers, ticket agents, flight attendants, baggage handlers, etc.

The result? Scores of fresh, new ideas to delight customers are constantly generated and delivered by Continental's "wired" frontline. For example, the Continental President's Club Manager requests system notification when a high-value customer who has experienced a lapse in Continental service (major flight delay, etc.) in the last 30 days is now in his Club. Imagine the customer's surprise when the Club Manager connects with him and offers a personal apology.

Clients: Master the art of cross-selling

In my book, Customer Loyalty, I define a client as a buyer "who feels a real commitment to buy from you and proves it by buying every product or service of yours he thinks he can reasonably use." So how does a seller consistently earn maximum share of wallet with a client? Continually educate the client about the full breadth of product and service offerings. Some savvy merchants go one step further and reward clients for their willingness to try new products and services.

Cross-sell champion. eBay did this with its "Camp eBay" promotion. It awarded merit badges based on various activities that users perform on the site. The badges aren't based on simple purchases. They're based on how purchases are made and what's purchased. Merit-badge-worthy behaviors included using the "Buy it Now" button instead of bidding on an item, shopping in several different product categories, and posting feedback.

By rewarding users based on behavioral changes, eBay hoped to accomplish several goals. It educated users about new or misunderstood features, such as the "Buy It Now" button. The promotion encouraged more profitable multi-category behavior and extended the brand into product categories that some regular customers didn't associate with eBay. Moreover, it trained users to be a better community by rewarding them for submitting feedback and performing other good-neighbor tasks.

Advocates: Ensure that customers are skillfully heard, not aggressively sold

"There's a crucial difference between a customer and an engaged customer," writes Gallop Global Practice Leader William McEwen in his book Married to the Brand. "What attracts a first-time buyer is often quite different from what it takes to turn that prospect into a fully engaged customer." Amen to that! Simply put, advocates are engaged customers who prove their vendor allegiance through such activities as spreading positive word of mouth, recruiting new prospects, and helping their vendor improve. So, how can a firm build stronger advocacy in the wired world?

Commitment creator. One way is to create a secure environment in which customers can be listened to and engaged over a finite period of time. Online technologies provide just that opportunity.

Here's one scenario: A group of people with desirable demographics agrees to provide feedback, insight, and advice though a facilitated online community. Surveys, discussion threads, brainstorms, chats, and other activities engage community members on a private branded and secure Web site, and community members agree to visit the site regularly to participate in the dialogue. Most important, the site supports and encourages interaction between members. These interactions are usually very robust and frequently provide novel, unsolicited insights into the opinions, emotions, and behaviors of community members.

Deeply engaging customers by soliciting input on products, messages, ads, and other topics not only results in better offerings and more efficient use of marketing dollars, but the very act of listening can also deepen customer loyalty. Want proof? Control group diagnostics show statistically significant positive shifts among community members on such loyalty measures as "likely to recommend," "would matter if I could not purchase from" and "committed to."

Sound too good to be true? Look no further than Charles Schwab's use of by-invitation-only online communities built and hosted by Massachusetts-based vendor Communispace. Reports Jim Hawn, vice-president of Schwab Retail Brokerage: "We can get an idea...and within a week, we can get back to the originator and say, 'We took your ideas out to 400 clients and here's what they said…'." Hewn adds that Schwab customers "know their ideas and suggestions are being listened to, and that what they are saying is being considered by Schwab management up to and including the chairman."

The power of that understanding became apparent when the chairman, Charles Schwab, become involved in a set of online customer interactions of his own. Mr. Schwab wanted up-to-the-minute information about his clients' investing strategies and views of the market in preparation for an upcoming press tour. Working with him, the site design/facilitation team prepared a questionnaire and wrote a letter addressed to the community. Reports Hawn, "He had the highest response to date. Clients were literally writing essays to him about what they liked and what needed improvement."

But Schwab has found that the online community's truest value is most often in the more serendipitous discoveries that surface from the community's everyday activities. For example, Schwab was surprised to learn that frequently active traders really used Schwab Equity ratings. (The firm had previously thought that relatively few people actually used them.) Reports Hawn, "Based on that unexpected finding, we were able to put together a strategy that used that information. It was a marketing program we would not have done under other circumstances."

* * *

Answer the "call of the wired." Think carefully about your customer loyalty stages. What wired tools and techniques can best keep you close to your customer? It's a question that deserves being answered (and asked) again and again.


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Jill Griffin (jill@loyaltysolutions.com) is president of Griffin Group (www.loyaltysolutions.com), a loyalty research, seminar, and consulting firm founded in 1988. She is author of Customer Loyalty: How to Earn It, How to Keep It and co-author of Customer Winback: How to Recapture Lost Customers and Keep Them Loyal.

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