death of profit
TRANSCRIPT
Death of Profit:
Customer Power Requires a Mind-set Change to Improve Customer Retention and Profits
Last week, I wrote about companies professing they had more important
priorities than Customers. In more and more studies, we are finding that
companies are losing existing Customers. The profit increase from
retaining Customers is shown below
In a recent Business Line article quoting a global study, they stated that 80% of the Customers in India and globally who complained about poor service or product deficiencies had their complaints ignored. Companies lost at least 18% of their annual revenues because of poor complaint handling. In my opinion the number is higher but is masked. Companies cannot afford to lose Customers and allow profits to leak through the poor Customer experience sieve. They need to heed this. So what are they doing?
Companies are planning to spend more in Customer support technology. They are thinking that technology will solve the poor Customer experience and retention problem. But what they need to do is to change the mind-set starting at the top with CXO’s and getting all departments to focus on the Customer and Customer issues. They need to break internal silos, and build a circle of promises internally to make sure the Customer remains happy and stays with the company (and even attract new Customers by word of mouth). They also need to incorporate Customer Circles like the Quality Circles to start a Continuous Customer Improvement program. This will give them more mileage and will be cheaper than a mere technology intervention. Companies beware of Customer Power! Do not let your profits die!
Gautam Mahajan
President, Customer Value Foundation Mob: +91 9810060368
email: [email protected]
website: http://www.customervaluefoundation.com
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