The first Thursday of each month features a “best of” X5 Management blog. The intent is to showcase and revisit some of our blogs from the past. We hope you enjoy them!
Have you ever thought about attempting to measure the return on your customer service investments? Is your organization aware of the lifetime value of your customers? Questions such as these are good reference points when thinking about and critically looking at your own customer service initiatives.
The lifetime value of a customer is the total revenue they will bring to your business during their entire relationship with you. These transactions are not single events, but part of an ongoing relationship and customer service strategy.
The cost of acquiring a new customer is on average five times greater than the cost of retaining an existing customer. Despite this fact, most businesses spend more resources on acquiring new customers than on investing in programs that nurture and retain their existing customer base. Strong customer retention likely means lower acquisition costs, a greater number of current customer referrals, more stable customer engagements and an improved level of assurance and optimism throughout your organization.
In 2015, X5 facilitated a customer service exercise during a workshop with a business that is committed to setting strong service standards within their organization. One particular team-member shared a story that their colleagues could hardly believe. This particular sales manager (after hearing the details and financial hardships faced by their customer) sacrificed their entire commission of a particular sale, and asked that their commission be given back to their customer anonymously.
Not only was their customer brought to tears, but they were given a break in a time when they needed it most.
Obviously, one cannot give up their commission during every sales transaction. However, it is through this form of consistent solution based thinking to customer problems, that you generate lifetime customers and set the bar for customer service excellence in your industry.
It becomes crucial for your business to look at your service efforts through the eyes of your customer. What would truly wow them? Engage with your customers in such a way that the majority of your transactions are simply one step in a series of many positive engagements throughout your customer’s lifetime.
X5 Management specializes in Improving Sales & Service for business. We offer comprehensive Business Consulting Services, Coaching Services and we have an extensive list of Training and Professional Development courses/workshops specific to supporting businesses with Improving Sales & Service. For more information, visit us at x5management.com or Contact Us directly.