Why you should stop trying to delight your customers

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Why you should stop trying to delight your customers

August 11, 2010 in Attitudes & Behaviours, Customer Service

Delighting customers does not build loyalty. Reducing customers’ effort does.

These were the findings from a large customer service survey conducted by the Customer Contact Council (CCC), and featured in the July edition of the Harvard Business Review. The survey’s aim was to get answers to three questions:

How important is customer service to loyalty?
Which customer service activities increase loyalty, and which don’t?
Can companies increase loyalty without raising their customer service operating costs?

After conducting structured interviews with customer service leaders and a study of more than 75,000 customers, the CCC uncovered three findings:

1. Exceeding expectations during service interactions has negligible impact on customer loyalty

Of the 75,000 customers surveyed, they were more interested in how well a company delivers on their most basic and/or vanilla promises rather than being dazzled and having their expectations exceeded. However, 89/100 customer service department heads had ‘to exceed customer expectations’ as their main strategy. This is not new. As I wrote back in June 2007, ‘Exceeding customers’ expectations?’, living by exceeding customers’ expectations doesn’t add up and ends up costing us more in the long term.

2. Service organisations create loyal customers primarily by reducing customer effort

In other words, helping customers solve their problems quickly and easily – not by delighting them in service interactions. Given these findings, we need to reframe around making the customer experience easy.

5 ways to lower the effort and make it easy for customers:

Don’t just resolve the current issue but head off the next one
Address the emotional side of customer interactions
Minimise channel switching by boosting self serve channel stickiness – 57% of complaints came from customer trying to resolve issues online but couldn’t
Use feedback from unhappy customers to enhance issue resolution rate
Empower the front line to deliver a low effort customer experience

3. Customer Effort Score (CES) tops the charts with the highest predictive power

In the customer service environment, Customer Satisfaction (CSAT) is a weak predictor of customer loyalty. Net Promoter Score (NPS) is slightly better.

By decreasing customer effort to purchase you can get increases in repurchase, increase spend and willingness to tell others about their experiences.

The survey asked customers to rate how much effort they personally put forward to handle their request. They were asked to rate on a scale of 1 (low effort to purchase) – 5 (high effort to purchase). 94% of participants reporting ‘low effort’ stated their intent to repurchase, 88% stated their intent to increase spend, and 1% stated their intention to speak negatively about the experience. Versus 81% reporting high effort stated their intent to spread negative feedback about the experience.

Outcome: CCC advises that we should move from increasing customer satisfaction to decreasing customer effort.

Remember everybody lives by selling something.

Author: Sue Barrett, www.barrett.com.au

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What’s the difference between a member, a client and a customer?

July 22, 2010 in Attitudes & Behaviours, Communication, Culture, Customer Service, Ethics & Values, Sales Relationships, Sales Skills, Strategy

What’s in a name? Well, there seems to be some confusion in the market place around the terminology used to describe those people who pay us money for goods, services, experiences, donations, etc.

Different industries can have different terms for the consumers of their products and/or services. We see terms such as customer, client, patient, guest, patron, member, subscriber, donor, etc. used to describe a person who buys our products or services and intends to use them directly. In short, these terms are referring to the same person – the ‘end user’. However, not everyone ‘consumes’ our products or services or is the intended ‘end user’. Some people or businesses buy our products or services to ‘on sell’ them to another party, often the final end user, but not always.

Many industries might a have a chain of buyers and only one will be the end user. For instance, if we follow the chain from the manufacturer who sells via a wholesaler (partner or client) who then sells to a retailer (client or customer) who then sells to the end user (customer or consumer), we can have several terms to distinguish who’s who.

If this is your situation, it does help to define who is who by having specific terms such as ‘client’, ‘member’, ‘customer’ or ‘consumer’ so we can keep track of our actions and key messages as each of them may want something different from you, and as sales people we need to know who we are working with. For instance, you may use ‘client’ for the retailer and ‘consumer’ for the end user to keep roles and communication clear. Marketing and advertising agencies use the term ’client’ for their direct customers since marketers also have to refer to the consumers of the client’s products.

So where does ‘member’ feature?

Some businesses, often retailers, use ‘member’ to distinguish between those who buy regularly from them compared to those who do not. They want to set up memberships so as to attract and retain regular users of their products/services and reward them with greater benefits or discounts so they keep coming back. It’s a way of building up your database to build a tribe of followers or a community of users or supporters which, if done correctly, can make future sales that much easier to attain. Retailers often have membership cards and reward programs for regular purchasers of their products or services. There are usually benefits and special privileges to being a ‘member’ but essentially a member is a ‘customer’, ‘end user’ or ‘consumer’ of your business. This means you can have customers and members in the same business.

When having ‘members’ can be a problem for sales growth

To avoid any challenges, you need to make sure that before you embark on a ‘membership’ program there are very clear definitions and actions in place that distinguish membership from customers. However, do not make the mistake of thinking once a person is a ‘member’ that you do not have to sell.

We are seeing a trend in some businesses who claim to be there for their ‘members’ or ‘member associations’ dissociating themselves from the function of ‘selling’ when their members are customers.

Because these people choose to be ‘members’ of these businesses there is an expectation of being kept informed of the latest trends, best buys or ‘right’ options for them, or why would you bother being a member. You expect the membership team to keep in touch with you and to help you make good ‘buying’ choices and decisions. You trust them to offer products and services that meet your needs. After all, they should know your current preferences and buying patterns. Members expect to deal with people who are skilful in client centric consultative sales practices even if they do not know to call it that.

However, when speaking to some of these membership businesses we find a deep reluctance to acknowledge and admit that the skills they want their membership teams to be competent in, such as prospecting and client centric consultative sales communication practices, are indeed selling skills.

By denying this practical reality, member organisations can end up developing teams who are reactive, passive and reluctant to engage in proactive, problem solving, solution based interactions with members. The number of membership based businesses that swear that being a member and a customer are mutually exclusive, are fooling themselves and are doing a disservice to themselves and their members. By telling their people “we are not sales people, we do not use the word selling, we have members” creates cultural and competency issues.

I am happy for people to call their ‘end users’ members, patients, guests, donors, patrons, subscribers, customers or clients as long as they recognise that serving the end user of buyers of your products and services properly means employing ethical, consultative selling skills and processes if you mean to exchange something of value i.e. money for your products or services.

Remember everybody lives by selling something.

Author: Sue Barrett, www.barrett.com.au

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We want more than a script

July 13, 2010 in Attitudes & Behaviours, Communication, Customer Service, Prospecting, Sales Relationships, Sales Skills, Sales Training, Tips

Hundreds of thousands, if not millions of sales people around the world use sales scripts. Used properly, sales scripts act as scaffolding or bridgework to earn us the right to have a meaningful discussion with our prospecting customers, members, donors or subscribers. The sales script is a well constructed set of guidelines that support us when we prospect.

Good sales scripts:

are purposeful – have a clear reason why you are calling someone;
use language the customer understands;
are designed for the benefit of the listener with it always being “the prospects choice” to accept or reject what they hear;
are brief and allow for questions and conversations;
aim to achieve a result – an appointment, donation, purchase, feedback, etc;
are planned not canned –they are flexible, allowing the sales person to adapt to the different needs or queries of the prospect whilst maintaining the integrity of the call’s purpose;
leave the prospect feeling valued and informed, even if they choose not to proceed with you in this instance; and,
are pleasant, respectful and engaging.

However, too many organisations push sales scripting too far creating word-for-word scripts that end up being stilted and clumsy at best and one-sided and ineffectual at worst. We had an experience recently with a telecommunications firm whose telephone sales and service people seemed unable to deviate from a scripted response as the responses they gave us had nothing to do with our issue. The impression this gave us was that our issue wasn’t even heard let alone acted upon – it didn’t fit their script. The number of times we had to request information to check that our matter would be dealt with made the whole experience cumbersome, time consuming and very frustrating. We ended up doing all the work, while the telephone sales and service person simply read from a script, which, as it turns out, could not account for our matter in its design.

Sales scripts are not meant to be regurgitated word for word with no deviation, nor are they meant to be a one-sided affair. This type of approach is called ‘canned’ scripting. You would think that in this day and age we would have ditched these ‘canned scripts’ but they still happen.

The Cluetrain Manifesto (a resulting force that rose out of the discontentment people experience with businesses and how they fail to communicate with people) really nails it when it says:

“Learning to speak in a human voice is not some trick, nor will corporations convince us they are human with lip service about ‘listening to customers’. They will only sound human when they empower real human beings to speak on their behalf. While many such people already work for companies today, most companies ignore their ability to deliver genuine knowledge, opting instead to crank out sterile happy talk that insults the intelligence of markets literally too smart to buy it.”

Building on this and taking the canned script one step further, some companies and political parties have even ditched the live person on the other end of the phone and opted for a recording instead. And this is supposed to engage us? This is free-to-air television advertising or junk mail in disguise. At least with television we can choose what we watch and we can put a ‘no junk mail’ sign on our letter box but getting ‘canned’ advertising over the phone takes the biscuit in my opinion. Yes there is the ‘do not call’ register which you can sign up to, however resorting to ‘recorded messages’ is lazy and only serves to create more angst in the already heated area of telemarketing.

If done properly, telephone sales is a very effective way of getting in contact with legitimate prospects. But when scripting removes the ability to genuinely listen and respond to a customer, we all suffer.

If you want to create positive and memorable experiences for your customers, members, donors or subscribers then seek to engage with them in a meaningful way. Don’t force your sales people to be rooted to the spot and limited by a one-size-fits all script. Trust your team to engage with people in meaningful ways by giving them the guidelines and tools they need to communicate effectively with the wide variety of people they encounter on a daily basis. The autonomy this gives your people puts back interest and challenge in the task of making effective prospecting calls and in the process might make the customers, members, donors or subscribers’ experience that much better.

Remember everybody lives by selling something.

Author: Sue Barrett, www.barrett.com.au

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Collaboration – The New Competition

July 8, 2010 in Communication, Customer Service, Performance Management, Sales Leadership, Sales Management, Sales Relationships, Sales Skills, Success, Teamwork

The New Competition was voted by you as the number 7 Sales Trend for 2010. Over the coming years, we will see collaboration become the new competition. Markets around the world are crying out for collaboration as innovation and differentiation become scarce in a sea of commoditised products and services.

Sales people who see themselves as collaborators, both internally (colleagues, departments) and externally (customers, competitors), will prosper more than ever during 2010 and beyond.

A large 5 year long research study conducted by B. Rosenbaum, Business Horizons, entitled Seven Emerging Sales Competencies and published in Jan/Feb 2001 revealed what makes highly successful sales people. His research, among other key findings, showed that the most highly successful sales people are indeed collaborators. In his research of over 1,000 B2B sales people across 5 years he found that top performers:

collaborated with colleagues and did not allow competitiveness to get in the way of good business, and often assisted their colleagues in achieving their best by sharing ideas, information and resources;
orchestrated internal resources so as to benefit the company, its people, and the customers and their people;
invested time building collaborative, customer focused relationships inside their organisation;
created an alignment between the customers’ and suppliers’ strategic objectives;
looked to further the interests of their customers’ firms as well as their own;
expanded the customer’s understanding of what a business relationship can be;
built a flexible relationship that is responsive to marketplace changes;
creatively drew on the full resources of the firm or business;
introduced customers to other suppliers and potentially valuable support resources; and,
invested time building collaborative, customer focused relationships inside their organisation.

These findings are not new as you can see. However these qualities are still seen, if they are seen at all, as a novelty by most senior managers which is a major risk moving forward in such changing times. Rosenbaum’s research revealed that, sadly, the vast majority of sales managers were completely unaware that these and other distinguishing qualities were what made their high performing sales people highly effective and successful. What he observed is that these sales superstars where acting and performing this way despite management. They knew what they needed to do to get the results. It’s such a pity that their managers did not.

As I wrote recently, many sales teams are still held hostage by old school sales management practices and outdated mindsets that encourage internal competition, league tables and the like. Too many sales leaders are still stuck in the 1980’s with ‘greed is good’ and ‘carrot and stick’ philosophies which do not work in the long term and only serve to hold us back in a 21st century world. Most sales rewards are still self serving, endorsing selfishness which is completely at odds with the new world of collaboration and our natural state of being.

Daniel Pink’s new book Drive focuses a big spotlight on this very issue – what motivates us. He reports that what business thinks works by way of motivation is not what the science shows or the vast majority of people want.

Besides the commoditisation of products and services, Rosenbaum’s research, Daniel Pink’s findings, and other corroborating research, the advent of social media and the multiple levels of engagement we can now have with our clients, suppliers and key stakeholders means that we need to work collaboratively with each other. And this collaboration needs to take place across marketing, sales, service, supply, production and finance if we are going to create the ideas and solutions needed for our success in the 21st century.

Those 21st century enlightened salespeople will be the conductors or connectors of viable and valuable relationships across many levels. They will be open-minded, humble and astute, and they will see patterns of connection and synergy in many places. They will recognise that we are all interconnected and without kindness and cooperation we cannot exist. They will identify competency and harness talent to achieve effective solutions. They will know that they are working towards something larger than themselves. And they will know that their success is a shared success they will celebrate collectively.

So we need to get with the program and rethink our approach to sales motivation, sales mindset, sales skills, sales rewards and teamwork if we are to remain viable in this world. Collaboration calls for a team effort. Sales teams where everyone is pitted against each other to achieve ‘top dog’ status will be replaced by a ‘lead team’ approach. Companies that want to bring in new business and grow and develop existing customers will rely on the united hands of many – rather than just one. Successful sales people of 2010 and beyond will leverage the power of collaboration over competition because they understand that relationships never work if they are forced and manipulated, and that the sum is greater than its individual parts. Synergy and collaboration will prevail.

Remember everybody lives by selling something.

Author: Sue Barrett, www.barrett.com.au

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How do I deal with client objections?

February 3, 2010 in Communication, Customer Service, Negotiation, Sales Skills

Many sales people will tell you one of the biggest worries in sales, besides prospecting, is dealing with customer objections. Its true many people do not like dealing with objections or conflict, however, it is also true that many people unintentionally create objections and conflict by not understanding a customer’s real needs or priorities and failing to find common ground.

In my opinion ‘overcoming objections’ is often blown out of proportion in terms of the issue it claims to be. Too much time and attention is spent on objections in sales meetings and sales training rather than focusing on the skills and resources needed to help sales people eliminate objections from the sales process in the first place.

The two key strategies to eliminating the issue of objections are: Having a sound, logical sales communication process that sets you up to understand where a customer or prospect is coming from, what they value, what their real priorities are, why and when they are ready to make a decision to buy, and how sophisticated they are; and a sound knowledge of your offerings and how it fits or serves your market.

Utilising your very best communication skills such as focused questioning, active listening, verifying and paraphrasing, and creative problem solving are keys to eliminating objections and creating a dynamic, productive sales and buying experience for you and the customer.

Let’s rethink labelling every customer question or concern as an objection. A customer asking a question about your product or service, seeking further clarification on a matter, or expressing confusion over a new product are not grounds for an objection, they are merely trying to understand what you or the product/service does in more detail.

They are often trying to see if there is match between you and them. As sales people we should welcome these enquiries as the customer is fully engaged, showing interest, and seeking to find common ground as to whether to work with us or eliminate us from the equation. This should not be grounds for fear and loathing.

So what is an objection? An objection, as defined by www.dictionary.com, is a reason or argument offered in disagreement, opposition, refusal, or disapproval.

Based on this definition, in many cases sales people are not trying to overcome objections, they are working with the customer who is seeking information or clarification for a mutually beneficial outcome, the sale. Dealing with nonconforming ideas or helping a customer coordinate a viable solution requires understanding, collaboration, and creative problem solving skills on the part of the sales person, not overcoming objection skills.

There are four common areas sales people come across which can, if not properly dealt with, lead to objections (and reactions):

1.   Misunderstanding – correct it
2.   Doubt – resolve it
3.   Limitation – compromise or put it into perspective
4.   Question – answer it

The reality is if you and the customer have not found common ground or agreement on an action to move the sale forward to the next logical stage it does not necessarily mean you have encountered an objection. It may just mean a viable sales opportunity may not exist. However, if you have not listened to the customer, tried to force your ideas onto them without their consent, or tried to bully them into a sale then the customer may object, and rightly so.

If during any stage, especially the last stage of the selling process, you encounter strong objections or indecision from your customer, it likely means one or more of these problems may exist:

You didn’t really understand your customer’s/prospect’s needs or priorities in the first place and tried to put forward solutions they do not want
Your customer/prospect doesn’t perceive having a need i.e. they maybe an uniformed buyer
Your customer/prospect is not looking for a solution, i.e. maybe they are just on a fact finding mission
You have not shown your customer/prospect what they think they need, i.e. there is a clash due to a mismatch between what you perceive as important and what they perceive as important
Your customer/prospect cannot see any real value in your offering
Your customer/prospect is not ready to buy yet
Your customer/prospect does not have confidence in you or your company
Your customer/prospect has unrealistic expectations you will never meet
Your customer/prospect has other agendas or loyalties that do not understood, i.e. they have biases and are unlikely to buy from your not matter what

These situations and others like them are the realities of selling. Our job as sales people it to properly understand our customers, their situation, their preferences, priorities, challenges, goals, and come up with viable solutions that are a win:win for both parties, or determine that a ‘no sale’ exists. Either way everyone is in the know about what to expect which should reduce the need to object. However, sometimes there is no simple solution to a customer’s concerns. A customer will hesitate to move forward and if you can’t find a solution, maybe you can negotiate a resolution.

If you do happen to come across a real objection, below is a seven step process for handling objections:

Deal with the objection straight away, don’t ignore it.
Be trustworthy and empathise with feelings that are expressed; Use an appropriate manner by remaining calm, showing respect, and using positive language (talk about what can be done rather than what can’t be done).
Utilise your most effective communication skills, remembering to: actively listen, question, solve problems, avoid making personal judgments, be flexible, and work together.
Ask questions to determine the real objection.
Restate objections to clarify the issue and gain agreement from the customer that this is their real concern.
Work towards seeing the situation from the customer’s point of view
Select a course of action which may include negotiating a resolution.

In short, the key to handling and eliminating objections effectively can only occur when open communication, cooperation and collaboration exist, however it is important to check and make sure it is a legitimate objection first.

Remember everybody lives by selling something.

Author: Sue Barrett, www.barrett.com.au

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