Customer Consulting explores how to retain ‘promiscuous’ customers ...

Unfortunately, CCL’s experience in this period shows that companies tend to be happy spending money on brand advertising, channel incentives and direct sales – but see customer service and retention as a cost.

"Many companies believe their customers want to be promiscuous – but, in reality, that’s not true," said Brian Jopling, associate director of CCL.

"Customers tend to view their relationship with a provider like a marriage rather than a one-night-stand. Of course, this means that both parties in the relationship need to work at cementing their commitment to each other."

"Customers are always prepared to put in some effort to make the relationship work. They are more prepared to consider buying more products from the same supplier because they want to believe that they made the right choice of provider in the first place," he explained.

"This should benefit the provider because the more products a customer buys, the more profitable that customer will be. Yet a number of companies are not proactive in investing in their customers because they don’t realise that putting time and energy into developing existing customer relationships will pay off."

Jopling believes that promoting new deals to new customers rather than developing existing customers can only go on for so long before existing customers realise what’s going on and become unhappy.

"Companies tend to believe – erroneously - that their customers don’t want to put ‘all their eggs in one basket’," he observed.

"Yet many people like convenience, simplicity and the ease of having to deal with only one company. That’s why Tesco is doing well at the moment – because it is offering its customers a wide range of products and services, from food to motor insurance in a one-stop-shop at a competitive price."

"Customers want to be loyal – so companies should make it easier for them to be so," explained CCL’s managing director, Simon Rustom.

"It’s not just about having loyalty schemes, although these can help. It’s really about helping customers to ‘buy in’ to the company’s values as well as its products and services."

Jopling added, "Our experience – and that of our client base across a range of industries - over the years has been that, if you give your customers a high level of service and develop that relationship with the customers, you find opportunities to cross- and up-sell. So we have found that maintaining an effective customer retention strategy is more cost-effective than seeking new customers."

Unfortunately, it can be difficult for companies to identify existing customers and contact them to introduce other products and services, because sales effort tends to be focused by product-specific areas across different sections of the company.

Jopling explained, "Partly because of various company amalgamations and partly because each product is its own ‘profit centre’, company data tends to show a particular product’s contribution to the firm’s profits - rather than providing the contribution data of existing customers. These systems are product- not customer-centred."

"So companies tend to accept, as a fact of life, the current ‘leaky bucket’ situation where you pour lots of new customers in at the top – and leak customers from the bottom of the bucket. Yet we have proved that there are effective ways of tackling this situation – and, in many cases, greatly reduced the degree of ‘customer leakage’, to the benefit of both suppliers and customers."

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About Customer Consulting Limited

Customer Consulting Ltd (CCL) is a specialist customer and change management company. It helps organisations to optimise their return on investment in customer management - especially contact centres and customer-orientated information and technology.

Its vision is to demonstrate that a best practice approach to customer management delivers sustainable business growth. CCL aims to deliver a combination of insight, intellect, wisdom and pragmatism - combined with a real understanding of people - to achieve commercial results that are beyond the norm. Using a joint project team approach, CCL offers advice and support to help companies develop and implement customer strategies that produce results.

With its 100 consultants averaging 20 years experience, CCL helps business leaders and their teams – including those at Aviva, BUPA, South West Trains and Orange – to activate their internal resources and ensure measurable success.

Further information from:

Kathy Duxbury, Customer Consulting, 00 44 (0) 1908 441012/ 00 44 (0) 7976 405779; kathy.duxbury@customerconsulting.com

Bob Little, Bob Little Press & PR, 00 44 (0)1727 860405; bob.little@boblittlepr.com