Customer Retention is the new Acquisition

We have been hearing it for years… It takes significantly more effort to acquire a new customer than it does to retain one.

In fact, current estimates suggest that it can cost 5X to 25X more to acquire new customers, as compared to retaining them. Yet, a large majority of organizations are focused on “new business” (as in ‘customer acquisition’), constantly pouring resources into a leaking funnel. But, what they ought to focus on is retaining their customer base and engaging with them in a meaningful manner.

Here are some ways to do just that…

  1. Improve Relevance – Understand your unique “tribe” and get to know them better – their needs and wants, what they want from you. Establish mechanisms to listen to your customers – not just an annual C-SAT survey but on an ongoing basis. Then, work on providing relevant products and services that satisfy those needs and wants.
  2. Build Engagement – Is your customer buying a home loan or a home? Is he/she in the market for a medical insurance policy or for peace of mind? How can we make their journey easier? No, engagement does not equal spending big bucks on media buys, or counting likes on a social post. It takes effort to figure out what really matters to your target audience, and even more effort to give it to them. But the reward is worth it.
  3. Develop Partnerships – Build partnerships with distributors, channel partners and even other service providers. The world is one large ecosystem, if you’re willing to see it that way. If you are a ride-hailing app (Uber?) your scope of service doesn’t just include matching a driver with a passenger. Wouldn’t it be far more delightful if your regular customers popped inside the vehicle and had the option to play their favorite playlist (Spotify?). Partnerships are a great way to extend your base offering in ways that are meaningful to your audience. Again, relevance is key.
  4. Build Category before Brand – I can’t recall the number of times I have encountered organizations getting this wrong. Even in a category that is nascent, every brand rushes to build their own brand presence, instead of first building the category. Handhold your customers to help them understand what’s involved. Avoid jargon. Think from their point of view. Test your theories. Validate all assumptions. Simplify. Then, simplify some more. Now you’re on the right track.

The 5 Ps of CX

“Customer Experience” (CX) is quite the buzzword, these days. In corporate meeting rooms, and on industry panels – every one seems to be talking about it. However, many of the folks I meet grapple with how to prioritize their efforts around improving customer engagement.

Over decades of helping clients and employers bridge the gap between Business and what their Customers really need, I have come to understand that there are 5 Ps that impact CX. These are the levers at your disposal. These are the elements you need to influence, so you can strike the right balance…

  1. Product (or Service)
  2. Platform (or System)
  3. Processes
  4. People
  5. Pricing

Product/Service – Define your Target Audience clearly. Don’t build your product or service around what you think they need. Find out what they seek from you, then build your offering around their real needs. No more, no less. Competition does not matter. Customers do.

Platform/System – We are surrounded by Technology, and it’s here to stay. Your customers are probably embracing it faster than you are able to keep up with it. Don’t resist: Embrace it without excuses. Invest in what matters to your customers, be it Mobile or AI. Invest in creating a friction-less User Experience (UX). Good Design matters.

Processes – Customer Experience is built on a foundation of consistent delivery (of promises made), not found in pockets of excellence. Processes, therefore, form the backbone of a good CX. Stay away from ad-hoc and discretionary management. Strive to build an organization that outlives you and your key managers. Process Excellence is the key.

People – In any enterprise, people are an essential factor of success. Research shows that happy employees drive a 2x improvement in CX. Employee engagement matters. Hire right, then provide them with a clear vision of your business goals. Once they have understood what is needed of them, empower them to take actions that help them meet customer needs.

Pricing – Customer expectations change as the price changes. We expect much more from products and services that are sold at a premium. So if you plan to charge a premium for your brand, make sure you justify the outcome. In every case, think hard about the relationship between Price (you charge) and Value (you provide). Every Moment of Truth matters.

These 5 Ps are how you can ultimately impact the outcomes your customers experience. Of course, you can ignore this list if all you want to do is pay lip-service to the cause.

P.S. If you look closely, you will find that this doesn’t just apply to CX – these are also the attributes that can help you build a robust enterprise – one that outlives you.

What Really Matters

Every business acknowledges that the reason for their existence is the Customer. Every business wants to design products and services that are meant to address their customers’ needs. Yet, almost every business struggles to understand what their customers really want from them.

Is it any wonder that billions are spent worldwide in trying to gauge the truth of the matter, via interactions driven by focused groups and metrics like C-SAT and NPS? To make matters worse, in this Age of Digital and A.I., the “Customer” is also ever evolving!

How do you make sense of it all? 

Yes, customers do exhibit different personalities and needs. But, there are a few insights and common traits that can help most businesses get going.

Here are some of my learnings…

In the India context, it helps to keep in mind that the first 100 Mn Digital Consumers were Younger, More Urban, More Men, More Desktop, while the last 100 Mn are relatively Older, More Rural, More Women, More Mobile.

That said, customers all over the world are figuring out how they can leverage the abundance of Technology that now comes embedded in most platforms, products and services.

They want more and more to happen via Digital channels, so they can access it On-The-Go.

They want lesser clicks, faster page loads, shorter queues, reduced turnaround times, smaller forms.

They want more self-service options (Starbucks?), and want less IVRS interactions (Your call is important to us…?).

In other words, they want their interactions with your brand to be relevant, useful and enjoyable.

Oh, and thanks to online forums, reviews, ratings, and social media exchanges, they probably know more about your product or service than your Sales agent does!

Keep these factors in mind when trying to improve relevance of your offerings, instead of simply believing “you know what’s best for them”. And, don’t leave any opportunity to talk to a real customer – to listen to what really matters to them.

After all, there is just no substitute for a real conversation.

Survival of the Fittest

The headlines keep spewing out paranoia:

AI is taking over hundreds of jobs!
Uber and Ola have all but replaced traditional cabs!!
The hospitality industry objects to predatory pricing by Oyo!!!

So, what does all this mean for corporates, marketers and industry professionals like you and me? Should we become paranoid too? Should we be doing something else instead? Is it already too late?

Here are some interesting statistics compiled by HostingFacts:

  • There are 4.1 billion Internet users in the world (Dec 2018)
  • China has the most Internet users for any country (~802 million or ~20 percent of total), trailed by India (~500 million)
  • Amazon is responsible for more than 49 percent of all online sales and about 5 percent of all retail sales in the U.S.
  • There are 3.7 billion global mobile Internet users (Jan 2018)
  • About 75 percent of ecommerce sales in China are done via mobile devices
  • Mobile traffic is responsible for 52.2 percent of Internet traffic in 2018

The combination of super-cheap data plans (as in Jio) and super-cheap smartphones (as in Android + China) is already making a dent in India. With a plethora of payment platforms (PayTM, RuPay, etc.) that enable everything from micro-payments and P2P money transfers to mutual funds and ticket booking, Indians are also embracing newer ways of dealing with money. And, we are only at the nascent stage of this ‘perfect storm’, as it were.

Whichever way you look at it, the Indian consumer is doing more on their mobile phones today than ever before. Even without the local language content that millions of them want and need. Even without high-speed internet access in their semi-urban and rural towns. Even if it means that their first exposure to the world wide web (remember WWW?!) is on a 2-inch device in their pocket.

So, if you think “going digital” means creating a website and posting some brochureware content on it that gets updated every quarter, you’ve got another thing coming. If you already have a web presence but it doesn’t render elegantly on a mobile screen, you have a lot of catching up to do. If you’re a marketer who thinks all this “AI” stuff is for the geeks in your IT department (or even for your ‘Digital’ team), you may need to learn some harsh truths real soon. And, if you think your business is all offline, so you can continue to manage it the way you have been doing for decades – may be you do need some paranoia in your life.

Voice, Video and Vernacular (content) are going to be the success drivers of tomorrow. Add Velocity to the mix, and you will have a potent combination of forces at play. The environment is certainly ripe for disruption. The only question is will you be making it happen, watching in wonder as it happens, or wonder what happened?!

Beginner’s Guide to Smart Devices

Everyone and their cousin seems to be talking about Smart Homes, lately. TV ads are filled with mentions of “OK Google” and “Alexa…”, banner ads want to make us buy Smart Wearable devices & Smart Lights, while contests like #GetFitWithFlipkart are trying to make us go outdoors and get more active.

But, is it all hype? Is India ready for the #SmartHomeRevolution?  And, do you need be a techie to try out some of these new technologies?

As a matter of fact, what earlier used to involve technical know-how has now reached the Consumer market. India boasts of the second-largest Internet user base in the world (after China). And a large majority of us are experiencing the Internet mostly through our smartphones. The bottom line is that if you have a smartphone and access to WiFi in your home, many of the “Smart Home” devices are already within your reach.

Here are a few examples you can get started with:

1. Smart Speakers

Google Home and Amazon Echo offer multiple devices (with varying sound quality) that enable you to do a variety of tasks by simply “talking” to your speaker! They easily connect to your home WiFi, and have built-in capabilities for Internet Search and streaming music (including Indian services like Saavn). Adding reminders or checking appointments from your linked calendars is also a breeze. You can also connect multiple devices from different rooms for a seamless experience.

Benefit: Fill your house with Music + Search at the tip of your tongue.

2. Smart Cameras

There are hundreds of models of WiFi-enabled cameras available online, that can be easily configured to work with your home WiFi network without breaking the bank. Also called IP-cams, most offer a mobile app that can be used to access the live feed from any of the linked cameras. They typically have a micro-SD memory card slot (just like your smartphone) to store recordings from their feed. Higher-end models also enable you to “talkback” from a remote location, and have “night vision” to see better in dim light conditions. So, choose the model that best suits your needs.

Benefit: Easily monitor your children/maid/aged-folks from outside your home.

3. Smart Watches

This is a category that has a huge range of devices in all shapes, sizes and costs. Basic ones offer a “pedometer” that counts the steps you take to keep track of your activity level through the day. Advanced features include “inactivity alerts” (that remind you to get on your feet every X minutes), “sleep mode” (that tracks the quality and quantity of your sleep) and “heart rate” (that tracks your heart rate when evoked). Most come with companion apps for smartphones that can be used to store past data and access more detailed analytics of your behavior. The key here is battery life, since models range from those that need charging daily to those that need charging just once a year. So, choose wisely. I should also mention that some of the inexpensive models are highly inaccurate when it comes to the basic task of counting steps. So, do read reviews before you buy one.

Benefit: Know how active (or inactive) you are, and take steps to improve.

As you can see, there are a wide variety of “smart” devices that just need a smartphone and a WiFi connection to deliver their smarts. So, don’t be afraid to take the plunge and give it a try.

Who knows? Your’s may just turn out to be the “smartest” home in your neighborhood!