Customer Delight
Not Customer Satisfaction, but...
BY: Prof. Jitendra Sharma
Trainer & Consultant
Email: [email protected]
Objective of the Session
1.What is delighting the customer?2.WHY delighting customer is
important ?3.HOW can we delight customer?
What is Delighting Customer?
PART -A
1-5
Traditional Definition of Marketing
Simple Definition: Marketing is managing profitable customer relationships.
Goals: Profit, Customer Satisfaction & Long term relationship
1. Attract new customers by promising superior value.
2. Keep and grow current customers by delivering satisfaction.
What determines Customer Satisfaction
CustomerSatisfaction
PerceivedService
ExpectedService
Levels of Customer Satisfaction
PerceivedService
ExpectedService
CustomerSatisfaction
Much Better than expected
As expected
Worse/Different than expected
Delighted *
Satisfied
Dissatisfied
Loyal
Vulnerable
Walk & Talk
WHAT IS IT?
• Customer delight is more
about the experience and
emotion than it is about
the product and its features.
• Its about creating customer life time value by improving the customer loyalty
Delight = Expectation + 1
+ 1s
+ 1 %
+ 1 more smile
+ 1 additional item
+ 1 more personal contact
+ 1 bit more thought fullness
+ 1 extra minute of your time
+ 1 check to make sure all’s now OK
+ 1 telephone call to ensure the customer’s happy
+ 1 anything else that will delight your customers
Modern customer-oriented organization chart
Top management
Middle management
Front-line people
Customers
Customers
Front-line people
Middle management
Top manage
ment
C
u
s
t
o
m
e
r
s
C
u
s
t
o
m
e
r
s
Traditional organization chart
All profit comes from customers
So if no customers = no profit
and no profit = no business
then no customers = no business
Therefore customers ARE the business
“The greatest danger for most of us is not that our aim is too high and we miss it, but that it is too low and we reach it”
Michelangelo
Why delighting Customer is Necessary?
PART -B
Challenging Scenario
– What are our challenges?• Attitude towards the customer• Competition• Price war • High quality man power• Marketing and Selling attitude • Pace of new service/technology induction
“ Customer satisfaction is no longer good enough to survive today’s competitive market place. What is needed is customer delight.” - Tom Peters
CUSTOMER ?
CUST ME MER
OR
ATITHI DEVO BHAVA
“ Figures are your history, customers
are your present and future. “
--- Philip Kotler
THINK
20
Customer Service Facts
Why customers leave:
1% die
3% move away
68% quit because of an attitude of indifference towards the customer by the staff
14% are dissatisfied with the product
9% leave because of competitive reasons
www.CustomerServiceManager.com
Lifetime Value of a Customer
Toothpaste Rs. 50 K
Detergents Rs. 100 K
Cigarettes Rs. 300 K
Colour TV Rs. 400 K
Branded Shirt Rs. 500 K
Car Rs. 2.5 M
Software Rs. >> M
Source: Atos Origin
91% of unhappy customers will not willingly do business with you again.
70% of complaining customers will do business with you again if you resolve the complaint in their favor.
95% of complaining customers will do business with you again if you resolve the complaint instantly.
A typical business hears from only about 4% of its dissatisfied customers.
• 96% just go away• 91% will never come back
(Source: “Understanding Customers” by Ruby Newell-Legner)
The Truth About Customers
• Ten times more expensive to acquire a new customer than to keep a current customer
- Bain & Company Research• Customers are lost primarily
due to indifference (68%) versus dissatisfaction (14%) - WSJ
Adequate Is Not Acceptable
• Most of what we do is adequate• People talk about Customer
Delight• People talk about bad service• People don’t talk about adequate
service
Dissatisfied customers can cause a destructive spiral
Delighted Customers
Customers
Dissatisfied Customers
30%
70%
Complain
Walk & Talk
95% of Satisfied Complainants remain loyal
1 x 1111 x 5
Total67
1 x 5 5 x 2
Total16
Source: PIMS, TARP, IBM & other research studies
Delighted customers yield several benefits
» Lower Cost
» Cost 5x more to gain a new customer than to keep one
» Cost 10x more to get dissatisfied customer back
» Growth
» Win customers trust & confidence
» Repeat business
» Non-competitive, shorter lead-time
» Opportunity to deliver new services
» Higher Profits
» Lower marketing costs
» Less risk; less write-offs; less fee-sensitive
» Higher acceptance to leverage new or junior staff
HOW?????
To Delight Customer
Actually• Customer expectations are
typically not very high
• Your job is to surprise them
• Customer Delight is doing what they haven’t even imagined
• What will cause them to say WOW!
• You know what you can do - they don’t
Creating Customer Delight
• What’s working?– How can we do more?
• Any barriers?– How can we overcome them?
Understanding What Customers Really Value
PerceivedService
ExpectedService
CustomerSatisfaction
WhatCustomer
Values
Deliverable(tangibles, reliability)
Financial Informational
(ease, access,responsiveness,
security)
Interpersonal(credibility,
competence,contact, empathy)
Environmental
Process
Momentsof
Truth
Hygiene vs. Enhancing factors
» Hygiene Factors
» Absence: Dissatisfies
» Presence: Neutral
» Enhancing factors
» Absence: Neutral
» Presence: Satisfies
Making Customer Delight A Core Value
• Staff Meetings• Board Meetings• Define and visualize the ideal
experience• Make a part of each agenda• What did we do right?• Missed opportunities?• Recognition• Who is the “champion” for Customer
Delight?• How are we treating customers now?
I Will
• Identify crimes committed against Customers, Donors, Program Participants and Each Other
• ……and do SOMETHING
Two Things I Will Do…
• 1)
• 2)
35
What separates the merely good organization
from the truly great?
BEST SELLER!
36
RemarkablRemarkablee
1. A Customer Service Culture
2. Alignment of Products and Services With
Mission
6. Organizational Adaptability
7. Alliance Building
3. Data-Driven Strategies
4. Dialogue and Engagement
5. CEO as a Broker of Ideas
Commitment to Action
Commitment to Purpose
Commitment to Analysis
and Feedback
METHODS OF
DELIGHTING
Selected MethodsSelected Methods
1 Customer Services2. Improving Employee commitment3. Innovation4. Customization5. Experiential marketing6. Permission Marketing
39
What is Customer Service?
"Customer service is the ability to provide a service or product in the way that it has been promised.“
Source: Customer Service Manager
"Customer service is about treating others as you would like to be treated yourself and how they want to be treated."
Source: Customer Service Manager
"Customer service is a process for providing competitive advantage and adding benefits in order to maximize the total value to the customer."
Source: Customer Service Manager
Example
43
2009 Businessweek Customer Service Champs
44
2009 Business week Customer Service Champs1. USAA 2. JAGUAR 3. LEXUS 4. THE RITZ-CARLTON 5. PUBLIX SUPER MARKETS
6. ZAPPOS.COM 7. HEWLETT-PACKARD 8. T. ROWE PRICE 9. ACE HARDWARE 10. KEYBANK 11. FOUR SEASONS HOTELS
& RESORTS 12. AMAZON.COM
1. NORDSTROM 2. CADILLAC 3. AMICA 4. ENTERPRISE RENT-A-CAR 5. AMERICAN EXPRESS 6. TRADER JOE'S 7. JETBLUE AIRWAYS 8. APPLE 9. CHARLES SCHWAB 10. BMW 11. TRUE VALUE 12. L.L. BEAN 13. JW MARRIOTT
Source: BusinessWeek Online
45
Case Study - Zappos.com
Source: The Letter Two.com
46
Zappos is committed to WOWing every customer.
Customers come…Over 10 million total purchasing customers
Customers come back…75% of purchases from returning customersRepeat customers order 2.5x in the next 12 months
Customers come back, order more and order more often…
Source: TheLetterTwo.com
47
What customers first see
24/7
Toll free phone number
Free shipping and return shipping
365-day return policy
Source: TheLetterTwo.com
48
What customers experience
Fast, accurate fulfillment
Most customers are “surprised”-upgraded to overnight shipping
Friendly, helpful “above and beyond” customer service
Occasionally direct customers to competitors’ web sites
Source: TheLetterTwo.com
49
Internal Methods
5 weeks of culture, core values, customer service, and warehouse training for everyone.
Culture Book
Interviews & performance reviews are 50% based on core values & culture fit.
Source: TheLetterTwo.com
50
ZapposDelivering Happiness
(customers and employees)
“People may not remember exactly what you did or what you
said, but they will always remember how you made them
feel.”
Source: TheLetterTwo.com
51
Zappos Core Values
Deliver WOW Through Service
Embrace and Drive Change
Create Fun and a Little Weirdness
Be Adventurous, Creative, and Open-Minded
Pursue Growth and Learning
Build Open and Honest Relationships With Communication
Build a Positive Team and Family Spirit
Do More with Less
Be Passionate and Determined
Be Humble
Source: TheLetterTwo.com
52
Innovation
Innovation allows organizations to remain competitive. Nurturing the ideas of employees is vital to the growth of the
organization.
10 - 54
• $50 billion in profits over 27 years
• Early new-product development relied heavily on copying the competition
• $4.2 billion annually invested in R & D
• Innovation is critical to Microsoft’s future success
• Much of R & D efforts are Internet related
• Many new products and services are in development
MicrosoftMicrosoft
Case Study
Tablet
Copyright 2007, Prentice Hall, Inc.
8-56
Firm History• Steve Jobs’s creativity
led to innovation in user friendliness of computers.
• LazerWriters and the Macintosh established Apple firmly in desktop publishing market.
• Status as market share leader and innovator was lost in the late 1980s after Jobs left the company.
Apple Computer – Innovation at Apple Computer – Innovation at WorkWork
Case StudyCase Study
Firm Recovery• Steve Jobs returns in
1997 and revitalizes Apple by first launching the iMac.
• The Mac OS X next breaks ground and acts as a launching pad for a new generation of computers and software products.
• iPod and iTunes change the face of music and are the hit of the decade.
Google Phone- Nexus one
Google’s mobile operating system for phones
Gillette Men’s Razors:Product Modification
Gillette Women’s Razors:Product Modification
LG
Innovative marketing Strategy
Future
Experiential Marketing
“Experiential Marketing: Beside product features and benefits, promotion connecting it to unique and interesting experiences”
if you charge for the time consumer spend with you, then & only then you are in experience business
Employ multiple touch points & multiple senses Often involves special events, contests, promotions,
sampling, on-line activities, etc. Combine brand education & entertainment Distinctive and relevant Example: (Disney Village), Rainforest Cafe, Planet
Holywood, Levi‘s and Nike Brand Stores Example: Day@Xcellon
Requirement –different from traditional marketing
Focus on consumer experienceFocus on consumption situationView consumer as rational/emotionalUse eclectic (diverse) methods and tools
Example
• Sample house• Virtual 3 D image • Test Drive
One-to-One Marketing:Competitive Rationale
“One-to-one Marketing: From transaction-based marketing towards relationship marketing including customer databases - dialog - customization.”
Three things1.Focus on individual customer through customer
database2.Respond to consumer dialogue via interactivity3.Customize product & services as per their requirement
One-to-One Marketing:Five Key Steps
Identify consumers, individually and addressable
Differentiate them, by value and needsInteract with them more cost-efficiently
and effectivelyCustomize some aspect of the firm’s
behaviorBrand the relationship
One-to-One Marketing:Consumer Differentiation
Consumers help to add value by providing information
Firm adds value by generating rewarding experiences with consumers Creates switching costs for consumers Reduces transaction costs for consumers Maximizes utility for consumers
Web Sites for In-Class Activity1) Computers:
Dell - http://www.dell.com/
Gateway - http://www.gateway.com/
Apple - http://store.apple.com/
3) Automobiles: Ford -
http://www.forddirect.com/
BMW - http://www.bmw.com/
Jaguar - http://www.jaguar.com/us/
5) Jewelry: Mondera -
http://www.mondera.com/
DeBeers - http://www.adiamondisforever.com/
2) Clothing:
– Lands’ End - http://www.landsend.com/
– Shirtcreations - http://www.shirtcreations.com/
– Americanfit- http://www.americanfit.com/
4) Bicycles:
– Cambria Bicycles - http://www.cambriabike.com/
– Cannondale - http://www.cannondale.com/
http://www.dell.com/
http://www.cannondale.com/custbike/c2.html
http://www.landsend.com/
http://www.FordDirect.com/
http://www.smart.com/
Permission Marketing
The practice of marketing to consumer only after gaining express permission…..
Permission marketing can be contrasted to interruption marketing
Permission marketing “encourages consumers to participate in a long-term interactive marketing campaign in which they are rewarded in some way for paying attention to increasingly relevant messages.” Anticipated Personal Relevant
Marketing based on consumer willingness and that marketers respect consumers‘ wishes.
5 Steps in Permission Marketing
Must offer incentive (overt, obvious, and clearly delivered) to prospect to volunteer
Must offer a curriculum over time, teaching the consumer about the product or service
Must reinforce the incentive over time that prospect maintain permission
Offer more incentive to get more permission from the consumer
Must leverage permission to generate profits
Integrating the BrandInto Supporting Marketing Programs
Product Strategy− Deliver tangible and
intangible benefits− Add value through
customer information
Pricing Strategy− Understand perceptions
of value− Balance price, cost, &
quality
• Communication Strategy• Mix & match communication
options
• Channel Strategy• Blend channel “push” with
consumer “pull”• Develop & brand direct
marketing options
Supporting marketing mix should be designed to enhance awareness and establish desired brand image.
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Touch Points
Voicemail
Snail Mail (Post)
Phone
Fax
Face-to-face
Social Media
80
Radar On Antenna Up
THANK YOU
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