Friday, 26 December 2014

A happy customer is the best advertising you can get

(First Published in New Era Newspaper - 12 November 2014)

In everyone’s life there comes a time when you need “someone in your corner”. Being married has reminded me of how important it is to have support structures in place through friends and family – especially when you and the better half have different views or opinions on an issue. For me, after only a few months of marriage, it has been difficult lately because my work is very demanding on my time, as well as being a job in which I get to travel very frequently. This means that I have to make that extra effort to convince my wife that she is still the most important person in my life.

Last week I was fortunate enough to be a panellist at the Namibia Customer Service Awards and Conference hosted at the Polytechnic of Namibia. The topic for which I was invited to do a short presentation was “Customer Advocacy”. This term is used to refer to companies that focus on what is best for a customer. This might sound like just another gimmick, but is in fact a marketing technique which is used to encourage the sales person to better understand the customers’ needs and according to this philosophy, give advice to the customer even if it means less profit for the company. It also means finding the time of the day that the customer is most comfortable being called about a company’s products and services. In extreme cases it might even mean suggesting a competitors products as they can best suit the customers’ needs. For me, this sounds like customer heaven.
While on the panel, I also had an opportunity to discuss how that companies can measure this advocacy and its integration into their strategic goals through customer satisfaction, retention and profitability. A popular tool to measure this is the NetPromoter Score. The Net Promoter Score (NPS) is a management tool that can be used to measure the loyalty of a customer to a business. It can be used as an alternative to the traditional customer satisfaction research and many businesses who use it claims that it can be correlated with revenue growth. In other words, companies who use NPS state they have improved their profits through this process.
NPS is based on a direct question: How likely is it that you would recommend our company/product/service to a friend or colleague? The scoring for this answer is most often based on a 0 to 10 scale. Customers that answer with a high score (with a 9 or a 10) are considered loyal promoters. Detractors are considered to be customers that answer with a score between 0 and 6. The NPS is now calculated by subtracting the percentage of Detractors from the percentage of customers that are Promoters. The primary purpose of this score is to evaluate the loyalty of a customer to a specific brand or company rather than their satisfaction with a specific product or transaction.
What is interesting for a customer advocate (such as myself) is that through this scoring, companies can identify customers who are willing promoters and sales persons of the company – without getting paid? This is becoming very important in the modern world where most of our decisions on products and brands are being made more and more often based on the recommendation of a friend rather than the advertising prepared by the sales and marketing departments of a company. The value of advice given by a friend (or trusted source such as this column), is becoming more and more important when buying decisions are made.
For companies this means that making a customer happy, and encouraging them to make their voice heard is good for the profit of a company. Never before has the bad experience of a customer been so quick to be shared with others as it is being done today through social media. Customers have now got the power to share their experiences, both good and bad, within a few seconds of that experience.

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