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Category: Customer Retention Programs

Phil Bounsall

The Fitness Center Phenomenon

Too often our account management programs are like the local fitness center. And I don’t mean that they are healthy. Here are three similarities that I have noticed between fitness centers and our account management programs.

1.      The New Year’s Resolution. Every year when January rolls around I can’t find a locker, and the locker room is so crowded it’s ridiculous. This happens because people make a resolution to get fit, lose weight, whatever. So people flock to the gym. Three weeks later, things are back to normal. Happens every year.

I see the same thing with account management programs. Account managers adopt a new account planning tool or commit to customer-focused account management. It lasts for a while, but sooner or later, people figure out that being customer focused takes work and they revert to their old ways. For anyone who doesn’t revert, a real competitive edge exists.

2.      Dress for Success. There are a group of people at my club that don’t really work out. But they look incredible. They buy workout outfits the way I buy suits, shirts and ties. Everything is coordinated. Style is definitely trumping function. I always figure I look tired and sweaty when I’m there regardless of my clothes.

These dressers remind me of the account managers that talk a great game, show up at all the right places, and send birthday cards to all the company executives. They just don’t sell anything. They look good, but they are not doing the right things. They are not achieving company objectives.

3.      The Injured Reserve. There is a guy at my club that is constantly present, but never working out. But, there is always an injury excuse. “I came to lift, but I tore my rotator. Better sit it out today.” Next week, a leg. His back the week after.

This manifests itself in account management with the typical excuse, “That doesn’t make sense for my customers.” Everyone else should use our account engagement tools, but this account manager is different. Uh huh.

These fitness center tactics are common. We simply have to be more diligent, more customer-focused, more value-additive than our competitors. We have to actually work out, use the tools our companies have given us. Time to get fit!

Chris Woolard

Importance of Training

This month marks my 10th year at Walker.  Over that time, I have done hundreds of employee loyalty/engagement surveys on companies in a variety of industries, sizes, and parts of the world.  A fairly consistent area of weakness is long-term training and development.  Companies continue to ignore this problem in hopes it will go away.  Unfortunately, what usually happens is the employee is the one who goes away, to a company who cares about offering long-term training and development. 

Companies complain about providing new skills and abilities to their employees for fear they will be more marketable and leave.  A former colleague of mine always fought that argument by telling these companies they have two choices, they can train their employees and they might leave, or they can not train their employees and they will stay, leaving you with an untrained and unmotivated workforce.  

Cisco is a company that understands the importance of training and development and is willing to invest in it.  This article outlines their program for giving training and development to high performers.  The cost is about $10,000 per employee.  However, the program has already generated ideas that could net the company billions, not a bad ROI.  Also, only two of the 360 participants in the program have left the company.  That is a company that understands the importance of training and development employees rather than face the alternative. 

Common Pitfalls: Are They Affecting Your Research?

Recently, I read an article about mistakes that are commonly made in Marketing Research. Since so many business decisions are made from the results of research, I felt it was important to be aware of some of the most typical pitfalls and how we might be able to avoid them.

 

1.       Halo Effect, or "the common tendency to make specific inferences on the basis of an overall impression."  The idea is that if a firm is performing well, people tend to think of it as being customer focused, well-managed, and a whole host of other positive things; however, the reverse happens when the firm starts performing poorly.

·         Suggestion:  When testing concepts such as “customer focused”, the author suggests not actually asking this question but a series of more fact-like questions such as "Are customers involved in the product design process?" or "How frequently is customer satisfaction measured?"

·         Caution: It is important to measure customer attitudes in the most efficient way possible, which typically involves asking one question directly instead of asking two to three questions that get at the idea.

2.       Assuming causality from a simple correlation.  With a correlation, there is no way of knowing if X causes Y or if Y causes X, just that there is a relationship between them. 

·         Suggestion:  Remember when interpreting correlations that the only thing they tell us is how strongly related the two variables are. Any claims of how one variable impacts another should come from regression results.

 

3.       Assuming that all variables that could possibly affect the dependent have been controlled. 

·         Suggestion: Pay attention to the R-square values in the analysis. These will let you know how much of the variance of the dependent variable has been captured by the variables we have included in the model.

 

4.       Thinking that following a given set of steps will ensure high performance.  The truth is, the existence of competition makes performance relative, not absolute.  A company can do all the right things, but if a competitor does them faster and better, typically the competitor’s performance scores will rise while the company’s will fall. 

·         Suggestion: Collect and analyze competitive information alongside data about your company. This helps get a feel for the true landscape, and is particularly important in highly competitive fields. 

 

Let this be food for thought as you reflect on your own research programs. Think carefully about how you are interpreting the findings and be sure not to fall into any of these common traps!

 

Jessica Gregory

 

Reference:  Rosenzweig, Phil.  2008.  "Common error in marketing research — and how to fix them." Marketing Research, Fall2008, Vol. 20 Issue 3 p:6-12.

 

Best practice for avoiding stomach cramps…

I remember being told as a child that swimming immediately after I eat would cause stomach cramps. I believe that it was a stated rule that 1 hour after you eat, you could safely return to the water without fear of cramps (regardless of how much you ate, it was always 1 hour). As a 6 year old, I don’t think I had any idea what a cramp was, but I was sure that I didn’t want one. I think it was a visual in my mind that I would end up in a hospital bed with tubes coming out of me and that I would be lying there looking deep into my mom’s eyes wondering why I had lived life to the ragged edge by swimming shortly after eating and not allowing for the proper digestive magic to take place. So I have taken from this that it is a “best practice” to relax and let your food digest prior to doing a cannon ball off of the diving board. Is that a good definition of a “best practice”?

According to Wikipedia – A Best practice is the belief that there is a technique, method, process, activity, incentive or reward that is more effective at delivering a particular outcome than any other technique, method, process, etc. The idea is that with proper processes, checks, and testing, a desired outcome can be delivered with fewer problems and unforeseen complications. Best practices can also be defined as the most efficient (least amount of effort) and effective (best results) way of accomplishing a task, based on repeatable procedures that have proven themselves over time for large numbers of people.

So how do you know that what you are looking at is really considered to be a "best practice"? Because someone on a blog said so? Because of the marketing scripts that encompass the idea? Because you read it about in a magazine which automatically makes it valid? Because your buddy is doing it at his company and told you it was a "best practice"?

I bring this up because of a recent conversation I was having with a colleague, he said that he was working with a client that stated they ran their organization based off of based practices and they had been burned on more than one occasion by adopting certain “best practices” when in actuality they had adopted unproven methods that were presented to them as “best practices”. This is what happens when you act on something that is packaged as a “best practice” but when you peel back the layers, you find that its validity is in question.

With the speed at which information is circulated and the impact of online social media creating discussions around “best practices”, you tend to hear everyone’s opinion of how they are doing something as being communicated as a “best practice”. I caution you to tread lightly here. Some so-called “best practices” would be better packaged as “this is what we are doing at this moment, and we are having a little bit of luck with it.”

Are you challenging your organization in their ability to implement validated and verified “best practices”? I’m not talking about the latest and greatest buzz, but proven methods that align with the strategic direction of our organization. In the context of your customers, are you utilizing proven methods of engagement to understand the experience that they are having with you? Are you able to accurately diagnose where the value lies in this wealth of information? Are you taking proven action steps? Are you aligning your “best practices” with your overall business objectives?

I challenge you to analyze your customer experience program and really understand the areas that are working and the areas that need work. Then look into validated, proven methods that can address those issues. You are now free to get back in the pool.

Michael Good
Vice President