Retaining customers

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Getting The Edge In Professional Selling
Terrence A. Hockenhull

ACHIEVING 20% sales growth is not easy; nearly every salesperson will attest to the difficulties of reaching targets when they have been increased. Tell the sales team to achieve this growth within a short period of time (say one or two months) and they will not go out to look for new customers. They will approach their existing client base and look for an increase in orders.

Leaning heavily on the relationship that exists with a loyal client base is critical to success. Client attrition is costly; acquiring new customers (as opposed to selling to pre-existing, loyal clients) demands significant effort in terms of time, money, and human resources. Thus the importance of retaining customers cannot be stressed enough. Professional sales executives are aware of this and I think it’s fair to suggest that they invest the necessary effort to keep their clients sweet. However, consider that there are many others within a company who interact with clients. What a shame if a client is lost because someone in the organization mishandles them.

Let me give an all too common example. Before a customer buys a new car, the sales executive handling the sale will fawn all over his or her client. Nothing would appear to be too much trouble. However, once the purchase has been made, the client may be left to fend for himself with an overcrowded, impersonal and inefficient service department. One of the larger dealerships in the Philippines has, in the past, left me wondering why they take such a shoddy approach to customer retention. A nice surprise recently when I found the service department now recognizes the importance of customers and now treats every job as an opportunity to satisfy.

My wife rejected her car brand in favor of another simply because she became disenamored with shoddy service, overpriced parts, and padded bills. She now buys the same brand as I do and is highly impressed with the level of service she receives. I guess both of us will remain loyal customers.

To satisfy customers across every level of a company requires a change of mind-set on the part of the company, vendor, or supplier. Careful thought and consideration must be given to determine if internal and external processes are patterned in support of customers. It is not enough to say, “We have a top notch service facility and hold a good inventory of spare parts with qualified, competent service personnel.” The company must consider how easy it is for the clients to use facilities.

In a similar vein, thought must be given to the product’s application within the total scope of the client’s business. Again, it is not good enough to claim that a piece of machinery can be competently serviced and repaired off-site in three days if this delay is going to cause expensive production losses. An understanding of this by the vendor should prompt and provide alternatives for the client to minimize their losses and maintain their production schedules. Too often, one hears stories that reflect this situation when a complaint to service personnel is met with, “This is the best we can do.” It is rarely the “best they can do” and is far more indicative of “the best they are willing to do.”

One potential area for adjustment is the internal measurement of an organization’s performance. Many organizations focus solely on profit margins, total sales, and earned revenues without ever considering what they have, or should have achieved for the customer. I know of one company that prided itself on an increase in sales of spare parts. Recognizing that clients would often buy non-original, non-standard or surplus parts, perhaps capture of this sector of the market justified their self-acclaim.

Yet further investigation showed that many of the spare-parts were purchased as replacements for components failing ahead of predicted life of the parts. Looked at in a different light, this would tend to indicate product deficiency rather than company success!

Changing a company’s attitude to customers cannot be achieved overnight. There must be recognition that customer service, quality, and support is below par and internal changes need to be made to bring performance in line with customers’ expectations. A customer satisfaction survey might help (although experience tends to show that these are rarely given the time or attention needed to come up with any useable data). Close working relationships with one-on-one meetings to secure feedback on clients’ expectations, thoughts, opinions, and needs are perhaps a better way of gathering data.

Changing internal processes in support of the customer should be implemented but not as a fait accompli. Testing new procedures will allow a company to secure feedback on whether the changes represent any real gain for the customer. Policy and procedural changes must only be made after careful consideration of “customer impact.”

There is no question that client loyalty and customer satisfaction ride hand-in-hand. The sales executive must play his part to derive the benefits that accrue from having a loyal client base that will continue to buy without any major investment in time and effort. The organization and everyone in it must have a similar understanding of the importance of the customer and structure activities, procedures and policy to render exceptional service and retain existing and loyal customers.

Terence A. Hockenhull is a long-term resident of the Philippines. He is an accomplished sales consultant who currently holds an executive sales position with an Italian geotechnical company.