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We’ve talked before on this program about the link between employee satisfaction and customer loyalty. And actually there is widespread acceptance that energized, engaged employees produce more satisfied, loyal customers. Books, articles, and tons of research have been written about this seemingly simple formula. But is it true…is there really a “happy employee = happy customer” formula? According to my guest today, yes. But it's not as direct as you may think. In fact, he says it's rather indirect.
Back with me today was Rick Garlick. He’s the Director of Consulting and Strategic Implementation for Maritz Research and I asked him to talk about the results of a recent Maritz Research poll of employees representing a cross-section of industries to better understand what employees can tell us regarding their role in producing a positive customer experience.
The indirect nature of the happy employee=happy customer relationship has to do with the fact that there is no direct correlation between the two. Rather it is a long series of elements that come into play that indicate a cause/effect relationship. He does a much better job of explaining this than I ever could so you'll have to listen to the show to get his view.
But there are two excellent take aways from the show today...
1. Toward the end of the program Rick suggest four straightforward things that senior leadership, mid-level managers, and line employees can do immediately to make a significant and positive impact on customer loyalty through employee satisfaction.
2. Rick emphasized the importance of organizational alignment and ensuring that policies and procedures made it easy for employees to satisfy customer needs. This was a common theme in the show as today's myopic focus on operational efficiencies in companies is a root cause of customer dissatisfaction.
A great topic and very practical insights for anyone wanting to make a positive change in customer satisfaction rates through employee engagement and relations.
-- David Kinard, PCM
A recent report by the Selig Center on the multicultural economy and multicultural purchasing power projected that in 2009 the combined buying power of the three racial groups of African Americans, Asian Americans, and Native Americans will more than triple its 1990 level of $456 billion, and account for 14.1% of the nation's total buying power. That’s more than $1.3 trillion folks! Add in the Hispanic ethnic market segment, and it is obvious why marketers recognize that it would be economically ill-advised to not aggressively go after these diverse segments.
If we add in the Hispanic ethnic market segment it becomes increasingly obvious that marketers must recognize the economic advantages of aggressively going after these diverse segments. However, you may not have the right team to meet the relevancy these groups demand.
With me today to talk not just diversity in marketing, but also the diversity of marketers is Jerome Williams. He’s a distinguished professor in communications at the University of Texas, Austin, and vice chair of the AMAF.
I asked about the symbiotic relationship between academia and the marketplace, and Williams described it as this:
...increased diversity among marketing faculty leads to increased diversity among students majoring in Marketing at all levels, which in turn leads to greater diversity in individuals working in marketing and advertising departments. This in turns leads to marketing and advertising programs that are more sensitive to the needs of consumers from diverse backgrounds.
We also talked about how most of today's marketing principles are based on a very white and mainstream perspective. Williams noted:
…with an increasingly diverse population, it becomes questionable whether theories developed and tested for, by, and of the dominant consumer group (i.e., White, Euro-Americans) can be appropriately applied to ethnic minority consumer groups (e.g., African-Americans, Hispanics, Asian-Americans, etc.), who perhaps differ in terms of household compositions, values, lifestyles, self-perceptions, and aspirations. A significant challenge facing marketing researchers will be to adapt the methods and approaches that have been successful with non-minority populations to the special circumstances of racial/ethnic minorities.
Overall a great program for anyone interested in sensitizing their marketing, and even for anyone interested in making a difference by mentoring or contributing to the success of minority marketing students. Williams highlighted two ways.
1. Contribute to and be a part of the AMA Foundation' s Valuing Diversity Scholarship Program.
2. Contribute to and be a supporter of the Ph.D. Project.
-- David Kinard, PCM
Companies are constantly looking for ways to grow their business by selling additional products to existing customers. In fact, some companies have begun using their inbound customer service call centers for this purpose by making product offers to customers when they call with a question or for service. But, are customers receptive to this approach and what are some keys to successfully selling during service calls into call centers?
In today’s show we talked about these issues and more with my guests Maddy Sheprow, Division Vice President of Strategic Solutions, and Rich Brose, Director of Research Consulting – both from Maritz.
Maritz recently conducted some research on this subject and talked with 1000 customers of financial services institutions. Of the people they talked with, 1/3 were offered a new product by the customer service rep. 75% of that one third agreed to listen to the offer. 25% were seriously interested in the offer adn 15% bought on the spot, and 40% wanted more info!
What does this mean to your company? Your customer service call center could be a gold mine for increasing revenue! And, just to prove the point, the Bank of New Zealand uses this approach and 35% of their total retail revenue comes from their customer service call center. That's inbound calls folks -- they're coming to you and you're making money off it. Sounds like a no-brainer.
Well, of course there are issues to contend with and the foremost one is to not treat this as something to be done to your customers. This has got to make sense for your company, your customers, and you have to focus on need and value, not just upselling and "adding fries to that order." In a nutshell, you have to ensure there is total alignment of the company's focus on customer experiences.
Tons more was discussed. If this sounds appealing, make sure you listen to the show.
-- David Kinard, PCM
How easy is it for people to talk about what you do as a company? Are you giving them reasons to do just this? Are you crafting customer conversations with your marketing or are you still trying to buy your way into their minds? Well, if you’re like most of today’s marketers, you're struggling to tap into the power of word of mouth marketing.
With me on today's show was Andy Sernovitz, author of the book Word of Mouth Marketing: How Smart Companies Get People Talking. He’s written what is being hailed as the most practical book on word of mouth marketing available and I have to agree.
"Traditional advertising is the price of being boring," says Sernovitz. After reading his book, and listening to his truely simple approach about how to make word of mouth (WOM) marketing really work, I think he's right.
It boils down to this -- First, WOM is about giving people a reason to talk about your product, service, company, whatever. That means you have to do something remarkable, be unique, be noticeable. People don't comment on the mundane, they talk about the unexpected and the meaningful. Second, it's about making it easy for people to have the conversation actually take place. Using the right tools to aide people in initiating that conversation (and Sernovitz lists gobs of great tools in his book) is paramount to spreading the good word.
Fantastic show and one that is only bested by his book. Listen, buy, and then go tell others. Yep, it's that simple.
-- David Kinard, PCM
Hey, I am really excited to announce that for this Wednesday's show we have Andy Sernovitz, author of the great book Word of Mouth Marketing: How Smart Companies Get People Talking. This is a call in show, so feel free to call in and ask Andy your own questions. You can reach us toll free at 877.474.3302.
As a reminder, the show airs live on Wednesday, April 23 at 9 a.m. PST. If you can't listen live, the archives will have the show ready for podcasting or download about 24 hours later.
Spread the word and let's see what kind of word-of-mouth we can generate for this week's show!
-- David Kinard, PCM
We all know that brands have the potential to be a powerful source of sustained competitive advantage. But we also know that changing consumer needs, emerging technologies and competition are making it more difficult than ever to create a brand that is meaningfully differentiated. In fact, when I asked a group of MBA students to describe a meaningfully different element of their brands, most could only come up with undifferentiated jargon – the same stuff you read in nearly every product brochure out there.
What is striking about the inability to differentiate is not it’s prevalence, but that we also know that undifferentiated brands are proven to underperform financially. This show addresses this issue.
With me on the show is brand differentiation guru Bob Kincaide of the Hazelton Group – they’re a strategic brand innovation company with a 20 year track record of delivering the goods. Bob is one of those scary-smart marketers who sees brands not for what they are, but for what they could be.
A few key elements from the show I think you'll appreciate:
Strategic branding focuses on positioning, unique experiences, and segmentation. It ensures that you offer a differentiated promise and have the capabilities to deliver on it. Tactical branding is the day-to-day stuff such as logos, image, colors, names, etc. According to Kincaide, marketers today spend about 5% on the strategic branding whereas he suggests we should be focusing more like 15% on it.
Segmentation is at the core of strategic branding. But rather than focusing on the typical elements of demographics, geographics, and even lifestyle variables, Kincaide suggests that needs-based segmentation works better. What is the attitude of the people toward your brand? They have a need for what? Their identity is based or wrapped up in what? Answer these questions and you're on your way to creating that experience that brands are supposed to deliver.
Bob also goes into the practical stuff -- even outlining a process you can start today. He refers to it as a mini audit...but you'll have to listent to the show to get that part.
Last thoughts...don't let strategic branding solely rest in the marketing department. This is a business issue and must be addressed by the owners of the unit, product, et. We're talking about the health and wealth of your business.
-- David Kinard, PCM
Any time this topic comes up, I get excited. Any chance to talk about the important work non profit marketers are doing adds fuel to that fire that burns in my belly. Not just about doing good, but learning to do it well --- ah the beautiful world of non profit marketing.
And we are going to talk about it from two perspectives: that of the AMA Foundation and even some insight from one of today’s leading nonprofit marketing gurus.
With me today is Tom Abrahamson. He is the Chairperson of the AMA Foundation, and in his day job he is the managing director and principal at Lipman Hearne, a national firm that focuses exclusively on the nonprofit sector. They’ve worked with international foundations, research universities, and cultural and medical institutions to small colleges, advocacy organizations, and community-based organizations.
"Nonprofits swim in the culture," says Tom in today's show. What an amazing metaphor for the work they do. But that work must be informed and skilled. The AMA Foundation is working hard to build those skills and have a number of initiatives underway to meet this goal.
1. Nonprofit marketing boot camps.
2. The national Nonprofit Marketing Conference -- July 14-16 in Washington DC
3. The national study on the state-of-nonprofits.
4. And about a gazillion educational resources available in online and offline channels.
What is clear from today's show is that nonprofits are facing the same challenges their for-profit counterparts are, and then a myriad of extras just becuase they're nonprofits. According to Tom, approximately 60,000 brand new 501c3 organizations start up each year. Passion and dedication are not going to be enough to make them effective and keep them running for the long haul. That's the job of the AMA Foundation -- to equip those leaders AND MARKETERS to step up to the challenges of today to capture the opportunities of tomorrow.
-- David Kinard, PCM
I am sure you’ve heard the marketing adage that says it’s cheaper to keep a customer than to get a new one. I’ve done some experimenting with the numbers, and from what I can see it’s true – anywhere from 5-15% cheaper. But although we may all agree with the statement, most of us don’t know the first thing on how to affect customer loyalty or even begin a conversation about it.
Today’s show fixes that. Today we’re going to focus on loyalty and not only why it is important to your competitive position in the marketplace, but also how you can measure it and use it to your advantage. Because, examining the loyalty structure of the market is a key competitive tool and becoming increasingly more important.
With me today to talk loyalty is a returning guest – one of my favorites – and the only one I know that can make loyalty research exciting and sexy. Aldy Keene is the president and CEO of The Loyalty Research Center. He’s consulted, taught at the university level, and worked with companies in nearly every industry helping them to transform customer loyalty into increased profits.
What is customer loyalty? Simply defined by my guest it is the strength of the relationship between two parties. Don't misunderstand this definition and mistake loyalty for specific outcomes of loyalty -- it is the sum of the parts.
Aldy used this example. Often people use tenure of a customer to indicate loyalty. However, how many people have been married for 25 years and they can't stand each other, but they stay together. High tenure is an outcome of loyalty, but by itself it doesn't indicate the "strength of relationship."
When creating a loyalty structure, we need to think in terms of how our business model is set up to provide high value and high uniqueness of that value to our customers. AND THEN find metrics that are easily communicated and highly discrimiate of key behaviors. These could be segmenting by loyal, neutral, and vulnerable, and then reporting margin, share of wallet, referrals, and even purchase probability. From what my guest reports, you'll find that your most profitable customers, and highest margins, are likely to be found in the loyal group.
What I find astounding is that we as companies continue benevolently ignore our loyal customers -- those with the highest margins -- and spend fortunes trying to buy the transaction of loyalty vulnerable customers. You can't buy love and strength of relationship -- you have to earn it.
This is a great show filled with powerful insights that will inspire and encourage your efforts.
For a long time we marketers have relied on buying expensive advertising and begging the media and analysts for coverage of our companies, products and services. We’ve basically interrupted people with our messages in the hopes of generating interest from buyers (who usually ignored us anyway). The Web has profoundly changed this practice.
Smart marketers now communicate with buyers through content rich Web sites, blogs, YouTube videos, ebooks, and other online media that buyers actually want to consume. The products and services offered by tuned in companies resonate with people who willingly buy without being coerced. But how do you get to this place in your marketing?
To answer this question and more I’ve asked David Meerman Scott to join me for today's author series show. He’s written a new book, “The New Rules of Marketing and PR” and I think it should be on every marketers' shelf.
If there was one key concept shared out today it is that you are what you publish -- and to borrow a phrase from the world of higher education this is equal to "publish or perish". It's all about what you put online and if we've heard anything over the past two shows the role of the Web site is essential (see my last post on having a bad Web site).
What can you do today to start implementing the new rules? David had some great tactical advice which includes:
1. create a Web site based on buyer personas and not your company ego (a common theme here folks -- it's not about you, your products, or services).
2. publish online press releases using the content based on your personas. Write the release for them not to boast about you.
3. Get onto the social networks that match your personas. Just because Facebook is all the rage right now, it may not be the right place for you. Go where your buyers are, not where the hype is at.
Tons of other great ideas including a brilliant metaphor about the Web being like a city. I haven't heard this before and it refreshed my thinking about how to incorporate online media into my own marketing efforts.
-- David Kinard, PCM
Whether or not you believe in the notion that a bad Web site is worse than none at all, it's hard to argue the merits of a well developed site and its resulting effects in lead generation, sales conversions, or improvements in overall customer experience. In fact, my guest today feels that when done right, even subtle changes can produce double-digit increases in online conversion rates and revenue growth.
Today's show was all about the content on your site and discussing strategies with me was Mark Wachen, managing director of Optimost at Interwoven. Interwoven provides a services platform that helps companies manage their Web content (I am sure I am doing them an injustice in that short description, so you can go to their Web site for more info).
I asked Mark what he felt were the first steps a marketer should take to begin a content-based optimization process. He offered a few ideas:
1. Set up key goals for your site and Web activity.
2. Identify what the value of a conversion is for your company.
3. Use the right tools and methodology to guide your optimization.
Seems pretty simple, right? Actually, in my experience the top two are going to be the hardest. Talking with marketers from all over the country I continually find that many do not have goals for their sites. They simple toss pages onto the Web and hope for the best. It still baffles me in a Web 2.0 world how many companies make their ABOUT US page the most important (e.g. first nav link) on their site.
Anyway, this was a great show to get you started on your journey to optimizing your site -- not in the keyword or search engine marketing sense, but in the ability of your pages to create customer experiences that drive results for your company.
-- David Kinard
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