If you know the number of customers a company has, and the cost to the firm of acquiring new customers, the current revenues and earnings per customer, and the quality of the customer experience that company delivers, you’re well on your way to being able to predict that company’s future earnings. If investors and financial analysts had been gumming the customer numbers that I propose we track in The Customer Revolution, they wouldn’t have been caught in the crossfire of the over-hyped Internet economy.
Now that the downturn is upon us and customers have become even more precious to our businesses than ever before. Will your company survive the Customer Revolution? Here’s a quick preparedness test you may want to take.
If you don’t know the answers to questions 1-4, find them out; if your answers to questions 5-10 aren’t a resounding yes, your company is likely to become a casualty in the Customer Revolution:
- For what percentage of your end-customers (individuals, not companies or accounts) do you have current, accurate customer profiles and interaction/transaction histories?
- What’s your average customer acquisition cost?
- What’s your current average customer retention rate?
- What are your average revenues/profits per customer? By customer segment?
- Do you have a high-level executive who is responsible for the total customer experience across interaction touch points (Web, email, call centers), distribution channels (retailers, distributors, agents, direct sales), and product lines?
- Are you collecting customer satisfaction and customer loyalty ratings every time that customer interacts with your firm and its brand? Are those ratings used in calculating executives’ and employees’ pay?
- Have you determined what outcomes matter most to your customers and what key customer scenarios they care about when interacting with your firm and its partners?
- Are you measuring your company’s performance against these customer outcomes and monitoring the quality of the customer experience you deliver on key customer scenarios in near real time (e.g., every day and throughout the day)?
- Have you noticed what your renegade customers are demanding and doing? Are you proactively redesigning your business practices to enable them to do business the way they choose to do so?
- Do you have a customer-centric corporate culture? One in which execs and employees alike really care about customers and their outcomes
In short, are you ready for the Customer Revolution? If not, it’s time to take action!