Customer On The Edge

The flight was late due to weather in Atlanta. The highways leading to the airport were all turned into parking lots. It was one of those afternoon travel situations following a day with the client that turned particularly sour. I was relieved to make my flight but camping on the tarmac quickly turned the joy of getting to the plane into no joy on the plane. At least I got bumped to the front cabin.

Unfortunately the single father behind me was closing in on a meltdown. The toddler on his lap was at the end of her rope and pretty much out of patience with the tower telling us to continue to stand on the taxi way.

When I travel, which I do a fair amount of, I tend to collect things - the snack left on the night stand at check in; the bag of pretzels from the plane; maybe the apple from breakfast that never got consumed; the chocolate on the pillow; even the mints at the hostess station. Almost always there is something edible in my briefcase.

I made eye contact with the unsung hero behind me. Yes ,my Fritos would be a welcome attempt at distraction. I handed him the bag and he doled the chips out one by one – trying to make them last until take off. Finally we were in the air and there was peace.

The tempest was only momentarily subsided. By the time we reached altitude things started to get uglier. A banana was the next peace offering and my last bit of stash. I did not even ask with body language, I simply handed over the goods. My guess is that the traffic jam caused him to reach the airport without time to stock up on in-flight nutrients. The little girl devoured the banana and then tried to eat the peel. We may not have achieved compete satiation, but we averted disaster.

After we reached the gate no words were exchanged, but the look he gave me, laced with extreme gratitude, was sufficient to explain his thanks.

When I lived in Vermont it was common to see very social minded bumper stickers on the backs of Subarus and Saabs. Save the Whale was popular as was Think Globally, Act Locally. But the one that I never really understood was Practice Random Acts of Kindness. Why Random? Should this not be something we just plan on?

I think this is a problem with the practice of Account Management as well. Account Managers give away all kinds of love and kindness to their customers, but it is not always planned, and worse it is not typically well measured. Do you know how much you have invested in your different accounts? Do you have a plan for it? Most of the time when I ask this the answer is pretty much, “not really”.

This is a mistake. When there is no or little planning and no real measurement then the likelihood is high that we are dealing with randomness. And, this means we are dealing with having no control over cause and effect. Account investments may pay off and they may not. This ultimately means we are wasting money.

Account investments need to be made with a clear strategy driving expected outcomes. If those outcomes are not achieved the plan needs to change. Otherwise we are investing in the wrong accounts.

Now in some countries certain industries have pretty tight regulations about this, so care must be taken in what is analyzed. But, even under these circumstances we want to still drive the investments with a clear strategy and at least an implicit understanding of cause and effect.

Don’t get me wrong on this. I certainly don’t expect that you have to plan who you are nice to on the plane or which car you let in front of you in traffic. That kindness needs to be spontaneous. When it comes to customer love – be strategic.

Posted by Matt Johnson at 02:12 PM | Permalink | Comments (0)

Picture the scene – it is one of those restaurant booths that is like an oversized study carrel. We are completely enclosed in dark wood paneling with a burgundy curtain as a door shutting us off from the other diners. My business colleague and I are having a sales dinner with a pair of prospective clients. This new opportunity comes from an industry that we are not entirely familiar with, but it is something we really want to pursue. I am leading the conversation and in the course of my dinner-friendly interview ask the woman sitting across from me, a sales operations director, “what are all the different ways you are currently touching the client?”

My business partner almost chokes on his appetizer, nearly spraying it on the gentleman sitting across from him, the director if IT applications. We had teamed up for the first time that night and he was unfamiliar with the vernacular regarding the idea of “touching” the client. He thought he was witness to a potential harassment suit and I was afraid I was going to be performing a Heimlich in our intimate little dining space.

I have discovered since that awkward incident at the restaurant nearly a decade past that the term “touchpoint” has become much more commonly accepted within the world of CRM. I have less of a challenge breaking in new consultants and my clients have a precise understanding of my meaning when building a customer touchpoint map of the front end functions. That has made life a bit easier.

The Touchpoint Map, a diagram illustrating the span of customer interactions across the full customer engagement lifecycle, is a really powerful tool. It helps to quickly define the potential scope of CRM and illustrates, very powerfully, cross-functional dynamics in play for attracting, acquiring, and retaining customers. CRM, after all, is pretty much all about managing the effectiveness of your customer touches.

One of the misconceptions I find, however, is that many of the organizations that I work with get that they are touching the customer with their sales functions and that they are touching the customer with their services functions, but they don’t always recognize that they are also touching the customer with their marketing functions. And, I think that this can get in the way of marketing being as effective as would otherwise be possible.
So, I put this question out to all you marketers – are you touching your customers enough? All kidding aside, at least briefly, I would like to laud the merits of multi-touch campaigning, a topic that does not get enough exposure in my opinion. But, I think it is one of the best means for optimizing the value of marketing and getting the most from marketing investments.

Pretty much everybody with reasonably solid campaign management experience has learned that three impressions gets the best lift per buck (impressions = touches by the way). What seems to be less universally experienced is that three impressions spread across multiple channels can have even more success. Run two impressions on a new product prior to a sales visit and the customer will be softened up for the new pitch. Make an offer with an e-mail campaign followed up by an outbound call and the prospect will be more prepared to hear the terms of the deal. Push the interested party to the website for a whitepaper download and they will be more prepared for an SME visit.

I am a real fan of the multi-channel approach to creating customer touches, but it does require some orchestration. Marketing and sales do have to be in synch for this to be most effective. Campaign planning seems to work well with the tele-channel but sometimes there can be challenges getting programs rolled out to the field in an organized manner. This is where the use of a CRM tool gets really handy helping to keep everybody on the same page. The cross-channel multi-touch does require extra effort but I believe the return justifies the effort. More importantly, with lower value segments, the use of non-field channels in the approach has proven very successful with strong ROI results.

There was a pretty popular television advertising campaign run by AT&T a while back that had the tag line, Reach Out and Touch Someone. If I were to hijack that slogan my version would be, Reach Out and Touch More Often.

Enjoy the contact.

Posted by Matt Johnson at 03:19 PM | Permalink | Comments (0)

Who invented the airline-size booze bottle and did they really think it was a good idea

This is a mystery to me, but if it was considered an improvement or innovation at the time, it has certainly outlived its usefulness. Recently I was on a plane where the flight attendant actually poured me a glass of wine from a real bottle into a real glass – in coach! I think this is a combination of both better service as well as a more cost effective approach to dispensing large volumes of liquids. Of course there are some flights – the shuttle from D.C. to Boston for example – that really need to plop down a tiny bottle and plastic cup on your tray and move on to the next seat quickly.

More importantly, this new development in the airline industry (not to mention USAir finally going back to free coffee and soft drinks) is a great thing. We have a situation where providing better service is actually more cost effective (plus it is a much greener use of packaging). Could this actually become a trend? The airline industry sure could use a positive trend right now.

Previously I believed there were three types of business outcomes that could be gained from making investments in CRM or other customer-facing initiatives. You could improve revenue growth, you could increase operational efficiency, or you could increase the value of the customer experience. And while I understood these three types of results had relationships with each other, I tended to treat them as distinct targets. Moreover, I encouraged my clients to pick a primary outcome as the source of a business case for their investments. Go after growth, efficiency or customer experience, but don’t try to go after them all. One should be the primary focus and anything else would be a secondary benefit or icing on the cake.

Lately it has been getting more complicated, but in a good way – like the better service at less cost by making me a gin and tonic that is poured from a liter size bottle of Tanqueray instead of something the size of my thumb.

What has started happening is that my clients are no longer satisfied with going after a single outcome. Now they want both the savings from efficiency and to use that to fuel growth. How audacious! Some want to grow the business in a way that builds loyalty through better service quality. Outrageous! Others even want to improve customer service by removing inefficiencies in the overall service process and gain both higher satisfaction and lower cost. This is going too far!

Now instead of three outcome types there are six – growth, efficiency, experience, growth/efficiency, efficiency/experience, and experience/growth. I just can’t keep up. Although, to be honest, the combo outcomes are the popular ones now, so maybe we are really back down to having three. And if you can have icing on your cake and eat it too, why not go for it?

The great thing about these new compound outcomes is that they help make the business case for CRM investment stronger. One of my clients is in significant growth mode, but needs to add some discipline and standardization to their processes. The process streamlining not only reduces waste, but will help facilitate growth as their market inevitably tightens up. So, it makes sense – let’s get two outcomes for the price of one. Hey we are in a recession and we can use all the help we can get

Meanwhile, I’ll take a refill on that lowered-cost gin and tonic.

Posted by Matt Johnson at 03:12 PM | Permalink | Comments (0)

Easily the most popular topic coming across my inbox these days is advice on how to conduct business effectively during the biggest recession anyone in the current workforce has ever witnessed. Every newsletter, every e-magazine, every spam (even the virility offers) have a connection to weathering the economy. Isn’t this a great world we live in where even when we are in the financial crapper we can make money off of it?

Therefore, I think it would be irresponsible of me if I did not contribute to this important topic and offer you my advice on navigating the turbulence. But I am going to up the ante and not just give one idea for how to be successful, but offer four different strategies for you to choose from. It is a veritable cornucopia of strategic advice.

To make it easy, I am going to offer up a single name for each strategy to make it easier to decide which one will fit best for your organization. They are: Trim, Sell, Love, & Change.

Trim

Without question the most common strategy, and the knee-jerk reaction to a troubled economy is to figure out ways to cut costs to match the projected loss in revenue in order to remain cash positive or at least minimize the red ink. If you own an auto manufacturing company, you are probably thinking along these lines right now and I would probably agree that it is a good idea. But this strategy does not have to follow a slash and burn policy. Trimming can include the concept of using a tough time as a sound reason for driving out some bad things.

The founder of one of my past employers, Ken Olson of Digital, was often quoted as saying that success hides a lot of sins. When things are going well you can get away with dumb things. Well, this is your chance to drive out the dumb. Chances are high that you will cut out some stuff that wastes money. I have been working with a client that had two different groups doing the same thing. They not only were redundant, but also often in conflict. The cost was high, but when times were good and everybody was busy, they got away with it. That ended about a month ago and the consolidation did not cause a layoff, rather it liberated some folks to do more productive work for the company.

Sell

When I started out my career decades ago at IBM I was given a small book that offered a bit of an overview of the company history. I read it out of obligation, but one passage has stayed with me for a quarter of a century. IBM, at the time selling nothing more sophisticated than typewriters, faced down the Great Depression with a different strategy than the rest of their industry. They doubled their sales force. You can question the strategy, but you cannot question their results.

I believe that it is possible to sell yourself out of a recession. Adding feet on the street is one approach, but an expensive one. You can also add feet on the phone, which is a lot less expensive. You can expand your geography or market segment, which is a bold one. Or you can move up a product release, which is even bolder. Using muscle to get through the recession is a riskier proposition, but if you have the confidence it could put you way past the competition when the cycle turns. And the cycle will turn.

Love

One of the lines of advice that have been consistently coming across my inbox the last few months is all about showing the customer more love. When it is 1:45 AM and last call, love related behavior can be that of desperation. Love does not have to come in this form, but one version of cozying up to the customer is offering up deals. Give a two-fer or circulate some coupons. Sweeten the deal to entice activity. I don’t think that this is a true form of love, just a fast path to poor margin. On the other hand, if you are swimming in excess inventory, maybe it is for the better. The downside is that it cheapens the relationship. If you do it too much you train your customers to expect it.

A better form of love is attention - better service, a renewed focus on relationship quality, extra visits, proactive focus on needs, perhaps even some new extra-loving services. Show your customers that you care and reward their loyalty with your affection. This seems dopey even to me as I type the words, but the reality is that I know it is effective. Even just the act of calling your customers and asking them what would help them out right now is a great act of love. Hey Valentines Day is coming – maybe you still have time to crank out a campaign…..

Change

For those of you who know me it may not come as a surprise to hear that this is my favorite of the four strategies. You have all heard the saying, “when the going gets rough, the tough soil themselves and have to change”. Well, now is the opportunity for a new outfit.

One of the things that I know about the dynamics of organizational change is that there are certain conditions that enable making significant changes easier. A crisis is the most extreme of those conditions. But if the world offers you lemons, I say make lemon daiquiris.

This strategy takes elements of the other three approaches and pushes the envelope. Use the opportunity provided by the downturn to change a part of the organization that has become a proverbial millstone. Use the volatility in the marketplace to test out an expansion into a new service line. Offer your best customers an opportunity for a new level of intimacy based on their specific needs. Whatever. But, if you have an idea that you have wanted to try out, but were hesitant, this is absolutely the time – your employees, your customers, your board, everybody is primed for change right now.

Good luck with whichever strategy you choose, but be aware of one thing. Of the four strategies offered above please note that there is one specifically not proposed. Doing nothing as a strategy seems like a really bad idea to me right now.

Posted by Matt Johnson at 05:14 PM | Permalink | Comments (0)

The exact same principles apply to developing an effective sales force. There are multiple muscle groups that need to be developed. A reliance on only a subset will hamper performance just like trying to ski the bumps with sissy quads.

When I work with companies who want to improve their sales capacity I will often ask what they feel they need to improve. If there was just one thing that would have an impact what would it be?
- Just need a better forecasting tool
- Really believe the sales team would do better with a new methodology
- We need to drive out wasted activity from low performing accounts
- If we just had more leads…

So, did one of these resonate with you? The question then to ask is whether this is the one thing that is holding you back or if it is the lever that you find easier to pull? I find too often it is the latter. The most common reason I will be invited to meet with a new client is to help determine how to improve the existing sales tools, or to select a new one that better fits with the needs of the business. Interestingly, I often find that there is a bigger need to address than the sales tools.

Many people perform exercises that they prefer rather than ones that they find uncomfortable. This happens with sales effectiveness as well. It is easy to throw money at tools or sales methods, but it is harder to improve accountability within the sales culture or raise the effectiveness of sales leadership.

Through some pretty exhaustive research I have found that there are eight factors that need to be in place to help a sales team perform at peak ability. These have been shown to differentiate between effective and less effective companies. In other words, these are best practices that if you have in place will increase your odds of success.

They are as follows:
- Sales Strategy – setting and communicating priorities including the integration between functions
- Sales Leadership – sales managers that motivate, coach, and aid salesforce performance
- Sales Process – consistent and documented business processes that facilitate the tasks of selling
- Sales Tools – technology that enables the sales processes to function efficiently and effectively
- Selling Competency – the requisite skills needed to identify, advance and close deals
- Sales Measurement – metrics that monitor performance and assist with driving direction
- Sales Training – formal methods that match the sales force’s skill, process and tool needs
- Sales Climate – a conducive work atmosphere that fosters rather than limits performance

Knowing about these 8 Salesforce Effectiveness Factors is only part of the key to success – you also have to do something about them. Most of the organizations that I work with have some that are more advanced than others and some that need help. The important thing is understanding which are the factors that are less mature – these are what holds back the performance of the sales team.

You may prefer to work on the factors that you like best, but those that need the most attention will give you the biggest payback. It may be great to hold a week-long strategy session each year with the leadership team, and you may really bang out great plans. However, if your leadership team is weak at execution, you are better off giving some tough love and spending less time at the offsite. Likewise, investing in yet more advanced and slick tools is likely a waste if you have under-developed processes.

Give the whole body a work out – not just the routines you like to do. Hate sit ups? Do more of those than you think you should. Love that Nordic Trak? Make sure you give equal time working your balance and core muscles.
Do the same with your sales team and you will see a similar improvement.

If only I had put in more time working the lung capacity before heading over to the Alps next week.

Posted by Matt Johnson at 11:00 PM | Permalink | Comments (0)