CX Mistake #5: Un-engaging New Customers
December 7, 2011 2 Comments
In this series of posts, we examine some of the top mistakes companies make in their customer experience management efforts. This post examines mistake #5: Un-engaging New Customers. Companies work very hard to get new customers, but they often ignore them after they write their first check.
There are a lot of issues that keep customers from getting the value they expected from a purchase they made. When these issues occur, customers will often have buyers’ remorse and think poorly of the company that just took their money. In these cases, sales can lead to negative loyalty. This situation occurs because:
- Silos leave gaps between sales and service. Companies have sales organizations and customer service organizations, but often don’t have any group responsible for making new customers happy before they run into an issue.
- Metrics overly focus on closing sales. Companies tend to have very mature systems for tracking and measuring sales performance, but few firms have strong customer experience metrics or can effectively make trade-offs between the two.
- New customers are very impressionable. The people who often know the least about a company are its new customers. They don’t understand the company’s terminology, its operational processes, or recognize its full value proposition. They may have made a purchase, but new customers aren’t necessarily “bought into” the company. Think of it this way: New customers want to love you, but they’re willing to hate you.
Instead of just trying to get money from customers, companies need to focus on making customers happy with their purchases. This requires focusing on a critical, yet neglected part of the customer life-cycle called the Engagement Phase, that we define as:
“The period where customers initially realize their expected value from a purchase”
Here are some tips for engaging new customers:
- Focus on PoV, not PoS. The Engagement Phase starts with the point of sale (PoS) and ends with the point of value (PoV), which we define as “The point at which customers get the value they were expecting from their purchase and are satisfied with their decision.” Companies need to orient their “finish line” as the PoV and view a sale as one step towards customer value.
- Establish and track PoV metrics. Companies need to develop metrics that track how often customers are happy with their purchases and how quickly they reach the PoV. This data should be used to drive priorities within the company. Bonuses, for instance, should be based on PoV performance, not just PoS performance.
- Design the engagement phase. Companies must understand the journey of new customers; identifying their needs and perceptions after they make a purchase. Using this insight, companies should design experiences that ensure new customers get value from and are happy with their new purchase.
- Define engagement ownership. The engagement phase can’t be an orphan within companies. A group or an executive must have clear responsibility for this critical period.
The bottom line: Customers that don’t get value, aren’t going to be valuable customers