Never Lose a Customer Again

1. Customer experience is the new competitive battleground

With zero product defects, customized offerings, bargain basement pricing, and ubiquitous availability becoming the norm across all industries, the only thing left for a business to differentiate itself from the competition is the customer's experience.

Experience as differentiator. In today's market, product quality, customization, and pricing are no longer enough to set a business apart. Customer experience has become the primary battleground for competitive advantage. This shift requires companies to focus on creating memorable, positive interactions at every touchpoint.

Evolution of customer expectations:

• 1960s-70s: Customers satisfied with functional products
• 1980s: Focus on zero defects and quality management
• 1990s: Customization becomes key
• 2000s-10s: Low prices and 24/7 availability expected
• Present: Superior customer experience is the differentiator

Companies must now go beyond mere customer service to design holistic experiences that engage customers emotionally and create lasting positive impressions.

2. The 8 phases of customer experience: from Assess to Advocate

All customers have the potential to transition through a series of eight phases over approximately one hundred days.

The customer journey. Coleman outlines eight distinct phases that customers typically move through in their relationship with a company. Understanding and optimizing each phase is crucial for creating loyal, long-term customers.

The 8 phases of customer experience:

1. Assess: Customer evaluates whether to do business with you
2. Admit: Customer decides to purchase and becomes a new client
3. Affirm: Address buyer's remorse and reinforce decision
4. Activate: First major interaction after purchase
5. Acclimate: Customer learns your way of doing business
6. Accomplish: Customer achieves their desired result
7. Adopt: Customer takes ownership of the relationship
8. Advocate: Customer becomes a referral engine for your business

By focusing on each phase, companies can create a seamless, positive journey that transforms customers into loyal advocates.

3. Investigate, observe, personalize, and surprise your customers

The more we know about our customers, the easier it is to wow them in our interactions.

Know your customers. To create exceptional experiences, businesses must deeply understand their customers. This involves a four-step process: investigate, observe, personalize, and surprise.

Four-step process for customer understanding:

1. Investigate: Gather data on customers' preferences, history, and needs
2. Observe: Watch how customers interact with your product or service
3. Personalize: Tailor interactions based on individual customer insights
4. Surprise: Go above and beyond expectations with thoughtful gestures

By implementing this process, companies can create highly personalized experiences that resonate emotionally with customers, fostering stronger relationships and loyalty.

4. The first 100 days are crucial for customer retention

I like to emphasize the First 100 Days® after the sale as a critical window for securing customer loyalty—not because it is an exact time limit, but because it is easy to remember, short enough to maintain focus, and long enough to deliver value.

Critical window for loyalty. The initial period after a purchase is vital for establishing a strong customer relationship. During this time, businesses have the opportunity to reinforce the customer's decision, provide value, and set the tone for long-term engagement.

Key strategies for the first 100 days:

• Reinforce the customer's purchase decision
• Provide clear onboarding and guidance
• Deliver early wins and value
• Establish regular communication touchpoints
• Address any concerns or issues promptly

By focusing on creating positive experiences during this crucial period, companies can significantly increase customer retention and lay the groundwork for long-term loyalty.

5. Make the required remarkable: transform mundane interactions

Make the required remarkable.

Elevate everyday interactions. Businesses often overlook opportunities to create memorable experiences in routine customer interactions. By reimagining these touchpoints, companies can turn ordinary moments into extraordinary ones.

Examples of making the required remarkable:

• CD Baby's creative order confirmation email
• Dropbox's referral program for extra storage
• Zogics' personalized video messages for new customers
• PolicyMedical's implementation puzzle for software rollouts

These examples demonstrate how creativity and thoughtfulness can transform necessary communications into delightful experiences that strengthen customer relationships and set a company apart from competitors.

6. Empower employees to create exceptional experiences

It's almost impossible to expect an employee to "wow" a customer if they have never personally experienced being wowed.

Employee experience matters. To deliver exceptional customer experiences, companies must first create a culture that empowers and inspires employees. When employees feel valued and have the autonomy to go above and beyond, they're more likely to create memorable moments for customers.

Strategies for empowering employees:

• Provide comprehensive training on customer experience principles
• Give employees the authority to make decisions that benefit customers
• Recognize and reward exceptional customer service
• Create a supportive work environment that encourages creativity
• Share customer success stories to inspire and motivate staff

By investing in employee experience, companies create a ripple effect that positively impacts customer interactions and overall business success.

7. Advocate customers become your best marketing asset

Customers who reach this pinnacle are worth their weight in gold.

Power of advocacy. When customers reach the Advocate phase, they become powerful assets for a business. These loyal customers not only continue to purchase but actively promote the company to others, serving as unpaid marketing representatives.

Benefits of customer advocates:

• Provide authentic word-of-mouth marketing
• Reduce customer acquisition costs
• Increase customer lifetime value
• Offer valuable feedback and insights
• Strengthen brand reputation and credibility

To cultivate advocates, businesses should focus on consistently delivering exceptional experiences throughout the customer journey and creating opportunities for customers to share their positive experiences with others.

8. Remarkable experiences lead to increased profits and loyalty

Across a wide range of industries, a 5 percent improvement in customer retention rates will yield a 25 to 100 percent increase in profits.

Financial impact of retention. Investing in customer experience and retention can have a significant positive impact on a company's bottom line. By focusing on keeping existing customers happy, businesses can dramatically increase profitability.

Reasons for increased profits through retention:

• Lower customer acquisition costs
• Higher customer lifetime value
• Increased upsell and cross-sell opportunities
• More referrals from satisfied customers
• Improved brand reputation leading to easier sales

Companies that prioritize customer experience and retention create a virtuous cycle of customer satisfaction, loyalty, and increased profitability. This approach not only benefits the business financially but also creates a more positive and sustainable relationship with customers.

Last updated: September 18, 2024