Daydream with me for a moment. Let's go into the business of
a competitor and examine the customers. Now hold these
customers in your mind but change the surroundings to your
own business. Magic, they're your customers and you're doing
business like gangbusters.
Fantasy, you say. Nonsense. But James Barnes from Memorial
University of Newfoundland may disagree. He questioned
people in 40 focus groups of random customers who talked
about their relationships with service providers, and his
analysis identified crucial factors in establishing effective
customer relationships from the customer's perspective. They
are . . . (in order of importance)
Barnes also closely examined long-duration customer
relationships and found that half of these customers report
satisfaction with their level of closeness, 40% express a
desire for a closer relationship, 10% express a desire for a
less close relationship, and 10% report dissatisfaction with
the business and feel trapped in the relationship.
Curiously, these last customers, who are dissatisfied,
form closer relationships with specific employees than any
other type of customer, and this little detail offers a
strategy for business owners to garner more customers for
themselves.
Here's an example:
The Cooper Department Store employs a marketing vice
president who is experimenting with relationship marketing. Her name is
Bernice, and she worked in the ladies wear department before her
promotion. She maintained call books which helped her be
the top salesperson in the store for many years. Now she's
trying two new ideas that expand this call book idea to the
store. Both ideas involve large data bases that she has been
carefully organizing.
The first data base includes a community listing of property
values and demographic data about the people who live there.
Bernice searches this data base for likely customers based on
age, gender, and property values, and then eliminates
existing customers. This leaves her with a list of likely
customers who haven't made a purchase at the store. She has
also identified the top salespeople in her store, and every
week she gives each of them a few names and phone numbers.
The store pays these salespeople to call these potential
customers in the evening. The customers are offered a twenty
dollar coupon if they will come in and get it personally from
the caller.
The second data base profiles people who have made purchases
in the store in the last 25 years: where they live, how much
they have spent, and the departments they have frequented.
Bernice searches this data base and identifies customers by
the year of their first purchase, the frequency of their
purchases, and the departments they visit most often. Then
she selects customers at 5 year intervals and prints and
sends a personal letter that is signed by the department
manager of their favorite department. The letter thanks them
for their patronage and includes a five dollar coupon.
Regular customers get one of these letters every five years.
With the second strategy, Bernice has taken a step to improve
the experience of her store's long-duration, dissatisfied
customers who feel trapped in the relationship, even though
she can't be sure which customers they are. She recognizes
that competitors covet these customers and they will likely
to be lost if they are approached as she is doing in the
first example.
Reference: Barnes, James G. (1997) Closeness, Strength, and
Satisfaction: Examining the Nature of Relationships between
Providers of Financial Services and Their Retail Customers.
Psychology and Marketing, 14 (8), 765-790.
Customer Psyschology Findings, by James Larsen, Ph.D.
Effective Customer Service
New research identifies crucial factors in establishing effective customer relationships.