Jim answers questions from fellow Drillers
(More questions with answers here, Work Overview here, Index of concepts here)
Topic Overview
Hi again folks, Jim Novo here.
What’s the best way to handle customized marketing programs, particularly if you are using customer value as the key segmentation approach? Surprise and delight, perhaps slightly influenced by making more money. Sound good? Let’s Drill it …
Q: Jim, do you have an opinion on overt versus covert customer benefits? What I meant by overt vs. covert… have you seen clients do programs where they TOLD their customers they are a valued (Gold, Platinum) customer and provided tangible benefits, vs. others who have just covertly treated these customers specially in some way (i.e. priority routing, better reps, thank you calls, etc.)
A: Well, a program won’t be very effective if everything is completely covert. I mean, it’s nice to get great service and that certainly contributes to customer retention, but recognition is much more powerful. The customer needs to know they are being treated specially at some level to maximize program effectiveness. Why?
Something like call routing is a good example. If a customer is getting priority call routing and they don’t know it, they may think the service is good. If you tell them they are going to get it and then they get it, it’s an entitlement they earned. More powerful, and more effective in keeping the customer. Let’s say they are thinking of defecting. If they don’t know they are getting priority routing, they could suspect the service might be as good at the competition. If they know they are getting priority routing, the question becomes “Does the other guy do this to? And if so, will he give it to me?” See what I mean? It’s much more powerful for the customer to know they are getting special treatment than not to know.
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