It has long been known that going above and beyond duty to provide stellar customer service to merchants is one way ISOs and merchant level salespeople (MLSs) can differentiate themselves in the crowded, commoditized payments industry. And many contributing writers for The Green Sheet have emphasized the importance of nurturing relationships with current customers, not only to retain and expand those business relationships, but also to secure referrals to help obtain new business.
The boom in blogging and the advent of social media have also led to exploring new forms of media to interact more fully with customers. Many companies maintain interactive corporate blogs and are active on Facebook, LinkedIn, Pinterest and other sites where they believe their customers can be found. Connect, connect, connect seems to be the mantra of the day.
Well, The Hidden Wealth of Customers: Realizing the Untapped Value of Your Most Important Asset, takes developing customer relationships even further - to realms that can foster more active, enthusiastic customers and faster, more profitable growth for businesses, according to the book's author, Bill Lee.
President of Lee Consulting Group and Chief Executive Officer of the Customer Strategy Group, Lee has provided consulting services to such companies as IBM, AT&T, Apple Inc., Microsoft Corp., Wells Fargo & Co. and Salesforce.com, among others, and he provides plenty of data and case studies in the book to support his concepts.
Lee believes current customers are "today's greatest overlooked growth opportunity" and that purchasing a company's products and services is just one way, and not necessarily the most profitable way, customers can provide value.
However, when it comes to their customers, most businesses are focused primarily on sales and secondarily on obtaining referrals; they give scant attention to other possibilities. Thus they are not getting much return on relationship (ROR). In the book, Lee offers methods for maximizing and measuring ROR, too.
It all begins with a new customer value proposition, one that brings customers closer to the core of product marketing and development than a traditional us-versus-them mindset, one that can create the customer advocates, influencers and contributors (AICs) who are essential to business wealth creation today, according to Lee. He illustrates "how to engage with, organize, and leverage the force of your own customer base to propel sustained growth - all while creating far greater value for customers themselves."
He emphasized that this is not a Net Promoter Score (NPS) system that identifies a company's most loyal customers as the most likely ones to recommend the company to others. Regarding NPS programs, Lee wrote, "I've found that many have major gaps and missed opportunities that add up to serious losses of potential earnings.
"They may work diligently and effectively to create promoters, yet do nothing to encourage them to, well promote - whether through referrals, testimonials, speaking at industry events, participation in a white paper or case study, or so forth. And they do even less to actually bring customers into their product development process."
One scenario Lee provided in the first chapter to give readers a sense of what the new customer value proposition can mean was of a customer he named Catie, a professional who is a loyal customer of a certain company, belongs to associations the company is interested in and is also active in social media.
The company begins to interact with Catie and learns she is open to becoming an advocate (an AIC) for the company. Lee emphasized that this cannot involve "crass rewards or bribes to encourage an ambivalent customer to say great things about you."
It does involve the company helping Catie learn to tell stories about how she's using the company's products and services to improve her business, as well as helping her expand her own network and visibility in the industry, a sphere in which the company is also interested.
The relationship develops over time as the company provides Catie with "thought leadership" information and data on new industry trends and products. Only when appropriate does this involve writing about the company's products and providing links for further information. Catie interacts with those who comment on her posts, as well as responds to related posts by others. This increases her visibility in the industry, and it increases the level of discussion about the company on social media.
Assuming this goes well, the relationship can expand to include co-creating webinars, videos and even industry conferences at which Catie participates as a speaker along with other industry professionals. And this is only the beginning. Catie, and others like her, can help, not just test and give feedback on new products, but actually help develop them from the start, because, as Lee pointed out, customers "understand buyer needs far better than we ever will."
The point of the example was to illustrate "that all of these activities represent tangible, high-value creation - value that most companies fail either to foster or measure." Real-world examples follow, including the case of Salesforce.com, which credits concepts in this book, in part, for achieving its 80 percent close rate for new business. This was central to its ability to grow its business in the face of established, better-funded, large competitors, according to the author.
While some suggestions in this book might be more applicable to large ISOs and processors, the book could prove useful to smaller ISOs and MLSs if they apply the ideas promulgated to make their business relationships more rewarding and profitable for themselves and for their merchant customers.
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