Printed
with permission from TCI
Management Consultants. A group of senior-level management
consultants, offering strategic planning and marketing services
to a wide range of public and private sector clients.
Customer
Satisfaction is WORTHLESS: Customer Loyalty is Priceless
by Jeffrey Gitomer
Bard Press, Austin, Texas, 1998
ISBN 1-885167-30-X
Subtitled "How to make customerslove you, keep them
coming back, and tell everyone they know", Gitomer's
book holds that traditional customer satisfaction measures
are essentially meaningless. A merely satisfied customer,
he maintains, is still likely to shop around the next time
he or she needs to buy your product or service, for a better
price or a more convenient offering. A loyal customer, on
the other hand, is more likely to make a point of coming
back to you specifically as the supplier, and moreover,
is likely to recommend your product or service to others.
To illustrate
this, he shows (on page 50) an interesting concept that
he calls the "ladder of customer service":
|
The
Customer is:
|
Tells?
|
Refers?
|
Buys
Again?
|
|
loyal
|
tells
everyone about you
|
refers
proactively to everyone
|
always
returns to buy
|
|
very
satisfied
|
tells
a few people about you
|
refers
a few people
|
sometimes
returns
|
|
satisfied
|
may
tell someone, if asked
|
if asked, may refer
|
may
buy, if convenient,
|
|
apathetic
|
tells
no one
|
likely no one
|
maybe
yes, probably not
|
|
unhappy
|
tells
at least 10 people
|
for sure no one
|
after
a few yearsSmaybe
|
|
did
wrong
|
tells
at least 25 people
|
absolutely
no one
|
only
by force
|
|
pissed
|
tells
everyone who will listen
|
surely
you jest
|
never...
or when it snows in hell
|
|
lawsuit
|
tells
the whole city (reverse referral)
|
anyone
BUT you
|
not
even if it helps the space program
|
So the key is how to develop loyal customers, not simply
satisfied ones.
Gitomer
holds that it all boils down to something easy to say, but
harder to do in practice: GIVING GREAT CUSTOMER SERVICE.
To show what this means in practice, he has articulated
13 principles of customer service success, which are:
1. understand
that your customer is your paycheck - (an interesting suggestion
that Gitomer has here is to paste a picture of your children
eating dinner above your desk or workstation, to reinforce
the knowledge that your customers are the source of your
bread and butter).
2. know
that your attitude (which he conceptualizes as the way you
dedicate yourself to the way you think) determines the degree
of excellence of the service you perform
3. customers
call, contact, or visit for one reason they need help!
- Gitomer advocates being as helpful and speedy in your
response as possible to customers when they call, rather
then letting then linger in voice mail limbo, or be left
uncertain as to whether you can help them or not as
he says" give them help, not hell"
4. the
value of a customer is 20 times his annual sales volume
- Gitomer recommends thinking in relationship marketing
terms about the lifetime value of a customer
5. a
customer ready to repeat his purchase is a powerful business
advantage - the point here is that a major strategic business
advantage that you have over your competition is customers
who want to buy from you again and again - retaining these
loyal customers (and developing more, of course) should
be a key business strategy
6. customer
satisfaction is worthless: "Satisfaction is no longer
the acceptable standard of customer service. Satisfaction
is no longer the acceptable measure of customer service
success. The standard and measure of success for the next
millennium is loyal customers." (p. 79)
7. when
you're done speaking with a customer, or when the transaction
is over, that's when they start talking - Gitomer recognizes
that word of mouth is the most powerful form of advertising,
and that customers who say good - or bad - things about
you are extremely influential
8. word
of mouth advertising is 50 times more powerful than advertising
9. your
friendliness and willingness to help is in direct proportion
to your success
10.
company policy is written in terms of the company, not the
customer - Gitomer's point here is that whenever a customer
request cannot be dealt with, it is very bad form to fall
back on 'company policy' as the reason why - company policy
is written for the benefit of the company, not the customer
- the customer doesn't care a whit about what the policy
might be, they only know that they are dissatisfied because
they can't get what they want - when absolutely necessary,
he recommends using phrases such as "in order to be
fair to everyone" which at least puts the emphasis
on the benefits to customers, not the company
11.
service is a feeling "Service is a feeling, and
you know what it is whether it's good or bad. If you
can't remember what 'bad' feels like, call the DMV, Post
Office, IRS or Social Security. That's bad. Then call L.L.Bean
that's good." (p. 84)
12.
the secret to successful customer service is start with...
YES - Gitomer says that instead of saying 'no' to customers,
say 'yes' whenever possible, even if it is something along
the lines of "yes, I see your concern"
13.
the customer's perception of good or bad service is the
measure of your success or failure
Most
of the book is given over to an elaboration of these principles.
A 'golden rule' that Gitomer suggests to help clarify these
is to pretend that the customer is your grandmother, and
to treat them with the respect and eagerness-to-please that
you would your real relative.
According
to Gitomer, great service is anything extra that you can
do for your customer that will make them take notice of
you and say WOW! He presents many examples of this kind
of service in the book (such as the hotel that calls ahead
of your visit to see if there is anything they can have
prepared for you upon your arrival, or the tire store that
has someone greet you in the parking lot with an umbrella
when its raining).
WOW!
Service will in turn generate free word-of-mouth advertising
(because people like to tell memorable stories) that will
in turn help build your business. Plus the customers will
be not merely satisfied when the next opportunity rolls
around for them to purchase your particular good or service
- they will be loyal.
The
most important determinant of providing WOW! Service is
attitude and self-motivation, and Gitomer talks throughout
the book about how to improve one's knowledge and positive
attitude about the business they are in.
Customer
Satisfaction is WORTHLESS: Customer Loyalty is Priceless
is a quick and easy read, with lots of interesting examples
and points to ponder. (For example, he provides a useful
checklist of things to do when customers call up to complain
- and you can be sure that one of then is NOT saying "Sorry
- it's company policy"). Gitomer's style is very open
and user-friendly, with interesting variations in the typeface
to enhance reader interest and curiosity. Throughout, he
presents quizzes and self-evaluation questionnaires to help
the reader evaluate their own levels of service.
