Have you ever thought that saving a customer can be ten
times more efficient than finding a new one? This is what Seth Godin
calls 'economics of loyalty', and here is why:
'The us/them mindset of most corporate customer service is simple:
- When you can, get it over with.
- If at all possible, evade responsibility.
Which means that when things go wrong, you’ll likely encounter a legalistic mentality that begins and ends with, “it’s out of our control.”
There’s an alternative.
It begins with understanding the economics of loyalty.
Saving a customer is ten times more efficient than finding a new one. If it
costs an airline $1,000 of marketing and route development to acquire a first
class business traveler, it’s worth at least $10,000 in customer service to
keep one. And that means that an extra ten minutes on the phone clocks in at a
high value indeed.
And it continues with a simple tactic: Instead of defining
the minimal legal requirement, outline the maximum possible action you could
have taken.
“You’re right ma’am, that was a terrible situation. And we
could have alerted you in advance that the plane was late, and we could have
trained the flight attendants to be more aware of situations like this and we
could have been significantly more responsive when we saw that the whole thing
was going sideways. That’s incredibly frustrating–you’re right.”
Because it’s all true. You could have done all of these
things. And it’s true, it was frustrating. If it wasn’t, she wouldn’t have
called.
And then, after learning all the things you could have done,
send the ideas upstream. It’s free advice, but it’s good advice.
Because the race doesn’t go to organizations that do the
minimal legal requirement. The race goes to those that figure out what they
could do. And do it.'
Just wondering, what would be the ratio if this economics of loyalty is applied to employees? What if the decision to keep a valued employee is ten times more rewarding than finding a new one?
