Is your goal to cross- and up-sell or to increase customer retention?
A few years ago, the buzz word in the business environment was the “seamless Omni-channel” Experience, where nearly everyone tried their best to create a seamless path for customers to continue their sales purchase, customer service process or whatever seamlessly from one device to another. In many cases, the focus was on only making the sales processes seamless, but not focusing on making every single customer touchpoint seamless. Some companies have succeeded in creating a seamless Omni-channel Experience, where most companies are either still developing it or have given up and have started focusing on other areas.
From a technology perspective, there are now many technologies out there that can help companies achieve a seamless Omni-Channel strategy with surprisingly easy implementation. One of these technologies is Thunderhead’s ONE Engagement Hub, where the entire concept revolves around managing customer journeys and knowing what are the “Next Best Conversations” to have with the customer and publishing these conversations in the right channel at the right time to the user, your organization or any back-end system.
When adopting these new technologies, such as Thunderhead’s ONE, companies often tend to focus on implementing new ways to cross and up-sell. This seems to be the easy answer to what these types of technologies are good for.
In my opinion, this is not necessarily the case where you should start to implement customer journey management. While I do understand the reasoning behind focusing on cross- and up-selling, as that is an area where benefits can be measured quickly, I believe that companies would get better results in the long run by starting to implement better customer experiences in other areas first.
I know you might disagree, so let me ask you a few questions. How much money do you already spend on marketing, communication, sales commissions and other similar expenses per one new customer? How long does it take for a customer to be profitable for your company? How long do your customers stay with you? And finally, what are your costs for an existing customer?
Companies generally keep investing large sums into getting new customers, but keep forgetting that existing happy and satisfied customers are the most valuable assets any company has. Providing your existing customers with exceptional customer experience will decrease your churn rate and increase the amount of recommendations they give thus at the end of the day creating new sales. By ensuring your existing customers are very happy with your services, you are creating larger value for them to continue with you and not opt out.
I’m not saying it’s bad to cross- and up-sell, but rather when you do it, it must bring additional value to that specific customer.
Let me give you one example. I recently went to a sport and outdoors shop to buy new trekking shoes. Prior to going to the store, I had already looked at certain brands and models and pretty much made up my mind on a few models from which I would choose from. When I got to the store, I was greeted by a very nice young salesman who started helping me with my purchase. He started by measuring my feet and looking at how I walk and if my feet had some “issues”. He very quickly told me what kind of shoe I needed, because my feet tend to wear and tear shoes from not so typical places. The models I had looked at, weren’t at all right for me. Instead he suggested models that were cheaper than the ones I had looked at online. He even gave me a 30% discount on the shoes! While paying we started talking about traveling and as it turned out, he had just been to the place I was going to. He gave me some good hints on what to do and where to go. Everything the seller did gave me more value for me. Did it eventually turn into value for him? Actually, it did. The next day I noticed I needed a duffle bag so without any hesitation I went to the same store, same salesman and bought a rather expensive duffle bag for the trip.
Could this same scenario be done or be supported digitally? Absolutely if it’s done right! When your company is aiming to increase customer experience, the key point is to listen and analyze to what your customers are doing and what their pain points are. The customer’s experience will vary across different channels and over time. By fixing the critical experiences first, the overall customer experience increases resulting in higher customer retention and better profit for your organization. And fixing these problems won’t cost you as much as getting new customers.
Spark Studio is partner of Thunderhead. If you are interested in finding more about Thunderhead One Engagement Hub, don’t hesitate to drop a line!