Embrace customer complaints to proactively manage customer experience: resolve issues and prevent recurrence. The key is what you DO with "voice-of-the-customer". See http://ClearActionCX.com Contact us at OptimizeCX@ClearActionCX.com

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Squeeze the Lemons for Loyalty Growth Recent Blog Posts Marketing Jobs Templates
by Lynn Hunsaker
How Do You Build
January 9, 2007 A Social Media
Community? Q&A
with BlogHer's
Lemonade is refreshing, particularly on a hot day. With a little sugar
Elisa Camahort
and a lot of squeezing, sour lemons are transformed into a nice, healthy
source of sustenance. Man Laws No More:
Say It Isn't So
Similarly, profitable customer loyalty can be a healthy source of The Netroots of a
sustenance for brand equity and a powerhouse on hot days of Primary
competition. Numerous companies are nurturing customers with an Going Berry, Berry
array of sweet programs such as personalized marketing, advisory Strong
boards and references, customized offerings, privileges, and rewards.
These are important contributions to your value proposition. MarketingProfs
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Squeezing the Lemons › MY ACCOUNT
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But what about the rest of the customer experience? How about › Member Directory
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squeezing the lemons, or acting on the less-attractive feedback from › Career Center chain solution
customers, to transform ambivalent and at-risk customers into a › Vendor Selector for your
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reliable source of profit? materials.
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We're not talking here about alienated or costly customers, but rather materials NOW!
the portion of your customer base that are fence-sitters due to
inconsistent business processes or lack of a compelling experience with
your brand. After all, if a large group of ambivalent customers has "sour Get Affordable
Advertising,
feedback," then your delighted customers may eventually confront Finally
situations that spoil their currently sweet experience.
Target our
230,000
The average American company loses half its customers within five marketing
decision making
years.1 How can your company achieve sustained growth with image- members
Visit Here To Get
building alone? By addressing the group that provides "lemon
Our Current Rates
feedback," your company can transform negative word of mouth trends
to sustainable competitive advantages that benefit your entire customer
base.
This is an internal branding effort that aligns what's going on inside the
company with what's being promised to customers. It adds customer
experience substance to your value proposition.
Truly Great Marketers
Ability to grow a business is what distinguishes a truly great marketer,
as stated in a recent article by consulting firm Booz Allen Hamilton: "In
an era of unlimited opportunities but constrained resources, the only
marketing metric that matters is growth. Driving growth means
stretching the traditional boundaries of the marketing function to
encompass activities many companies don't even think of as
marketing—yet."2

2. Squeeze the Lemons for Loyalty Growth | MarketingProfs.com Page 2 of 5
Growth goes beyond quarterly revenue targets. Growth is fueled not
just by brands but also by customer equity, or customer lifetime value
(CLV).3 Research shows that a 1% improvement in retention can
increase customer equity 3-7%.4 The ultimate goal is to increase
customer lifetime value.
Rewards programs, customer databases, and empowered customer call
centers have their role in growth. Wisely, customer experience
management (CEM) is also a growing practice among leading
companies.
CEM is the "process used to comprehensively manage a customer's
cross-channel exposure, interaction and transaction with a company,
product, brand or service." An "outside-in" operational excellence focus
is one of the key components of CEM, with a "comprehensive evaluation
and improvement of people, process, policies, technology, and systems
that facilitate, track, and measure customer interaction and
transaction".5
Marketers have an important opportunity to assert their authority and
value as a conduit for the customer's voice into all areas of the
company. "Squeezing the lemons," or driving companywide action on
the less-attractive feedback from customers, represents a chance to
own CEM, improve CLV, and be acknowledged for playing an
instrumental role in growing the business.
Value-Based Business Case
The first essential step in growing your business by acting on the voice
of the customer (VOC) is to establish unwavering executive
sponsorship. Let's face it: Long-term growth is a sizable stewardship
that requires companywide enthusiasm for the means employed to
achieve it. A well-respected executive champion accounts for a great TOP 5 PREMIUM Articles
deal of the difference between success and failure. 1. Case Study: Smart
Marcomm Strategy Enables
Precision Manufacturer to
Calculate CLV by identifying your costs to acquire and service different Nearly Double Sales in One
customers. Also calculate the cost of your lost customers. According to Year
the Pareto principle, 80% of your profits are typically generated by
2. Ten Steps to Creating a
about 20% of your customers. Some of your customers are likely Brand Ambassador Program
creating losses due to their inordinate service demands and/or
3. The 10 Biggest Mistakes
insistence on deep discounts.
Marketers Make—No. 8:
Swallowing Fads
Unthinkingly
Once you assess customer profitability, you can develop appropriate
strategies for aligning your company's efforts with the varying CLV 4. How to Produce a
levels across your customer base. This analysis also provides an Marketing Toolkit That
Eliminates the Need to Sell
opportunity to engage your CFO as an advocate for CLV and to minimize
the likelihood of budget cuts that could cripple your growth efforts. 5. The 10 Biggest Mistakes
Marketers Make—No. 7:
Living in the Marketing Silo
Assess your current methods of capturing VOC to determine whether
these methods provide you with a 360-degree perspective of the TOP 5 Articles
customer experience. Customer advisory boards, user groups, blogs,
surveys, complaints, call centers, transaction pulses, executive listening 1. Six Ways to Prepare
sessions, sales and service call reports, and many other techniques are Better Collateral for Sales
Teams
VOC options. Consider firsthand VOC exposure for middle managers and
executives for additional momentum. Make sure your VOC methodology 2. Five Ways to Develop a
provides you with a thorough understanding of customers' pain, Dialogue With Key
'Influencers'
wherever it may be. As Jim Morgan, chairman of Applied Materials,
quips: "Good news is no news, no news is bad news, bad news is good 3. Marketing to Generation
X and Y

3. Squeeze the Lemons for Loyalty Growth | MarketingProfs.com Page 3 of 5
4. The 12 Tenets of Social
news." Media Marketing (and Why
You Need to Learn Them)
Acting on VOC
5. Stop, Thief! How to
Protect Your Site from
Copyright Infringement
To overcome apathy, denial, or finger-pointing when sharing customer
feedback within your company, slice the customer feedback by product TOP 5 Downloads
line and by sales and service teams. When each group has its own set
1. Direct Marketing Creative
of data, you can drive VOC throughout the organization, establishing Savvy - print the .pdf slide
handout -Slides
clear accountability for action as the data relates to each internal group.
2. The Wide World of Direct
Additionally, VOC feedback associated with support functions, such as Marketing on the Web -
print the slide handout
safety and human resources, can be assigned to these organizations for (1,222 kb .pdf) -Slides
action-plan development. Distribute templates that help each group
prioritize the low-performing business processes with the highest 3. How to Craft a
Compelling Offer - print the
correlation to customer loyalty. Each group can examine and summarize written text .pdf file -
diagnostic comments from customers to help identify root causes of Transcript
underperforming processes.
4. Google, The Secret
Weapon - print the written
text .pdf file -Transcript
Action plans must be specific in naming deadlines and action item
owners within the group, and must include metrics to track progress. 5. Hitchhikers Guide to the
Ask each group's executives to sign the action plans as a visible Metaverse -Second Life -
print the .pdf slide handout
endorsement of their support. -Slides
Measure and reward the right things to motivate employees and to
predict future customer perceptions. VOC data are symptoms of
underlying business process health. They are lagging indicators, Can your customers
reflecting what customers have already experienced. Other lagging find you?
indicators include revenue, profit, and market share. While these Smart companies like
symptomatic metrics are important to track, it is essential to identify, HSN, Northern Tool,
track, and provide visibility to metrics for the associated business PETsMART, Discovery,
Hancock Fabrics,
processes. These are leading indicators because they represent future
Furniture Online, Home
impact on the customer experience. Visions, Wards,
TireRack, Toolfetch and
Effective incentives reward internal groups for improvements in both Bellacor Lamps turn to
Netconcepts for SEO
leading and lagging indicators, with a balanced formula that reflects the
advice and technology.
improvements' results from the perspectives of all affected
stakeholders.
Reaching out to Customers
Be sure to "close the loop" with VOC participants as often as possible.
Thank customers for their feedback and let them know you're working
on solutions. Validate your thinking with them as you establish priority
action areas. Share your action plan progress with them. By making
your internal metrics visible to customers once you've achieved
significant improvements, you're helping customers reset their
perceptions for fresh experiences and fresh feedback in the near future.
Customer-focused service at all customer touch points is only as good
as the weakest link in the entire value chain. Analyze handoffs
throughout the company's business processes to identify streamlining
opportunities and to track in-process warning signals. By monitoring
internal customer satisfaction for each group's business processes, you
can greatly reduce the "garbage-in, garbage-out" syndrome of business
processes that plagues the reliability of the customer experience.
A wide variety of programs can be developed that engage and reward
customers who are delighted with their customer experiences and to

4. Squeeze the Lemons for Loyalty Growth | MarketingProfs.com Page 4 of 5
address those who are at risk of defecting. These include customer
appreciation events, reference programs, gifts and rewards, privileges,
and customized offerings among many other strategies.
The Key Is What You Do With VOC
Clearly, in the quest for sustainable growth, there is much essential
work to be done to transform VOC into high ROI. In your recipe for
healthy sustenance, don't forget to "squeeze the lemons in addition to
adding sugar."
In the new book Chief Customer Officer: Getting Past Lip Service to
Passionate Action, author Jeanne Bliss sums it up excellently:6 "As with
any customer feedback system, it's what you do with the information
that's key," explains Bliss.
"Companies have spent more time chasing the elusive 'score' than
doing anything different for customers," she says. "In their quest to
drive customer focus, corporations have attempted to improve customer
experiences by attaching things people want to the attainment of a
good score....
She enumerates:
What will you do when a customer won't recommend you? Will
you find out why not?
Are you collecting all of that information from dissenters and
identifying the big things that are broken in your business and
fixing them?
Are you identifying and holding those who have declared that
they would recommend you close and building stronger
relationships with them?
Have you spent the time to find out what they really love about
your business and then pinpointed which part of your operation
those actions are coming from?
Have you created systems and processes to reliably replicate
those loved experiences across your enterprise?
Bliss concludes: "Becoming a hero to your customers is more about
reliability than it is about heroics. If they could just count on you to
always deliver, to always be there, to fix what ails them, to really
care... well, things would be different. You'd have customers who
desired the experience you deliver so much that they keep coming back
again and again for more. And recommend you? No prodding necessary.
They'd be singing your praises from the rooftops."6
Notes:
1
The Loyalty Effect, by Frederick F. Reichheld, 1996.
2
"Growth Champions" by Edward Landry, Andrew Tipping, and Jay
Kumar, strategy+business, Booz Allen Hamilton, 6/20/06.
3
Driving Customer Equity, by Roland Rust, Valarie Zeithaml, and

5. Squeeze the Lemons for Loyalty Growth | MarketingProfs.com Page 5 of 5
Katherine Lemon, 2002.
4
Return on Customer, by Don Peppers and Martha Rogers, 2005.
5
"Just What is CEM Anyway?" by Leigh Duncan, MarketingProfs.com,
1/10/06.
6
"Is Your Company a Customer Survey Score Whore?" by Jeanne Bliss,
MarketingProfs.com, 7/25/06.
Read next article on this subject »
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Lynn Hunsaker, MBA, is a veteran high-tech marketer, university
instructor, and founder of the consulting firm ClearAction
(www.clearaction.biz). She is also associate partner with Marketing
Operations Partners (www.mopartners.com).
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