Dunvegan Blog

Do your customers recommend you?

Do your customers recommend you to others?

We all know that "word of mouth" or personal recommendations are the most powerful of all forms of advertising. But, is the likelihood that customers will recommend you enough to support continuous growth in new customers, retention of existing customers and growth of revenue from existing customers?

Some customers may say they are likely to recommend you but have no intention or need to do business with you again themselves. Perhaps they have moved to a condo and no longer require a yard service or perhaps their child is now fully trained and no longer requires Pull Ups. A recommendation may attract a replacement customer but will not necessarily indicate customer retention or lead to revenue growth.

Another customer may say they are not likely to recommend you ... yet they themselves stay with you and increase their spending! This can occur when your product or service is not an appropriate subject for polite conversation, or  your products and services provide the customer with a competitive advantage. In such instances, their unwillingness to recommend you will have no impact on their own use of your products and revenue growth may occur in spite of poor recommendation ratings.

So, what's the solution?

First of all, we must all accept that there is more to understanding customer retention than their likelihood of recommending you.

We need to know:

  • What customers value about your products and services - why they come to your and buy your particular offering
  • How customers see your products and services in comparison to the competition
  • Whether customers intend to continue doing business with you or are thinking about switching

And in each case, we need to understand the reasons behind the customer's perceptions and intended behaviors.

We also need to know how well your company performs when it comes to problem resolution. Every company will let its customers down from time to time; human error is inevitable. How you recover and remedy the situation is critical to customer retention. Our own research has shown that a problem poorly resolved (e.g., where the customer is not completely satisfied) is as likely to result in a lost customer as a problem not addressed. In other words, unless you are prepared to completely satisfy the customer, it would be better not to spend your energy on it as the customer is just as likely to leave.

The Dunvegan System™ provides continuous customer feedback from the beginning of your relationship with your customer, throughout their life-cycle. Clients have found that our system provides precise guidance on how best to serve each customer, how to ensure that customers are retained and where there are opportunities for revenue growth.

Sound like what you need? Give us a call and let's begin the conversation!

 

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