In his article, The One Number You Need to Grow, Bain consultant Fred Reichheld identifies one essential question to ask customers: “How likely is it that you would recommend this company to a friend or colleague?” In Reichheld’s experience researching thousands of companies over the past ten years, the higher the percentage of people who answer extremely likely, the better your chances to increase sales in the years ahead.
How much better? In reviewing other research on customer satisfaction and its impact on the bottom line, improving customer satisfaction scores by just 10% can improve revenue growth by 3%. That might not sound like much on the surface, but in a company with $100 million dollars in sales, a 3% increase equals an additional $3 million dollars in revenue.
Interested in creating a higher percentage of people who enthusiastically recommend your company? Here are a couple of tips from Blanchard consultants Kathy Cuff and Vicki Halsey on how to create a culture of service in your company:
- Good service begins by showing your customers that you care. Create a culture of service and align everyone in the organization towards a focus on the customer.
- Get to know your customers. What are their likes and dislikes? How do they prefer to be communicated with?
- Be responsive. Demonstrate this by responding quickly to requests and service needs.
- Empower your people. This starts by turning the organizational pyramid upside-down. In this model, the people closest to the customer come first. Frontline supervisors, mid-level managers, and senior leaders all play support roles to the person directly serving the customer.
By getting started in these four areas you can create a culture that gets a higher percentage of people recommending your company to their friends. That, in turn, translates into extra revenue growth. It’s a success formula where everyone wins.
Would like to learn more about the linkages between customer service satisfaction and the bottom line? Download Blanchard’s new whitepaper on The High Cost of Doing Nothing.