Although it may seem like a difficult question to answer, this is actually an interesting question because there’s really two responses.
Transcription of this Video
Hi, my name’s Adam Ramshaw, and I’m from Genroe. Today’s question is “How can I increase customer loyalty without increasing costs to my business?”
It’s an interesting question because there’s really two responses. The first response is quite often you can increase loyalty and increase cost to your business by doing things that your customers want that will also reduce cost to your business. A real simple example of this is first-call resolution. Solving customers’ problems or resolving their issue in the first call, when they contact you by via call center is something that customers like and will actually — as you increase that first-call resolution, that will increase their loyalty. The upside of course is that as you improve first-call resolution, you’ll most likely drive down costs because you won’t be having that multiple call from your customer.
There’s an example where we can quite easily improve customer loyalty and drive down cost in your business at the same time. But that’s not always the case. Sometimes you will have to make changes and you will have to do things in your business that will increase cost. But at the same time, that will increase loyalty. The thing you need to really understand is how does the loyalty-cost equation go together?
What you should be most interested in or most concerned about is not the cost of the change that you’re making but the increase in results, or return on investment that comes from making that change. If you can increase loyalty, you can increase revenue, you can increase profitability in your business. So what you really need to understand is how can I increase loyalty in a way that increases the return of the business but cost me less than those returns might be. So the return on your investment is the thing you should be most concerned about.
There were two answers to the question today. One is quite often you can change customer loyalty and also reduce cost by just being smart, and doing the things, simplifying the processes in your business that the customers want; that will increase their loyalty. The other one is sometimes you do have to invest money to make changes. But what you really need to do is invest money in the right places, and invest money in improving customer loyalty; that improvement in loyalty will actually change the return on investment that you make from your investment.
So that’s today’s question: “How can I improve customer loyalty without change in costs?” If you have other questions, please email them to us at [email protected]. Thanks very much.