Top 10 Ways to Build a Customer-Centric Organization & Profitable Business

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Satisfied customers aren’t enough.  To drive profitability you must generate customer loyalty and orient your entire organization around that mission.  Real customer loyalty is not a short-term proposition; rather, it is a long-term commitment to your products or services, company or brand.

In order to create and build Loyal Promoters and improve customer retention, your company must be customer-centricCustomer-centric organizations consistently attain higher profits than those companies that are not customer-centric.  The key difference is how you focus your company.

Here are the Top 10 ways to build a stronger customer-centric organization and increase profits:

1. Focus on Generating Customer Loyalty.  According to the latest research from the Corporate Executive Board, customer loyalty is the best indicator of future customer economic behavior and profitability.  Returning customers and those to whom they refer to your business keep the cash register ringing.

Have a loyalty mindset. Know the lifetime value of your customer.  The Harvard Business School has put together a Lifetime Customer Value Tool that estimates the cost of acquiring a customer and the net present value of that customer’s business during his or her economic lifetime.  You can check it out here.

In most cases, a customer generates a profit for your business only if he comes back after his first experience, since the cost of acquiring any given customer far outweighs the gross profit produced by one transaction with that customer.

2. Go Undercover.  Be your own undercover boss.  If you are a small business, have someone who will be brutally honest with you shop your store, call on your business and try to do business with you.  This will allow you to find out what your customers experience in doing business with you.  The feedback you receive will be invaluable.  This exercise is almost always a profit-building experience because it helps identify leaks and missed opportunities.

3. Be Easy to do Business With.  The most effective way to create customer loyalty is to provide a low-effort customer experience.  The easier it is for customers to take advantage of your product or service, the more business you will generate.  When you limit the amount of effort customers have to expend during their customer experience, they will want to come back.

Take another look at your policies and procedures – which ones were designed and implemented with the customer as first priority?  If your answer is “none” you are not alone.  Most companies design policies and procedures to support company functions or protect the company in some way.  That’s okay, but the trick is to find a way to accomplish this in a way that does not jeopardize your efforts to build customer loyalty.  Great companies find the right balance!

4. Learn to Sell on Value, Not on Price.  Poor-performing salespeople sell on price because they do not know how to effectively create value for the customer.  Unless you’re Wal-Mart, or unless you’re the proverbial Wal-Mart of your particular industry, competing on price is growing increasingly difficult in the current business environment.  Most companies have to build a value proposition for the customer based on other customer needs that rise above price.

5. Seek Referrals.  Learn to ask for what you want.  Proactively ask those existing loyal customers to actively refer their family and friends.  Ask them to share the value of your business with other consumers.

6. Treat Your Employees the Same Way You Want Your Customers to be Treated.  Employees, like children, will behave in ways that are consistent with the manner in which they are treated.  So, if you want your employees to provide great customer service, treat your employees well.

Reassess your employment culture.  Are your people positive and upbeat, or are they micro-managed and not trusted?  The behavior of your employees will be transferred into the employee-customer dynamic.  Employees create loyalty with customers because their interactions make your customers feel something.  You want that something to cause your customers to come back again and again and to promote your company, products/services and brand.

Loyalty is an emotional reaction to your business, not a practical reaction to your products or services.

7. Be Proactive.  Don’t wait for business to walk through your door or for your phone to ring.  You have to have a sound method of being proactive in telling your story and engaging customers and prospects.  I have participated in several BNI (a business and professional networking organization) groups and have encountered a number of lazy business people trying to build a business.  They seem to believe that if they just join the group, the business will come.  Nothing could be further from the truth!  In business, it takes a great deal of effort to get the ball rolling and keep it rolling.  In addition to working hard, you need to work smart.

8. Set Performance Standards and Expectations.

Your success in creating and sustaining customer loyalty and driving profitability is directly related to the commitment and productivity of the people who work in your business.  To that end, it is critical that management sets effective performance standards and expectations, and then creates the positive accountability to make them meaningful.  When this is done the right way, employees become energized and empowered to take ownership of their positions; management becomes inspired, everyone knows what is expected of them, and productivity increases.  The process also tends to open up new channels of healthy communication inside the organization.

9. Create a Culture of AccountabilityI refer to accountability in #8 above, but accountability deserves its own discussion for this reason:

Everything that matters inside your organization revolves around the discipline of accountability.

Accountability means taking full responsibility for your behavior and your results in the execution and accomplishment of your role.  There are three kinds of accountability: organizational, managerial and personal.

Organizational Accountability is all of the employee handbook-type stuff.  It is how the overall organization holds people accountable.  The attendance policy is a good example of organizational accountability.

Managerial Accountability is how your managers and supervisors hold their direct reports accountable.  Some employees only do what their boss tells them to do; in absence of being told what to do, they tend not to do very much.  If employees are held accountable only from an organizational or managerial standpoint, it takes a great deal of effort and energy to just to reach and maintain mediocrity.

Personal Accountability is how an individual holds himself accountable to the high business standards set inside the organization, as described in #8 above.  It is each person’s individual commitment to living up to his purpose with passion and professionalism.  A company’s success in generating customer loyalty and profitability is dependent on a high level of personal accountability among a critical mass inside company.

10. Train and Coach.  As much as you might like them to be, the skills and behaviors necessary to create customer loyalty and profitability do not come naturally for most people.  When it comes to execution and performance on the front line, do not take anything for granted or leave performance to chance.

Hire the attitude, then train and coach the skills and behaviors that will create loyalty and profitability.

Too many businesses view training primarily as a cost.  However, the right kinds of training and coaching will give you one of the highest rates of return of any business investment you can make.  Do not ignore the coaching side of the equation – if the objective is changing and improving behaviors to drive performance, providing training without coaching makes as much sense as buying a car but never fueling the gas tank.  Remember the ABCs of performance improvementAlways Be Coaching!

These are the Top 10 business-driving components we use every day with companies to help make them more customer-centric and profitable.

What are the top items you are focusing on in 2012?  We’d like to hear about them.




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About Jack Dempsey

Jack Dempsey, CEO, heads Pretium Solutions’ Customer Experience & Sales Area focusing on Customer Loyalty, Brand Loyalty and Customer Retention Strategies. He directs Pretium’s revolutionary customer loyalty program, the Golden Touchpoint™. Pretium Solutions is a premier provider of cutting-edge, sustainable and globally-recognized customer experience management solutions and customer service, call center and sales training, consulting and leadership programs. Pretium shows companies how to create, build and maintain customer loyalty, the most important measure of a company’s success with its customers and the most profitable customer service outcome.

3 Responses to “Top 10 Ways to Build a Customer-Centric Organization & Profitable Business”

  1. Jdempsey January 2, 2012 at 10:46 pm #

    Loyalty cards are great at rewarding loyal behavior. They will in themselves not create profitable loyalty. If you have a loyalty card to a business you don’t like then you have a card you won’t use. The way your company meets the practical and emotional needs of your customer while being easy to do business with will create loyalty that the card can reward. Keep your team focused on the behaviors that create loyalty and you no doubt will be successful.

  2. Abiolaeribo January 2, 2012 at 8:53 pm #

    I’m really inspired by the 10 points listed above. My business is new and growing and we are presently working on Point No. 1 (Focus on Generating Customer Loyalty). We have developed loyalty cards for our customers, which enables them to get a discount after a certain number of purchases. The response has been encouraging and has brought us a lot of referrals.

    Point No. 3 (Be Easy to do Business With) has also offered a solution to one of the challenges we are facing with the deployment of the cards. I’m happy to have all these tools to work with now to enhance my business. Looking forward to more interactions through this group.

    • Pretium Solutions January 2, 2012 at 10:56 pm #

      Thanks for your comment, and glad to see the post has inspired you!

      Loyalty cards are great at rewarding loyal behavior but by themselves are not likely to create profitable loyalty. If you have a loyalty card to a business you don’t like, then you have a card you won’t use.

      The way your company meets the practical and emotional needs of your customer, while being easy to do business with, will create the real loyalty that the card can reward.

      If you keep your team focused on the behaviors that create loyalty, there is no doubt you will be successful!

      We’d love for you to keep us posted on how you’re doing.

      Jack

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