Does CRM resolve HR Problems?

Wow! Wouldn't that be perfect? Not only could you solve all of your customer management, data and data integration problems -- but it would fix your Human Resources problems too? CRM is just like having your own in-house magician!

Well, sorry to be a bubble-burster but, unfortunately, the real answer is no -- CRM can't really solve HR problems. Many firms make the mistake of thinking that it can, however, and this is highlighted as one of the Top 5 CRM Deployment Mistakes in a recent Multi-Channel Merchant posting by Rebecca Wetteman.

In addition to over-customizing and not paying attention to your data assets, the article states that while CRM can support changes in sales, marketing, and service management, it can not lead them, and "if you’re just paving over cow paths, the cows will still wander in the same direction." That pretty much sums it up, huh?

While spending money on well-thought-out CRM initiatives can take your company to the next level in terms of customer management and service, marketing and sales efficiency and achieving your ROI goals, companies need to be cautious as to how the intiative is designed and deployed.

It is extremely important to clearly state your business goals prior to launching your CRM intiative, then to re-visit them throughout the design and implementation processes to ensure that you are tracking to those goals -- or adjusting to your changing goals. As Wetteman states: "A good rule of thumb: If you don’t have a clear view of how you’re going to see benefits within 12 months, you need to do more thinking before you waste any money on CRM."

customer relationship management

Vanity ZIP+4--We love it!

Vanity 800 numbers have been around a long time. You know, the 800 numbers that everyone can remember (For example: 1-800-GoFedX). A good vanity 800 number can boost response rates to a direct marketing program simply because consumers can remember how to reach the firm.

But this recent AP article was the first I heard about vanity ZIP+4 codes! Saks Fifth Avenue shoe department gets own ZIP code: 10022-SHOE

From the article: "The new shoe department at Saks Fifth Avenue is so big it's getting its own ZIP code.

The Manhattan store is currently revamping its shoe department.

Officials say that when it moves from the fourth floor to an almost 800-square-metre space on the eighth floor in August, customers will be able to send mail to 10022-SHOE."

The ZIP+4 code was introduced by the US Postal Service to help automate delivery service and speed up mail sorting. A ZIP+4 typically represents about 10 households. When the ZIP+4 was first created, the USPS offered lower postal rates to direct marketers who use special addressing software to apply a 9-digit ZIP code. This helped introduce the concept of a longer ZIP to consumers; the USPS' goal is to get everyone to employ the full 9-digits, even when you're writing a personal letter. Of course, this hasn't happened, yet.

We're wondering how a vanity ZIP+4 will help Saks, other than the nice publicity of being the first to implement the concept.

I know that, as a shoe-lover, this is one ZIP+4 that I will remember!

The Growth of Direct Marketing

Just in time to assure us all that our industry is steadily moving forward, the Direct Marketing Association (DMA) has just released some new -- and exciting -- figures about the Direct Marketing industry!

In terms of sales revenues created from Direct Marketing efforts, the industry has continually experienced 5-6% growth year-over-year for the last three years. In 2007, sales figures are expected to climb to a whopping $175 billion (over $166.5 billion in 2006). This continual growth spells success for us Direct Marketers, and proves that our clients continue to find value in using DM as part of a successful piece of their Marketing strategies.

The top-three consumer industries that spent the most DM dollars over the past three years are retail, finanical services, and manufacuring/motor vehicles. It will be interesting to see if there is a shift in the top spending industries as we continue to see a shift within the 3 industries mentioned above -- particularly within financial services in the mortgage lending area.

The top three states in terms of DM spend were California ($274.3 billion), Texas ($146.6 billion) and New York ($136.9 billion).

For more on how our industry is doing financially, visit the DMA website. It is jam-packed with lots of exciting facts on how Direct Marketing continues to be a successful tool in creating profitability for all sizes of businesses in today's global economy.

Don't Forget to Remember

You may ask what Memorial Day has to do with Direct Marketing??? Well, if it weren't for all of those dedicated women and men who have made the commitment to serve our country, the freedom we possess today could be lessened -- and we may not have the opportunity to help our clients build more profitable customer relationships (I know, a shameless plug for RRW Consulting-- but we are direct marketers after all).

Whatever your beliefs are on the various military involvements that we are engaged in today, Memorial Day is about those folks that have served and have given their life to protect our country. This week, a young man was lost in Iraq from Torrance, CA -- a city adjacent to one of our RRW offices. Private-First-Class Joe Anzack was only 20-years-old. He was a nose-tackle on South High's football team, and an admired young man in the local community. Of course, when these stories hit your local papers, it really does bring the war closer to home. Our thoughts and prayers are with the Anzack family this Memorial Day.

Today, we'd like to do a shout-out to all those who have served and returned (thankfully) unharmed -- thank you for what you did to protect us and our country.

And to those who have served and lost their lives -- our thoughts, gratitude and prayers are with them and their families.

Happy Memorial Day weekend! While you're flippin' the burgers on the grill, take a moment to pause and reflect on why we have this nice long weekend.

More on Customer Service--Or Lack Thereof...

Seems to be a hot topic this week, and rightfully so. Accenture performed a study that rated customer service from technology companies. Surprise, surprise, the news isn't good.

See this ComputerWorld article. "Survey: Consumers see Little Value in CRM."

The article reports that many consumer technology companies are alienating customers with less than excellent customer service. "73% of those surveyed said that merely "average" service would prompt them to consider evaluating products of other vendors."

Wow--it's never good to be in the position of losing almost THREE-QUARTERS of your customer base! If I was facing that kind of risk, you'd better believe that I'd take a serious look at customer service and make sure that my retention programs were up-to-date and robust.

More findings from the survey:

Accenture’s research also exposed several additional areas of poor customer service and consumer dissatisfaction. Among the findings:

* More than four in 10 customers surveyed (42 percent) said they had to access customer-service channels multiple times to resolve their problems.
* More than six in 10 customers surveyed (61 percent) said they believe that technology has not improved customer service.
* The vast majority of consumers—78 percent—said the service they receive is “at or below” the level competitors offer.
* Companies are wasting millions of dollars on customer-service initiatives that customers don’t view as important, particularly self-service capabilities.

Hmmm. Perhaps it's true, people really do like to talk to people. There's got to be a middle-ground between self-services that actually DO make your life easier (like being able to renew your library books via an automated service, instead of having to visit in person) and those that don't (like NEVER being able to reach a live person when you call your bank).

Companies need to seek out that middle-ground that balances the correct use of self-service technology with live, real people help, always with the customer experience and customer satisfaction in mind.

Customer Centricity - Where Are We Now?

If you've been reading our blog for a while now, you probably know that we are passionate about how companies deal with customers and how sound direct marketing practices can help increase customer satisfaction. The direct marketing industry has been talking about "customer centricity" for over 10 years now. The unfortunate truth, however, is while there is still a whole lot of talking going on, few companies have successfully made the transition.

In an article by Elana Anderson of Forrester Research, Elana points out that in order to effectively make this transition, it must start from the top of the organization -- it cannot be a grass roots effort of well-meaning, forward-thinking marketers. Dang!

Actually, when you think about it, this makes a lot of sense. If you don't have buy-in from the top, it will be very difficult to implement a customer-centric marketing approach. The reason why is very simple: it costs money. In order to get to customer-centricity, a company has to blow up their silos, share goals across divisional lines, communicate amongst the various customer touchpoints, and integrate their marketing efforts throughout the company.

Basically, this involves shifting your company paradigm and unfortunately, that ain't cheap. While increasing communications between divisions can be done through corporate edict (sort of), the systems integration, customer data integration, and database technology alignment all tend to come with some pretty hefty pricetags.

The good news is that those corporations who embrace a customer centric philosophy (and do spend the money and efforts to realign their company) will reap the rewards on the back-end. And, the reason that some fail despite their best efforts, is that the plan was not well enough thought out on the front-end, and the pain of going through the transition was just too much to bear.

Elana reports on three different companies in her article that did effectively make the transition, using varying approaches. So, it can be done! How do you start? The bottom line is that your CEO and Board of Directors have to not only be on board, they have to drive the strategy and be present and involved until you reach a successful outcome.

If you'd like some of our pointers on steps towards effective data management and integration, take a look at our White Paper.

Direct Marketing Toolbox

I'm feeling generous today!

Today I'll share three resources that I go to on a weekly basis for data and information. These places make my life (and job) easier. Hope you, too, can use these resources to help streamline your direct marketing project.

1. Melissa Data's Look-Up tools. Melissa DATA provides a variety of easy-to-use, data quality solutions to help boost response rates, increase revenue, streamline CRM, data quality management and direct mail operations. Their website includes a series of look-up tools. For example, you can look up phone numbers, or income statistics, or demos within a zip code. Further, you can define a radius around a location or even produce a map with their tools. I go here to help define a target market, or to perform basic phone and reverse phone look-ups.

2. Direct Magazine's List Finder. This is a no-charge service where you can find virtually any mailing list (or e-mail list) that exists out there. List owners post information/datacards on their files and "Direct" has offered a nifty search engine tool to let you find the right list, just by typing in keywords. A great service!

3. US Census Bureau. Oftentimes, I question the quantities or counts from any given data provider and go to this site to validate commercially-available data. For example, I had a client who wanted to market to every homeowner in the country (oh, those good old days of heavy mortgage marketing....). When we ran counts of this broad select from the leading compilers, we felt that we were missing millions of homeowners--the counts just seemed too low. So, I went to the US Census bureau site to see how many homeowners there actually are in the country. Sure enough, the compiler was off by several million records and we figured out a work-around to identify more prospects (probable homeowners).

Hopefully, you'll make good use of these resources. And, if you have any more that help YOU in your day-to-day work, please share!

When it comes to Customer Service, Cox Communications Leads the Pack!

In a recent BusinessWeek post, it is happily declared that "Cox is a cable company that people don't hate!" Since you probably now know that I am wont to get on my soap-box at any mention of terrible customer service, this article came as a breath of fresh air in an industry that is, unfortunately, known for it's annoyingly bad customer service. In fact, a variety of metrics, from network performance and reliability to billing and cost, customers in several regions describe Cox as their preferred provider.

So, how does Cox accomplish the impossible? Well, the article reports that Cox uses only one customer-care provider, with multiple call centers located across the US. In addition, rather than pushing call-center reps to get customers off the phone as quickly as possible, Cox tries to handle care issues on a single call. Not only that, the reps get graded on how well they eliminate problems, as opposed to how quickly they can get rid of the customer.

Furthermore, and this really brings tears to my eyes, Cox seems to hold true to an tenet near and dear to all of us direct marketers -- customer data integration. At Cox, rather than having separate databases for care reps and field technicians, these groups actually utilize the same database so that the customer does not have to tell their story multiple times as they are transfered from one department to the other. There is no transferring and no repeating of oneself. Incredible!

Finally, in a true testament to going over and above the call of duty, Cox has even started a "geek squad" to help customers with technical issues, whether they involve Cox's gear or not. I think we all know that this is virtually unheard of in any industry. This additional group alleviates all of the finger pointing that normally goes on when trying to trouble-shoot an issue with your telecommunications service.

This is some very impressive stuff. Here's hoping that the rest of the industry will see how Cox is winning away customers and jump on this excellence-in-customer-care bandwagon. Congratulations Cox -- on a job well done!

Capital Groups Love DM Giants

A leading article in today's "DM News": Private equity groups to buy database giants Alliance Data, Acxiom

These deals alone are worth $10.8 billion. Wow.

Just another sign that our industry is changing/evolving.

Here's my take on this, 2 things--

1. Financial experts recognize the value of a solid firm that deals in information and information management. In the short term, they see the positive margins and cash-flow and in the long-term, they recognize the continued growth in the value of data and database marketing.

2. The change (and confusion/disruption that's always associated with change) within the giant firms (like Acxiom and Alliance) represents growth opportunity for smaller, more nimble firms. I foresee new clients won and new business opportunities for small and mid-sized marketing firms.

Good news for RRW and other smaller companies that have found a way to add value as they represent some of the offerings of the DM giants!

Have a wonderful weekend.

The Sales and Marketing Conundrum

As direct marketers, our job is to figure out the best, most accurate approach to acquiring new customers, while keeping loyal customers. It's a simple equation of adding in new revenue, while at the same time maintaining and growing existing revenue. This makes everyone happy and makes us look like heroes in the eyes of our leadership.

When this equation is not positive, marketing tends to get blamed for not using the right data, the right message, etc., to attract those new and loyal customers. . . or worse, they are blamed for not providing the "right" leads to sales. We've seen this happen time and again, where there is a disconnect between marketing and sales, resulting in a lot of hard work with less than stellar revenue results. It also results in a lot of very frustrated marketing and sales people.

Sometimes this phenomenon occurs because of a lack of communication between sales and marketing, other times it is a simple matter of opposing goals between the two divisions. When you think about it, both of these issues are relatively easy to remedy . . . all it takes is a little strategic thought and some open discussion. The problem is that egos sometimes get in the way due to the fact that we, as human beings, sometimes don't play so well together in the corporate sandbox. Go figure.

Just so you know, you can solve this problem. We've helped many of our clients resolve this conundrum by simply sitting down with the various groups and gaining an understanding of what will make them successful goal-wise, how they currently interact with the other group, and how they are currently measured. It really is as simple as that. Once you have this understanding, you can tweak your current operations and create open communications paths.

OK -- call me Pollyanna -- but this is the first step to bridging the gap between marketing and sales. If you can begin to explore this, you will clearly see how you can impact your company's bottom line in a very positive way -- while at the same time, improving your work environment, i.e., having more fun! That's what it's all about, right?

Mobile CRM is Coming!

Yesterday we discussed future direct marketing applications using emerging mobile technology--the ability of marketers to relay messages in real time to their customers and prospects is very exciting.

Almost just as exciting is the ability for companies to intelligently use mobile technology to beef up their CRM strategies. Salespeople, delivery folks and others who visit their customers and prospects have long been in search of applications that can make their life easier (as opposed to making it easier for their bosses to keep tabs on them!). And, if mobile CRM can help strengthen the customer relationship by providing immediate information and better customer service, we're all for it!

CRM Buyer published "Is Mobile CRM Finally Ready for Liftoff" yesterday. Their definition of an application that works: "An effective mobile CRM application needs to be easy to get information into and out of -- it must be semi-connected and not browser-based, for instance. It should also provide events and triggers so a salesperson doesn't have to enter a lot of data on a tiny keyboard."

CRM Buyer believes that this year is the year that the Mobile CRM "industry is finally poised to deliver robust mobile offerings."

We look forward to seeing how these new offerings will make our lives easier as consumers. And, as a business-person, who is out on the road quite frequently, I look forward to seeing what kind of cool, new tools I can use!

Using Mobile Effectively for Direct Response

BtoB Online has recently interviewed Dave Whetstone, CEO of Clonefone, a company that allows consumers to manage their mobile phones online. In the interview, Whetstone discusses the emergence of this technology as a new and very effective direct marketing channel.

More specifically, Whetstone argues that mobile phones are the ideal channel for direct response. "Whether people are listening to the radio, seeing an outdoor billboard or standing in line at the checkout counter, consumers can respond to marketing messages, request and receive information or, of course, make a phone call." Whetstone goes on to give us his insight on how to craft the "best" mobile marketing campaigns. He believes that the most effective campaigns tend to be part of broader cross-media campaigns, and mobile helps increase response rates from other forms of media. In addition, in this era of permission-based marketing, people can opt-in for various reminders or information delivered to their cell phone when utilizing mobile marketing. All in all, mobile marketing can really lend a hand in driving customers to your brand.

If you (like us) find this topic of interest, the University of Southern California's Center for Telecommunications Excellence is hosting a 2 day conference on June 1-2 in Marina Del Rey, CA, entitled "LA Mobility Global Rountable Program." Experts from around the globe will be closely examining mobile technology and it's evolving impact on us as direct marketers. Check out the website for more information and the program agenda.

Business Model Evaluation--Always A Good Thing

I read this recent Business Week article, "Why Dell Needs RadioShack" and what struck me is how important it is to constantly be re-thinking and evaluating business strategy. This article is essentially the author's (Peter Burrow) opinion that Dell should consider purchasing RadioShack in an attempt to broaden distribution channels.

This idea is based on a recent e-mail sent by Michael Dell where he states that he's evaluating his direct-only approach. From the article: "CEO Michael Dell says it's time to "go beyond" phone and Internet sales. Could this brick-and-mortar electronics retailer be the answer?"

We write in this blog constantly about how companies are exploring direct marketing channels as a way to augment other advertising/marketing (see Friday's post on Procter and Gamble). Interesting to look at it from the opposite viewpoint--Dell who started the direct-to-consumer computer sales industry, is now exploring more traditional retail channels, such as (shock) store-fronts.

In any event, what this article emphasized to me was the importance of constantly evaluating your marketing strategy, programs and direction. By not staying complacent and by always looking for new opportunities, you'll stay ahead of your competitors and keep your business growing.

Direct Marketing Helps Packaged Goods Leader

I love it when traditional marketers finally see the light and embrace relationship marketing! See this Ad Age article about Procter and Gamble's commitment to one-to-one marketing: P&G Primes its Pinpoint Marketing.

Their goal is not small--they want to build relationships with 60 million consumers. They plan to use a segmentation strategy to help them with this task. How fun!

In addition to their plans to embrace relationship marketing, P&G understands that they need to change their mass media mindset. The article references brand/product groups within the organization that are having a hard time embracing the direct concept. They "assume these companies can't do one-to-one because direct programs just don't scale, and scale is everything at a company the size of P&G. The margins on a tube of toothpaste just aren't big enough to support a piece of mail aimed at every target."

But, despite the large task of changing a culture, P&G is definitely committed to its evolution "from a "consummate push marketer," into a company that better serves its customers through information, communications and resources that are relevant. Relationships, after all, are built not on hard sells but on give and take."

My take on this--if P&G can make relationship marketing pay off, any marketer can.

Have a great weekend!

Direct Marketing Industry Continues to Grow Globally

In an interesting article today from Business Wire, it is reported that the Direct Marketing industry continues to grow, year-over-year, at an accelerated pace (over 15% in 2005 -- still calculating actual numbers for 2006).

This news bodes well for all of us Direct Marketers -- and the even better news is that with the expanding customer acceptance of receiving direct marketing messages from different sources/channels, this upward trend will most definitely continue.

While telemarketing and direct mail still are the bread-and-butter for most direct marketing campaigns, this article reports that "there is increasing spend in the channels that are able to deliver much more detailed customer data, which allows for more highly targeted, highly responsive campaigns. Many organizations have also invested in customer relationship management (CRM) software applications, which allow them to collect more detailed customer information."

Finally, the article points out the focus on database and data-management solutions. Utilizing smart database marketing and customer data integration practices will allow companies to build very detailed customer databases -- and more effectively track their customer relationships. It is in these areas that direct marketing will continue to deliver the kind of return on investment that is needed in today's highly competitive economic environment.

To review our white paper and some ideas on how to implement effective database and customer data integration tools into your business, please visit our website.

Using Intelligence to Build Customer Loyalty

I love reading stories about how various industries are using database management and analytics to keep their customers satisfied, build loyalty and grow profits.

Today's "CRM News" published an article titled: Customer loyalty, profitability drive BI consolidation at Fairmont. It provides a case study on how the Fairmont Hotel chain maximized their marketing database investment by incorporating intelligent analytics and by a stringent data cleansing and maintentance routine.

Additionally, the article talks about how the Fairmont successfully implemented a customer segmentation strategy. "Marketing wanted to be able to enhance the customer experience by segmenting the customer base and ultimately driving behavior and additional revenue based on what it already knows about its guests."

In addition to the heavy reliance on analytics, what I found truly encouraging is how Fairmont solicited sponsorship from all aspects of their organization--from top-level execs, to marketing to IT. I'm sure that this team approach helped ensure a successful project.

From the article, quoting Jeffrey Berry, Director of Database Marketing for the Fairmont: "The biggest thing we've learned -- because there is a heavy technology spin and because the day to day is focused on the minutia of technology -- it's really important to make sure the business objectives are clearly established and outlined and you check against them," Berry said. "You don't want to get mired in the details so you miss the big picture. For me that's the key lesson."

Lesson learned!

Make Search Engine Optimization Work for You!

Over the course of the last few weeks, we've talked about many of the different tools that you can use in your direct marketing toolbox. Today, I'd like to focus on the topic of search engine optimization (SEO).

Prior to about a year ago, we didn't give SEO much thought. We thought it was only applicable to large corporations and some kind of cyberspace "voodoo" that lean and mean consultancy firms such as ourselves didn't need to be bothered about. Well, let me tell you, our opinions on SEO have done a 180 degree reversal once we met Daryl Clark of Internet Search Marketing. Daryl introduced us to the world of SEO by asking us a couple, seemingly innocuous questions, such as:

• What happens when people search on RRW Consulting in Google or Yahoo?
  
• If people are looking for smart and savvy direct marketing consultants, does RRW Consulting land in the top 10 on either of these search engines when potential clients type in general direct marketing keywords?

Unfortunately, before we hooked up with Daryl, the answers to both questions above were not very positive. In fact, when you typed in RRW Consulting, our website didn't even show in the top 10 on either search engine. And, we were not even on the radar when searching for companies with our direct marketing expertise. Can you even imagine such a terrible tragedy?

Well, thanks to Internet Search Marketing, I'm happy to report that we are now officially converted to SEO aficionados! Thanks to Daryl's good work, RRW Consulting now appears as number 1 in most search engines. You are also able to find us when typing in many direct marketing terms on the different search engines. SEO took us from the state of virtually invisible to highly visible. SEO has been an important part of our strategic marketing plan, and we highly recommend that you take a closer look to help your business achieve even greater success.

Happy Workers make Customers Happy

I came across this article about the new trend in customer support/service agents working from home after I made the long commute to my home office this morning. The article, from "CRM Buyer", titled: A Job That's Virtually Stress-Free discusses "virtual call centers". Networks of agents working from home have emerged, and large companies are reaping the benefits of using these call centers. "Instead of sending call center work overseas, a growing number of consumer products and services companies, from Office Depot to Walgreens are outsourcing work to virtual call center firms."

More from the article: "Experts say the industry has hit a growth spurt: The number of home agents will triple between 2005 and 2010, predicts Stephen Loynd, manager at IDC, a Framingham, Mass., research concern. Almost anyone with a broadband Internet connection, a computer and a phone can get up and running."

The reason I wanted to talk about this today is because I see this as an excellent trend in providing superior customer service. In a nutshell, if the person who is dealing with your customer is happy, they'll provide better service. And better service equates to increased loyalty, thus higher customer profitability--all good outcomes!

It's truly that simple. Maybe it's time to examine your customer touch-points with an eye to looking at how you could improve the quality of your service/support team's job situation. Again, if your team is happy, I guarantee you that they're treating your customer better!

More on the Effectiveness of E-Mail Marketing

Continuing on our theme of effective e-mail marketing . . . Marketing Sherpa has recently released some very interesting statistics about the use of this channel in their E-mail Marketing Benchmark Survey.

The results of this survey are very compelling. Here's a sample:

• 61% prefer to receive marketing materials via e-mail
• 77% will open marketing emails from trusted sources
• 76% want to receive "relevant" marketing e-mails
• 67% are more likely to visit your website after opening a marketing e-mail

In fact, e-mail marketing sent to in-house lists has been shown to have excellent response rates, and can really help your company build customer loyalty. Further, due to the cost effectiveness of this channel, conducting relevant e-mail marketing campaigns can do a lot to help you reach your marketing budgetary goals -- and kick-start your ROI. The report also confirms earlier suspicions that the use of e-mail campaigns on prospect databases is at the opposite end of this spectrum -- open and click-through rates remain very low. Getting potential customers to opt-in or ask for your e-mail messaging is the only way to make e-mail campaigns effective.

And, the definition of spam has changed a bit. Where it used to be viewed as simply "junk e-mail" it is now more accurately viewed as "non-relevant e-mail from a source I don't trust."

If you'd like to review our ideas on integrating e-mail marketing effectively into your marketing strategy, take a look at our E-mail Marketing Best Practices White Paper.

TGIF!

Intelligent E-Mail Marketing Technique

As big fans of multi-channel marketing, we love the idea of being smart about how you conduct your e-mail marketing campaigns. There is a new idea called Dynamic Customer Segments that can help you easily segment and target your e-mail campaigns to get higher click-through rates and to boost overall response. In a recent article from Email Marketing Voodoo, they discuss this concept. These dynamic segments are created by rules of inclusion or exclusion.

Utilizing these rules, you can very easily message to specific members of your database or list effortlessly. And, used with a reoccuring message feature, your email campaign can be sent to subscribers automatically based upon preset rules. Thus, you are communicating with a customer-specific message to each segment of your customer database. Talk about one-to-one marketing -- this is an easy and effective way to get there!

The Importance of Customer Service

Now, the last thing I want to do is get up on a soap-box . . . but why is it that some companies just don't get how important it is to provide excellent customer service? With all of the data out there that has proven that it is much more cost effective to keep your existing customers than to acquire new ones, you'd think that all companies would focus on the customer relationship. Apparently, not so much.

An example of this is this post that I found regarding Time Warner Cable's (TWC) recent stock-price woes. In the article entitled Time Warner Cable, New Customers, Same Crappy Service, Tom Barlow talks about TWC's recent opportunity to reverse their reputation for poor customer service. After it separated from Comcast and acquired Adelphia, TWC had a golden opportunity to start fresh with 3.5 million customers. Unfortunately, the fresh start didn't happen. Instead,TWC has already lost 90,000 customers due to somehow not anticipating the overload of these happy, fresh customers to their network. Thus, many customers experienced problems with their TV, internet and telephone connections. They decided to vote with their dollars and go find a provider that worked better.

We each have an opportunity to create customer satisfaction every day -- no matter what our roles are in our companies. In essence, it really doesn't matter what else we do -- because without satisfied customers, well, there are eventually no customers.

In fact, we recently dedicated one of our newsletters specifically to this topic because it is so near and dear to our hearts. It was entitled, Knock your Socks Off Customer Service and one of the most widely commented on of all of our monthly newsletters. Yes, I think we all are on the lookout for good customer service each and every day. OK -- I'll get off that soap-box now.

Customer Retention Proven Important (Again!)

We all know that 80% of revenue comes from existing customers. Yet, so many marketers focus the lion's share of their budget on acquiring new customers. Of course, it's important to bring in new revenues, but we also need to focus on our existing customer relationships.

See this article from "Business Times" about how one firm, Allied Business Networks, made a conscious decision to dedicate marketing dollars to retaining customers, and growing their overall relationship. The article walks readers through a case study of how Allied changed their focus to customer marketing and how this re-allocation allowed them to reap significant rewards, revenue-wise.

As a result of their new focus on customer marketing, "the company has become profitable and seen its annual revenue grow to $6 million." Just one simple change in direction allowed this business to turn a corner and become profitable. That's powerful.

The other thing I liked about this case study is the fact that Allied incorporated a multi-channel approach. Channels included outbound and inbound telemarketing, e-mail marketing, direct mail and faxes. A good example for us to continuously evaluate our channel approach.

If you've enjoyed this case study, you may also be interested in an RRW Retention Case Study, where we outline our experiences with a leading telecommunications provider who needed to sell as many products as possible to each of their customers. Just let us know if you'd like this Case Study.