'
Subscribe Last 30 Days' News e4m on your Mobile - www.exchange4media.mobi
Mar 26, 2017 rss feed
 View Point Email this page
How often do we pause and ponder about industry issues that have a bearing beyond just our rigmaroles? Share insights that can further the common understanding? Or, at the very least, point at things that need to be set right. View Point - an exchange4media platform, will fill this void and become a source of understanding, action and perhaps some inspiration.

It’s about time we took the customer seriously, and started treating him like he mattered


Justin Rabindra, Regional Knowledge Manager, Asia Pacific,OgilvyOne Worldwide

I’ve reached that stage in life where I want to just simplify my life.

And it’s affected everything, from the food I eat (almost vegetarian), to the things I do (fewer parties and definitely no hard drinking), to the number of credit cards I carry in my wallet (three, and working towards two).

Which brings me to my point. I’ve been trying to get rid of a particular credit card for the last six months from when it was due for renewal. I cut it into two halves and sent it to the bank with a letter explaining that I do not wish to have the card anymore and to please find enclosed a cheque towards full and final payment.

If only life were that easy! For the last six months I’ve been getting bills for the annual fee, and interest on it has been compounding monthly. Calls to the helpline confirm that they have received my instructions to cancel the card but “you understand sir, the bill is system-generated”, like the system had a life of its own!

The last bill took the cake; it said “your account status continues to remain irregular. If you do not take immediate corrective action, you will be listed in the industrywide defaulters list”.

We’re talking of a very respected multinational bank here. Funnily, I still respect the brand and all it stands for, it’s just the people who work there, their attitude and treatment of customers that gets to me. (They need to be listed in the industrywide list of people who have defaulted in handling customers.) Before long the brand will take a beating as well, at least in my mind.

With few exceptions, most Indian companies display exactly the same behaviour. Think about when you were last handled well as a customer. Can you name one company that consistently recognizes you and treats you well. According to Fred Reichheld, the ultimate test of loyalty is when a customer is willing to recommend you to a friend. Which company or service would you recommend to a friend?

Do we need the shock and awe of an economic downturn to realize the importance of customer relationships? Do we always have to be reactive, apologizing for unkept promises, for shoddy treatment, and for ignoring signals until it is too late and the customer has long gone.

Compared to a lot of economies, we’ve had it mostly good in the last few years; new product launches are doing well, except for the odd dud; company growth targets continue to be met organically. Of course, it does not hurt that we’ve been blessed (?) with a record-breaking population and a healthy market base for virtually any product or service.

The growing size of the consumer market means that customer acquisition, i.e., winning new customers, and not retention, has been the primary goal of any business. With a growing market new customers continually replace those who defect or move on. And margins are almost guaranteed by increasingly efficient production at a time of rising end-user prices.

We need to look at the basis of our customer relationships

Marketing managers have been taught in management school that the most important way to grow is through acquisition. Sell, sell, sell at any cost is the mantra for everyone from the CEO to the doorman. Arriving at that ‘winning strategy’ that cuts through the clutter and generates demand for your product is the key to getting that promotion and annual bonus. Advertising agencies supported this view too by focusing on mass media communications that treated customers like fish to be trawled from the deep seas.

This cannot last forever.

The truth is out there

During the downturn of 1990-92, marketers in the West were driven to desperation and were forced to look for innovative solutions to grow their businesses using scarce resources. And they made a fascinating discovery. They found that there was a goldmine under their very noses. Customers they were already in touch with and doing business with actually held more value than their prospect pool. These were people they had been taking for granted for so long.

There was also a second, equally important discovery. That cross-selling and up-selling to existing customers was more cost effective than selling to new customers.

According to Philip Kotler, the cost of making a sale to a new customer is 5 to 7 times that of selling to an existing customer. This is because with a new customer you need to get her attention, create awareness about your product, tell her why you are better than the competitor, create the desire to purchase, and place in front of her all the information and channels to close the transaction. Not so with existing customers - they’re already aware about the company and how to buy. In other words, you already have a relationship with them. By introducing them to new products and services, less sales and marketing costs are incurred.

The bottom line benefits of treating existing customers in this way can be substantial. According to Fred Reichheld, increasing customer retention by just 5 per cent can increase revenues by between 25 to 100 per cent, depending on the industry sector. This happens because you are, in effect, maintaining a longer relationship with the customer at a lower cost while increasing the number, range and value of products and services they purchase.

You can’t build a relationship with loyalty programmes

The first and most obvious route to build customer relationship for many companies has been Loyalty Programmes. “Earn points when you buy, redeem them for gifts!” While effective for a while, this really amounts to bribing a customer into staying loyal (if it can be called that) and works as long as a rival offering an equally acceptable product does not come up with a similar scheme.

There’s more to customer relationship than loyalty programmes.

You cannot ignore the Internet anymore

The Internet has put a new spin on the whole dynamics of customer management. From a supply perspective, web-enabled technology has allowed low cost management and processing of both information and transactions. For example, the cost of making a transaction over the web in banking is a small fraction of the same transaction across the bank counter.

On the demand side the Net has empowered customers with wider and quicker access to information about products and services: greater flexibility about when and where to purchase; and shorter cycle time from need identification to action. Customer expectations for enhanced choice, in products and services, channels of delivery and even modes of payment have accelerated.

The major effect that the Internet has had is in the impact that customers now have over companies, compared to any time in the past. This is especially true in B2B businesses where large manufacturers have insisted on web enabled supply chain management initiatives from their key suppliers.

Any company entering the customer relationship space cannot do it in isolation of the Internet. You need to re-look at the way you had always conducted business because traditional ideas of brands, advertising and distribution are being challenged by new concepts of value. Especially in India, where the population is getting younger and the youth are clearly saying that the Internet and mobile are an intrinsic part of their real world. Are marketers logged in and listening?

The need for relationships to create value

While the Internet opens up opportunities to service customers on a scale and at a price unheard of before, there are issues of customer retention that the Internet uniquely creates. The “weightless economy” of e-business is based on frictionless relationships where customers may never interact with a company other than through the company website. Going high-tech for many companies has meant losing the high-touch that they had with customers earlier. And as they say in e-commerce, the competition is only a click away.

Customer Management – easier said than done

Customer Management is emerging as a business philosophy that can leverage new channels and put in place tools to embed long-term relationships. Effectively, it can deliver greater shareholder value through lower costs and higher profitability.

As demonstrated by dozens of companies, the biggest obstacle to implementing CM is the problem associated with existing processes for managing customer relationships. It has to be recognized early on that CM is about re-engineering business processes rather than introducing new technology.

The CM mantra – retain that customer!

By increasing the life, breadth and depth of customer relationships it is possible to substantially increase the value of each relationship. Simultaneously, low value customers can be identified and the relationships terminated, or re-directed to low cost channels. The genuinely ‘growable’ customers need to be focused upon for nurturing, and the most valuable customers retained.

It’s useful to remember that CM does not work on some hugely intellectual construct, as some people would like you believe. The basis for CM is the simple ‘touch and feel’ of human relationships. Which is why the much-quoted ‘Mom and Pop’ corner shop anecdote and its human style nicely capture the spirit of CM.

The time to act is now. The acronym is unimportant – CRM yesterday is CM today and may be something else tomorrow. But there is no getting away from the principle of it.

Like David Maister said, “The customer does not care how much you know until he knows how much you care”.

Maybe some day soon my credit card bills will stop. Come to think of it, I never asked for the card in the first place. But that was years before I was declared an industry-wide defaulter.

 
Archives
Getting a hold on Google Instant Benedict Hayes
- Benedict Hayes, Head of Search, Communicate 2 - 10/15/2010
Webinar – An evolving marketing tool
- Balaji Kesavraj, Head - Marketing (India), Cisco WebEx - 10/21/2009
Accurate and reliable Readership Measurement Matrices need of the hour
- Manajit Ghoshal, CEO, Mid-Day Infomedia - 1/28/2009
Consumers are the New Media
- Atrayee Chakraborty, Business Director, Lintas Media Group - 1/15/2009
Lending a helping hand to those who fell defending Mumbai
- S Yesudas, CEO, RK Swamy Media Group - 12/2/2008
It would be wonderful if a great idea wins an election
- Swapan Seth, CEO, Equus Red Cell - 11/24/2008
Social Media: A suitable supplement?
- Indranil Datta, Vice President – Knowledge, Mudra RADAR - 10/13/2008
100 GRP: New benchmark or overrated myth?
- Indranil Datta, Vice President - Knowledge, Mudra RADAR - 9/8/2008
Reality talent search: Redefining TV viewership
- Indranil Datta, Vice President-Knowledge, Mudra RADAR - 8/13/2008
Artificial Obsolescence
- Anand Kurian, Writer and advertising professional, - 6/25/2008
Why the Consumer should not be the King in India?
- Jitender Dabas, VP & Strategic Planning Director, JWT India - 6/19/2008
How the Voda pug got lost in God’s own country
- Rajul Kulshreshtha, Managing Director -- Motivator, A GroupM company - 6/3/2008
There is a new K-serial on air, it’s called K-ricket
- Anisha Motwani, Executive Director-Marketing, Max New York Life - 5/22/2008
Managing Retail Through Market Research
- Muder Chiba, Executive Director, TNS India - 5/8/2008
Understanding Integrated Marketing Communication in India
- Deepika Kurl, Sport Leasing – Corporate Controller, San Francisco, USA - 4/11/2008
Making the most of large format events
- Vijay Singh, MD, 141 Sercon - 3/31/2008
... And then there were blogs
- Preeti Chaturvedi, Manager, Mktg & Biz Dev., GIST
Justin Rabindra, VP, Training & Knowledge Mngt, Ogilvy One Worldwide - 2/25/2008
The ‘Nano’ Challenge
- Sourabh Mishra, Chief Strategy Officer, TBWA\India Group - 1/29/2008
Genre hypnotism
- Manisha Talwar Rana, Marketing Communications, LG Electronics - 1/10/2008
When ‘Dhan’ in Dhanteras becomes elusive
- Vishakha Singh, Head-MarCom, Future Media India - 11/22/2007
Who stole my retail dream?
- Hemant M Mishrra, Brand Consultant, Mudra Brand Sollutions - 11/5/2007
Watching less, Reading less, Talking more
- Praveen Ramachandra, Business Director, Insights, MindShare, Bangalore - 10/24/2007
The 4Es of Client Management
- Swapan Seth, CEO, Equus Red Cell - 10/11/2007
Advertisers to vie for that two square inch space on your mobile handset
- Dr L Venkata Subramaniam, Research Staff Member, IBM India Research Lab - 9/10/2007
The Lintas saga: Why Prembhai is not Anilbhai or Mukeshbhai
- Ramanujam Sridhar, CEO, brand-comm - 8/8/2007
Is the Advertising business losing respect?
- Gopinath Menon, Senior Vice-President, Media, TBWA India - 7/28/2007
What's your brand's chakra reading?
- Mythili Chandrasekar, VP and Executive Planning Director, JWT - 7/19/2007
Growing hunger for Business Analytics
- Sandeep Pandey, National Business Director, ATG - 3/20/2007
Is agency bonus the right way to reward success?
- Libby Child - CEO, UK, & Sunil Gupta - Regional Director, South West Asia, APRAIS Worldwide - 2/6/2007
Is your media plan CAS-trated?
- Rajendra Dwivedi, Business Director, MAXUS - 1/22/2007
Do not divide - and rule!
- Premjeet Sodhi, Senior Vice President, Initiative, Lintas Media Group - 12/5/2006
Bonding with the big studios at MIPCOM
- Gitanjali Murari, Programming Head, PIX - 10/24/2006
The Phenomenon of Instant Success
- Sandeep Singh & Gaurav Sood, COO, CSD, Get.Next.Job, Wunderman India - 8/16/2006
The mystery of the vanishing agency
- Lynn de Souza, Director of Media Services, Lintas India Pvt Ltd. - 7/27/2006
The Word-of-Mouth Factor

I have found that Word-of-Mouth works fastest when integrated into standard brand building communication.

- Sumit Roy, Founder Director, Univbrands - 6/28/2006
The birth of the Global Indian

From whining about the globalisation of India to celebrating the Indianisation of the Globe: tracing and defending the role of media and advertising

- Mythili Chandrasekar, VP and Executive Planning Director, JWT Chennai - 5/29/2006
Be a leader, others will follow you as an evangelist
- Prof. Sushil Bahl, Consultant, International School of Business and Media, Pune - 4/24/2006
Towards a meaningful industry integration
- S. Yesudas, COO, Media Direction - 4/1/2006
Showtime Everywhere @ Davos 2006
- Atri Sengupta, Director, Showtime - 2/21/2006
A door to “impact” full media plans
- S Yesudas, Business Advisor (Director), Initiative Worldwide, Jakarta - 1/17/2006
A profession does not become redundant, its practitioners do
- Svetleena Choudhary, Media Group Head, Initiative, Delhi - 12/9/2005
Jaago Grahak Jaago – bring accountability in media
- Rajul Kulshreshtha, General Manager, GroupM Team LG - 11/8/2005
YOUR PASSPORT TO POWER
- Sushil Bahl, Consultant, International School of Business & Media, Pune - 10/18/2005
Media specialist: Changing paradigms
- S Yesudas, Business Advisor (Director), Initiative Worldwide, Jakarta - 10/7/2005
“It’s the customer, stupid”
- Justin Rabindra, Regional Knowledge Manager, Asia Pacific,OgilvyOne Worldwide - 8/8/2005
The Changing Indian Woman
- Kishore Chakraborti, Associate VP and Director, Consumer Insight, McCann Erickson India - 7/12/2005
Vision & Mission: Breaking the joojoo
- Manosh Sengupta, General Manager – Marketing Communications, IDEA Cellular Limited - 6/22/2005
Too much of a good thing? Research Vs "gut feel"
- Abraham M. Alapatt, Client Services Director, Ogilvy & Mather Advertising, Chennai,& Practice Group Partner, Ogilvy Business Network - 4/27/2005
Does brand management need a shave and a wash?
- Ashish Misra, VP Marketing, Mason & Summers Alcobev - 4/6/2005
Is creativity all about creatiwitty?
- Surojit Sen, Creative Supervisor (Copy), Rediffusion DY&R, New Delhi - 3/15/2005
Singapore Airlines – An Excellent Asian Brand
- Martin Roll, CEO, VentureRepublic, Singapore - 12/18/2004
Changing Black into White!
- Sushil Bahl, Faculty, Marketing Area, Nirma Institute of Management,Nirma University - 11/27/2004
STAR POWER – Will the force be with you?
- Anupma Suneja, General Manager, Synovate - 10/29/2004
The True Value of Account Management
- Anisha Motwani, Vice-president, EURO RSCG, New Delhi - 10/4/2004
K-Kapoor Factory, B-Bollywood, C-Cricket…but no crorepatis!
- Rakesh Khar, Programme Director, School of Communications, Jaipuria Institute of Management, Noida - 9/16/2004
A Closer Look at Awards
- Indu Balachandran, Executive Creative Director, JWT Chennai - 8/26/2004
Moving towards ‘virtual’ PR agencies
- Sushil Bahl, Faculty–Marketing Area, Nirma Institute of Management, Ahmedabad - 8/11/2004
Pepsi and the art of Cool
- Rohit Ohri, Senior VP & Area Director-Delhi, J Walter Thompson - 7/21/2004
Cannes of creativity (no worms need apply)!
- Ashish Misra, Vice-President Marketing, Katra Liquor - 7/8/2004
"Budget blues and the rest of the year"
- Anant Rangaswami, Director, Event Management Development Institute - 6/24/2004
Understanding Commercial Break Viewing on Television Setting Norms that Promote Effective Buying
- P V Narayanmoorthy, Regional Director, Strategic Resource, Carat - 6/7/2004
“The list of their restrictions can go on forever…….Perhaps they deserve all those many crores that they receive for endorsements. It offsets their suffering, I guess. Except, how come they have all the restrictions and all the money, and I have all the choice, not the power to exercise it?”
- Anant Rangaswami, Director, Event Management Development Institute - 5/29/2004
‘Comparing different and unrelated companies often is an acceptable approach if you are looking simply at the operating features of the business rather than their financial performance.’
- Sushil Bahl, Faculty–Marketing Area, Nirma Institute of Management, Ahmedabad - 5/15/2004
"A fully interactive brand channel on UK satellite today exists in what is essentially a walled-garden of some 200 channels, rather than the Wild West of 17 million websites. It reaches more than seven million homes and will drive commerce both electronically and through the brand’s outlets."
- Bhaskar Majumdar, CEO, Recreate Solutions - 4/21/2004
The index could be based on a rating that takes into account agreed parameters/attributes, past-present media coverage/favourability and relevance, ground situation in terms of successful/unsuccessful seasons/tenures, future prospects, etc.
- Rajesh S Lalwani, Director, Strategy & Business Development, brand-comm - 4/10/2004
Instead of a Unique Selling Proposition, let’s start thinking about our Unique Feelings Proposition.
- Suresh Dinakaran, President, Communicate, Dubai - 3/11/2004
Creating the right buzz through WOM
- Prof. Sushil Bahl, Faculty, Marketing Area, Nirma Institute of Management, Nirma University, Ahmedabad - 2/24/2004
"India Shining is worth more than a Lion"
- Swapan Seth, Co-CEO, Equus Red Cell - 2/10/2004
Connecting with the Rural Folks
- R V Rajan, CMD, Anugrah Madison Advertising Pvt. Ltd. - 1/13/2004
THE “INCREDIBLE” BRAND!
- Sushil Bahl, Faculty, Marketing Area, Nirma Institute of Management, Ahmedabad - 12/20/2003
7 Highly Effective Ways of Killing a Brand
- Ashish Misra, , - 11/27/2003
"AND WE DRINK THIS STUFF !!"
- Prof. Sushil Bahl, Faculty, Marketing Area, Institute of Management, Nirma University - 11/5/2003
Sorry, Cannes Save You.
- G S Shridhar, CEO, Purple Blaze Advertising Consultancy - 10/24/2003
The Context of Existance
- Swapan Seth, Co-CEO, Equus Red Cell - 9/24/2003
"Oh, you don't work Saturdays" and other taunts!"
- G S Murari, Director, Fidelis Advertising and Marketing - 9/13/2003
"But to say advertising is dead or dying is being somewhat naïve"
- Sushil Bahl, Professor, Mudra Institute of Communications (MICA) Ahmedabad - 9/1/2003
Attack of the delight providers
- Ashish Misra, Vice President, The Henley Centre - 7/30/2003
"Creativity on demand with creative aerobics and imagination management"
- Prof. Linda Conway Correll and Sushil Bahl, , - 7/23/2003
"Lessons in Advertising"
- Anand Halve, Co Founder, Chlorophyll - 7/3/2003
"Fees, and not a 15% commission, I am told, are now the order of the day."
- Sumit Roy, Founder Director, Univbrands - 6/2/2003
"The AOR or media agency will continue to grow in importance because this is where one talks money."
- Arun Kumar, Associate Media Director, MPG, Delhi - 5/15/2003
"Does your Marketing Strategy know your Consumer?"
- Ashish Misra, Vice President, The Henley Centre. - 4/26/2003
"Is there an insidious move to undermine the very edifice on which print is built? That of credibility. Is there an attempt to 'commoditise' news? "
- Indrajit Lahiri, Professor of Broadcast, Symbiosis Institute of Mass Communications - 4/15/2003
"Is there an insidious move to undermine the very edifice on which print is built? That of credibility. Is there an attempt to 'commoditise' news? "
- Amitava Guha, GM,, Key Accounts Hindustan Times - 4/1/2003
"Asian companies need to move up the value chain through strategic branding."
- Martin Roll, CEO, VentureRepublic - 3/26/2003
"THE PRICE IS RIGHT (OR IS IT?)" A closer look at the perils of misusing the pricing variable in the marketing mix.
- Anand Halve, Co Founder, Chlorophyll - 3/1/2003
"If today, agencies are under fire, are we, the client, not as responsible for this crisis?"
- Manosh Sengupta, GM, Marketing Communications, Idea Cellular - 2/19/2003
"Media marketing has finally come of age."
- Rajul Kulshreshtha, CEO, Optimedia Indonesia - 1/30/2003
"Great advertising ideas are not just original and interesting, most importantly they are relevant."
- Samit Sinha, Managing Partner, Alchemist Brand Consulting - 1/11/2003
"Look London, Talk Tokyo: The eternal schizophrenia of the advertising creative person"
- Kiran Khalap, Founder, Chlorophyll - 12/28/2002
How often do we pause and ponder about industry issues that have a bearing beyond just our rigmaroles? Share insights that can further the common understanding? Or, at the very least, point at things that need to be set right. View Point - an exchange4media platform, will fill this void and become a source of understanding, action and perhaps some inspiration.
- Swapan Seth, Co-CEO, Equus Red Cell - 12/16/2002
"I think a lot of our clients are far more inquisitive about the future of media than us media professionals..."
- Sandip Tarkas, President, South Asia, MPG - 12/2/2002
"But now, it sometimes seems to me that the creative and servicing teams are completely divorced from the media"
- Shovon Chowdhury, Exec VP & GM, Bates India - 11/12/2002
"Broadcasters are today putting the distribution and pay related issues as top priority and factor in new concepts like 'Opportunity To See'"
- Amitabh Srivastava, - Network Development, GM Aaj Tak - 10/21/2002
Phadnis comes from Planning and Strategy background, having worked with Starcom, HTA and Rediffussion. Phadnis joined TV Audience Measurement [TAM] as Director, S-Group in early 2002 quitting Starcom as Media Director.
- Atul Phadnis, Director - S-Group, TAM - 10/1/2002
An ardent bridge player, a producer, a writer and a teacher - one could go on and on about Amit Khanna. Khanna has a wide lineage- he has worked in theatre, radio, television, journalism, advertising and films. He has been on the executive committee of IBF, Indian Music Industry, and Film Federation of India. He set up Plus Channels in '90s and quit in 2000 to launch Reliance Entertainment with Reliance. Khanna the Chairman of the Convergence Committee of FICCI. And also he is the Member of the Core Group of Ministry of I&B, on GATS and Ministry of Commerce. His contributions and association is a long list.
- Amit Khanna, Chairman, Reliance Entertainment - 9/16/2002
Unless media independents enlarge their scope and act as clear partner with the brand both in terms of efficiency in planning and providing actual savings, they will not be heard or seen by practical clients
- V.Balasubramanium, National Director, ATG - 8/19/2002
exchange4media has been calling me for my Viewpoint, but like a true advertising person, I have no time! So I decided to write it in sleep (if you can walk in sleep why can't you write in sleep?) If it hurts your sensibility or you disagree with my views, please disregard this as a piece of junk - because I know it is impossible to pour water in a glass full of water - to give gyan to advertising gyanis.
- Amit Ray, VP-Media Services, Mudra - 7/24/2002
"How does a media professional go about seducing his two primary constituents; the client & the client's customers?"
- Sai Nagesh, GM, Maximize - 7/8/2002
Creating Media Assets
- CVL Srinivas, COO-North&South, Madison Media - 6/24/2002
 
 

Disclaimer
:

"The views expressed are personal views of the author and not necessarily represent the views of the organisation author works for or of exchange4media.com."

© exchange4media 2007                                                                                     Post your opinion

Dialogue
People Movement
Home | About US | The Team | Contact US | In Press | Terms of Use | Advertise with us | Our Tour & Travel Operator | Articles | E-book | Press Releases | SMS Push | Site Map
Access exchange4media.com on your mobile www.exchange4media.mobi
This site is best viewed in Internet Explorer 6 & above at 1024 X 768 resolution.
Copyright © : 2010 Adsert Web Solutions Pvt. Ltd. New Delhi, India. All rights reserved.
Hosted by