If you’re running any kind of business, you’ll know that you can’t survive without customers. Customers are the lifeblood of every business, and yet a surprising number of companies neglect their customers or don’t give them the level of attention they deserve.
The truth is, your nearest competitor is usually only a click or two away, and competition is fierce to retain customers over the long-term. This is important, because 65% of a company’s business comes from existing customers rather than new customers, and increasing customer retention by 5% boosts profits by 25-95%, depending on your industry.
So what are businesses doing to retain more customers? The answer is customer obsession. In this blog post, we’re going to be exploring what customer obsession is, how it can help your business, and some examples of companies doing it right.
What is customer obsession?
Customer obsession means the business is exceedingly dedicated to meeting customer needs. The business strives to consistently make improvements to the customer experience and everyone in the company, from the top down, has a laser focus on the customer. Customer obsessed companies meet or exceed customer expectations by repeatedly gathering feedback and taking actions based on insights.
When businesses are customer obsessed, the emphasis is on driving repeat business and customers who are loyal to your brand, whatever the weather. Customers go from being an afterthought to the center of everything you do as a business.
In customer-obsessed companies, there is nothing more important than pleasing the customer. Every business goal is aligned towards the customer and success is measured based on customer satisfaction.
What are the qualities of customer obsession?
1. Company-wide customer focus
Customer obsession goes beyond your customer service team and spans the entire business. Every department understands the role they have to play in building an exceptional customer experience, and each individual is willing to go the extra mile to surprise and delight the customer. Customer obsession becomes baked into your company’s DNA and is a consideration before you hire any new employee.
2. Build long-term relationships with their customers
Customer-obsessed companies treat each and every customer as an individual and avoid the mindset of growth at any cost. They would rather support a more limited customer base when every customer can receive the care and attention they deserve in contrast to unfettered expansion. They emphasize customer success and ensure that customers get the most out of their products and services. The company grows sustainably with customers who are invested in long-term relationships with the business.
3. Retaining customers over attracting new ones
Most businesses heavily invest in marketing and sales to attract as many new customers as possible to ensure the business can grow. Customer-obsessed companies, on the other hand, focus their growth efforts in nurturing existing customers who they try to retain for the long-term. They value customer service before, during, and after the sale to ensure that customers feel satisfied with their purchase and return for repeat business. Acquiring new prospects is still important, but a greater emphasis is placed on retaining current customers through superior service.
4. Proactive customer service
Proactive service means you consciously look for opportunities to help your customers rather than passively waiting around for them to contact you with a problem. It means creating instances of customer delight where the business reached out to support them and ensured they had a memorable experience. Being proactive is all part of customer obsession where you exceed expectations for the customer and do more than the bare minimum.
5. Solicit and act on customer feedback
Customer-obsessed companies know that building relationships with customers involves having a dialogue. Many customers are more than willing to share their thoughts about your business, so you should regularly survey them to find out their opinions. The goal is to discover what already pleases them about your business so you don’t make changes that have a negative effect on your customers, but also to find out areas you could improve so your business is continually evolving. Involve your customers in a continuous feedback loop where you report back to them any changes you have made that were inspired by their opinions.
Why is customer obsession important?
You might be thinking, this is all very interesting but it’s not relevant to my business. My company is already satisfying my customers and growing steadily as a result.
The answer to this is customer obsession is the difference between an average business and one that stands the test of time. Customer obsession leaves no room for error as the business is always oriented by its north star.
Gets you closer to your customers
When your business is customer-obsessed, they are able to have a finger on the pulse of their customers and anticipate their needs ahead of time. A company that truly understands its customer base is able to craft better products and services and move in a more agile way. Customers direct the flow of the business and the company is always improving as a result. This means unpleasant surprises become fewer as you develop products to fit customer demand.
Positive impact on customer retention
Customer obsession means you focus on your existing customers and give them what they want to stay a long-term customer of your business. Not only is having a solid customer base going to support you through any tough times, but existing customers are much more likely to buy from you and 50% more likely to try new products. Retaining more customers drives revenue and all through very little effort on your company’s part.
Can have gains in customer acquisition
Customers who appreciate your company’s obsession with their happiness are much more likely to leave positive reviews and recommend your products or services to others. Customer obsession helps your company to earn word-of-mouth advocates who play an influential role in attracting new customers to the business. This type of marketing is very effective since 98% of people are more likely to trust a recommended brand, even if that’s from a stranger.
Sets you above your competitors
Companies that are obsessed with their customers gain an advantage over the competition who aren’t as customer focused. They have a competitive edge when it comes to the experience they are providing and become market leaders. Again and again, studies show that what customers appreciate about a business is the customer service, and this is what drives repeat purchases for 93% of customers.
How to measure customer obsession
You may be convinced of the value of a customer-obsessed culture, but how do you measure its effectiveness? There are some key metrics that you can take advantage of that will tell you how well your strategy is working.
Net promoter score
NPS tells you how much a customer likes you and how loyal they are to your brand. It’s based on asking customers a simple question: how likely are you to recommend this business to family, friends or colleagues? A high Net Promoter Score indicates that your business is obsessed with its customers by delivering experiences that they value. Customer obsession generates loyalty in customers by consistently outperforming the competition and giving them no reason to consider an alternative.
Customer Satisfaction score
CSAT tells you how satisfied a customer is with your product or service by asking them a question: how would you rate your overall satisfaction with the goods/service that you received? CSAT measures an immediate reaction to a specific interaction with the company, rather than capturing the overall relationship like NPS. By using CSAT, you can measure how well the company is performing in the eyes of your customers and whether it has managed to provide a satisfactory experience.
Customer retention rate
Customer obsession is reflected in the number of customers that you manage to retain over time. If your customer retention rate is high, this indicates that the business’s customer-centric culture is having an impact on the customer’s sense of loyalty to your brand. Customers trust your company, they feel invested in your products, and are responding well to your business’s efforts to retain them,
Employee retention rate
A high employee retention rate means that your company is successfully holding on to its staff members by matching their values. When you hire employees that are a good fit for the company, they are more likely to adopt your customer-obsessed culture and deliver an amazing level of service that keeps customers coming back for more. Employees are your “internal customers” and keeping them happy will transfer over to the customer experience.
Customer obsession examples
There’s no better example of a customer-obsessed company than Disney. The company is dedicated to providing magical experiences to its customers, which it calls “guests”. 70% of Disney’s first-time visitors return to the theme park.
Disney creates outstanding customer experiences by closely observing its customers and optimizing processes. Magical experiences are created by processes that enable you to manufacture the same reaction, every time.
Disney pays close attention to its customers, for example when it comes to height limits on its rides. Often children would wait in line for a ride, only to find out that they weren’t tall enough to ride. This was disappointing for the child and frustrating for the parents, and seriously compromised the experience of being in the park. To remedy this situation, staff were given special passes to hand out to children that enabled them to jump to the front of the line on their next ride.
Customer obsession is the first of Amazon’s four key values. The ecommerce giant prioritizes the customer experience over paying attention to its competitors and this focus has set Amazon apart from the herd.
Customers know that when they shop with Amazon they are going to receive a high quality customer experience through reasonable prices, dependable shipping times and a vast array of products on offer. Customers can take advantage of recommended products based on their history and regular discounts on many product categories.
The consistent and reliable experience that customers benefit from keeps customers returning again and again. Since Amazon seems to have everything and all at the lowest cost, customers see no reason to shop anywhere else. Amazon Prime also generates customer loyalty by making it more worthwhile for customers to shop at Amazon.
While Apple no doubt offers popular products, the key to their success has been their relentless customer obsession in the service that they deliver. Apple opened its Apple stores so they didn’t have to rely on third-party retailers who might not deliver the highest standard of customer service that they desired.
Employees at Apple stores are highly trained in how to deal with customers. The following acronym is a mantra for Apple employees:
- A – approach the person in the store with a personalized welcome.
- P – probe to understand what the person is after.
- P – present a solution for the customer to take home.
- L – listen for and resolve any issues or concerns the person might have.
- E – end the conversation with a fond farewell.
Apple sells high quality products at premium prices and the experience customers have when using their products reflects that. Apple has devoted, ardent fans who would never even consider turning to a competitor.
Zappos is another ecommerce brand that has no end of positive customer service experiences that underline its relentless customer obsession. They insist that customer obsession should be one of your core values.
They recommend developing a truly customer-obsessed culture by treating your employees, vendors and shareholders as customers, to ensure the mindset isn’t just something you “turn on” when someone is paying you money.
Zappos customer service reps are empowered to make the final decision when it comes to delighting the customer. There aren’t multiple hoops to jump through when it comes to offering free shipping, for example. And there’s the story of the rep that spent over 10 hours on the phone to a customer, who ended up buying a pair of shoes and was very happy with the service.
In today’s market, it’s not enough to simply pay attention to your customers. You have to truly obsess over them in order to maintain a competitive edge and stand out from the crowd. Customer obsession means there’s nothing more important than making your customers happy and recognizing their needs. Everyone in the business is closely oriented to your customers and developing products and services to fit the demand.
If you want to start building a customer obsessed culture in your business, start from the top down. If executives are invested in the customer experience, this will filter down to the rest of your company and employees will make it their mission to delight customers.