Many companies fear social media.  But the good ones have less to worry about than they might fear. While SM can be intimidating (especially with all those lawyers out there chomping at the bit in our sue-happy America), the truly good companies will find that social media is a friend.  In fact it is their key ally. Why? Because Social Media may expose your vulnerabilities but it also amplifies the good.  GREATLY! Here’s why.

Four companies in the past month have so impressed me with their service that after just this one experience with each of them I am probably a customer for life!  So what did these companies do?  Simply put they:

• indulged in good old fashioned customer service
• delighted me, the customer, especially when I was down /stressed
• simply kept the promises they made in all their ads and promotional materials when they signed me up or attracted me to their business.

Sidenote; If you know my philosophy of marketing then you know I simply call this marketing.  Everything else especially when people say “yeah it’s all just marketing…” is very simply, lies.

So how did this good get amplified?

1. I am a customer for life. And what’s my life time value compared to what they gave me in terms of goods and service?
2. I am so impressed that the competitors can quit calling or writing me. No matter how good their marketing they are wasting their time — not until there are exaggerated instances of bad service from my current companies in the future — highly unlikely! A good culture, like a bad culture, sticks!
3. I am telling everyone – on Yelp, Twitter, on my blog here, everywhere… And where I used to tell 10 friends I am telling all my followers in Twitter, I have told everyone on Yelp and this blog post even shows up on LinkedIn since my posts on this multiple through all my networks.

Some old fashioned stuff is not a fashion after all; it’s a classic.  Know how to recognize it, preserve it, cultivate it with great care AND let social media amplify it for you!!

In case you’re wondering, those companies are:  Geico, America’s Tire, Enterprise Rent A Car and Zappos.

Reena Kapoor, of Conifer Consulting, (www.ConiferInc.com) helps organizations with new product & marketing strategy.  She brings over 18 years of new products & brand management experience from Fortune 100 CPG companies and venture-backed Silicon Valley companies.   Reena has deep consumer brand, product management and marketing leadership experience and brings this background to her work in helping organizations define their businesses based on a strong marketing/customer focus.

I traveled with my family on a Carnival cruise to Mexico 2 weeks ago (yes, we had fun and gained a cumulative 11 pounds among the 3 of us!).  We were all prepared for a sub par cruise experience since, after all, it WAS Carnival (and not the higher priced Royal Caribbean or Princess lines which we have cruised before).

Our actual experience was not that much different from our experiences with other lines…there were little things that were different, however Carnival did a great job of spoiling us and ensuring that everything was in place to have a great time.  We walked away from the cruise thrilled that we had done the trip and ready to recommend Carnival to anyone that considered cruising an exorbitant luxury.

But what absolutely DELIGHTED us was the level of service we encountered when we reported my son’s passport missing (it actually wasn’t MISSING…we knew exactly where he left it!).  Within 24 hours of filing an electronic ‘claim’, we received a personal email from the Guest Relations department, telling us that they had, in fact, located the passport and that we would be hearing back from a designated representative within a week (they had to get the passport from the ship to a post office…at that time, it was back at sea on its way back to Mexico!).

Even better than hearing back from someone, less than a week later, we actually received the passport in the mail!  I was shocked…we had the passport back only 9 days after we had left it on the boat.  And no one was hitting us up for a ‘handling fee’ of some kind—I was totally prepared to pay $20 or so to cover the extra effort required to return the passport.

What this experience reminded me of is that even though all of the work that organizations do on their ‘core product’ is important, it’s the LITTLE things (like how you handle your Lost and Found department or your Returns process or your Tech Support desk) that are opportunities to exceed customers’ expectations and really wow them.  Those situations can go a long way to helping your customers really understand how devoted you are to making it easy for them to do business with you and that you really care about their business.

It sure worked for me…I’m now a loyal Carnival Cruise Line customer!

I have emailed about 8 small tour companies in Europe and in every case, received a response in less than 10 hours (and in a few cases, an immediate email auto response indicating that I’d definitely get a response within 24 hours)—no small feat since there is at least an 8 hour time difference.  The responses were personal, customized to some degree to respond to my specific questions, and very thorough.  I had all of the information I needed within 10 hours of my request.

My experience trying to find a shuttle to the airport in San Diego for my Mom was entirely different.  I still haven’t gotten a response to 3 different emails after 48 hours!  And I have no idea whether I ever WILL get a response, meaning that if I’m really serious about needing a shuttle, I’ll need to get on the phone and probably will book the first company I talk to vs. making an intelligent decision based on several choices.  Someone is going to get my business only because I don’t have the time to do more work on this…not necessarily because they deserve it.

In the case of the European ‘service delight’ examples, after the first response, I thought it was an exception…but when I received consistently amazing service from all 8 vendors, it made me think “Maybe they are really hurting for business there…”  And then after the consistently disappointing experience re: the airport shuttle, it made me think that there may be something bigger at work here.

This challenging economy we are in has shaken companies up, however, I’m concerned that many companies are responding by slashing prices vs. providing more value.  Understanding what your customers value and delivering on that very well is much more effective when it comes to customer loyalty than price cutting (see this great article on the topic).  But, obviously, not all companies practice that approach.  Is it possible that Europeans in general, or at least those in the European travel business, understand this better than American companies?

Note: I definitely did not get the impression from the travel vendors I heard from that they were ‘desperate’ for my business and ready to bargain on price…they were proud of what they had to offer and eager to provide an exceptional experience, not only in the ‘shopping’ process, but extending to the actual tour.

I tried doing some Googling to see what I could find on European customer service levels vs. American customer service levels, but came up empty…perhaps some of you have personal experience to either confirm or deny my hunch?  Would love to hear from you…and would love to see some major focus from our U.S. companies to make it easy to work with them vs. slashing prices.  It may be key to our long-term recovery…

Yesterday I spoke rather spontaneously during the final session of the 2010 Silicon Valley P-Camp - the third annual Silicon Valley ’un-conference’ focused entirely on Product Management topics/issues.

Spontaneous talks are not uncommon at an un-conference…the whole concept is that anyone can submit a topic for consideration and attendees vote on what they are most interested in. I came to the conference with a topic I thought of that morning and 20 handouts that I printed before I ran out the door (I thought that bringing any more than that would be a bit presumptuous!) and lo and behold my topic was chosen by popular vote to be one of the 12-15 afternoon sessions!

When I say ’spontaneous’, I really mean that…this is the first time I have EVER facilitated a 45 minute session with absolutely NO agenda, just a broad idea of the topic: “Choosing the Right Methodology for Gathering Customer Input”.

We ended up with 30 people all crammed in a small meeting area to explore this topic, specifically focused on using customer input for product development/marketing/launch purposes.  The session was very interactive and one of the things we discussed before getting into the meat of the topic was why product managers so seldom actually integrate any customer research into their work to launch great products.

I came with my own theories, but we had an active dialogue and below is a list of some of the reasons that came up…I’ll be blogging about some of these in the future, but wanted to provide a summary list here:

We talked about each of these obstacles, and debunked most of them, but it was important to ‘go there’ before talking about how to choose the right tools.  According to The 280 Group’s 2009 Product Management survey, the top 3 sources of influence on product management decisions are:

We’ve all seen the movie where the girl or guy turns to their significant other and says “I love you, but I’m not in love with you.” Sometimes it’s hard to believe while other times you want to yell at the TV and say “Duh!!!!!” Shouldn’t the recipient of the news have known? You can tell when someone loves you compared to being in love with you right?! Most of the time I think it’s pretty obvious.

Companies often fall into the same situation when you change the first “love” to “satisfaction” and the second to “loyal”. Companies tend to think that satisfied customers are enough, but it’s not. You want loyal customers! Companies also tend to think that satisfaction and loyalty are the same.  They are very different!

So what’s the difference between satisfaction and loyalty? Satisfaction is defined as contentment and fulfillment. Loyal is defined as being faithful and showing allegiance to someone or something – somewhat similar definitions but huge differences when it comes to businesses. Sure I was satisfied with my lunch today, but I’m going to keep looking around for a better restaurant like the one down the street that I’m loyal to. I love it and try to go as often as I can while also telling others about it.

Bain & Company and Satmetrix talk about satisfaction as a product meeting the needs of a customer, a product working as expected or problems being resolved as expected. Loyalty is a bit different. They both describe it as ordinary services delivered exceptionally or exceptional services/features delivered well. You will see the difference being “satisfactory” versus “exceptional”. When you were in elementary school you got a “satisfactory” grade if you did things okay but nothing exceptional – that’s what “A’s” were for. I always equated “satisfactory” with a “C”. Is that good enough? It might be for you, but not for me.

Still not sure of the difference?  How about this….

Love = satisfaction = dating

In love = loyalty = marriage

Studies have shown that loyal customers add to a company’s bottom line. Less money is spent on retaining them than trying to gain new customers. Loyal customers also tell others about their great experience with you. Loyal customers want to let others know how smart they are because they selected your product. Loyal customers have a vested interest in your company and product.  Satisfied customers are happy for the moment and although they might tell others about you and be repeat customers, it’s more beneficial for your company to make them loyal.

Simply put, satisfaction keeps customers happy for the moment while loyalty keeps them happy for a much longer period of time, while also having them tell others. It’ll cost you less money in the long run to have loyal customers rather than satisfied customers.

Don’t get me wrong, satisfied customers are good and definitely better than ticked off customers, but your ultimate goal should be loyal customers. Loyal customers are more beneficial to your company. Don’t be afraid to be exceptional! It’s the difference between loving someone and being in love with someone.

Are your customers satisfied or loyal?

Maeve Naughton has been involved in B2B customer references and customer loyalty for ten years.  She is currently on the Board of the Customer Reference Knowledge Sharing Network (CRKSN) and writes her own blog, Customer Reference Programs Maeve can be reached at maeve.naughton@gmail.com AND twitter id: @maevenaughton.

The relationship between employee and customer loyalty is easy to sense or feel but hard to prove. This is a tough question to answer well, especially for the analytics, but let’s see if we can create a trail of causation.

Recent research by Dan Pink author of Drive indicates that there are three important factors involved in motivating employees in a sustainable way:

• Autonomy (I get to choose and be in charge of certain things at work)
• Mastery (I get to to become master of a skill, domain, etc.)
• Purpose (we all need to know why if we are going to present our best self and best effort.)

People who are motivated in a sustained way do their best, deliver their best work, and contribute.

Autonomy + mastery + purpose = engaged employees

Who do you want interacting with customers?  If I am an engaged employee, I usually interact with enthusiasm and speak from an informed authority. I am also more inclined to advocate for my company if I feel good about the work I am doing, the opportunities I have, and the understanding and clarity I have for why my work matters. We all prefer to talk with upbeat and informed people- so do our customers.

The only piece missing from the information above is ‘listening to the customer’ which you describe so well in your video.  I don’t assume that an engaged employee who can speak well on the part of the company is necessarily a good listener or open to tough customer feedback. However, that is a skill that we all can develop over time with practice and training.

Patrick Reilly is the President of Resources In Action, Inc. Patrick is a successful entrepreneur and executive consultant with 20+ years experience helping leaders solve current business problems while supporting them to become better leaders tomorrow. His work is strategic, developmental and focused on improving performance. He specializes in working with leaders and organizational systems in transition. His experience is both tactical and strategic.

Patrick brings his extensive experience in both change management and executive development to accelerate and focus the results of his work. Patrick has been a featured speaker at national and regional conferences sponsored by the Association of Executive Search Consultants, ERE Media, the Professional Coaches and Mentors Organization, Northern California Human Resources Organization, and the Organizational Development Network.

At first, it seemed like the show was about ‘spying on employees’ and sort of made me feel sick given my commitment to helping companies understand the link between employee loyalty and customer loyalty…and ultimately business success. After awhile, however, it became evident that even if the boss’s original intent HAD been to spy on his employees to find them doing something wrong, the real experience became something very different…the boss (Larry O’Donnell, President and C.O.O. of Waste Management), via various entry level roles such as cleaning portable toilets and collecting garbage, got a REAL view of what it’s like to work for Waste Management.

This view from the ground made him realize that:

• He has some terrific employees who are devoted to providing good service
• Many of the guidelines and policies that he and the board had implemented over the past year were actually serving as obstacles to his employees’ best efforts.

How many organizations are in this same position? Do YOU know what you are doing to keep your employees from bringing their best intentions to the job? As we’ve discussed before, employee satisfaction is on a steep decline in the U.S., which impacts the bottom-line at companies all over America.

Could this trend be reversed if more managers and executives spent just a little bit of time to experience their organization from their employees’ perspective? It sure couldn’t hurt… Could this new reality show help people in charge consider doing a little ‘snooping around’ of their own? We can only hope…

Why do sales and service representatives feel compelled to tell customers how to answer a survey? Does the company want to know what the customers really think, or is the company trying to build positive publicity by claiming superior ratings?

The answer to the second question exposes the company’s culture and customer experience management motives — whether they are striving to be customer centric (eager to know and act on what customers really think), or happy to be self centric (eager for positive publicity). Maybe the motive behind the satisfaction survey depends on the sponsoring organization; perhaps a Marketing-sponsored satisfaction survey will naturally lean toward PR objectives, while a Quality-sponsored satisfaction survey will naturally lean toward continual improvement. Regardless of the sponsor, here’s why it’s best to pursue a customer centric survey strategy:

1) Investment: Surveys are an investment of customer time and of company funds, manpower and time – aren’t there more straightforward (honest) and cost-effective ways to build positive publicity? From a statistical view, manipulated surveys are worthless. Even the positive publicity is not sustainable, if it is inaccurate. Telling customers how to respond to a survey makes the survey results invalid, and the whole effort a waste of everyone’s time and money.

2) Customer Management: Many companies are concerned with respondent fatigue issues, so it’s essential to design surveys wisely and use results wisely. And since customer expectations can rise after they participate in a survey, it’s wise to have a well-established process in place to act promptly and systemically on survey results.

3) Growth: Marketing is overlooking lucrative opportunities to heighten their value within the organization if they do not view their role as a voice of the customer conduit into all functional areas across the company.

The answer to the first question reveals weaknesses in the company’s performance management strategy — either imbalanced scorecards or poor training of employees. Customer experience management scorecards should balance lagging indicators and leading indicators, with greater weight placed on the latter. Leading indicators are metrics that are actionable at the manager and worker levels, with a strong (predictive) tie to the customer survey ratings, and which can be measured before customers experience their effects. Survey results are lagging indicators because they reflect what customers have already experienced. If sales and service employees know their performance is being measured primarily by leading indicators, and secondarily by lagging indicators, their compulsion to tell customers how to rate them will be lessened. With the proper setup of customer satisfaction incentive pay, employees should be trained to respect customer’s pure assessments of the business and its related services, and to welcome constructive customer feedback.

The practice of coaching customers on satisfaction surveys should end! Customers feel insulted to be told what to say, especially in our Web 2.0 world, where customers are now accustomed to thinking independently and voicing their true opinions. To end this manipulation, go to the root cause of it: the company’s motives and/or the employees’ bonus calculation. Customers will reward you well for doing the right thing the right way.

Contact Lynn to find out how to customize these tips to your situation.

Lynn Hunsaker, founder of ClearAction, specializes in customer-centric culture-building, customer data ROI, and cross-organizational engagement to deliver brand promises. Lynn has rich hybrid skills and executive experience in marketing & market research, process improvement & quality, organizational development & change management, and leadership & teaching. She managed customer experience programs for more than half of her career, and her executive roles include Head of Corporate Quality, Director of Marketing & Business Development, Manager of Voice of the Customer, Manager of Customer Services, Manager of Strategic Information, and Market Research Manager. She has worked with Accountants Inc, Adecco, Anritsu, Applied Materials, Cadence, Deltek, FormFactor, Hospira, Merck, MicroWarehouse, Sonoco, SunPower, and many other companies.

We got started on this topic a month or so ago when discussing our respective work with clients: her focus is on employee retention and mine is on customer loyalty.  We are both passionate about helping organizations be more successful from our different perspectives…and we realized that our clients that don’t focus on ‘loyalty’ as a priority are least likely to emerge from this recession in a healthy position…or at all.

As we explored this topic, we found a multitude of information that supported our hunch about the link between employee and customer loyalty:

- Southwest Airlines is rated the #1 place to work in Glassdoor.com’s 2nd annual Employees’ Choice Awards.…is it just coincidence that this same organization rates as one of the highest in customer satisfaction/loyalty?

- Deborah Schmidt of Loyalty Leader, Inc. recently wrote an article, “Unhappy Employees Create Dissatisfied Customers“, that explores the many facets of this connection and provides some great advice to employees.

- Walker Information has been tracking the relationship between employee and customer loyalty for the past 8 years and finds that both types of loyalty consistently move in parallel to one another.

Given this strong connection, it’s a very bad omen to those of us who are passionate about customer loyalty that employee satisfaction is at a record low.  According to a study by the Conference Board, only 45% of U.S. workers are satisfied with their jobs compared to 61% in 1987…and the numbers have been declining over the past 20 years.

During a recession where companies believe that they are in the driver’s seat since unemployment is high, it’s especially vital to remember this inextricable relationship…if organizations don’t consider employee loyalty a priority, it will inevitably show up in the quality of their customer relationships.  Just remember the last time you had contact with someone from a company that had obviously ‘checked out’ and was unhappy with their job…how good was THAT experience?  What did that do for your commitment to that company?

Let’s all spread the word out there to not forget about the importance of employee satisfaction/loyalty…it’s common sense, but another area that is not common practice.

An excellent video talk by Joseph Pine on What Consumers Really Want. He talks about how we’ve evolved from economy that was based on commodities, to goods, to services and now its about creating and selling experience.  In this context, authenticity is the new consumer sensibility and it’s what consumers want to experience.  We’re hearing this with social networking/web 2.0 taking off as well.  But the question remains: what is authenticity and how do we (as businesses) render it effectively?