Of Course Your Customers Are Satisfied. But Are They Loyal?


In research conducted by HR Chally, 80% of customers who defected from their current supplier described themselves as satisfied or very satisfied!!! How could that be? So much for measuring customer satisfaction….

No customer/supplier relationship is static. Things change. People change on their side. People change on your side. Economic conditions change. Technology changes. Customer priorities change. Your company’s priorities change. It is your ability as a company to step up to the challenge of change that differentiates you as a company. The ability to change, requires an ability to learn.

First and foremost, it is important that you learn how value is perceived through the customer’s operating reality. Let me explain the graphic above and how this customer will soon become a lost customer.

As you can see by our graphic above with Customer 1, The Point of Fear® is where the Value = Benefits minus Cost equation is neutral. Here is how it works: a customer has challenges with a certain set of products and services. In other words, they are at a “recognition of needs” in their decision process. Your company comes in with a proposal/presentation and your relative cost to eliminate the challenges has tremendous perceived value. The customer awards you a contract. Over time, and change, as described earlier (people, priorities, technology, etc.) takes place. Add to this dynamic environment the fact that the customer sees little to no challenges with the areas of business you have been handling, but has also has been bombarded by other suppliers stating that they could deliver a better program at a lower price. Unfortunately, this supplier wasn't doing Quarterly Business Reviews and uncovering changing priorities.

The fact is, you are now at The Point of Fear®!!! Your client is officially vulnerable to competitive threats!!!! Are they satisfied? Perhaps, they are satisfied, but satisfaction does not equal loyalty!

What could be worse? A new key decision maker (“KDM”) enters the picture as in Customer 2.

Now take a look at what the graphic looks like immediately above. Notice we have “grayed-out” everything that occurred before the new Key Decision Maker. The new KDM has no history with your company and the value you created. In this case you move from green or "all good" to being “red” in terms of your Client Risk Analysis. Most likely, the end is near….

Could this situation have been prevented? Could you still save these much valued customers? The answer is yes to the first question. It depends to the second question. In the case of customer 1, ajdusments were made and the account flourished. In the case of customer 2, the picutre tells the story.

Let’s wrap up with what could have been done to prevent The Point of Fear® and Changing of the Guard®. At a high level, it comes down to three critical things:

At Butler Street, we specialize in client retention and expansion. Click on the videos below to learn more about our approach and methodologies.

Mary Ann McLaughlin on Client Retention

Mike Jacoutot on: The Silent Killer: Changing of the Guard®

If you are interested in understanding how we can help you grow your business, click on CONTACT and we’ll give you a call.