This morning I was thinking about the movie, The Queen, which I watched last night for the second time. The first time I was struck by the way the movie guided my sympathies away from the increasingly wacky public to an appreciation of the private and rational motives of Elizabeth II. This time, probably because I was walking to work, I thought about the Diana debacle from a different perspective. The movie, it seems to me, could be viewed as an object lesson about long-established companies clinging to traditions that are no longer meaningful to their customers.

It isn’t really a stretch to think of the royal family as a business—perhaps the most traditional family business there is—relying as it does on the support and loyalty of the British people for its income. In this instance, the royal family business held on to the tradition of the monarch’s standard, which flies over Buckingham Palace for one reason only—to notify the people that the Queen is at home. The people, however, considered it merely a flag that should be flown at half mast for Diana. They no longer knew or cared about its original purpose. The failure of the royal family to grasp and appreciate this change created a lot of hard feelings and disaffected customers. According to the movie, one in four respondents to a poll (customer survey) was ready to give up the monarchy. That’s a lot of “detractors” in Net Promoter parlance.

Within the world of the movie, the royal family received 360 degree input, in the Voice-to-Market manner that Whitney described in her recent post (May 18). From the people of Paris who stood silently when her hearse passed. From the police chief who wanted a condolence book to help crowd control. From the growing carpet of flowers outside the palace gates. From the press. From the polls. From the Prime Minister, acting as the royal family’s business consultant. Even from Prince Charles, who seemed to get it that the monarchy had to modernize or lose support. Once Elizabeth listened, it turned out to be pretty easy to give the customers what mattered to them: a brief appearance in front of the crowd, a sympathetic public statement, and the lowering of a flag. That’s a good lesson for companies about listening to the market. While the consequences of not listening can be dire, the remedy may be a lot easier than you fear.

Nancy Heifferon, Consultant
Nancy.Heifferon@phelongroup.com

Many companies launch annual or quarterly satisfaction surveys to measure their customer loyalty and satisfaction and call it a day. It is no surprise that no meaningful action comes from these sorts of satisfaction surveys.

If you truly want to uncover the levers and dials that you can control to drive customer retention, repurchase and referrability, you must restructure the way you dialog with your customers.

Customer ‘listening’ should happen when it matters to customers, not just at the usual quarterly or annual markers. We recommend launching ‘listening-posts’ across a cross-functionally defined customer lifecycle –- at specific events and at lifecycle milestones.

Using event-based listening, you query customers at various key stages of the lifecycle. For example, you might launch a listening post at the point the sale of a product or service was completed, and another 30 days after implementation. This lets you, over time, compare all customers at point ‘x’ in the lifecycle to see where problems or opportunities may lie.

Questions are limited and targeted; you know who said what and can analyze answers within an account-specific context. Instead of a sampling, which is what old survey methods deliver (and why they fail), you get a census of all your key accounts and can know immediately if something is wrong so that you can act to fix it. And, you can quickly close the loop with unhappy respondents – sometimes just a simple call lets them know you’re listening and you care about their success. The important aspect is that you must be ready to take action and close the loop. Asking for insights or feedback if you are not prepared to act on the results will only create more detractors.

This simple restructuring around listening at key stages of the customer lifecycle gives you the real insights needed to drive action that leverages stronger customer relationships and has impact on the three pillars of customer retention, repurchase and referrability.

David Ambler, Vice President of Client Services David.Ambler@phelongroup.com

MSNBC’s Redtape Chonicles blog (“CEOs Think Customer Service is Great") stirred up a lot of disgruntled customers today, by reporting that 75% of CEOs surveyed think their companies deliver “above-average” service. Apparently CEOs live on a different planet from their customers. At The Phelon Group we believe that 90% of all company ills can be cured by listening to customers. When companies hit revenue barriers and stop growing the way they want, customers have the answers--if only companies will listen with an open mind and commit themselves to act on what they hear. Most of the hundreds of commenters to the Redtape Chronicles blog seem to consider bad service a strategic decision on the part of the companies they deal with to disrespect them. Our experience is that companies often do care--they just don’t have the discipline and systems in place to listen, identify high-impact actions, and close the communication loop with their customers. And companies we work with are often surprised at how little some of the most effective corrective actions end up costing.

Paula Stout, VP Client Services
paula.stout@phelongroup.com

Whitney Wood, Senior Consultant
whitney.wood@phelongroup.com

Recent sightings of this species suggest that the CMO may be on the latest endangered list, just as the CIO was in last decade. However, if you look around, the CIO is still here, and I suspect so will be the Office of Chief Marketer. Its survival depends on what it becomes. We have all heard about how the marketing business is changing. This is NOT news. The more relevant topic is what form marketing will take in light of viral marketing, social networking, blogs, and web-based everything, and under the pressures to measure the return on marketing investment, drive revenue, and continuously align to deliver to the company’s strategic objectives.

As the CMO becomes more of a business partner to the CEO and COO, the role will need to take on that of collaborator and unifier among product management, sales, service and delivery. If you look around, new-generation marketers are going beyond what is rapidly becoming the table stakes de jour of blogs, communities, social networks, customer experience management, permission marketing and the like. The surviving CMO will use what is learned and gathered from these new forms of connecting to and with the marketplace to become a new force within the enterprise, unlocking barriers to growth in yet to be discovered ways. Furthermore the surviving CMO will interlock product management, sales, services and marketing in order to drive greater efficiencies and impact with the customer.

Who knows what the shelf life will be for methods and tools of-the-moment for the marketing organization. Clearly the fittest survivors will be those who can demonstrate their ability to deliver to strategic objectives.

Debra Colombana, Vice President of Client and Market Development
Debra.Colombana@phelongroup.com

I have a question for readers out there who have experience with executive sponsor programs. These programs exist to create and sustain executive dialogs leading to relationships of trust between vendor and customer that, in turn, increase the vendor’s influence as demonstrated by a growing share of the customer’s wallet.

Some account managers I know prefer to create formal one-to-one relationships by getting the customer to officially assign a counterpart to the designated executive sponsor. One of these was curious recently to know how many others in his company had taken the same approach.

Other account managers deploy a one-to-several, fluid sponsor relationship in a strategy I’ll call “A little touch of Harry in the night,” borrowing from a scene in Shakespeare’s King Henry V. In this scene, Harry (aka Henry V) circulates among the troops before battle to get a sense of their morale and commitment.

So when you have an executive sponsor with limited bandwidth, is it better to match him or her to one customer executive and build a deep relationship? Or is it better to play the field and meet as many customer executives and senior management as possible, and listen to the customer more widely?

I am collecting anecdotal perspectives and, in return, will share them.

Nancy Heifferon, Consultant
Nancy.Heifferon@phelongroup.com

** Disclaimer: this blog posting is not about our own Paula Stout—she was not in an accident and drives Audis only. **

I spent some quality time on the plane last week thumbing through Fortune Magazine’s Fortune 500 Edition. On one of the first few pages was an ad for the Mercedes S-Class Sedan. It grabbed me. In 20-point type the headline read:

“If I had not been in the car I was in, I probably wouldn’t be alive … My Mercedes saved my life.”

Does it get any better than that? Whether or not you drive a Mercedes, this ad has teeth.

What’s different about this story—

• No “blind” or diluted quotes
• As picture and name of the customer advocate--Paula
• simple to follow, uncontrived, compelling story … we can all relate
• Customer commitment to, in the future, only drive Mercedes
• The “success” is a story, and the story is survival!!!!!

What’s ironic about most success stories and marquee customers today is that they’re at the intersection where less-than-remarkable customer experiences and legal departments / PR teams collide. The demand for volume has lowered the bar. If you could capture your intended customer at a glance and then direct them elsewhere for the rest of the story, would you do it?

After years of our own and other industry research into how prospective buyers gather and validate vendor claims, approach the decision-making process and influence internal constituents, it’s become so, so, so clear that emotion drives. People believe their own experiences first; the experiences of others to whom they can relate are a close second. Story consumers look for the less than linear pitch. They like to choose their own adventures. If stories lack meaning, people lose interest or become overly critical.

Could Mercedes have done more?

Sure. On top of this great story is a marketing opportunity. In addition to building an integrated marketing campaign centered around Paula and her story, Mercedes could have created and directed readers to a Web site that features Notes from Paula: a destination that tells the rest of her story, chronicles how she and her husband evaluated other car makers before choosing Mercedes and shows photos of the damaged car and what Paula is driving now.

Mercedes hit me in my old brain. Great stories should engage all parts of the mind and create a believable experience—one that personalizes the person or company taking it out of the realm of concept. People may buy “concept” once; but they don’t buy it fast or repeatedly. Further, stories must touch different parts of who you are—dig down into amygdala, the old brain. Why? The old brain (or the reptilian brain) is where decisions happen; this part of the brain helped man survive since the dawn. We form deep passions and opinions here, the old brain is where decisions are made. So why is it that nearly every customer tale we hear is diluted and without real meaning?

I recently heard a colleague pitch his refurbished medical devices company. He didn’t talk about the hospitals or practices the company serves but about the cost savings and life-essential value these tools bring to saving premature children, injured athletes and our aging parents. He told three stories of how his technology saved real people’s lives in way that no other company could.

Yes, some areas of the buying process call for us to be pragmatic and consistent. But as humans we gravitate toward shiny objects and things that make us feel safe. Stories must have that heart-felt emotional quality; they must be compelling and credible and believable. Thus, stories need to be told or translated both factually and emotionally by someone who gets the psychology of buying and retention—and of loyalty and love.

Promise Phelon, CEO Founder
Promise.Phelon@phelongroup.com

More than 200 people tuned into the May 3 AMA Webcast that our Paula Stout led on “Get-in-Step with Sales”: How World-Class Companies Bridge Gap Between Marketing and Sales. Paula presented some sure-fire short- and long-term actions that companies can take to stop the finger pointing and get Marketing and Sales on the same path to double-digit growth. These include

• Listening to Sales through a disciplined and sustained Voice of Sales methodology
• Mapping marketing efforts and content to the customer buying process so that they are aligned with Sales’ needs during the cycle
• Determining the effectiveness of your marketing-sponsored activity mapped across the buying cycle using a Heat Map.

The Heat Map really resonated with listeners, generating a lot of follow up questions and interest. It shows, at a glance, all marketing activities mapped across the buying cycle to determine where marketing is being most effective in supporting sales. If you would like to discuss the effectiveness Heat Map and other ways to close the Sales-Marketing divide and drive growth, I invite you to contact Debra Colombana.

She’ll make sure you connect with the right person for a lively and productive conversation.

Nancy Heifferon, Consultant
Nancy.Heifferon@phelongroup.com

We recently worked with a client to develop a business case for increasing their investment spend in capturing the voice of their customer. The goal of the CMO was to drive retention and repurchase. Using the Net Promoter methodology, we were first able to identify their Promoter, Passive, and Detractor accounts. We then took this account data and correlated the financial value of each of these accounts. The results were amazing. We learned that our client’s Promoter accounts were spending, on average, two to three times more in various services categories than were Detractors.

The question quickly became what actions they could take to convert Detractors into Promoters – who are both loyal and spend more on our products and services – and what revenue growth they could expect. A study of companies in the client’s industry showed that converting detractors to promoters yielded an average of 17% annual revenue growth. Based upon this data, our client was able to assess the impact of their voice of customer program and recalibrate their investment spend in the systems and processes that would create more Promoter accounts.

David Ambler, Vice President of Client Services David.Ambler@phelongroup.com