During recessions it’s more important than ever to remember that loyal customers are the primary, enduring source of cash flow and organic growth.  Marketing isn’t optional – it’s a “good” essential to bringing in revenues from these key customers and others.

In the current economic climate, many buyers are hesitant to pull the trigger on a purchase.  Uncertainty about the future and a policy of “make due, or do without,” are some of the factors influencing purchase decisions.  Working within these parameters, buyers tend to minimize risk and look to known and trusted suppliers.

An axiom among management and marketers is that the least costly sale one can make is to an existing customer.  Acquisition costs are low, the distribution process is in place and the customer understands the value proposition.  Re-selling or up-selling to the customer base provides for greater margin.

Given these two complimentary forces, it is interesting to note the number of high-tech companies who continue to have their customer service function report into their Engineering department.  The traditional thinking that customer’s problems are solved solely by Customer Service and an Engineering escalation path may no longer be applicable.

In today’s environment, Customer Service may be the first and possibly the only touch point that a company has with its customers.  If the sales force is composed of gunslingers and/or multi-level distribution channels, they may not be touching the installed base. 

The opportunity arises when a customer calls directly into Customer Service.  Most often, Customer Service personnel are technically trained to solve problems, i.e., act reactively and are not expected to be aware of more subtle customer needs and wants, or act proactively.  Frequently they are measured (compensated) by the customer “wait” time, and as a result look no further than solving the problem presented and moving on.  This is especially true if their ranks have been diminished due to the current economic conditions.

One solution is to have Customer Service report into the Marketing department instead of Engineering.  Included in this organizational change would a change in the measurement system to include having the Customer Service personnel fully understand the customer’s current needs and wants beyond the problem call…in short using Customer Service as part of the sales team.  The objective is to hone in on sales opportunities that then can be passed along to the sales channels as qualified leads.  While this may require a difficult cultural adjustment, the potential for increasing revenues dictate the change.

As a Marketing manager, have you reviewed how your customer service people are dealing with your customers today?  Is everyone in your company adequately trained in dealing with your customer base?  Do you recognize that “that loyal customers are the primary, enduring source of cash flow and organic growth?”

RHM 5/1/09