Measuring Business Performance: Customers
Over the past two weeks, we have looked into business performance in terms of profitability and employees. Today, we will conclude the series by examining the third component of business performance: customers.
Finding and retaining customers has always been crucial to any business. When you start measuring and analysing the performance of your business in terms of customers, it is important that you understand them. Here are a few tips on how to measure customer performance.
Conduct market and customer research. This is the first step to understanding what customers need and how to go about aligning products and services to meet their needs. Some questions to consider include: what is changing in terms of market/customer needs? Are there other factors that might have impacted this change? What is the level of competition in this particular market and what are the possible solutions businesses can offer to meet market needs? The ability to answer these questions provides insights on the type of goals to set.
Identify and set goals based upon the conducted research. Once you have identified the goals following your market and customer research, you need to set specific, measurable, achievable, realistic, and timely (SMART) goals, for example attracting and retaining new customers or improving customer satisfaction rates. It is crucial to have the marketing/sales teams on board during this decision-making process as they deal directly with customers and are responsible for the successful execution of marketing activities.
Place more focus on customers that bring in additional value. This can sometimes pose a challenge to companies as they tend to focus more on increasing customer base. The cost of customer acquisition is often more expensive than retaining existing ones. Therefore, companies should ensure they target their strategy at acquiring and retaining customers with more value using the 80/20 Pareto Principle.
Explore new ways of reaching customers. With increased level of competition, companies need to find new and effective ways to reach customers. In addition to social media, there are other platforms such as offering email and newsletter services, running campaigns, promotions, and customer satisfaction schemes.
Monitor customer data. Customers provide insights on products, services and brands they interact directly or indirectly with. Companies that pay attention to the insight from customers will gain a competitive edge, as customers tend to stick with brands that pay attention to their views and needs. Data can be gathered from inbuilt social media analytics, customer surveys, questionnaires and information from sales/customer representatives.
Review feedback from customers Receiving feedback from customers helps a company understand how to improve the goods and services they offer.
In summary, as customers are the pillars of a successful business, companies must adopt a customer driven approach by getting to know their customers in order understand their needs and how best to meet them; create and provide unique experiences for customers and work towards delivering promises made to customers (existing and new).
If you need support on how to best align your customers to your business, please email us at firstname.lastname@example.org for a free consultation.