7 Levels of Business Relationships

, ,

Organizations can help drive revenues by managing and improving the level of relationships. Following is a table and graphic that identifies 7 levels of business relationships beginning as a “record in a database” and evolving into a “friend”. A friend is the best type of customer as they will send referrals and are likely to purchase other products.

The 7 levels of business relationships include:

  1. Record in database – no communication, no relationship
  2. Contact – communicated once or so by phone, email, or social media
  3. Prospect – a contact that may become a customer
  4. Acquaintance – communicated more than once, good prospect
  5. Customer, single product – Possibly met once or more
  6. Good Customer – purchased more than once – Speak or meet occasionally,
  7. Friend – Great customer, will send referrals, likely to purchase other products

To drive revenues, your staff members need to build relationships by moving contacts from Level 1 to hopefully Level 7. The most likely way to achieve a Level 7 relationship is to interact with the contact in a non-business setting, such as with an out-of-office event.

Result of Recent Microsoft Study

According to a recent Microsoft study, 60% of global consumers have stopped doing business with a brand due to a single poor customer service experience. The majority of these customers leave quietly, without complaining, so organizations are not aware of their loss.

The Net Promoter Score

Do you know your Net Promoter Score?

The Net Promoter Score is an index ranging from -100 to 100 that measures the willingness of customers to recommend a company’s products or services to others. It is used as a means to measure customer satisfaction and their loyalty to the brand.

The score is intended to predict the growth of a business and to establish a focus on processes to improve customer satisfaction.

Using a 10-point scale, respondents are grouped as follows:

  • Promoters (score 9-10) are loyal enthusiasts who will keep buying and refer others, fueling growth.
  • Passives (score 7-8) are satisfied but unenthusiastic customers who are vulnerable to competitive offerings.
  • Detractors (score 0-6) are unhappy customers who can damage your brand and impede growth through negative word-of-mouth.

Subtracting the percentage of Detractors from the percentage of Promoters yields the Net Promoter Score, which can range from a low of -100 (if every customer is a Detractor) to a high of 100 (if every customer is a Promoter).

* Information obtained from Net Promoter Network.

Turn Customers Into Friends

,

An organizations strategy to drive revenue should include processes to develop customers, to retain customers, and to turn customers into referral agents. Developing referral agents can be accomplished by including a process to turn customers into friends. Friends are much more likely to refer business to you than persons who are not. Amazingly, it can be easy to develop friendships with customers. In non-business settings, acquaintances can begin evolving into friends by sending a gift, or an invitation to an event. This same process can be used in business and it can be done with very low cost.

For example, host evening or late afternoon events such as art museum visits or 9-hole golf events and use email to invite everyone on your customer list in the metro area to attend. Only a small percentage of customers may attend but everyone will appreciate the invitation. The cost to send the email invitation is almost nothing. The cost to host the event may be one or two thousand dollars, but this will be money worth spending because it will provide time with customers. The events will help turn customers into friends and friends are more likely to be long-term customers that will refer others.

Other examples may include gifts such as $5 or $10 gift cards, or free service upgrades which may not cost anything.

The event or gift processes can be used for customers of almost any annual spend. This means if a customer is worth $300 or more in annual revenue then they should be included on your event invitation list. Often you’ll have customers worth many thousands of dollars in revenue per year. Include them on your event invitation and gift lists.

 

Customer Service Audits

Social media has increased the need for great customer service. One unsatisfied customer can proclaim their dissatisfaction to many. This was seldom an issue 10 years ago, but it’s a common occurrence today.

Senior management of an organization may believe that only the highest level of customer service is provided by their organization. Possibly so. But do they really know? Many organizations have customer service issues festering, already dragging on earnings, and senior management may not be aware. According to a recent Microsoft study, 60% of global consumers have stopped doing business with a brand due to a single poor customer service experience. The majority of these customers leave quietly without complaining. Others complain through social media, not directly to the company, so how can senior management know? One way to find out is to order a customer service audit.

A customer service audit assesses the state of customer service offered by an organization by performing various tasks to identify policies, practices and issues that cause customer frustrations that may lead to lost business. The audit also measures the organizations’ customer service “score” and reports on how it compares with other organizations in the industry. The audit report includes recommendations to resolve issues, prevent future issues, and to turn customers into referral partners.

A customer service audit will do more to improve the financial performance of an organization than the annual financial audit because recommendations from the customer service audit will have direct impact on revenue development, a financial audit does not.

If you believe that great customer service is important for your organization, call Triliji to schedule a customer service audit.