Most businesses are aware that it makes sense to keep in touch with customers. They know it is cheaper to keep a customer than to gain a new one. They know customer follow up increases retention. They know asking customers is one of the best ways to keep up with the 'market'. Unfortunately, active customer follow up does not happen. It becomes the 'unessential' item pushed aside by weightier issues. Does this sound familiar?

Often corporations of all types do passive customer analysis. They look at why and when customers or distributors call the company. Passive analysis is essential. However, only 1 in 20 customers who have a complaint will call and inform the company. Occasionally a customer will deliver a compliment. With passive analysis, companies miss out on important feedback. Even fewer customers will call and report their neighbor is also interested in the product. The company and distributor have the opportunity to tap into untapped resources by contacting their customers.

Another reason direct sales or multilevel marketing companies often don't receive feedback from customers is because they rely on distributors to make that contact and then hope the comments make it back to corporate headquarters. Distributors are sales, not customer service. They don't take time away from selling to do it. They know they should follow up with customers, but they don't do it. Just like we all know we should add to our retirement--it just never quite makes it to the top of the list.

Distributors often sell to their warm market. It's difficult calling a friend or neighbor and get real feedback. It's too personal to give honest feedback and they don't want to offend or hurt anyones feelings. They would rather just 'chalk it up to experience' rather than hurt anyone's feelings. They will however, tell others about their negative experience.

Implementation

One method used by both distributors and companies is to hire outside follow up consultants. The outside consultant can bring an increased level of objectivity. The follow up team can get feedback the distributor or company may not be able to access any other way. By using an outside firm, the feedback is more objective; it gets done every day and results can be tracked.

A parent company or distributor must first determine what goals it wants to accomplish from customer follow up. These goals can vary from product / service satisfaction; new product need; product / service reliability; staff performance; marketing strategies; priority notification; building trust and relationships; more product usage; to reduction in complaints. The goal must clearly fit into the strategic business plan and benefit customers, employees, sales staff, vendors and stockholders.

Once goals have been established, the decision is made regarding the best way to collect the data to analyze. For example, there may only be interest in knowing about product usage. In this case the customer would be surveyed regarding product receipt and usage as well as their overall impression of the parent company and distributor. In addition, the customer should have the opportunity to give positive or negative feedback, and when appropriate, referrals can be obtained from satisfied customers. It takes a combination of written and oral communication to satisfy these goals.

The questions to be asked upon phone contact are developed around the established goals. Any additional information to be given to the customer is decided upon as well as any verification that may be required. All of this information is then formatted for ease of flow in a conversational setting. Having professional call center personnel putting the customer at ease is essential in order to obtain useful feedback. Since it is not possible to physically speak with every customer, it is necessary to build written correspondence to supplement the actual calls. Written correspondence is developed around established marketing goals. While at first glance a letter may not seem as effective as a call, in contrast, it gives the customer valuable information about the parent company and distributor, the product or service and the assurance the parent company and/or distributor is interested in feedback. In addition, written correspondence invites customers to make contact if ncessary. Customers know their business is valued.

Benefits and Results

Parent companies or distributors will find communication with their customers results in learning much information previously lost. The results of pro-active communication with customers include:

Valuable data for effective marketing strategies
Valuable data for new product/service development
Customer needs identified
Customer satisfaction history
Customer profile and contact information updated
Win-back criteria collected to market selected cancelled or inactive customers

Distributors and corporate can view the information collected. They have a better understanding of what they need to work on. For example, distributors who have a high cancellation rate because the customer really didn't need the service learn "I'm marketing to the wrong person", or "I need to change my sales pitch".

Identify customer issues
Identify reasons for canceling
Track retention statistics closely

Follow up involves reminding customers of the key benefits. Interestingly sometimes customers say they didn't like the service or product at first. It's difficult to get these customers to stay long enough to see benefit. Follow up keeps them connected in those initial post decision months.

Cross-selling opportunities
Objective customer feedback
Resource for customer testimonials

It's important to capture positive feedback. If a customer has a wonderful experience with the product or service, document their comments. With this specific information, the company or distributor can contact the customer for a testimonial.

Referrals
Customer retention improvement

By using an outside source, one distributor with a very low retention rate doubled retention the next year. What changes had they made in their marketing approach? None. The only difference was they started a follow up system. Other distributors may utilize a follow up system, but learn their retention can improve with various marketing adjustments. The key point is customers get an opportunity to communicate. They are impressed someone took the time to follow up. When angry, they appreciate someone is listening.

These benefits show an eyes wide open view. Sometimes it's scary, but business is often quite scary. Knowing what customers think is how successful businesses keep on top. All businesses are competing in the customer retention game. Corporate needs to proactively capture the feedback to alter at the macro level. Distributors need to understand at the personal level what they can do differently and what should also remain the same. Proactive customer analysis is an important step in understanding the various levels of any business and especially one that advocates person to person selling. It's never too late to find out what your customers are really thinking. You won't regret the results.