“Organizations that engage their customers outperform those that do not.”

The statement comes from a Gallup report, Customer Engagement: What’s Your Engagement Ratio?, available on Gallup’s Web site. Gallup backs up the statement with results from extensive cross-industry research:

• In average organizations, the ratio of fully engaged customers to actively disengaged customers is 0.8:1. (Fully engaged customers are emotionally attached and rationally loyal; actively disengaged customers are emotionally detached and actively agnostic.)
• In world-class organizations at or above Gallup’s 90^th percentile, the engagement ratio is 8:1 — 10 times larger than the average organization’s ratio.
• Fully engaged customers represent an average 23% premium in share of wallet, profitability, revenue, and relationship growth over the average customer.
• Actively disengaged customers represent a 13% discount in the same measures.

The report cites an example of a restaurant chain with an engagement ratio of 5.4:1 in 2006 that improved its ratio to 7.2:1 in 2008. Over the same time frame, its overall U.S. sales increased by 30% and per-unit sales grew 13%. A competing chain’s engagement ratio dropped from 0.63:1 to 0.46:1 over the same period and its overall sales dropped 2% in that period.

“Customer Engagement” is the first Item in the Customer Focus category of the Baldrige Criteria. Gallup’s report identifies five areas that world-class organizations focus on to fully engage their customers:

1. Emotional Attachment. Your most profitable customers have strong emotional bonds with your organization that must be honored and strengthened.
2. Moving Beyond Satisfaction. Simply satisfying customers is not enough.
3. Key Touchpoints. Every customer interaction makes that customer more or less engaged.
4. Brand Alignment. All customer touchpoints must be measured and managed.
5. Local Variation. Strong customer relationships must be managed locally. Everyone is responsible for the customer experience.

To read more about these areas, check out related articles on Baldrige.com:

• Ground Zero for Customer Service
• 9 Ways to Get Closer to Customers
• Creating a Positive Customer Experience
• Customer Loyalty Myths
• Why Customer Loyalty Matters
• Customer Focus: The Freedom to Ask Stupid Questions

Help us grow our community 

(1 votes, average: 4.00 out of 5)

 Loading ...