Discover, Control and Increase Your Hidden Customer Value!

By Peter K. Neff

According to Professor Bernd Schimitt of Columbia University in New York, "The future-oriented income value in the distance selling business is sustained by the value and profitability of the customer."

However, based on the Excellence Barometer 2005 (DGQ)--a benchmark study that reports on several industry segments--more than 50 percent of customers are dissatisfied with products, services and companies. And furthermore, they do not feel committed towards the company. In the DRTV industry, that percentage could even be more. It is not surprising then that the profitability of many customer relations falls by the wayside. There is an obvious gap between the promises, services, programs and processes that companies deliver, and what is experienced and valued by the customer.

Those who increase customer commitment will clearly optimize profitability. Using a Strategic House (see diagram below) will give direct marketers and electronic retailers the opportunity to generate the most valuable information.

4 IMPORTANT FACTORS
In reality, this Strategic House can really be compared with the structure of an iceberg. What really moves, motivates or drives a customer often stays hidden under the surface. Yet, it often remains dormant in the companies themselves. These treasures can be discovered in four chambers: data, customers, value and process.

Data. Decipher the information. The companies already have numerous relevant data available from the activities. To track down the information contained in the data and to transform this into knowledge, the created value chain must be organized without media breaks--starting from the data and proceeding all the way to the integrated control and management of the customer value.

Customers. Pick your best and most valuable customers! When the data has been organized, new qualities can be defined. Then the company can really focus on particular after-sales activities using the data on the most valuable customers.

Value. Measure, calculate and direct customer value. Once the factors that influence buying decisions have been identified and the drivers of customer value have been deciphered, the effects on interrelations will become transparent. This individualized value assessment will ultimately have an effect on marketing, sales, service and campaigns, which then will be converted to corresponding values.

Process. Increase performance through measurement. Processes in customer and data management are simplified and interwoven with each other. Customer performance is measured and increased through goals to be defined, indexed and put into action.

Although this might seem like an exhaustive process, uncovering the things that inspire, motivate and engage the customer to pick up the phone and order product can mean the difference between garnering the quick sale or gaining a long-term customer.

Peter K. Neff is the European representative of Global Infomercial Services LLC. He can be reached via e-mail at peter.neff@giservices.tv.