New Research Outlines How Customer Service Leaders Should Develop a Cross-Functional Customer Break Up Strategy.
By 2025, 75% of companies will 'break up' with poor-fit customers as the cost of retaining them eclipses good-fit customer acquisition costs, according to
This shift will expose silos among customer-facing functions, as a customer breakup strategy must be developed cross-functionally, and force leaders in sales, marketing, customer service and customer experience (CX) to collaboratively execute a common customer-facing strategy.
'Business leaders are starting to recognize how costly keeping a poor-fit customer can be for business, such as overcustomization, custom-made solutions and outsize time spent on servicing,' said
Gartner research shows that all functions must agree on a common set of attributes that define a poor-fit customer and then determine how each of those attributes would appear in related functions. Functional leaders must adjust their teams' processes to deselect poor-fit customers. For example, customer service and support leaders will need to rethink their routing and queuing processes and ensure reps don't give preferential treatment to poor-fit customers. Marketing teams will need to adjust their advertising strategies to deliberately deprioritize customers who are not a good long-term fit for the organization, instead of repeatedly marketing to every existing customer.
'Organizations will need a consistent data analysis strategy to capture and align customer data across different silos. This analysis strategy will be critical for predicting poor-fit customers,' said
As organizations explore breaking up with this customer segment, Gartner recommends the following to align across teams:
Create a customer-fit score to inform actions to take with a customer, such as deciding to further grow the relationship, maintain the relationship or break up with the customer.
Work closely with the CFO and the CFO's team to ensure the organization's ability to adequately grow business with, and acquire, good-fit customers to compensate for the loss of revenue from poor-fit customers.
Adjust organizational KPIs, including employee incentives, to include customer breakups along with growth targets.
Communicate the breakup strategy to the board and investors to ensure they understand that any reduction in overall retention is intentional, and done to improve the company's growth.
Revise retention targets to center on the percentage of good-fit customers retained, not overall customers retained.
Additional information is available to Gartner clients in the report: Predicts 2022: Customer Service and Support Strategy and Leadership.
About Gartner for Customer Service & Support Leaders
The customer service and support function is vital to maintaining customer loyalty and influencing brand perceptions. Gartner for Customer Service & Support Leaders provides indispensable insights, advice and tools needed to achieve service and support leaders' mission-critical priorities, specifically improving the customer experience while managing costs. Gartner's research, advice and best practices equip customer service and support leaders to design an optimal service channel strategy; measure and reduce customer effort; and hire, develop and retain high-potential frontline talent.
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