[The following guest post was written for CMO.com by Ernan Roman, a member of the Marketing Hall of Fame and the author of Voice of the Customer Marketing: A Proven 5-Step Process to Create Customers Who Care, Spend, and Stay.]
When HMS National, a leading home warranty provider, sought to improve homeowner renewal rates, it turned to a powerful source for guidance: its own customers. I worked with the company on a process of in-depth customer interviews, called Voice-of-the-Customer (VoC) research, for answers. The strategies and tactics HMS gained from that research increased customer satisfaction, lifted renewal rates 20 percent across the board—75 percent in some segments—and helped the company radically reconsider its marketing efforts.
So what did HMS learn that made such a significant difference? That honoring consumer preferences, privacy, and personalization matters. Often referred to as customer experience marketing (CEM), the process begins with specialized research on customers or prospects to understand their product or service needs, decision-making process, and expectations of the optimal experience via Web, social media/community, email, offline media, and customer service call centers. It is advanced by engaging customers and prospects to opt-in and self-profile their preferences. And it culminates in a preference-driven multichannel marketing effort that far surpasses the “spray and pray” approach of the past.
Committed to making changes as a result of its VoC research, HMS reworked customer touchpoints to include profiling and preference management opportunities. It employed new marketing techniques that honored customer preferences, respected their privacy, and was personalized to their households. The result? A 20 percent increase in conversion rates and outcomes in some markets that are nearly twice the industry average. HMS listened and customers rewarded the company for doing so.
It is clear that consumers are selecting companies that engage them and seek their input. Moreover, customer-driven relationships and personalization have become powerful competitive differentiators. In a digital world where commerce is driven by 24/7 access and unlimited options, simple transactional marketing has become table stakes. We expect the Amazons and Travelocitys of the world to know what we purchased and when we purchased it. True personalization has become the key to standing out and engaging customers on a meaningful level.
Meanwhile, lawmakers and regulators are actively protecting consumer privacy. As opt-in and consent rules become broader and more widely enforced, businesses will need a next-generation marketing process in place that can thrive in a compliant customer interaction environment. CEM solves this, as well, by featuring preference management and opt-in tools at the center of the process. Engagement delivers consent as a by-product of active interest in the value a company is providing.
More and more companies have achieved double-digit increases in response and revenue as a result of implementing VoC-driven strategies and action plans. As a result, momentum toward deep customer research and related CEM strategies is growing. That's why I’ll be discussing what I’ve learned from more than 100 VoC projects at the inaugural Customer Experience Marketing Summit in Atlanta on Sept. 19 to 20. I’ll be joined by leading voices from companies such as Intuit, Symantec, and Coca-Cola to explore higher levels of engagement in an environment that truly respects consumer preferences and privacy. The event will also feature presentations from technology innovators who have built platforms and tools that allow for effective CEM implementations across large enterprises.
As HMS National learned--and as many other companies are just now discovering--honoring consumer preferences, privacy, and personalization is essential to any effective marketing strategy.