The 12 Principles for Building Profitable Customer Relationships

By Brad Cleveland

The principles behind building strong customer relationships are as important as ever in today’s hyper-connected economy!

Over the past decade, ICMI has studied, codified and periodically published a summary of the most important principles behind building strong, profitable customer relationships. Lately, I’ve been asked, are these principles less important? Have evolving customer expectations, social communities, new channels and other developments changed the fundamentals?

Not at all! These 12 principles are as important as ever, in large part because of the most significant changes that are taking place. Each is both compelling on its own, but as an overall customer relationship strategy, they are best viewed and implemented together – the integrated whole is greater than the sum of these parts.

  1. Continuously learn about your customers: From this principle, everything else follows. When you know your customers, you can make sound business decisions about how to develop relationships with them.
  1. Interact personally with your customers: Relationships result from interaction. Knowing your customers is just the first step. Use that knowledge to develop your relationships with your customers whenever you interact with them.
  1. Handle different customers differently: The power of this principle lies in the potential for optimizing the value of each customer relationship through differential treatment. Segment customers sensibly – effective customer relationship management strategy ultimately seeks to optimize value.
  1. Retain the right customers: Customer knowledge and the capability for differentiated customer treatment significantly improve many organizations’ capabilities to retain customers.
  1. Anticipate customer needs and offer to fulfill them: Knowledge of your customers presents new opportunities for making the right offer or delivering the right service to the right person at the right time.
  1. Increase value for your customers and of your customers: It is precisely because building customer relationships increases value both for customers and the organization that it is such a compelling strategy. When executed properly, the focus on building relationships and brand loyalty is a “win-win” for customers and the organization alike.
  1. Present a single face to your customers to make their experiences with your organization seamless: Seek to simplify the experience for your customers. Take a holistic view of your customers and consolidate information from across the organization, regardless of geography, department, function, contact channel, social community, or product line.
  1. Focus on revenue and retention more than on reducing costs: A renewed focus on building relationships can require so many organizationwide process changes that operational cost savings may well be realized – but keep your eyes on value, overall revenue and retention first.
  1. Enable information sharing and interaction across the organization: It is both a requirement and a benefit of customer relationship management that organizations improve their internal communication processes. The only way to develop a comprehensive view of each customer’s relationship with the organization is with the full participation of every part of the organization.
  1. Create business rules to drive all customer relationship management decisions and automation: Business rules codify and automate processes, specifying what should happen in specific situations, thus enabling both differentiated customer treatment and automation.
  1. Empower agents with information and training: Just as the cockpit of an airplane displays all the information a pilot needs to fly in any conditions, the contact management screen should pull together cleanly and clearly all that the organization knows about its relationship with that customer. Empowerment is a complementary principle because no set of business rules can or should fully anticipate every conceivable situation.
  1. Remember that the effective management of customer relationships is a way of doing business, not just a technology project: Technology is an enabler, but as these 12 key principles demonstrate, cultivating customer relationships is much more than high-powered technology. Customer strategy must be the way you do business.

You can trust these principles. They have staying power, even (and especially) in today’s fast changing environment.

This article was originally published by ICMI,

Copyright Brad Cleveland.

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