Customer Experience is a critical factor driving customer loyalty and retention. It is important for companies to focus on these Key Performance Indicator (KPIs) because it takes 5 times as much to attract a new customer as it does to keep an existing customer satisfied. Maintaining high levels of customer loyalty and retention can also have a huge financial payoff. Benchmark studies show that just a 5% increase in retention can yield profit increases in the range of 25% to 95%.
Connected Customer Experience
Service Contract renewals are vital for a steady stream of service revenues. Renewal Rate is also a key performance indicator for service revenues, customer satisfaction, and customer loyalty.
Given the enormous attention that field service organizations (FSOs) are placing on growing topline service revenue, Blumberg Advisory Group and Giuntini and Company recently partnered to conduct a study among service executive about best practices involved in selling extended warranty and/or extended service programs. A key finding of the survey is that the configuration of extended warranty and extended service programs has a tremendous impact on the sale of these programs. In other words, the length of coverage, level of customization, processes engaged and resources employed in delivering the warranty, and entitlement levels offered play a key role in driving sales. These findings suggest that the more distinctions a company can make about its service program, as defined through the configuration, the more effective the company will be at getting customers to purchase it.
Recently, Blumberg Advisory Group and Giuntini and Company conducted a study about the Extended Warranty/Extended Service Market. We looked at various aspects of sales process and specifically evaluated the Warranty Attachment rate (i.e., customers signing up for these programs) and Renewal rate (i.e., customers renewing their agreement during the warranty or at the end of the term) as they are Key Performance Indicators (KPIs) that measure how successful a company is in marketing and selling extended warranties and extended service programs. Best in class performance would equate to companies achieving an attachment rate of 50% or higher and renewal rates of 75% or better.
Warranty Managers are faced with a dilemma on deciding the level of automation in claim processing. Automated approvals can lead to more efficiencies, but may result in excess payments from overcharges and even fraudulent claims.
Companies are increasingly focusing to become more customer-centric and elevate customer experience to improve customer satisfaction, loyalty and life-time value. Durable goods companies that provide high value and complex products face unique challenges. Experts at mize, software leader in Connected Customer Experience, have identified 10 Best practices to deliver customer support excellence in the durable goods industry.