You Will Find What You Are Looking For | William Nozak, MBA | Harper’s Hut Shaved Ice
Several years back while in a chapel at ORU, the Men’s Pastor Earl McClellan delivered a message titled You’ll Find What You’re Looking for. This message is not limited to spiritual pursuits. In business, we have a similar moniker “you can’t improve what you don’t manage”. Experts agree upon managing KPI or Key Performance Indicators. Although this article does not delve into financial ratios, they are KPI and every business owner must run and manage month-to-month and year-to-year ratios. Even a lemonade stand has KPI. Maybe the following can be catalysts to help you devise or revise your own. Three important KPI include technician upsales, customer surveying, and social media mentions.
Whether you take a soft or hard approach to upsales the additional revenue per transaction is likely some of the highest margin revenue. Always be measuring though, not every change that increases the average ticket is a good change. If you have (ten), $100 dollar clients and you increase the average ticket by $10 dollars, but lose three clients you will actually decrease sales by $230 dollars. Whatever the expectation for upsales, there needs to be a minimum benchmark percentage. This minimum allows for A-player hiring and encourages associates to be mindful of add-on sales as a job requirement. Often times, we lose some customer respect when a focus is placed on increasing ticket value and that is why the second KPI deals with tracking customer perception.
Not every business has access to a Net Promoter Score (NPS), which has its own set of algorithms to calculate customer perception. Doubly not everyone sends an email to every client asking that $2 dollar question. How likely are you to recommend us? In order to understand how customers perceive their interaction with the company, there must be some form of feedback recovery system and on top of that a customer recovery plan AKA customer surveying and then a bad reviewer retention strategy. Emails or phone calls are the tried and true way to collect customer data. With upsales benchmarking, be certain, there will be negative comments about how an associate tried to upsell a client and the bill was 2 or 3 times higher than expected. This customer feedback allows for perception monitoring. Perception is reality with customers. Those with bad perceptions, it turns out, are more likely to share their woes with friends, so this allows for safety valves before a problem arises. It also helps to guard against ‘bait and switch’ tactics. Upsales are vital, but more so, is avoiding negative perceptions. Always monitor the balance between increasing profits and decreasing perception. If this line is not managed correctly, social media will never reach its potential.
Once revenue is increasing through strategic upsales and benchmarking, and the management team is seeing what is exciting promoters and enraging detractors it is time to focus on social media. A word to the wise, do not start a social media campaign until the team has a decent understanding of why angry customers are angry. Maximizing social media before this will yield sub-par reviews and will become your social media presence. After you have a decent customer recovery plan in place, encourage customers to promote the brand through social media channels i.e. Facebook, Twitter, Instagram, Yelp, Foursquare, Angie’s List, and others to come. Shamelessly build your web presence with your happiest customers. Expect every associate to encourage social media mentions from clients; this is a KPI because companies can easily see if reviews are increasing and whether they are positive or negative.
By implementing upsales benchmarking, a form of customer surveying, and social media mention expectations you will be on your way to finding what you are looking for. The great part about managing KPI is they become reflexive over time and adding new KPI is easier once a measurement backbone is in place. Run your business like a science experiment, more than likely you will be able to see good results when they occur and reproduce them time-and-time again. For more business related articles check out http://harpershutshavedice.me/ or Harper’s Hut Blog.