Imagine what could happen if your existing customers felt misled or had a negative experience related to needless charges on any service or subscription.
Bad profits arise from the sale of a product through misleading messaging and unclear pricing strategies – for instance, if you take a closer look at your mobile bill and realise that you have been paying for an additional data pack that you didn’t upgrade to. Bad profits confuse customers.
Are Companies Becoming Victims of Bad Profits?
Businesses are becoming addicted to bad profits, which can be disastrous as they compromise customer experience.
Profit is central to the bottom-line growth of any company, no matter how big or small. But companies focus most of their energies on acquiring new customers while neglecting a piece of the puzzle that’s every bit as important: customer retention. For instance, a fitness center might offer discounts to new customers and not focus on retaining repeat customers, or an airline might charge extra for loyal customers to switch flights, even when they have seats available. This is how an existing customer can feel mistreated by a brand.
Bad profits pull businesses down by hurting customer loyalty because when a customer realises what the business is doing, it is incredibly difficult to earn back their trust.
Break the Habit of Bad Profit with Customer Experience
The idea of bad profits was created by Fred Reichheld in his book “The Ultimate Question” and the term refers to money made off customers by being deceptive or misleading. In “The Ultimate Question”, Fred Reinhold talks about the effect of bad profit on a company’s Net Promoter Score(NPS), asking: “How likely is it that you would recommend this company to a friend or colleague?” But we must dig deeper to understand the real issues behind why customers are dissatisfied.
Customer Experience Management for positively engaging with customers can help businesses avoid bad profits and make good profits.
The focus of your business should be to gain promoters as much as possible to boost your good profits. But how? Measuring and improving your NPS can help your business to find detractors (customers who feel badly treated by your company) more easily.
Turn Bad Profits into Good Profits by Predicting and Preventing Customer Churn
With integrated Customer Experience Management (CXM), your business can predict and identify high-priority customers at risk. This makes you focus first on customers with high transaction usage and low NPS ratings.
How CX works to turn bad profits into good profits?
This is about Good Business; not Smart Business
Customer experience helps to turn detractors into promoters! More promoters can help your business stand out from competitors in terms of superior customer experience.
Real, sustainable good profits are impossible without a thoughtful customer retention strategy
If the customers you acquire don’t stay longer to build a relationship with your brand, the effort that it took to bring them into the fold will have been for nothing. AI-enabled CXM is the best choice to boost good profits.