The top strategies for mid-market businesses over the next twelve months or so are increasing customer loyalty and reducing operating costs, according to a survey of over 2,000 decision-makers in mid-market businesses, conducted for Sage by research firm Populus.
More than one third of respondents saw increased customer loyalty as the means by which they would grow their business over the next year. The study interviewed decision makers in businesses with 100 or more employees as part of its annual Business Index Survey, which gathers insights across 18 countries around the world.
"As confidence for mid-market companies reaches new highs, businesses are planning for growth by focusing on increased customer loyalty," explained Jayne Archbold, CEO for Sage Mid-Market Europe. "We also found that Europe's mid-market companies are pinning their hopes for growth on strengthening their product and services portfolios and marketing."
In the UK, mid-market companies account for more than a third of the UK's GDP and have the highest levels of business confidence in Europe.
The UK's 'Mittelstand' is expected to surge over the next 12 months, with 68% of businesses anticipating growth in their turnover. This confidence is all built on strong momentum in exporting this year and an expected surge next year - 34% of UK mid-market companies saw their levels of exporting grow in the last year, while a whopping two thirds (65%) expect to see export turnover growth in the coming twelve months. While they increase export turnover, Sage Mid-Market's research suggests that much of this will be underpinned by a drive for greater customer loyalty.
By focusing on customer loyalty, businesses are demonstrating realism and pragmatism. They have understood the huge value that happy customers bring. Gaining new customers is expensive and time consuming, and customer churn means that is multiplied many times over. Dissatisfied customers can also spread the news of their unhappiness far and wide and a negative sentiment can have a huge effect on profitability.
A content customer is your advocate: the happiest will go out of their way to sing your praises, recruit new customers and provide constructive feedback on your products and services. There are knock-on effects too. Employees who feel they're doing something worthwhile, and who work with satisfied, positive customers, tend to stick around longer - and provide better service, because they're happier doing their job, too.
Customer loyalty really comes into its own when a business is in a growth market. Customers spend more - making them more valuable and helping to boost growth organically. It also requires less outlay than recruiting new customers.
There are many reasons why a culture of customer centricity makes even more sense these days. The emergence of the social customer - who can react to a bad experience on social media with catastrophic repercussions - is one reason why customer satisfaction has become a mission-critical issue for many businesses.
Driven by technology opportunities people want to communicate and collaborate more in business, as they do in their personal lives. Gartner predicts that by 2016, more than 1.5 billion people will use social networks. There is a huge opportunity here for customer loyalty.
Customers are interacting with brands and businesses, creating deep attachments, and communicating more often. This gives connected companies more insight, enabling them to create yet richer interactions and better communications, products and services.
By incorporating social media into sales, marketing and customer service activities, businesses can learn more about their customers' likes and dislikes. By leveraging the information available they uncover more leads and boost the overall customer experience with greater personalisation and timeliness.
Beginners on this journey will find that by broadening their presence on social media they create an extra avenue to generate interest. If people can find the business in multiple places they are more likely to make that connection between the brand and their need when they are ready to buy.
Then the customer service team can use the increased visibility into the customers and make every agent more productive, empowering them to upsell and cross-sell.
Customer centricity is not just about offering great service, it means offering a great experience all the way through the customer journey, from initial awareness through purchasing and finally the post-purchase process. Companies that are committed to customer centricity focus on what the customer wants and needs, and develop products and services around that.
Communication and collaboration is quicker, easier, and far more natural than it ever was before the advent of modern collaborative tools. It's not just for customers though. When staff are socially connected they also become more engaged and more productive.
Responsive to customer needs
Another hot topic is 'responsive design' - the design of a website, or programme which adapts and changes the way it looks depending on the size of screen it is displayed on. From a customer perspective, this is about displaying the data in a viewable fashion on any device. It doesn't matter if you are trying to view your data from a 3-inch smartphone screen or a 15-inch laptop - the data that you need to see should still be easily viewable and digestible, and the mechanics of the app adapt around it.
Yet marketing departments are not fully utilising the benefits of CRM from a mobile perspective yet. This is particularly from a data capture point of view - you can have people out in the field speaking to customers, filling in forms digitally, but in many cases that data is not then integrated into a CRM system. This can ultimately mean a duplication of work for those in the field, or even more worryingly, those vital customer or prospect insights are lost altogether.
This segment is particularly underdeveloped from a mobile perspective and I think we will see moves to fill that gap over the coming months. On top of this, the capturing of social interactions between a business and their customer will continue to evolve, building a picture of their relationship.
What businesses need to fully realise are the benefits between front and back office integration through CRM. Think of the possibilities of putting every piece of information and interaction for a customer at the fingertips of your sales team while they are out in the field.
"It is notable how optimistic exporting mid-market companies are. They companies are the unsung heroes of European economy, a fertile breeding ground of innovation and growth, yet are often overlooked by policy-makers," concluded Archbold. "Fortunately this part of the economy has their own growth ambitions and are looking forward a great 2015."