Terms like customer relationship management (CRM), one-to-one, custom-centric and customer-focused are used by people who don't really know what a customer is. Here are a few guidelines if you really want to build relationship with your customers. First, respect your customers. Don't regard them as targets to be penetrated, segments to be exploited, or crops to be harvested. Consider them as those who don't want to be lied to, and who don't want their dinnertime interrupted by phone calls.

Secondly, forget the pseudo-science. Qualitative market research doesn't work. If it did, new products wouldn't fail. Thirdly, build your brand, but in a 21st century mode. There's new age stuff creeping into brand talk, as agencies talk about "brand essence," along with the hoary pathetic fallacy of "brand personality." We are in a service economy, and one that, thanks to the internet, is increasingly interactive. Brand loyalty is a result of the experience customers have had with your product or company.

Next is building your database, but without violating privacy. Privacy is going to be a critical consumer issue of the next few years in India. You should always ask permission, offer opt-out at every information gathering opportunity, explain why you need certain information, make your privacy policy clear and accessible in all media.

The other thing to be kept in mind is to resist runaway technologies. Good intentions and bad infrastructure will ruin customer relationships every time. So be careful of technologies that promise more than they can deliver. But also beware of technologies that take on a life of their own.

Next would be to learn the differences between loyalty, necessity, and bribery. The fact is, no one knows the differences right now. I have several thousand miles on Air India. Does that mean I am loyal? Not necessarily. Loyalty creates barriers to customer defection. Necessity and bribery don't. To me, loyalty means staying with a company even after it makes a mistake. This is contingent, of course, on the company doing an expeditious job of fixing the problem.

Keeping loyalty programmes clear and simple will be the next tip. Look at the way Shopper’s Stop go about doing their loyalty programme. Every year you need to spend a lot to stay with your Gold Card! And, what prestige do they offer for the Gold Card? A free magazine of theirs will not keep the customers loyal. Remember the complex point collection campaigns by cola majors? Why complicate the process and end up losing the real loyal customers?

Offer ego rewards as well as economic rewards. At the upper tiers of loyalty/frequency programmes, customers become more interested in convenience and ease than in freebies. The other point that should be kept in mind is master customer satisfaction and complaint dynamics. Only loyal customers complain. For every customer who complains, there may be 20 others with the same problem who don't. In a recent article in Wall Street Journal, John Chambers, CEO, Cisco Systems says, “There is a one-to-one correlation between customer satisfaction and future revenues and profits. The problem is that it lags 12 to 24 months, which is why most companies don't pay attention.”

Next would be to remember that the internet makes word of mouth a mass medium. If instead of telling 15 people about a bad experience, customers could tell 1,500 or 15,000, businesses would clean up their acts fast. On the downside, of course, there's the chance of unfair accusations being levelled. And finally, love your customers more, and your products — and processes — less.

The writer is the CEO and MD of CoustomerLab Solutions