Job Churn Era & ‘New/Current’ Customer schism

CNN reports that employees changing jobs in USA see an immediate 18% pay bump. Sobering, but not surprising that firms owned by hedge funds or even more remote (Mars-bound!) billionaires are out of touch with their employee’s daily struggles.

What will happen now? Employees who are restless, capable, aggressive/assertive, disgruntled or disrespected will now ‘jump’ elsewhere; dominoes will fall b/c those people’s roles were legit staffing needs. The ‘churn era’ will put pressure on HR /Recruiting, tho it need not have occurred at all.

Firms out of touch with their own customers commit this sin, too! In an oligopoly, a firm’s tendency is to ‘take current customers for granted’, yet obsess about new-to-market prospects (immigrants, teenagers coming of age, etc). The reason? Sexy Metrics! New customers are EZ to count [“Wow! Look at the gains!”] and the Marketing Dept often uses an unrealistic Lifetime duration over which to amortize their overly generous trial offers. Are the Metrics to retain a customer equally obvious & sexy? Nope. Reinvesting seems boring- and unnecessary [“after all, who would leave us?]

Examples? Canada’s giant telecoms reserve their best promotion offers & fastest response times for new customers [thereafter, your best hope is for late, reactive, limited consideration [& as the saying goes “Service requested is service failed” ie if you must ask for it, it’s already too late to feel respected]. Our chartered banks dote on new customers, but once you’re in, you’ll pay service fees for everything, submit to brutal ForEx rates, nasty checking account fees, etc. [why should they care? They signed you up- and their competitors are all doing what they’re doing, so what would you gain by switching?]

Is there a remedy? Not an obvious one. In oligopolies, the status quo remains until one player, for reasons unknown*, wakes up & starts to rebalance service efforts/offers to show respect for current customers. *They might justify such a strategic shift after doing some testing, which will inevitably show a remarkable improvement in customer retention, if you just stop disrespecting or ignoring current customers.

Respect what you have. It’s unsexy, but it works. And it’s a lesson every firm must relearn periodically, even if they’re not part of an oligopoly. Or owned by a hedge fund. Or a Billionaire space traveler.

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