Service, leadership promotes profitability

A five-percent increase in customer loyalty can drive a 25-percent to 85-percent increase in profitability, says Phil Monetti of The Integrity Team Inc., Severn, Md.

And profitability and growth is the goal of the “service-profit chain,” a concept Monetti presented to National Auctioneers Association members July 15 during “The V-Factor: Creating more Value for Clients.”

The presentation was part of the NAA’s annual Conference and Show in Orlando, Fla.

In order to achieve customer loyalty, Monetti says customers must perceive that they get value over what they actually pay for goods or services. Productive employees drive customers’ value perceptions, therefore, employees must be loyal to their companies.

“One of the strengths of your business is the loyalty,” Monetti says. “I bet half of the (Auctioneers) that I met (July 14) have relatives in the business. That gives you a real important understanding of one of the reasons you’re successful.”

Employees must be satisfied with their employers to promote this loyalty. It’s important that business leaders, then, make employees feel important, engaged and respected, he says.

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Filed under Auction Industry, Conference and Show, Education, NAA Members

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