State of the Industry

A recent article in Harvard Business Review (“Stop Trying to Delight Your Customers,” August, 10, 2010) discusses recent research, which found that

While it is often believed that to increase loyalty, companies need to WOW customers by exceeding expectations, what customers really want (and rarely get) is just a satisfactory solution to their service issue. In fact, recent research found that loyalty has more to do with how well companies deliver on their basic promises than on how exceptional the service experience is.

The just-released customer service survey of more than 75,000 customers conducted by the Customer Contact Council (CCC) revealed that:

1. Exceeding expectations during service interactions has negligible impact on customer loyalty. While surveyed-customers were more interested in how well a company delivers on their most basic, plain-vanilla promises rather than being dazzled and having their expectations exceeded, a full 89% of customer service department heads had 'to exceed customer expectations' as their main strategy.
2. Service organizations create loyal customers primarily by reducing customer effort. This means helping customers solve their problems quickly and easily – not delighting them in service interactions.
3. Customer Effort Score (CES) tops the charts with the highest predictive power. In the customer service environment, Customer Satisfaction (CSAT) is a weak predictor of customer loyalty. Net Promoter Score (NPS) is slightly better;
By decreasing customer effort to purchase, companies can drive increases in repurchase, spend and brand advocacy.

A Harvard Business Review article, “Stop Trying to Delight Your Customers,” by Dixon, et al. that summarized these research findings recommends that customer services representatives should focus on reducing the effort customers make by anticipating and heading off the need for follow-up calls, addressing the emotional side of the interactions, minimizing the need for customers to switch service channels, listening to and learning from disgruntled customers, and focusing on problem solving not speed.

Customers want their problems fixed … fast and easily

Consumers are drawn to companies that that offer quality products at a good value. Most often, we defect when they fail to deliver on customer service. In fact, when customers reported that a “very low effort” was required to have their problem resolved:

• 94% intended to repurchase
• 88% said they would increase their spending

But when the effort to resolve the problem was considered by the customer to be “very high,” a whopping 81% intended to spread negative word of mouth.

These findings clearly indicate that “making it easy” for customers to interact with customer service to resolve questions and problems is an optimal way to enhance customer loyalty. 

So, you ask, how does a brand make it easy for customers?

The study uncovered three primary reasons customers have to expend extra effort/work hard to get their problem or question resolved. These are having to:=

• Place multiple calls to address the same issue
• Repeat the same information to multiple contact points
• Switch from one service channel to another

Training and information are the keys for success.Armed with proper training and equipped with the information, tools and authority to head off future problems, customer service reps can eliminate the need for multiple calls and make it faster and easier for consumers to solve their problems.