Many people believe that only a negative customer experience is shared via social media. But, according to a recent study from Ipsos Loyalty, consumers are just as likely to promote a positive experience.
The survey covered seven sectors and assessed more than 10,000 “critical incidents,” which are defined as moments of truth in the customer experience that can make or break a relationship. Overall, it found that 52% of consumers who had a bad experience told their friends, family, or colleagues about it. Yet surprisingly, more consumers (56%) indicate to have shared a good experience with others.
Loyalty360 caught up with Jean-Francois Damais, Deputy Managing Director, Global Client Solutions at Ipsos Loyalty, to find out more about this compelling study.
What are your two or three key takeaways from this study?
Damais: 1) Customer Experience REALLY Matters. Nearly 2/3 of customers said that personal experience influenced their decisions about which brands to choose. Social media plays a significant role, with 16% of customers saying it influenced their decisions.
2) The voice of the customer is louder and its reach stretches farther than ever before; 52% of consumers who had a bad experience told their friends, family, or colleagues about it; 56% indicate to have shared a good experience with others. Consumers aren’t only voicing their thoughts and experiences with brands through old fashioned word of mouth. They are, of course, also turning to social media. In fact, the study found that consumers who had both bad and good experiences shared it on a social media platform: 12% and 10%, respectively. Finally, the study found that following a negative experience, 24% used the brand less or stopped
using it; on the flip side, 17% started using the brand more after a good experience.
Clearly, the stakes are high and companies need to work hard to leverage their customers’ good experiences and resulting goodwill, while designing processes and service experiences that minimize the occurrence of negative critical incidents.
3) Companies need to do work harder to resolve customer issues.
Across sectors, about 50% of customers who experienced a negative critical incident are dissatisfied with how the issue was resolved. Customers report that in over one in three cases companies are not even aware of a complaint or negative critical incident, meaning that they do not have the right systems in place to capture customer feedback following an interaction. In addition, while we would expect companies to work hard to solve a customer issue, our data shows 60% of customers perceive that they are putting more effort in than companies to get things resolved following a negative critical incident or complaint!
How can companies manage the customer experience better?
Damais: Managing the customer experience is not an easy task. In service industries, in particular, keeping a high degree of consistency in the way services are delivered to customers is a challenge. And the number of channels of interactions has grown in the recent past making it even harder for brands to offer a consistent and on-brand experience to all customers at all times. As our study shows, responding to customer incidents is key to minimize negative customer outcomes. But companies need to think strategically about this in order to allocate resources most cost effectively. Making all customers happy at all times is not a realistic goal. A good starting point is to understand that not all incidents are equal. Companies need to discriminate between different types of incidents and prioritise interventions based on likely impact. They also need to account for customer value, customer profile and past transaction history.
How can brands use these insights to leverage social media in a more impactful way?
Damais: Our study confirms the importance of social media in the customer experience space. It highlights that social media has some influence on brand choice and that customers share negative, but also, positive experiences online. As such as it is more important than ever for companies to mine the digital voice of the consumer to make sure they get a 360 understanding of what drives customer attitude and behavior.
But extracting insights from social media data is not without challenges and companies embarking on that path need to make sure they have access to the right technology (e.g. sophisticated Text Analytics capabilities) and expertise to transform large amounts of messy data into meaningful and actionable insights.
Customer experience is such a key differentiator for brands today. How brands using social media well and what are the challenges they still face?
Damais: More and more companies recognize that they need to deploy a broader palette of channels to communicate with customers. In particular, the use of social media channels for customer service purposes is growing at a fast pace. Well beyond marketing, social media provides a lot of opportunities to deliver cost effective and targeted customer care to an ever increasing number of consumers using social media in their daily lives. There is more and more strategic thinking going into managing social for customer experience.
For example, some companies choose to have separate Twitter account for customer experience management and brand while others like to keep both together to get a more authentic feel of the brand and of the interactions between brand and experience. We also see more brands making use of Twitter’s direct messaging capabilities to overcome issues around confidentiality, particularly important in the financial sector. But one of the biggest benefits, in our opinion, is the flexibility social platforms offer when it comes to testing different types of interventions or communications. Training costs for the deployment of such initiatives are kept to a minimum compared to a call center environment for example, and consumer reactions are pretty much instant!