Stop Trying to Delight Your Customers

en.clix.vn20 November, 2022

0 10 10 minutes read

the idea in brief

The idea that companies should “delight” their customers has become so ingrained that managers rarely examine it. But ask yourself this: how often does someone patronize a business specifically for their over the top service? You can probably think of a few examples, such as the traveler struggling to return to a hotel that has particularly attentive staff. but you probably can’t think of many.

Now ask yourself: how often do consumers fire companies because of lousy service? all time. get back at airlines that lose their bags, cable providers whose technicians keep them waiting, cell phone companies whose representatives put them on permanent hold, and dry cleaners who don’t understand what “rush order” means.

Reading: Review how to improve customer care

all too common obstacles

Consumers’ impulse to punish poor service, at least more easily than reward pleasant service, manifests itself dramatically in both phone and self-service interactions, which are the largest customer service channels in the world. most companies. In those settings, our research shows that loyalty has much more to do with how well companies deliver on even simple, basic promises than how dazzling the service experience can be. however, most companies have not realized this and pay dearly for it in terms of wasted investments and lost customers.

the domino effect of poor service

To examine the links between customer service and loyalty, the Customer Contact Council, a division of the Corporate Executive Board, conducted a study of more than 75,000 people who had interacted with representatives of the center over the phone contact or through self-service. channels such as the web, voice prompts, chat, and email. we also conducted hundreds of structured interviews with customer service leaders and their functional counterparts at large companies around the world. (for more details, see the “about the research” sidebar). our research addressed three questions:

How important is customer service to loyalty?

Which customer service activities increase loyalty and which do not?

Can companies increase loyalty without increasing their customer service operating costs?

about the investigation

Two critical findings emerged that should affect every company’s customer service strategy. First, delighting customers does not build loyalty; reduce their effort, the work they must do to solve their problem, you do. Second, deliberately acting on this information can help improve customer service, reduce customer service costs, and decrease customer churn.

trying too hard

According to conventional wisdom, customers are more loyal to companies that go above and beyond. But our research shows that exceeding their expectations during service interactions (for example, by offering a refund, a free product, or a free service like expedited shipping) makes customers slightly more loyal than simply satisfying their needs.

For experienced leaders in the service department, this is an alarming finding. What contact center doesn’t have a wall covered with letters and emails from customers praising the extra work the service reps did on their behalf? in fact, 89 of the 100 customer service managers we surveyed said exceeding expectations is their top strategy. but despite these herculean and costly efforts, 84% of customers told us that their expectations had not been exceeded during their most recent interaction.

One of the reasons they focus on exceeding expectations is that 80% of customer service organizations use customer satisfaction scores (csats) as the primary metric for evaluating customer experience. And managers often assume that the more satisfied customers are, the more loyal they will be. But, like others before us (notably Fred Reichheld), we found little relationship between satisfaction and loyalty. Twenty percent of the “satisfied” customers in our study said they intended to leave the company in question; 28% of “dissatisfied” customers intended to stay.

The picture gets even bleaker. Although customer service can do little to increase loyalty, it can (and usually does) do a lot to undermine it. customers are four times more likely to leave a service interaction than loyal customers.

Another way to think about the sources of customer loyalty is to imagine two cakes: one containing things that build loyalty and the other containing things that breed disloyalty. the loyalty pie largely consists of such slices as product quality and brand; the serving portion is quite small. but the service represents the biggest part of the disloyalty pie. we buy from a company because it offers quality products, great value, or a compelling brand name. we leave one, most of the time, because it doesn’t deliver on customer service.

make it easy

Let’s go back to the key implication of our research: When it comes to service, companies create loyal customers primarily by helping them solve their problems quickly and easily. Armed with this understanding, we can fundamentally change the emphasis of customer service interactions. Framing the service challenge in terms of making it easy for the customer can be very enlightening, even liberating, especially for companies that have been struggling to delight. telling frontline reps to exceed customer expectations can lead to confusion, wasted time and effort, and costly giveaways. telling them to “make it easy” gives them a solid foundation for action.

what exactly does “make it easy” mean? simply: remove the obstacles. We identified several recurring complaints about service interactions, including three that specifically focus on customer effort. customers resent having to contact the company repeatedly (or be transferred) to resolve a problem, having to repeat information, and having to switch from one service channel to another (for example, having to call after unsuccessfully trying to resolve a problem through the website). more than half of the customers we surveyed reported encountering difficulties of this type. Companies can reduce this type of effort and measure the effects with a new metric, the Customer Effort Score (CES), which assigns scores from 1 to 5, with 5 representing very high effort. (For more information, see the “Customer Effort Score Presentation” sidebar.)

Customer Effort Score Presentation

during our study, we saw many companies that had successfully implemented low-customer-effort approaches to service. Here are five of the tactics they used, tactics every business should adopt.

1. don’t just solve the current problem, prevent the next one.

by far the biggest cause of client overexertion is the need to call back. many companies believe they are doing well in this regard, because they have strong first contact resolution (fcr) scores. (see sidebar “what should you measure?”). however, 22% of repeat calls involve subsequent issues related to the issue that caused the original call, even if that issue itself was adequately addressed the first time. Although companies are well equipped to anticipate and “solve forward” these problems, they rarely do so, often because they are too focused on managing call time. They need to realize that customers measure the effort they expend not only in terms of how an individual call is handled, but also by how the company handles evolving service events, like getting a mortgage or setting up a business. cable service, which usually requires several calls.

what should you measure?

bell canada overcame this challenge by mining its customer interaction data to understand the relationships between various customer issues. Using what she learned about “event groups,” Bell began training her reps to not only solve the customer’s core issue, but also to anticipate and address common downstream issues. for example, a high percentage of customers who ordered a particular feature called back for instructions on how to use it. The company’s service representatives now give customers a quick tutorial on key aspects of the feature before they hang up. this type of direct resolution allowed bell to reduce its “calls per event” by 16% and customer churn by 6%. For complex downstream issues that would take an inordinate amount of time to address on the initial call, the company sends follow-up emails, for example, explaining how to interpret the first statement. bell canada is currently integrating this problem prediction approach into the call routing experience for the customer.

fidelity uses a similar concept on its self-service website, offering “suggested next steps” to customers executing certain transactions. Customers who change their address online often call later to request new checks or ask about homeowners or renters insurance; therefore, fidelity directs them to these topics before they leave the site. Twenty-five percent of all self-service transactions on Fidelity’s website are now generated by similar “next number” prompts, and calls per household have decreased by 5% since the policy began.

2. coach reps to address the emotional side of customer interactions.

Twenty-four percent of repeat calls in our study arose from emotional disconnects between customers and reps, situations in which, for example, the customer didn’t trust the rep’s information or didn’t like the answer given and had the impression that the representative was hiding behind general company policy. With a few basic instructions, representatives can eliminate many interpersonal problems and therefore reduce repeat calls.

A UK-based mortgage company teaches its reps how to listen for clues to a customer’s personality type. they quickly assess whether they are speaking to a “controller,” a “thinker,” a “sensor,” or an “entertainer” and tailor their responses accordingly, offering the client the appropriate balance of detail and speed for the diagnosed personality type. this strategy has reduced repeat calls by a remarkable 40%.

lighting company osram sylvania reviews transcripts of your calls to identify words that tend to trigger backlash and generate repeat calls (words like “can’t”, “don’t want” and “no”) and coaches their reps in alternate phrases. Instead of saying, “We don’t have that item in stock,” a representative might explain, “We’ll have stock available for that item in two weeks.” Through such simple language changes, Osram Sylvania has reduced its Customer Effort Score from 2.8 to 2.2, which is 18.5% below the average we see for B2B companies.

loyaltyone, the operator of the airline mileage rewards program, teaches reps to look for information they can use to better rank for potentially disappointing results. A representative dealing with a customer who wants to redeem miles for an unavailable flight may learn that the caller is traveling to an important business meeting and use this fact to put a positive spin on the need to book a different flight. The rep might say, “It sounds like this is something you can’t be late for. Monday morning flight is not available but with possible delays you would be in a hurry anyway. I would recommend a Sunday night flight so you don’t risk missing the meeting.” this strategy has resulted in an 11% decrease in repeat contacts.

3. minimize channel switching by increasing the “stickiness” of the self-service channel.

Many businesses ask, “How can we get our customers to visit our self-service website?” our research shows that, in fact, many customers have already been there: fifty-seven percent of incoming calls come from customers who went to the website first. Despite their desire to drive customers to the web, companies tend to resist making improvements to their sites, assuming that only big spending and technological upgrades will induce customers to stay there. (And even when expensive upgrades are made, they often backfire, because companies tend to add complicated and confusing features in an attempt to keep up with their competitors.)

customers can feel overwhelmed by the profusion of self-service channels (interactive voice response, websites, email, chat, online support communities, social networks like facebook and twitter, etc.) and often they lack the ability to make the best choice for themselves. for example, technically unsophisticated users left to their own devices may turn to highly technical online support communities. as a result, customers can expend a lot of effort jumping between channels, only to pick up the phone at the end.

Cisco’s consumer products now guide customers to the channel it determines is best for them, based on segment-specific assumptions generated by the company’s customer experience team. language on the site’s home page pushes tech gurus into the online support community; those with less technical experience are steered toward knowledge articles with the promise of easy step-by-step instructions. the company removed the email option, finding that it did not reliably reduce customer effort. (Our research shows that on average it takes 2.4 emails to resolve a problem, compared to 1.7 calls.) When Cisco Consumer Products started this program in 2006, only 30% of their customer contacts were handled through self-service; the current figure is 84% and call volume has decreased accordingly.

travelocity reduced customer effort simply by improving the help section of their website. he had heard that many customers looking for solutions there were blocked and resorted to the phone. By removing jargon, simplifying the design, and improving readability, the company doubled the use of its “top searches” and reduced calls by 5%.

4. use feedback from unhappy or struggling customers to reduce customer effort.

Many companies conduct post-call surveys to measure internal performance; however, they may neglect to use the data they collect to learn from dissatisfied customers. but consider the australia national group approach. The company has front-line representatives specifically trained to call customers who have given it low ratings. Representatives focus first on resolving customer issues, but also collect feedback that informs service improvements. the company’s problem resolution rate has increased by 31%.

such learning and intervention are not limited to the telephone channel. some companies monitor online behavior to identify customers who are having difficulties. earthlink has a dedicated team of representatives who engage with customers as needed on their self-service website, for example starting a chat with a customer who spent more than 90 seconds in the knowledge center or clicked “contact us” . link. this program has reduced calls by 8%.

5. empowers the front line to deliver a low-effort experience.

Incentive systems that value speed over quality can be the biggest barrier to reducing customer effort. Most customer service organizations still emphasize productivity metrics like average handle time when evaluating rep performance. they’d better remove the productivity “governors” that get in the way of making the customer experience easier.

An Australian telecom provider removed all productivity metrics from its frontline rep performance dashboards. although handle time increased slightly, repeat calls were reduced by 58%. today, the company evaluates its representatives solely on the basis of brief, direct interviews with customers, essentially asking them if the service they received met their needs.

Freed up to focus on reducing customer effort, frontline reps can easily pick the fruit at their fingertips. Ameriprise Financial, for example, asks its customer service representatives to capture every instance in which they are forced to say no to a customer. While auditing the “no’s”, the company found many legacy policies that had been made obsolete due to regulatory changes or improvements to systems or processes. during its first year of “capturing the no’s,” ameriprise modified or eliminated 26 policies. he has since expanded the program by asking frontline reps to propose other process efficiencies, resulting in $1.2 million in savings.

Some companies have gone even further and made low customer effort a cornerstone of their service value proposition and brand. South Africa’s Nedbank, for example, instituted an “ask questions” promise, which guarantees that the representative who answers the phone will take care of the customer’s problem from start to finish.

The immediate mission is clear: Corporate leaders must focus their service organizations on mitigating disloyalty by reducing customer effort. But service managers concerned with how to redesign their contact centers—departments built on customer delight—should consider this: A massive shift is underway in terms of customer service preferences. Although most companies believe that customers overwhelmingly prefer live phone service to self-service, our most recent data shows that customers are, in fact, indifferent. This is a major inflection point and likely heralds the end of phone service as the primary channel for customer service interactions. For entrepreneurial service managers, it presents an opportunity to rebuild their organizations around self-service and, in the process, put customer effort reduction firmly at the center, where it belongs.