As is often the case, the answer to a simple question is “It’s more complex than that.” But at a high level, the research is finally in, confirming what we’ve known at gut level here at Leading Beyond for some time now: STOP trying to delight your customers, and focus on making it easier for them to do business with you.
After years of working with organisations to help improve their customers' experience, if ever there’s been a year for a shift, this has been the one where finally, more and more companies are starting to understand the difference between customer service and customer experience, and more importantly, take action. Several of our clients have made very successful shifts in focus, with more exciting and promising work in this arena into 2016.
So, back to the question. Delight or not frustrate?
Think about it for a moment. Would you prefer to get an extra special something from a service provider, something above and beyond what you might have expected (despite challenges in doing business with the company) or to have an easy experience of doing business with them? What’s now clear is that the road to customer delight, so long the darling of customer service departments, is fraught with danger and can potentially drive a company out of business.
Dr. Noriaki Kano, creator of the Kano model, knew a think or two about what customers want, yet many seem to have forgotten his useful framework:
But here’s the thing: you can do all the delighting you want in the world, but if basic needs aren’t met, just like with Maslow’s Hierarchy of Needs, they’ll have little to no effect. So having to hang on the phone for 20 minutes to get through to someone will undo any other niceties your company may offer. Likewise when a customer gets transferred and has to give their information all over again, much goodwill is lost.
What the latest research shows is that even if you do delight customers, it doesn’t make them any more loyal. Loyalty is driven far more by the overall customer experience, from initial contact with your company (for example via an advertisement, a website, some promotional material) through to them using your product and then potentially doing repeat business with you. And if there are any points on that journey that frustrate, annoy or impact negatively in any way, well simply put, it kills loyalty. The ‘killer’ here is that many of the metrics from the world of customer service will likely suggest that all is good, when the reality from the customer’s perspective can be very different. A famous study shows that though 80% of CEOs claim their companies deliver great customer experiences, only 8% of their customers agreed!
Recent rigorous research by Dr Philipp Klaus (@ProfDrPhilKlaus) shows that companies that are built around delivering an overall customer experience (what it’s like from the CUSTOMER'S perspective) achieve far better results than companies built around delivering excellent customer service (as defined by the company). By how much? Get ready for this:
By a factor of 6 (average sales growth over 3 years).
That’s a lot.
And the great news is these sorts of results are NOT context specific or dependent on company size, industry sector or location (Measuring Customer Experience, by Dr Philipp Klaus).
The organisations that are implementing a holistic customer experience strategy are not competing against other organisations, they’re competing FOR their customers.
There’s a world of difference between a customer experience-focussed company and a customer service-focussed company: it’s a profound cultural difference, and to make the shift from one to the other isn’t necessarily easy, but it IS possible. Oh, and extremely rewarding in the long run. It brings with it significant challenges for leaders and organisations used to working in a particular way, and it’s one we’ve helped several clients achieve: if you’d like to know more, do get in touch.
As for useful reads on the topic, we can highly recommend Dr Philipp Klaus’ book “Measuring Customer Experience: How to Develop and Execute the Most Profitable Customer Experience.”
Also highly recommended are:
“The Effortless Experience” by Matthew Dixon, Nick Toman and Rick DeLisi
"Customer Experience 3.0 High-Profit Stratgies in the Age of Techno-Service.” by John A.Goodman.
With several large customer experience programmes of work upcoming in 2016, we’re predicting that this will be a very hot topic during the year ahead. If you’re thinking of embarking on this journey, drop us a line or give us a call for an informal chat, it's always good to share ideas.