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Ease and Engagement Trump Satisfaction and Compliance
March 21, 2011
By Mike Garner
Chief Customer Officer
Because the theme of this quarter’s Customer Contact eBulletin is “Creating a Personal Experience,” I thought I’d share my thoughts on the topic with a few examples, categorized by the customer loyalty gauges proven to have superior predictive value relative to revenue growth.
Let’s start with the four levels of “Customer Engagement,” 1which is a key metric used by leading brands today to gauge the emotional, not simply rational, level of engagement a customer feels toward a company. The sum of the research tells us that feelings are facts, emotional engagement wins markets, and rational satisfaction doesn’t keep you in tall cotton for long.
In increasing order of loyalty impact:
Confidence
The bedrock of any lasting relationship—it’s the feeling that you’ll deliver what you say you’ll deliver –and that you can be trusted. If you have any shot at building a loyal customer base, it starts here. I think of McDonalds and Southwest Airlines in this space; these companies know who they are, what they do, what makes them different (only 43 percent of employees across all industries know this). They deliver on their brand promise consistently; when I know what I want (700 grams of fat or a 35,000-foot view of the Grand Canyon), I know who to visit first.
Integrity
This is the feeling that you’ll be treated fairly in your dealings with a company. The big thing to remember is that if customers feel that a process or system is designed to solve their concern versus your business problem, you’re on to something that will build loyalty.
Pride
Customers who feel respected and proud to be a customer are some of the most loyal and profitable around. Just as some people are proud to be season-ticket holders (yes, even some Kansas City Chiefs fans), others are equally prideful in their choice of department store or airline. Priceline is the company that comes to mind–I absolutely love staying in a 4-star hotel at a 2-or-3-star price. It suggests that I’m about value and at the same time, capable of wearing a tie occasionally. Think about how you’re helping people feel ‘proud’to be a customer of yours.
Passion
Customers who are passionate about a company feel connected to it, become advocates of your brand and feel your products are irreplaceable. They are your most profitable customers and can be your best ambassadors. Can you imagine approaching an iPhone-wielding friend and saying, “Hey Steve, I know you like that thing-a-ma-bob, but it breaks up when we’re on important calls, so I sold yours and got you this really cool LG flip phone on a better network.” This would never happen, unless Steve was in a rubber room with no sharp objects around. Apple customers are fanatical. They are willing to stand in line and pay more for their sleek little slice of Über-connectedness, regardless of the phone’s ability to, well, be a phone. You get the point. Find your fanatics, cultivate them and enable them to grow the fan base.
Equally important, and intertwined with Customer Engagement, is Employee Engagement. This metric is all about passionate advocacy and effort by employees. When individuals throughout the organization know what they will get, what they can give, that they belong and that they can grow with the company, you can start predicting revenue growth with more confidence. In other words, productivity in the service sector is very personal, and getting high marks in “employee engagement” translates into:
- 18 percent more productivity
- 27 percent less absenteeism and a
- 260 percent revenue growth advantage over the competition on average.
Why does this matter? Business units and companies that score highly in both customer and employee engagement grow at 3.4 times the rate of those that don’t.
The Customer Effort Score
Relative to process improvement, the number one focus in moving up the loyalty needle is reducing the amount of effort customers must put forth when working with your company. As a matter of fact, it’s considerably more predictive than CSAT and Net Promoter Score. The new question to ask your customers relative to service interactions is: “how much personal effort did you have to put into doing x or solving y?” The lower the effort, the higher the loyalty. 2The stats:
- A full 20 percent of “satisfied customers” will still leave you
- While only 9 percent of “low effort” customers are disloyal and
- 96 percent of ‘high effort’ customers are disloyal
Bose is the first company that comes to mind in “making it easy” on me. I travel a great deal and I put the Bose noise-canceling headphones on my short list of irreplaceable products. I’ve had four pairs since they first came out, and twice, I’ve had the right ear go silent (after about 1,000,000 miles traveled). Each time, I called Bose and they never attempted to put me in the middle of a mind-numbing replacement process. They simply said “sorry to hear that, I see you’ve enjoyed that pair for 32 months already, and we had our newest version of the same headphones for $299. I can immediately ship you a pair for $89 and free shipping.”
Done; new revenue for Bose and no mess for me. I’m way past any expectation of warranty, so I feel great about the deal and my new headphones are there in time for my next trip. Low personal effort. High loyalty.
Think about how you’re measuring success—and whether or not it’s translating into faster, more profitable growth. If you’re not sure or the answer is “no,” then pick up a copy of Human Sigma or download some of the information on Customer Effort Score, and start moving closer to the predictable outcomes you’re after.
Footnotes
1 Source: “Human Sigma”, John H. Fleming and Jim Asplund, 2007
2 Source: HBR July-August 2010;” Stop Trying to Delight Your Customers”; Research provided by the Corporate Executive Board