Poor customer service is currently costing businesses more than $75 billion a year, according to the recently published New Voice Media 2018 ‘Serial Switchers’ report. Yet, in many ways, a greater emphasis is being placed on customer service skills and delivering a positive experience today than ever before.
In fact, for many organisations, customer experience is now seen as the key battleground, overtaking concepts like product and price. So where are these businesses going wrong, and why does customer service appear to be deteriorating, even with the clear focus on it and the extensive investment being made in this area?
According to the aforementioned New Voice Media report, the modern sales landscape is made up primarily of ‘serial switchers’, with 67 percent of customers willingly switching between brands, based on the customer experience provided. This is interesting, because it marks a 37 percent increase from the previous version of the report.
The consequences of delivering a poor customer experience are disastrous, with 39 percent of customers stating that they will never do business with an offending company again. Common criticisms of modern customer service include an inability to speak to a real person to get answers, and a feeling that they are not appreciated.
One of the biggest failings, however, is an inability to build an emotional connection. When such a connection exists, 89 percent of customers would willingly do business again, even after a poor experience. Unfortunately, only 30 percent of customers felt the brands they had interacted with over the past year made such a connection.
It is here that customer service is deteriorating and the priority for sales organisations should be to use customer service coaching and training to develop the skills necessary to build this personal, human, emotional connection. After all, this is the basis of true customer loyalty in the modern sales environment.
For organisations looking to make an emotional connection, one of the best strategies is to think of customer service as a series of defining moments. If a customer calls, do they get through to a rep quickly? Does the rep ask thoughtful questions? Are they provided with a solution? Does the company website load quickly? Is it easy to use? In a physical store, are they greeted upon entry? Is the layout sensible? These are all things to consider.
“There are a lot of defining moments in just one visit to your store,” says Karen Allinder, writing for the Miller Heiman Group blog. “Ask yourself, who is responsible for these moments? Do you know if they are positive or negative? Map your customers’ journey from start to finish to fully understand the experience.”
Most businesses are aware of the problem with negative defining moments and their impact on customer retention. Indeed, our own research shows that 93 percent of customers will leave after fewer than three negative DMs. However, neutral defining moments are also a threat, but most organisations are less aware of this.
A neutral defining moment is one where a customer’s expectations are met, but not exceeded. The problem with this is that most businesses see meeting expectations as a job well done, while those customers will still feel free to explore competitors. To build loyalty, businesses must exceed expectations to create positive DMs.
To do this, you need to create a customer experience roadmap, identify all of the defining moments and go the extra mile to impress customers. Find out which of these DMs are most important to your customers and prioritise those. Then, continually measure performance and seek out customer feedback. Do not assume no news is good news.
Ultimately, one of the key explanations for deteriorating customer service is a lack of clarity. Businesses do not always hear from their customers unless they ask, they do not always understand the issues with neutral defining moments, and they do not always have clear insight into how they are performing, compared to how they should be.
According to the CSO Insights 2018 Customer Experience Study, there is a major gap in how leader and laggard organisations operate in terms of assessing performance. For instance, more than half of leader organisations use voice of the customer data to continuously improve how they operate, yet among laggard organisations this figure stood at just 23 percent. A similar gap also existed in terms of using VoC to understand the experience they provide.
The key to success with customer service is to solve the ‘knowing/doing gap’. This means not only understanding the current customer service skills of your team and the level of service they are providing, but also doing things to improve both aspects and deliver the kind of outstanding experience that breeds customer loyalty.
For organisations that take the time to do this, continually understanding, assessing and improving performance through customer service coaching, the findings of the NVM report are very promising. Indeed, 66 percent of customers say they would be more loyal to companies that provide great service, while 65 percent would recommend that business to friends or family. Moreover, 48 percent would even be willing to spend more money.
Customer service is now arguably the single biggest battleground for sales organisations, yet research indicates many are still falling short in this area. This is primarily because, in the modern age, it is increasingly important to exceed customer expectations and create positive defining moments.
When this is achieved, customers will show real loyalty to brands. However, without it, customers feel more empowered than ever before and will simply shop around, looking for an improved experience.