In this white paper, we look at how putting the customer at the heart of your business can deliver an exceptional customer experience, and ultimately boost profits, along with some of the typical approaches for conducting customer experience research.
“Delighting customers inevitably adds costs” is suggested as one of three key barriers to some companies making a push for delighting their customers, by Steve Denning in his “Is Delighting The Customer Profitable?” article for Forbes earlier this year.
The perception of delighting customers being a cost burden as outlined above would of course depend heavily upon a particular company’s culture (and would undoubtedly be engrained throughout the company). Said company would, as an example, be fairly successful, and be content to deliver a good service. Delivering ‘good service’, we would argue, is not a long-term strategy. A ‘good service’ is expected by customers – it is a hygiene factor that does not drive satisfaction higher, but it will drive it lower if it is not fulfilled. From the years of customer research that our team has conducted, we know that if customers are delivered a service that is merely ‘acceptable’, their heads will be easily turned if a better provider comes along.
There are other types of companies that put the customer right at the heart of their business, and make it part of their goal to deliver customer excellence. Rather than being focussed on the cost of ‘going the extra mile’, these companies will have a motto something along the lines of “delighting customers is what we do, it helps our profits thrive” – such an idiom would be engrained in the company culture (see Apple, Google, Amazon, Zappos, etc). It is very pleasing to see more and more companies switching to this way of thinking.
The first type of company, the one focussed on the cost implications of change, has (in very rough terms) an ‘outside-in’ approach to the business. Every decision, choice and action is accountable back to the central finance department and/or shareholders, and therefore must be justified. Obviously this is common in all businesses to some extent; however, in extreme examples these would be the companies where the chance for creativity and empowerment amongst employees is confined to rather lengthy and carefully worded company guidelines.
The second type of company could be referred to as inside-out companies – these companies have their customers at the very core of what they do and this resonates outwards and impacts on all elements of the business. These companies give their staff free reign to use their own intuition when it comes to delighting customers.
These are two fairly polarised views – but what it does highlight is that, although change may take some time, an outside-in company can indeed become customer-centric by placing the customer at the heart of all decisions. However, in all case (all successful ones, at least), decisions such as this must be lead from the top – from the CEO to the person at the store counter, the whole business has to have the customer at the forefront of their mind.
One exercise that is useful for any company is to understand what the issues are that your customers expect, and which issues really delight them. In many cases, issues that companies believe to be differentiating areas, are in fact seen by the customers as hygiene factors.
We can split elements of a product or service offering into three distinct categories:
‘Hygiene factors’ are the elements of a service or offering that customers expect. These issues will not increase satisfaction, but they will decrease it if they are not delivered against.
‘Nice to haves’ are issues that can influence satisfaction. These are elements of a product or service that are not necessarily expected and can drive satisfaction higher if they are delivered effectively. Over time, nice to haves can regress to become hygiene factors as they become expected by customers.
‘Differentiators’ are the delight issues – these are things that customers do not expect; the examples of going ‘one step further’, or of exceeding expectations. These are the things that set companies apart from their competitors. There is sometimes a perception that differentiators can be expensive to implement (see Denning’s quote at the start of this article) due to the impact and value that they deliver to customers. However, in many cases these areas can be easy and inexpensive to implement and instead come down to allowing staff a little flexibility to embody a focussed company promise, and to shine in their own way to deliver a personalised service.
What would you say are your company’s hygiene factors, nice to haves, and differentiators? Do you think your customers would agree, or would they position them differently on the pyramid? Many differentiators are so simple; sometimes they can be the fundamental elements of a product or service offering that no other company in the market currently does well, where providing an exceptional service can really set a brand or company apart from the competition.
Steps Towards Implementing An Holistic Customer Experience Research Programme
With the above in mind, how do we then approach a typical programme of customer experience research? There are number of different approaches, techniques and tools that can be used. In this white paper, we shall take an initial look at some of the more common techniques.
Customer experience research programmes typically involve a number of key stages:
- Mapping the customer journey (both from an internal perspective, and an external perspective)
- Assessing how the company performs at all stages of the customer journey, and at key touchpoints
- Developing a core set of values or a brand promise that can be brought to life at all touchpoints in the customer journey
- Tracking performance and customer satisfaction on an ongoing basis.
Start From The Top
In order for all the stages above to fully gel together and deliver dramatic change within an organisation, there needs to be full senior support. With that in mind, for any organisation looking to conduct such a programme, we would always recommend involving all senior stakeholders in the key stages of the research. This should be from the very first commissioning meeting, right through to the final strategy workshop. Taking this approach ensures that all senior staff not only feel ownership of the project, but are also able to deliver change far quicker than might otherwise be the case.
Take A Hike
When working through the stages of such a research programme, there are a number of tools and approaches that can be used to bring (in hypothetical terms) the customer to the heart of the business. At the start of the customer journey mapping research, it may be that we want to take the senior stakeholder on a clue-spotting safari. As grandly-named as this may sound, it can essentially be a trip around a company’s store, offices, or similar place where customers might interact with the organisation. On this trip we would encourage the stakeholders to take pictures of the small details that build up their perception of the customer experience – anything from loose shopping trolleys in the car park, to faulty TVs on display. Although these small details may seem trivial, it is indeed the small details that help us build our perception of things (indeed, even the ends of a toilet roll being carefully folded in a luxury hotel give off the message that the hotel has close attention to detail – and yet it costs the hotel nothing to implement).
Once the stakeholders have an understanding of how these elements can influence the customer experience (just as much as any product guarantees, or a product’s quality might), it enables us to deliver a much more comprehensive and thought-out strategy at the back-end of a project. Placing the stakeholders in the shoes of the customer, and focussing on the detail, highlights just how much a company’s values can be shown through so many different aspects of what the organisation does.
Research and insight has moved on dramatically in recent years in terms of the creativity that it can deliver when bringing data and information to life. Customer experience research especially lends itself to this creativity. One of the key elements of success in delivering change within an organisation is ensuring that all staff are ‘bought in’ and understand the changes, and one of the most effective ways to do this and to bring research findings to life is through video. A picture does indeed speak a thousand words, and when a short video clip can highlight a particular problem that customers face, or a particular event that fills them with delight, the message is instantly clear to staff. Some of our clients have been keen on video clips merged with customer journey maps, whereby particularly troublesome touchpoints are highlighted with video evidence so that employees know how to deliver effectively against them in the future.
Tracking And Monitoring Satisfaction
A core part of many customer experience research programmes is conducting an on-going satisfaction tracking survey with customers. Trackers tend to be conducted in waves at regular intervals (e.g. every month, every quarter, every 6 months), and involve surveying a large enough sample of customers to allow differences in satisfaction to be measured robustly from one wave of interviews to the next. Data from these trackers can be fed into reporting dashboards that can be used to interrogate and monitor satisfaction data as it comes in, to highlight areas for immediate action. The effects of this live data can also be amplified through real-time ‘hot alerts’, whereby an email alert can be automatically sent to a particular team or individual if a very low satisfaction score is received on a particular topic (as an example, a member of the accounts team might receive an email notification when a customer has given a low satisfaction score relating to ‘prompt invoicing’). Data can also be married up with existing client data and, with analytics applied, can help us understand such things as ‘potential revenue at risk’ due to poor satisfaction and loyalty scores.
Social Media Monitoring
Another development in customer experience research is the advent of social media monitoring. As many companies know, a good or bad comment on twitter can spread like wildfire. With most customer experience programmes, we now suggest that clients consider combining social media monitoring exercises alongside customer satisfaction research – in many cases, this can be delivered as part of a tracking dashboard so that all information is accessible in one place.
Small Things Make A Big Difference
Something that is often enlightening to many clients is just how much of an impact small (and often low-cost or free) changes can make in improving customer satisfaction. As a follow-up activity to customer satisfaction research, it is fairly obvious that something should be done to improve the relationship with those that are not satisfied. But something that is often overlooked is thanking the people who are truly satisfied – the promoters. These promoters are the lifeblood of any company, and often something as simple as saying ‘thank you’ and displaying gratitude can go a long way.
In summary, customer experience research is both simple in its aim and highly detailed in what is involved and what can be delivered. Researching the customer experience can deliver great value in highlighting areas of strength and in identifying unmet needs. Crucially, it can help in indicating the disconnect between a company’s perception of its offering and the customer’s perception of its offering – which in some cases can mean the difference between going out of business, or continued growth.
The points mentioned above do indeed only scratch the surface of this exciting area of work. But one point to always remember: any company that asks its customers how it is performing, and is seen to pride itself on an excellent customer experience, automatically raises expectations. Once people have taken part in a satisfaction survey, they expect to see a change.
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