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Can loyalty be created only through 'surprisingly' good experiences?

Wednesday, February 03, 2010

I had just entered an airport after turning in my rental car when I heard someone running up behind me, shouting “Mr. Bingham! Wait!”  I turned around, wondering what could possibly be so important that someone was running and calling my name.  The Avis agent, clearly out of breath, handed me my cell phone that I had mistakenly left plugged into the car.   I thanked him profusely–this could’ve been a huge disaster, with all my contacts, calendar, and email missing I’d have been in deep trouble.  I tried to tip him for his efforts, but he refused.

So many people believe that loyalty can only be created by “surprise.”  In other words, loyalty is engendered through a constantly escalating series of unexpected “above-and-beyond” experiences.  This notion is erroneous and hugely dangerous.  Customers don’t need to be “surprised” at every turn, and trying to do so rapidly creates an unreachable and unprofitable standard.

I was “surprised” by this Avis agent going above and beyond the minimum required of him, but in truth, he was not trying to surprise me, he was instead treating me like I would want to be treated.  Despite being a perfect stranger, he treated me like a best friend would, knowing how important my cell phone is to me as a lifeline to my customers, my business, and my family.  Avis did a fantastic job of treating me the way that I want to be treated. National Car Rental did similarly well until they sent me a follow-up notice that I talked about on my customer strategy blog at curtisbingham.com.

Customers need to have their basic needs met in spades.  The product must function as advertised, it must be delivered, installed, and maintained as advertised.  These are the building blocks of satisfaction.  However, to engender loyalty, a company must know their customers well enough to understand and anticipate higher-order needs and desires. Companies must be able to treat increasingly smaller customer segments the way they want to be treated.  The surprise may come as a side-effect (“Gee, how did you know that I was struggling with this problem?”), but it shouldn’t be the primary goal and desired outcome.

Consumer-package goods companies used promotions and coupons to drive behavior and in so doing have trained their customers to only purchase if something is on sale. They’ve commoditized their own products.  In the same way, seeking solely to surprise is a sure way to commoditize your service.  You train people to raise their expectations and soon what was once surprising becomes commonplace.  It becomes more costly at every turn to address outrageous and unnecessary expectations in this game of one-upmanship.  No, you need to simply treat them the way they want to be treated–as though you were a best friend looking out for them.  Your customer strategy must involve understanding your customer segments’ needs at an increasingly granular level and meeting stated or anticipated needs.  Let the surprise come from sometimes knowing more about the customers than they know about themselves.

What do you think?  Can loyalty only be created through "surprise"?

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Here’s a Quarter, Call Someone Who Cares

Wednesday, February 03, 2010

Some time ago there was a Country & Western song entitled, “Here’s a quarter, call someone who cares.” I don’t remember the lyrics or even who sang it, but this is the new catchphrase for United Airlines.

In last week’s Wall Street Journal it was announced that United is dropping an Indian customer-call center that took compliments or complaints, telling customers to write or email instead. All customer communications will now be devoid of any customer relations phone numbers.

United claims they’ve done the research and “people who email or write us are more satisfied with our responses.” Come on. That’s just plain stupid. It is either a blatantly bad cover-up for cost-reduction, or a gross misreading of customer data. So many companies I’ve spoken with recently are reversing their offshoring decisions. They’re finding that the overseas costs are soaring, the strong accents are off-putting for angry customers, and the results no longer justify the expense and hassle.

In this case, I’ve got to believe that United’s higher satisfaction scores are due to the fact that written English is far more easily understood than spoken as a second language.

There is a ton of research to prove that disgruntled customers want to speak with real humans, right now to gain resolution and closure. To force someone to write a letter only forces them to sit and stew on the issue. More research proves that they’ll tell anywhere from 2-30 other people about their bad experience. Is the cost cutting in this area truly worth it? This is a great example of what happens when you lose sight of your customer strategy and make decisions based on costs alone rather than on a detailed understanding and appreciation of long-term customer value.

United had a Chief Customer Officer, Graham Atkinson, but in October of last year, he was put out to pasture and Dennis Cary, the CMO took over the CCO role. I had a nightmare of a time trying to reach Mr. Atkinson for my book.  I was told repeatedly to email their support lines to request an interview only to be repeatedly ignored.

This bald-faced cost-cutting move sounds like what happens when nobody is truly accountable to the customer and even worse, when someone merely assumes a sexy title in an appearance of customer intimacy.  Dennis Cary, if you’re out there, please prove me wrong.

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Customer Insight Is Too Good To Waste

Wednesday, February 03, 2010

I was reading a blog today about a company’s efforts to gather customer insight using a well-known research institution and it occurred to me that while gathering customer satisfaction scores is a good thing to do, many companies that I’ve worked with start their customer insight collection with massive surveys and end up wasting opportunities for strategic input to their overall customer strategy. In my experience at companies large and small as well as in interviews with scores of Chief Customer Officers (CCOs) for my upcoming book entitled, The Key to Customer Strategy:  The Rise of the Chief Customer Officer, I’ve found that there must needs be a sequence of customer insight collection methods from coarse to granular, and expensive to economical.  This approach may at first seem counterintuitive, but actually yields the most valuable results that drive profitable customer loyalty.

If you simply begin with satisfaction surveys as your primary view of the customer, you may well capture “dissatisfiers” or those things that are currently damaging customer relationships and must be fixed immediately. However, you miss the most valuable information, namely the real reason why your customers buy, what they value the most, whether they may be willing to pay more, and even more importantly, where your customers are going next and how you can lead them there.

To achieve this type of insight and more fully inform their customer strategy, the best companies have a hierarchy of customer insight collection methods:

1. Executive advisory council to understand strategic imperatives:  This mechanism gets senior-most executives (the economic buyers) from critical customers together to understand their highest-level business challenges and directions.  This input is critical in determining future directions your company must begin to consider because if your customers are heading in a direction that you aren’t, you’ll be left behind.

2. More tactical customer advisory boards:  Companies may have customer advisory boards for each major product line or customer segment they are in.  They are primarily comprised of product/service users and influencers.  Broadly speaking, these groups provide a wonderful focus group in which customers can speak their mind, share their issues and problems and get help from their colleagues and the company, as well as  react to forthcoming products/services and activities.

3. Direct interviews of key customers:  Direct interviews are incredibly important to truly understand customer value drivers:  ie. the critical reasons why your customers buy from you (see this blog post and this article published in CEO Refresher for more information on value drivers). Direct interviews are critical to uncover all the hidden issues, learn the context of problems, and even more importantly, discover new opportunities only exposed through direct, contextual interviews.  These direct interviews will refine questions and inform the large-scale customer surveys.

4. Large-scale customer surveys:  The surveys, by their very nature, need to be confirmatory–they need to validate the insights you’ve gained to date and confirm or otherwise assess the scope of the issues you are seeking insight into.   It is extremely hard to get strategic insight if you simply start with surveys unless you follow up with interviews, which simply indicates the need to have started with interviews beforehand.

5. Focused working interviews:  The large-scale surveys will invariable confirm issues that need to be addressed, and you’ll need to gather your cross-functional teams together to get to the root cause of the issue confirmed through the previous steps, propose solutions, and upon implementation, evaluate their success.

It may be tempting to simply send out a survey and call it good.  In my experience, surveys  can can be subject to many pitfalls that I’ve previously written about on my Customer Strategy Blog.  Squash this temptation.  Just like you don’t allow your sales people to go into a customer visit without preparing, you can’t allow your company to just send out a survey without fully informing the survey.

You only have so many silver bullets in your gun when it comes to your customers.  Do your homework first and make sure that when you spend your silver bullet and ask your customers to help you out, that you get only the insight you really need to drive your business forward.

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Categories: Customer Insight | Customer Survey