Customer experience is key to long-term business success: interview with Dennis Otto
66% of customers switch brands due to poor service. 55% are willing to pay extra for a guaranteed good experience. Guaranteed means that it’s not about the promise of a great experience, but the actual great customer experience. This is what makes customers happy.
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Customer experience is key to long-term business success: interview with Dennis Otto
91% of unhappy customers don’t complain, but simply leave. No news is not good news, after all.
It all comes down to customer experience
Some of your customers will be promoters, satisfied with your company and happy to put in a good word for you. This segment is likely to help you grow your business. Others will think your product leaves a lot to be desired, becoming detractors who badmouth your company. And there will be some in between: passives.
You don’t really want detractors to dominate your customer landscape. In fact, you don’t even want a single detractor in your client portfolio! If passives could be turned into promoters, that would be great too, right? Remember it all comes down to customer experience and the level of customer satisfaction. A satisfied customer will come back to you or even promote your business.
How to produce satisfied customers? How to transform the unhappy clients into the promoters of your brand?
The answer is: ensure impeccable customer experience.
To clarify what’s behind customer experience and how to improve it, we talked to Dennis Otto, Customer Experience Manager at Webinterpret and the leader of the NPS strategy.
Interview with Dennis Otto
Dennis Otto, Customer Experience Manager at Webinterpret and the leader of the NPS strategy.
How would you define customer experience?
Dennis: First, I would like to mention the current situation on the market. A great deal of businesses continue to believe that the key to winning customers is price and product quality. In other words, the lowest price or the perfect product will surely be a deal maker.
However, this view is very limited and short-sighted. According to Walker’s study, by 2020 customer experience will overtake price and product as the key brand differentiator.
What is customer experience? It is about the customer’s perception of the way a given company treats them. This perception affects customer behaviour as well as creates memories and feelings. It may also drive their loyalty.
As Greenberg said, if your customers like you and continue to like you, they will do business with you and recommend you to others. To make this happen, you have to know them well: what product they need, who they are and what they like doing. This is necessary in order to be able to serve your clients a personalised experience and gain their loyalty.
It’s worth making the effort to ensure compelling customer experience since it leads to customer satisfaction. Customer satisfaction is one of the key differentiators in today’s competitive marketplace. It is satisfied customers that drive your business.
Ensuring perfect customer experience must be challenging from the organisational point of view?
Dennis: Absolutely. For some organisations, the overall importance and value of customer experience may go missing somewhere along the line. Individual departments don’t have the same amount of contact with the client and the same take on this subject, e.g. Customer Support vs. Product Development.
However, customer experience is an integral part of product development and a company’s finances. Why? Bad customer experience will simply cost you money and can lead to business failure. Your churn rate will be high and acquisition costs will increase. This will affect every department, not only Customer Support.
Hence, it’s better to make your customers satisfied enough to continue doing business with you than to splash out on finding new leads. The challenge is to get all employees on board, many of whom may believe it’s a one-man responsibility.
It’s also worth mentioning that your potential clients may look you up online before they buy from you. 70% of a decision is made before a potential customer contacts you. This means that frustrated customers and their reviews can cost you hundred of thousands of dollars. Don’t let poor customer experience destroy your reputation and stop potential clients from doing business with you.
It is satisfied customers that drive your business.
How to measure customer experience and satisfaction?
Dennis: The easiest and fastest way is the Net Promoter Score (NPS) that indicates the percentage of customers that would recommend your company to their friends, family or colleagues. Typically, the NPS is measured through a customer survey asking a single question:
‘How likely is it that you would recommend our company/ product/ service to a friend or colleague?’
The metric has an accompanying 0-10 scale and is the percentage of Promoters (9-10) minus the percentage of Detractors (0-6).
The NPS seems to be all the rage, but I wouldn’t recommend businesses rely solely on the NPS score. This is just one of the key metrics and there is more you should keep an eye on, e.g. the churn rate or the average resolution time required to solve a customer’s problem. Of course you should always dig into the reasons why customers contact your Support Team.
One of the recent customer experience KPIs is the Customer Effort Score (CES) that determines the relative effort required by the customer to do business with a brand. The CES measures how easily exchanges between the customer and the company are completed, e.g. in terms of customer service or support.
You said that the NPS was an easy way to measure customer satisfaction. What are the benefits of the NPS compared to other survey-based methods?
Dennis: Indeed, the NPS is really quick and efficient compared to other surveys. As a result, response rates are also higher than in the case of normal surveys. I would also like to mention the holistic approach since the NPS involves the whole company from Sales & Marketing and Customer Service to the Product Team.
The Net Promoter Score can be very insightful in terms of the customer satisfaction level. You can better understand how to adjust and improve processes so that your clients are genuinely satisfied and are happy to recommend your business. This helps immensely in growing your customer base in a reliable and cost-effective way.
Bad customer experience will simply cost you money and can lead to business failure.
How about the drawbacks of the NPS?
Dennis: The biggest drawback appears to be the need for additional research. Let me reiterate: the NPS is based on a response to a single question. To compare, satisfaction surveys
can provide better insights and a more comprehensive view. However, there must be a balance between asking customers too many questions and looking to minimise the interviewing time.
Asking a single question is an extreme situation and may be too biased towards the customer as opposed to organisational needs. Due to the lack of data, the company can’t do much towards improvement. The customer will ultimately become frustrated and will go to a competitor.
Another disadvantage of the NPS are cultural differences. In some countries, satisfied customers are culturally biased towards giving companies a 9- or a 10-point rating. In other countries, however, this 9- or 10-point score may be perceived as an example of ultimate excellence found in exceptional circumstances. As a result, the rating of 8 may be considered the best you’re going to get.
This difference in perception makes it challenging to come up with objective results, especially if you work with international clients.
Who plays a role in determining customer experience?
Dennis: For starters, it is impossible to assign improving customer experience to one person or one department only. Customer experience is a common cause and the whole company should understand the concept, its purpose and be involved in the improvement process.
Many departments can help, for example Sales with communication and Marketing with email automation. You can ask various questions about each department’s responsibility towards the customer experience:
There must be a balance between asking customers too many questions and looking to minimise the interviewing time.
It must be quite challenging to integrate processes in the whole company to ensure impeccable customer experience?
Dennis: It definitely is a complex task, but also a crucial factor. Individual departments can’t work independently. Otherwise, let’s say, the Product Team can create a new product, a
really good one, but may fail to notify or give enough information to Marketing. As a result, Marketing fails to communicate the right message to current and prospective customers. You see the point: the Product Team’s effort may be completely wasted.
Such cases will inhibit business growth. Hence, all departments ought to be informed of each other’s actions that should be synchronised. All in all, priorities must be set, an overall roadmap created and an individual department’s’ actions aligned with the common good, i.e. … satisfied customers.
In terms of involvement and common goals, it is a great idea to identify the sources of best practice in your company and ask high NPS scorers to share their advice with those with lower scores. Learning from the best may be the easiest way to maximise the level of your customers’ satisfaction.
It seems pretty self-explanatory by now, but in a nutshell … why improve customer experience?
Dennis: As Gartner’s survey on customer experience confirms, it is key to long-term business success. The top reasons to improve customer experience are to improve customer retention, customer satisfaction and to increase cross- and upselling.
Another important factor is a unified vision that brings together the distributed resources to enable extraordinary branded moments at every customer touchpoint. It may be easier said than done, but it is also a necessity: customers cast their vote with their wallets and often they are the ones with plenty of choice. You want them to vote for you so that’s why you should improve customer experience.
Customers cast their vote with their wallets and often they are the ones with plenty of choice. You want them to vote for you so do your best to improve customer experience.
How to improve customer experience?
Dennis: Above all, you must spend enough time talking and listening to your customers. Dig into their feedback, fix any issues and communicate the changes you’ve made back to your customers.
And then ask for feedback again. This process will help you thoroughly understand the actual issues your customers have with your product, not the ones you think they have.
So deal with detractors, but bear in mind that customer experience goes beyond this. You must also care about your promoters and passives to turn them into loyal customers.
Reward your promoters and increase their involvement with your product and brand. Ask them to spread the word and actually recommend your company. On top of that, investigate what promoters love about your brand and enhance this experience even more. Finally, ask passives about what they are missing and what is holding them back from promoting your brand.
According to a recent survey by Gartner, currently around 90% of companies plan to compete mainly based on customer experience. Isn’t this statement exaggerated?
Dennis: Far from it. We are living in times where the customer has power. It has never been so easy to check a company’s reputation: with a few clicks, surfing the Internet from the comfort of your own sofa.
It’s not surprising that 70% of a decision is made before a potential customer contacts you. Hence, reputation matters, and excellent customer experience resulting in satisfaction is the basis of that reputation.
What also matters is honesty and being upfront with your (potential) clients. Focus on your strengths and tell them what they will get for the price they’re about to pay. It is essential to make it clear, simultaneously highlighting the benefits of your offer and promoting your brand.
You can analyse your present clients’ expectations as to whether they match the value you provide at your current price. Remember it’s more about a guaranteed good experience, not the promise of it.
Remember it’s more about a guaranteed good experience, not the promise of it.
So setting the right expectations helps to avoid customer dissatisfaction, improving the future customer experience?
Dennis: Correct, highlight your actual strengths that make unique selling points. Avoiding making promises you cannot keep can truly help you work towards greater customer satisfaction. Your unique selling point may be the lowest price on the market yet a somewhat lower quality of the product / service, which is fine if it’s still good value for the price.
So be honest and advertise your strong points. Your business won’t work for all customers. Hence, build the right expectations, keep your promises and attract customers genuinely looking for the product price and quality you have on offer. Managing or failing to do so will lead to either customer satisfaction or dissatisfaction.
Finally, let me highlight this again: to improve customer experience, follow up with your detractors. You don’t want them to stay dissatisfied. Hence, don’t leave them alone with their frustrations, but try to fix the reported issues. Remember that detractors are an invaluable lesson about the state of your customer experience.
On a final note, what’s your vision for the future customer experience at Webinterpret?
Dennis: First, I’d like to say that Webinterpret regularly monitors customer satisfaction levels. Not only is there a lot of interdepartmental engagement in measuring the NPS, but also in undertaking any follow-up action that may be required afterwards. Since we put a lot of focus on improving our product, processes and customer satisfaction in general, the NPS is a big part of our daily business activities.
Our vision and goals involve providing an excellent customer experience from the very beginning, through the whole customer journey. We want to deliver added-value service with the highest level of quality. We don’t want to just meet the seller expectations, we want to exceed them at every level and deliver exceptional value. Maintaining valuable and long lasting relationships with our customers … that’s our mission.
What would I recommend to companies? Focus on the root causes why customers contact you. In line with the company’s global product roadmap, ensure a consistent customer experience level and get the necessary resources to improve the main pain points for your customers. The long-term goal is to make customer experience a key part of daily activities across all departments with buy-in from all stakeholders.
The long-term goal is to make customer experience a key part of daily activities across all departments. The goal is not to meet customer expectations, but to exceed them at every level.
The customer should receive the same level of service across the entire lifecycle. The happier they are with a brand, the longer they stay with them. Your long-term objective is the transition from good to excellent.
Further Reading & Other Sources
http://www.huffingtonpost.com/vala-afshar/50-important-customer-exp_b_8295772.html
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