The Customer Experience Podcast
The Customer Experience Podcast

Episode · 2 years ago

56. 3 Customer Experience Myths Debunked & Set Straight w/ Ethan Beute

ABOUT THIS EPISODE

The most economically valuable thing you can do is to meet customer expectations.

Meet the expectations. Not exceed customer expectations. Not surprise and delight your customers at every turn. Actually, the best way (economically and experientially) to serve your business and especially your customers is to meet their expectations.

I’m Ethan Butte, here today on The Customer Experience Podcast to share my appreciation for a book that I’m, yes, late to the party on. It’s called The Effortless Experience: Conquering the New Battleground for Customer Loyalty by Matthew Dixon, Nick Toman, and Rick DeLisi

The first chapter of The Effortless Experience starts out by calling out myths that tend to be overlooked by marketing, sales, and leadership — but which are highly relevant to these people and their organizations. There's so much focus on customer delight and the so-called “wow moments,” but not enough focus on something much simpler and more economically valuable: meeting customer expectations and reducing their effort.

  1. Delighting customers in the service channel does not pay.
  2. Customer service drives disloyalty, not loyalty.
  3. The key to mitigating disloyalty is reducing customer effort.

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Ninety six percent of customers who had high effort experiences reported being disloyal, compared to only nine percent of customers with low effort experience. The single most important thing you can do today is to create and deliver a better experience for your customers. Learn how sales, marketing and customer success experts create internal alignment, achieved desired outcomes and exceed customer expectations in a personal and human way. This is the customer experience podcast. Here's your host, Ethan Butte. The most economically valuable thing you can do is to meet customer expectations. Notice that I didn't say exceed customer expectations or surprise and delight year customers. The most economically valuable thing you can do is to meet customer expectations. My name is Ethan bwed. I'm the host of the customer experience podcast and the cohost of the B tob growth show. I host the C X Series on the show and...

...in this episode I'm going to share a handful of awesome takeaways from a book that I'm late to the party on. It was published more than five years ago. It's called the effortless experience. It's by Matt Dixon, Nick Toeman and Rick De Lacy. Dixon, by the way, also co authored the Challenger sale and the challenge own your customer. And these may not be revelations to the more well studied customer success experts who listen to the show, but likely will be for everyone else, as it was for me. I am only going to share some takeaways from the first chapter of the book, and this chapter, as well as the greater portion of the book, is based on research with ninety seven thousand consumers and hundreds of executives inside businesses serving these customers. So here's the setup and a quote from the book. What if you got up in front of the team and, instead of asking them to delight your customers, you ask them to make things as easy as possible for...

...your customers, and you told them to do this by focusing on a small set of actions, like avoiding situations where the customers likely to have to call back, not transferring customers when they can handle the issue themselves, not asking customers to repeat themselves, not treating people in a generic manner and so forth. By the way, those are four of the most annoying things to the customer. Surveyed and likely, if you've looked at your own customer feedback or you looked at your own experience as a customer, these things annoy you as well. So what this chapter does is open up by dispelling a couple of myths that are typically off the radar of marketing, sales and leadership, but they're highly relevant to these people and to the entire organization. You know, there's so much focus on customer delight in wow moments, but not enough focus on something much simpler and more economically valuable, meeting customers expectations and reducing their effort. Three takeaways from the chapter. Delighting customers in the service channel does...

...not pay. Number two, customer service drives disloyalty, not loyalty, and number three, the key to mitigating disloyalty is reducing customer effort. So let's focus on that first one. Delighting customers. Delight is not the fully sensible and most effective mission of the CS organization. A lot of the stories that we hear are typically what they call, quote unquote, lottery ticket logic. We tend to over celebrate the rare moments of delivering above and beyond and overspend on training toward moments of wow. I'm going to quote them here. There's virtually no difference at all between the loyalty of those customers whose expectations are exceeded and those whose expectations are simply met. Loyalty actually plateaus once customer expectations are met. So what do they mean when they say loyalty? They define it with three specific behaviors. One is repurchasing, continuing to buy from you.

Number two is share of wallet, buying more from you over time, and number three is advocacy, saying Nice things about you to other people. So again, there's no difference in loyalty between customers whose expectations are exceeded versus those who are simply met. And, of course, when they interviewed senior leaders, exceeding expectations comes with much higher operational costs. So higher cost for no particular benefit. I'm going to quote them again. The data show that, an aggregate, customers who are moved from a level of below expectations up to meets expectations offer about the same economic value as those whose expectations were exceeded. And, of course, exceeding expectations is more expensive for us from an operational standpoint. So the goal here is basic competence, professional service and getting the fundamentals right, solving the problem and getting people back to their day. Point one, delighting customers in the service channel doesn't pay. Point two, customer...

...service interactions tend to drive disloyalty rather than loyalty. You know, here at Bombomb we have amazing customer success and customer support people and we often get those very positive replies about how a particular team member of ours made someone's Day or really over delivered for a customer. But an aggregate, and I'm quoting from the effortless experience here, any customer service interaction is four times more likely to drive disloyalty than to drive loyalty. And worse, and I'm quoting here, those customers we make disloyal are much more likely to spread that disloyalty to other potential customers through negative word of mouth. And even worse, and finally, and I'm quoting again here, forty five percent of the people who had something positive to say about a company told fewer than three people. By contrast, forty eight percent of people who had negative things to say reported that negative speak...

...to more than ten people. So those positive experiences are shared less, those negative experiences are shared more, and we're four times more likely to drive disloyalty any time someone gets into our support channel by phone or email or elsewhere. Final quote here. We pick companies because of their products, but we often leave them because of their service failures. So the goal is self service, product service, great product and service experience, so that people don't need to get into your customer service channel in the first place. Finally, point number three from the first chapter of the effortless experience. The key to mitigating disloyalty is reducing customer effort. This is the third one in the chapter, of course, because it teas up the rest of the book. It's all about reducing effort. Four of the five drivers of disloyalty are about additional effort that customers must put forth, and you've already heard them at the top of this episode. In rank order, they are requires more than one contact to resolve...

...the issue. Number two, generic service, treating people like a number, noncommittal responses, corporate speak. Number three, having to repeat information. I know that's a frustration for me. You told one service rep you know this piece of information or this number and you have to tell the next person the same thing. Right. People hate having to repeat information. Number four perceived additional effort to resolve. This reminds me of an episode I released with Mike Red Board of hub spot, who really drove home the point in that podcast conversation that the customers reality is the reality. So their perceived additional effort to resolve, even if on our side of it, as the service provider, we think, oh, wasn't that big a deal, if the customer perceives it as such, it is a big deal period. It is a matter of fact. Finally, transfers getting bounced around. Now, if you're not a very large organization's probably doesn't happen so much, but if you're in a medium to large organization, you may have to bounce people around. The more...

...you do that, the more effort and the more perceived effort and the greater likelihood of producing disloyalty. Here's how common they are. Fifty six percent of the cut stomers interviewed again. About a hundred thousand people interviewed. Fifty six percent said they had to re explain their issue during a service interaction. Fifty nine percent had a higher perceived additional effort to resolve the issue. Fifty nine percent also said they were transferred during a service interaction. Finally, sixty two percent of people said it took more than one contact to resolve the issue. This produces frustration because it requires effort and therefore it produces disloyalty. Ninety six percent of customers who had high effort experiences reported being disloyal, compared to only nine percent of customers with low effort experience. I'm going to say that one more time. Low effort experience, only nine percent of people were disloyal. High effort experience. When we're asking our customers to spend time and energy,...

...mental and physical and emotional, ninety six percent of the people in high effort experiences were disloyal. To close, here their four principles of creating low effort service. Number one, low effort companies minimized channel switching by boosting the stickiness of self service channels. This prevents customers from having to reach out in the first place. Number two, head off the potential for subsequent calls by having employees practice next issue avoidance, being a little bit proactive. Hey, now that we've addressed what's really on, your mind right now. Let me tell you about something upcoming. Proactively avoiding future issues a huge value to the customer because it reduces effort. Number three, succeed on the emotional side of the service interaction. One or more chapters of the book go through Experience Engineering Tactics very specific things you can do to manage this. If you've been listening to the customer experience podcast, you know that video is a great way to manage...

...that emotional side of the service interaction. Fourth and finally, here and power front line reps to deliver a low effort experience by using incentive systems that value the quality of the experience over merely speed in efficiency. It's really easy to measure and reward speed and efficiency. It's a little bit more difficult to get at quality, but quality in effort reduction is a big, big deal. It's a huge value driver in your business. Their book goes into way more detail on all of these topics. I just wanted to share my appreciation for the book and the provocative opening thoughts in that first chapter. The single most important thing you can do today is to create and deliver a better experience for your customers. As an individual as a team and as an entire organization. Reducing effort is a great way to do that. I hope you found this valuable. If you did subscribe to the customer Experience Podcast, you can find...

...it in your favorite podcast player and, while you're there, take a minute and leave a review or drop a rating. It's super helpful to the podcast into people evaluating whether they might get some value out of it too. Thanks so much for listening. My name is Ethan Butte and I welcome any feedback on linkedin or in my email inbox. Ethan at Bombombcom. Clear Communication, human connection, higher conversion. These are just some of the benefits of adding video to the messages you're sending every day. It's easy to do with just a little guidance, so pick up the official book rehumanize Your Business. How personal videos accelerate sales and improve customer experience. Learn more in order today at Bombombcom Book. That's bomb bombcom book. Thanks for listening to the customer experience podcast. Remember, the single most important thing you can do today is to create and deliver a better experience for your customers. Continue Learning the latest strategies...

...and tactics by subscribing right now in your favorite podcast player or visit Bombombcom podcast.

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