So far, we have talked about what might be described as the table stakes for winning a customer’s loyalty:
CX Is Flatlining – move faster
Intolerance For Poor Service Is Rising
This is all about demonstrating the competency to deliver what the customer wants from a functional perspective. But is being in the top tier for efficiency and effectiveness all that is needed?
In one sense the answer is yes. Much of what causes customers to leave a brand still boils down to an incompetence in getting the job done, wasting time and adding effort in the process. As a result, service improvement plans will remain focused on these challenges for years to come. Efficiency and effectiveness remain highly relevant.
However, removing reasons to leave is not the same as providing reasons to stay.
A 2007 Booz & Co study of US banking customers showed that rationally satisfied customers churned at the same rate as dissatisfied ones. In other words, both groups felt the same and so behaved the same. As American poet Maya Angelou put it “People don’t always remember what you say or even what you do, but they always remember how you made them feel.”
So how do we make customer feel the way we want them to?
The traditional answer has been to invest in a loyalty scheme. These typically centre on providing customers with an experience of being recognised and rewarded with exclusive offers. There is evidence these deliver commercial value and the market for them continues to grow. But equally, there are questions as to whether they effectively lock out competitors or simply help discount a customer’s lifestyle. For the sake this exploration I’m going to put them to one side with the following observation.
“True loyalty doesn’t come because of an app. It doesn’t come because you have a punch card where after ten punches you get a free sandwich. It is about the relationship. Take away those “perks” and would the customer still be loyal?” – Shep Hyken, Chief Amazement Officer at Shepard Presentations
At The Heart Of CX Is Emotion
So, what does it really take to keep a customer for life? The answer to that lies at the heart of what CX and the experience economy is all about. The core premise is that experience and relationship matter to the point of changing my behaviour as a customer. I’m prepared to pay more, buy more, stick around and tell others if I feel good about a brand and its performance in relation to my needs and expectations.
There is plenty of evidence to support this. A recent macro example from Forrester shows that a portfolio of CX leaders grew their share price by 32%, outperforming the S&P 500 average (17%) and CX laggards, who only achieved a 3% growth. Another quote doing the rounds is that emotionally engaged customers are twice as valuable as other segments.
Of course, these claims do need some qualification. Customers don’t always want a meaningful brand relationship. It could be just a one-off event. If more than that, then maybe the relationship is still treated as purely transactional. The supporting mindset is that it’s convenient until it’s not. But certainly not a reason to recommend to others.
I’m sure we can all relate to this type of behaviour. It is one side of how we engage the world and cope with our busy lives. Being constantly emotionally connected is just too exhausting!
Equally we can be motivated by other needs. Here is a deeply held one that summarizes the psychology we are in the process of exploring. It explains why the ambition of a ’customer for life’ is even possible in a world so full of choice and easy access.
Despite everything, it remains true that we want to stick around other people who make us feel good. As we know, this need often drives our key decisions in life. So, if brands can find ways to satisfy this core human need for feeling good, they are on the path towards staying in relationship with their customers.
As we shall see feeling good can be experienced in many ways. Here’s a customer quote that perfectly captures the experience of what it takes to make someone feel good and therefore feel loyal.
“I’m treated with respect, and I’m not just a “customer number” to them. They train their employees to care about me as a person, and they offer their best support when things don’t go right. Even if things go wrong often, I won’t change my loyalty to them because I can trust that they will always work with me to make things better and that they will always care for me as a loyal customer and friend.” 2018 CX Trends Report of 1,300 US retail consumers
In the context of customer engagement, we are often reminded this quality of relationship used to common between corner shop owners and their customers. Now we do business in a globalised economy, this need to make the right impact is being rediscovered. It’s not just what you do as an organisation that matters, it is how you do it and the way in which that impact is perceived by each individual customer.
This has motivated organisations to adopt customer experience management and invest in becoming outside-in cultures. Given the length and complexity of that journey it is worth pausing and asking whether the ability to evoke the right experience and emotion is enough to stop customers acting like butterflies moving on from flower to flower?
The evidence suggests so. A recent headline from Forrester’s research into the impact of customer experience stated that in 17 out of 18 industries, how an experience made customers feel influenced loyalty more than a product’s effectiveness and ease of use.
This is because humans are more often instinctive and emotional than considered and rational in their decision making. It is our normal way of engaging the world most of the time. We use previous experience to rapidly and unconsciously assess what is going on. This helps conserve mental energy. It’s all part of how we have evolved as a species.
In fact, according to Harvard Business School professor Gerald Zaltman, 95% of our purchase decision making takes place subconsciously.
Gamification leverages this by using appropriate combinations of pain and gain triggers to get us to act immediately. This is constantly used by marketers in CTA (call to actions) to persuade us to engage now and become drawn into buying from a brand.
In a service context, self-service FAQs can fail in terms of call deflection because sometimes customers won’t trust an answer until they have verified it with a customer service advisor. This might be illogical behaviour but is understandable as an emotional need and explains why effective self-service has to consider more than just accurate content to work as expected.
In the context of loyalty building, emotions play a clear role in influencing how customers feel towards a brand after a service or sales interaction.
Research shows that positive emotional memories bind customers closer to an organisation after engaging with brands while negative ones drive them away.
Human experience is a blend of thought and feeling interacting with each other in ways that neuroscience is still unpicking. But what we do know is that emotions are central to decision making, influence our perception of events and help anchor memories.
Contact centres play a vital role in helping this to happen. It is a major touch point for many customers providing service and sales support across digital and non-digital contact channels. Contact centres are also moments of truth in many customer journeys and are therefore central to CX effectiveness. Every interaction is an opportunity to build that goodwill.
But how good are we at doing this? Research from CX transformationist Bruce Tempkin suggests there is still a long way to go. His research shows we are getting better at delivering outcomes and reducing effort. But delivering positive emotional memories still remains a challenge. It is therefore an opportunity for entrepreneurial service teams to forge ahead of their competitors.
With that in mind, here is the third of our action lists that contribute towards the goal of keeping customers for life.
- Prioritise customer journeys that are emotional, complex or matter to the quality of relationship. Use voice of customer feedback, analytics and advisor insight to identify the most common emotions for each journey. Research indicates there are usually a couple of dominant emotions for a given journey.
- Teach advisors how amplify positive emotions and transform negative emotions into an appropriately positive version. For instance:
- What does it take to transform an angry customer into a happy one?
- How can someone move a customer from feeling stressed to a feeling of relief?
- How can you take a customer from apathy to excitement about a new product?
- What’s the pathway to taking a customer from feeling insulted in the way they were initially treated to finally feel respected and cared
- Teach team leaders and coaches how to support advisors in empathetic conversations
- Start tracking emotions before and after engaging. Map those against customer scores to understand the impact of making customers feel good by the end of the interaction
- Add emotion into quality and performance management
- Recognise, reward and promote excellence in emotive CX engagement
- Review recruitment profiles to ensure you are attracting the right quality of candidate
