As anyone who pays attention during TV advertisements will know, companies are participating in an arms race to give their customers more – a free railway travel card here, a bespoke fountain pen thrown in there, a case of wine for customers who buy x and a subscription to a current affairs magazine for those signing up to y. Bonus points go to the firms who think of colourful inducements that get their offer quoted on money-saving blogs and mentioned on Twitter. The slogan “We go further” neatly summarises the prevailing strategy for winning and keeping customers.
All of which represents a misunderstanding of consumer behaviour, according to a new book. In The Effortless Experience: Conquering The New Battleground For Customer Loyalty, authors Matthew Dixon, Nick Toman and Rick Delisi attempt to comprehensively debunk the notion that going further for customers is a worthwhile strategy. In fact, they say, what companies need to do is simplify their offering and make the consumer’s experience as low on effort as possible. Effortless, frictionless and fast are the things that drive loyalty, not frills and going the extra mile.
Based on extensive research into people’s experience of customer service in particular, and surveying 97,000 customers, the book claims there is almost no difference between the loyalty of those whose expectations were exceeded by a company’s customer service and those whose expectations were merely met. The authors therefore claim that companies grossly underestimate the benefit of simply meeting expectations and throw unnecessary resources at the task of exceeding them.
What consumers want is not to be “delighted” – to borrow the book’s chosen term for describing surpassed expectations – when they communicate with a company about a problem or have a question, but quickly and efficiently satisfied.
“With the majority of companies, the customer service interaction is fraught with what we call high-effort experiences,” says Mr Delisi, who like his fellow authors works for business advisory service CEB. “Ultimately you want to make a customer feel like ‘this was much easier than I thought it would be’ rather than ‘you lavished me with some sort of extras or went out of your way to apologise to me, or you put me in some sort of special category’. Customers can see through those things,” he says.
The book highlights its point by describing how many companies treat their customers either as “callers” or “webbers” and don’t record in their data that many only call because the web hasn’t proved as effortless as it should have done, a phenomenon described as “channel switching.” Some 57 per cent of customers calling a company tried to use their website first, demonstrating both a damaging problem and a major cost-saving opportunity for firms willing to invest in useful and usable websites.
How applicable, then, is the book’s argument about the value of meeting expectations and the low value of exceeding them outside customer service, in an online selling situation or with supply-chain delivery?
Joe Fogg, business development director for supply chain solutions at supplies and logistics firm arvato, says making things effortless rather than elaborate is indeed key for his clients.
“Frictionless is what we call it,” says Mr Fogg, pointing out that the supply chain from a web purchase fails entirely for the customer if it does not fulfil basic demands like on-time parcel delivery. If a package arrives 24 hours earlier than a customer expects it to, that may be appreciated, but it isn’t hugely relevant to the customer’s view of the company. Delivering later than the promised time, though, is disastrous.
Mr Fogg also cites a figure from a UPS report that says 63 per cent of online buyers abandon their basket at the end of the process rather than buying – a rate of failure that would be comical were it repeated in real shops. That figure is “alarming”, he says, and shows the web purchasing experience being offered “isn’t quite right”, including the mistake of not being transparent with customers about shipping costs until late in the process.
He says one of arvato’s clients, gift website Firebox, have recently revamped their website in the hope of making it more frictionless and are reporting greater success. “They have tried to give people only what they need to know – clear, concise information,” says Mr Fogg. “Fewer words would probably come into it – clearer options.”
Marketing consultant Paul Brewster believes Amazon are “the greatest exponents of frictionless shopping”, pointing out that they filed a patent application for their 1-Click buying function in 1997. “It is not about fancy graphics or having the lowest prices on the web,” he says. “Do not create unnecessary friction by forcing your customers to jump through hoops or go around in circles.”
Applied rigorously, that mantra could end up saving companies a lot of time and effort, and prove just as effective for retaining customer loyalty as the giveaways and attempts to wow.
SELF-SERVICE
GROWING TREND IN SELF-RELIANCE
Paying staff to roam tills and shop floors at the times they are needed is one of a retail business’s biggest challenges – and costs. At the same time, not being able to find a sales assistant or having to wait too long in a queue are two of the most frequently aired customer complaints.
So new research that shows a clear consumer appetite for self-service will be enthusiastically received in the business community.
In their Customer Experience Survey, Cisco asked 1,514 respondents of all age groups and from ten countries about their preferences when shopping. The results showed a higher than expected enthusiasm for conducting research and purchase outside the usual face-to-face encounter.
Some 52 per cent surveyed said they would rather use a self-checkout station than wait in line to pay, while 43 per cent would use their mobile phone, while browsing the store, to research products further. Some 57 per cent said they liked using touch screens, such as the ones provided at shops like Argos.
Their answers point to a customer base who value speed over personal reassurance and want control over the research that they do into products.
Software firm Synthetix released research among UK and US consumers earlier this year, which showed that web-service is now the channel of choice for after-sales service, with 90 per cent of consumers checking a website first before e-mailing or phoning.
And a survey by Zendesk found 19 per cent of Twitter users have used the site for web self-service and that the internet self-service industry grew from $600 million in 2011 to $1 billion in 2012.
Costa’s Costa Express self-service coffee mini-bars, dozens of which are now dotted across London, is one recent example of a company trying to capture the desire of busy, tired consumers to have control over their purchasing and not feel they are being slowed down by others.
