The Cost of Poor Customer Service and Customer Experience
Vital Germaine
According to a survey done by Nuvi, “Most companies that offered a great experience saw an increase in the likelihood of their customer base showing loyalty-based behaviors from 15% to over 80%! That's a 4.5x increase! This is where revenue increase comes from.”
Be aware, however, this is about how each and every touch point along the customer journey with your business makes them FEEL. Considering that 90% of purchasing decisions are emotion based, it would be foolish to ignore how your customers feel about doing business with you.
You can have the four P’s of brand perfectly in place (Product, Process, Place and People), yet your customers may still experience a negative journey. Let’s first break down the key differences between Customer Service and Customer Experience. They overlap and often get confused.
In the book, Outside In, by Harley Manning and Kerry Bodine, they share a poignant FEDEX anecdote demonstrating the difference between Customer Experience and Customer Service. Here’ the short and simplified version.
On arriving at FEDEX, employees do everything right: warm welcome, friendly service, short wait times etc. HOWEVER. Packages are taken by the clerk, who places them immediately behind them amongst endless other packages, which employees affectionately refer to as the “leaning tower of rubble”. This tower of rubble, inspires a feeling of, “oh, my package is going to get lost midst the rubble,” in customers. Customers leave feeling anxious. They have had a negative experience despite FEDEX’s reputation and every single touch point being well executed.
The simple cost-effective fix was to place a screen with slits between the customers and the “conveyer belt”. From the outside, it appeared as though each package was being strategically sent to a very specific location, inspiring confidence in the customer that their package would not get lost and/or delayed. However, behind the new screen, lived the identical “leaning tower of rubble.” Perception is everything. In particular when it comes to building a strong brand that inspires customer loyalty.
The thing about Customer Service and Customer Experience is that both need to be consistent across all platforms of you business and the customer journey.
Read more about Customer Service.
Regarding Customer Experience (CX), it doesn’t have to be toxic or terrible to fail and negatively impact consumer loyalty. It’s sometimes as simple as one or two minor pain points that leave a slightly unpleasant taste. Most companies create a “decent” CX. They deliver what is expected and get away with it (for the most part).
80% of customers say that experience is just as important as a product or service.
Companies that are happy with “just ok” eventually lose their client base. By the time the executive team realizes the loss or downturn it’s too late and a costly fix. The company needs to heavily invest in employee training and begin the urgent process of change: re-evaluating company policy, culture and leadership. Many even go through a painstaking and costly rebrand as a result of negligence.
How to avoid these costly business pain points:
In our online communication course, we share many great customer service strategies, including conflict resolution… even better, how to avoid disgruntling customers.
