The Vicious Cycle starts with one bad customer experience. That experience leads to customer dissatisfaction. If the company does nothing to make amends or improve its customer experience, the customer defects. That customer tells other customers. The company loses customers—and money. In turn, the company cuts costs in customer care, which worsens the customer experience. And down it goes from there. Poor customer experiences cost companies customers and revenue. Here is step three to help companies change course and create a virtuous cycle of satisfaction and profitability.
Step Three: Break the Vicious CycleSo what are you going to do? First you need to “be” your customer. How does it feel to interact with your contact center? Your website? Your retail associates? Try out a few of your processes and see how they work from the customer’s point of view. Next, think about a customer experience you’ve had that impressed you. Look outside of your industry. What was it about the experience that was so outstanding? Did the company make it easy for you? Anticipate your needs? How long did it take to complete your task? Now comes the hard part. Look in the mirror.
Earlier, we talked about companies operating at one of four levels of readiness. Which one are you? At which level was the company that you were impressed with? Now get your leadership team together and challenge them to do the same thing. Create a shared vision and then build an inspirational roadmap that includes the following:
- Culture: Culture doesn’t happen by accident. Business leaders need to create an environment that rewards empathy, is committed to the customer, and encourages honesty and determination.
- Organization: The structure builds from there. The organization needs the capabilities to provide accurate and personalized information to the right person at the right time. Leadership must also be committed to on-going skills development.
- Process: Processes must appear seamless to the customer and evaluated for continuous improvement and innovation.
- Technology: On-premise, in the cloud, hybrid—the infrastructure must enable a 360-degree view of customers, as well as integrate individual, household, and product insights. Be predictive and flexible enough to leverage emerging tools and channels.
There is no magic bullet. No quick way to turn the tide. But for companies that are committed to change, success is possible and well worth the effort and investment.
According to a 2010 Harvard Business Review study, service failures not only drive existing customers to defect, they also can push away prospective new ones. According to the study, 65 percent of respondents said that they were likely to speak negatively about a poor customer service experience, as compared to only 25 percent who were likely to speak positively about a good one.
And even more compelling, 48 percent of customers who had a negative service experience reported that they would tell 10 or more people about it. Add in social settings like forums, blogs, and online communities and the megaphone has just been turned up to tell the whole world. Let’s face it, your scarcest and most valuable resource is your customer base, and each one of those customers is becoming more connected, empowered, and impatient. The winning companies will be the ones that break the Vicious Cycle and make it easy for their customers to do business with them. Will you be next?