There is seemingly no end to the number of companies that are "customer-centered," "customer-focused," or "customer-oriented." It's no secret that customer satisfaction is a key contributor to business growth and sustainability in a highly competitive marketplace. Nevertheless, there is a major disconnect between what company executives believe their brands are delivering by way of customer support, and how their customers actually feel.
For example, a classic study by Bain & Company found that 80% of companies believed they were delivering a "superior experience" to their customers. However, the surveyed customers told a different tale. They indicated that, in their opinion, only 8% of those companies were actually doing so.
There was a disconnect when that study first came out, and there is still a disconnect today. Why? What are corporate leaders missing? How can the gap between perception and reality be effectively bridged? The following information will discuss the answers to these questions as we explore the customer support disconnect in depth.
Reasons for the Disconnect
While it is impossible to list out all the possible reasons for this customer support disconnect in a single article, there are 3 key factors that often contribute to a fundamental misunderstanding on the part of company leaders and executives as to what customers really want:
- Ineffective feedback mediums
- Undue emphasis on customer acquisition vs customer retention
- Misconceptions around the importance of "delighting customers"
Let's take these factors one at a time.
Ineffective Feedback Mediums
One of the biggest barriers to accurately gauging customer satisfaction is the nature of many "feedback mediums" utilized by large corporations. The customer satisfaction survey is a prime example of this.
For email surveys, research indicates that the average response rate hovers just below 25%. For other survey methods, like phone or letter, the response rates are much lower. This means that most corporate decision makers are only hearing from a quarter of their customer base, at best. Add to this the fact that only an estimated 4% of dissatisfied customers ever give feedback to the offending company, and you have the textbook definition of a "small sample size."
Why is this significant? Simply because such a small sample of a company's total consumer base may not provide adequate representation as to major customer support issues that are occurring. In addition, many customer surveys only allow for multiple choice questions, with little room for open-ended feedback. This muzzling of the customer's voice further hinders the effort to understand common friction points.
Undue Emphasis on Customer Acquisition vs Customer Retention
It costs, on average, five times more to acquire a new customer than it does to retain an existing one. That figure by itself would seem to indicate that a company should focus any customer experience initiative around its core of loyal customers.
However, it seems that many corporate leaders place an inordinate amount of time and resources into new customer acquisition - at the expense of keeping current customers. While an influx of new customers is important for the growth of any commercial organization, the risk of alienating brand advocates and long-time buyers should not be taken lightly.
The following list provides some common examples of companies losing their focus and inadvertently damaging their customer core:
- Increasing transaction surcharges and fees to support a marketing campaign
- Offering new customers inexpensive promotions or trial periods, and making up the losses by raising rates on current users
- Neglecting ads focused on current customers in favor of ads oriented towards new prospects
Misconceptions Around the Importance of "Delighting Customers"
Another common reason for the customer support disconnect is a fundamental misunderstanding of what keeps customers coming back for more. Several years ago, a Harvard Business Review study found that customer effort score (CES) is a far more accurate indicator of churn than customer satisfaction ratings. Put simply, in many industries the majority of customers don't want to be "delighted" - they want to complete their transaction as smoothly and effortlessly as possible. Company executives that focus all of their efforts on providing "exceptional customer service," while simultaneously ignoring friction points along the customer's journey, will likely find that their strategy only yields minimal results.
How to Bridge the Gap
The good news is, there are steps that executives and managers can take to bridge the gap between the perception of providing world-class customer support, and the reality of doing so. For instance:
- Implementing more accurate customer feedback analysis. Many businesses are adopting tools and technologies designed to leverage customer sentiment analysis into actionable insights. These AI-powered tools search across a variety of platforms and websites, such as social media posts, Google reviews, and open forums, to determine where customers may stand on a variety of product and support issues. It's no secret that the average consumer is much more willing to share his or her thoughts through a social media post, as opposed to a customer survey. Thus, sentiment analysis tools enable marketers to examine a larger, and likely more accurate sample for pain points and overall brand perception.
- Focusing on the core customer demographic. It's easier to sell to a current customer than a potential customer. Companies that understand this fact won't neglect marketing campaigns that target existing users instead of prospects and leads. At the same time, focusing on exceptional service to current customers will likely provide an indirect boost to your brand by means of word of mouth marketing. Since 83% of consumers trust recommendations from friends, family members, or colleagues, you want to do everything within your power to encourage existing customers to advocate for your brand.
- Making it easier on customers. Eliminating friction points is one of the most important ways to increase customer satisfaction. In some cases, a measure of foresight is all that you need. For example, if you realize that a software update may come with a learning curve for some of your current customers, then you may decide to roll out a tutorial in your newsletter before the change goes into effect.
There is a real customer support disconnect throughout the business world. However, if you identify the key factors that feed into this cognitive dissonance, and then take decisive steps to correct any deficiencies that you see in your company's business model, you'll be able to bridge the gap between perception and reality. Your customers will appreciate you even more, and your business will be in a position to thrive for years to come.