Customer satisfaction is the key to customer retention, and it is a critical cog in the wheel for any growing business. That said, there is no real measure of customer satisfaction and what you don’t know could hurt your business.

Satisfied customers are also crucial to any business in more ways than one. First, they are bound to buy more products or services over a shorter period. Second, once you can establish customer loyalty, they will partake in word-of-mouth showing their advocacy. Third, they are bound to bring in referral customers to your business. Thus customer satisfaction adds a lot of value to a business cycle.

It is a known fact that a business will not act on a laundry list of improvements just to satisfy a few customers. However, it is essential to analyze the cause of why the laundry list exists and look for changes or developments that the entire customer group can take advantage of. So, a dedicated customer service team is essential to keep the ball rolling. Similar to the above, there are certain customer satisfaction myths that this piece looks to debunk.

Myth #1: Customer loyalty takes precedence customer satisfaction

This is highly misplaced assumption, and where loyalty is essential, satisfaction brings better results in abundance. Consider that loyalty can always be controlled with price discounts, offers, and freebies while happiness will come only with the use of the product. Pursuing the line of allegiance will perhaps, get more business in the long run but ignoring satisfaction will bring no business in the future.

Loyalty thus can be bought but not customer satisfaction.

Myth #2: Maximise customer satisfaction

Maximising customer satisfaction is not possible, period. Satisfaction is more of a personal vibe with the customer and is not in control of the business. All that the company can do is to optimize it with more features and better service. Any effort to maximize satisfaction through an increment in counters or through such efforts might improve it a niche above but at the cost of profitability.

Put profit above all and stretch only as much as you can to achieve optimal customer satisfaction.

Myth #3: Try and exceed customer expectations

This one is good for the textbooks. Meeting customer expectations is more realistic than exceeding them. On the ground level, how will you reach something that is not tangibly expressed? Customer satisfaction is a tight-rope in the sense that, you can never indeed establish what action will result in meeting the expectations.

The reality is that customer expectations should be met using excellent and friendly business strategies that add to the bottom-line instead of striving to invest in it. Meeting such expectations should be a pleasant accident rather than a calculated move.

Myth #4: Avoid customer dissatisfaction at all costs

If you have been in business for some time you will know that you are making 80% of your money from 20% of your customers. So, going by the 80/20 formula keeping customers who probably don’t add to your bottom-line may seem to be a loss-making proposition. However, this does not mean that you leave those customers out. If you use a good CRM and have customer profiles and data available, handling dissatisfaction from selected customers who add to your profits can be a joy. Customer dissatisfaction will always be there to some extent, eliminating it 100% is not possible or even profitable.

Myth #5: Minimize customer complaints

Businesses do not like complaining customers. However, such complaints must be dealt in a proper manner and not treat them as distractions. Listening intently to complaints can give you insights into your business process that can be bettered. Also, some customers never complain, which again does not mean that they do not have complaints.

Encouraging complaints and resolving them is the way to go. Failure to listen to them is to set yourself for failure.

Myth #6: The percentage of customer satisfaction

Customer satisfaction is a two-faced sword. There are scales – external as well as internal (for some businesses) that measure it on a percentage scale. Honestly, no customer is completely satisfied or dissatisfied. On the one hand, you are looking at a tangible expression of satisfaction, and on the other hand, you measure something that is a complete bundle of emotions and thoughts that are invariably bound to change. A simple scale or a percentage is no measure of satisfaction. It is only an indicator.

At the ground level, simplifying customer satisfaction can result in adverse decisions affecting your business long-term.

Myth #7: Customers are loyal

Customer loyalty is not about brands anymore. They have grown to get ahead of that mindset and are focussing more on customer service. Regarding customer satisfaction, they are happier where they get personalized attention to resolve any issues.

In this scenario, do not think that a customer is satisfied or loyal to you just because you are a well-known brand.

Myth #8: A satisfied customer is a loyal customer

Customer satisfaction is a combined measure of his or her attitude towards the brand, products, and services. Customer loyalty is entirely different and is a combined measure of opinions, behaviors, attitudes, repeat purchases and feelings. Customers can showcase loyal behavior without a loyal view and vice-versa.

So, assuming that a satisfied customer is a loyal customer can be quite misleading.

Myth #9: Customers always look at the lower prices

Many reports have been crafted on the subject, however, as per most surveys, it has been found that the percentage of customers looking for quality is a tad more than those looking for a reasonable price.

Irrespective of what your customers prefer, quality or price, it is always a good policy to consider the value you provide for the price. Focus on offering value for money.

Myth #10: Technology is critical to improving customer loyalty

Technology applied to produce good or services is internal to the organization. However, if you advertise the technology used, which is better than the competition, could be a USP. The focus of investing in technology should be to provide better goods and services rather than advertising it to gain customer loyalty. Also, the technology used for communication with customers should be chosen with care to facilitate more accessible and better customer interaction and not for the sake of it.

End of the day, a customer will look at the quality of goods for monies paid and in a more natural way to get through to you. He or she is not impressed by what you use. They are influenced by how better it gets for them.

Myth #11: Customers will be loyal if they like you

Amidst fierce competition, it will be foolish to assume that customer loyalty depends on how well he or she likes your company. In which case, your competition will make the best efforts to get into their good books. Assuming this end will be dangerous.

Customers are fickle, don’t ever take them for granted.

Myth #12: Loyalty building is expensive

This is the biggest myth of them all. Businesses, small or big need not worry about costs of loyalty building. Offering excellent products and services at the right price will build loyalty automatically.

If you are looking to build customer loyalty, you are on the wrong path, focus on your business and loyalty will come automatically.

Myth #13: To build customer loyalty, you will need personal interactions with customers

Personal interaction goes for a toss when a customer uses your product and finds it faulty or too expensive. Building relationships is a good thing to get more business but never assume that such relationships are going to build the loyalty factor.

Personal relationships and business never did mix, why do you think they are going to come to your aid today?

Myth #14: The more numbers of times you contact a customer, the more loyal he or she will be

Why would want to reach out to a customer, for up-sell or cross-sell? And, how many times a week do you think you will do that? None of your customers would like to be spammed. So, increased contact is not a solution to gaining customer satisfaction or loyalty.

Use the right communication mediums to keep in touch and keep testing your communication frequencies without annoying your customers.

Myth #15: Measuring customer loyalty is only possible through customer satisfaction surveys

Customer satisfaction surveys are great to measure customer satisfaction, however, they are more qualitative. There are specific quantitative methods to measure the customer loyalty. They could include some metrics like purchase frequencies, how much revenue they are bringing and so on. These can be measured through some analytics tools available online.

Myth #16: Retention does not help build better bottom-lines?

To de-myth this, consider that the percentage of selling successfully to an existing customer is around 60-65% while selling to a brand new customer, your chances are anywhere between 5 to 20%. With the vast potential to up-sell and cross-sell, retention does help build better bottom-lines.

Myth #17: Tracking customer loyalty is a challenge

Not true at all, there are so many tools out there like membership cards, rewards, points, unique customer numbers and so on to assign memberships to customers. Once done, you can collect a wealth of data that can be used to analyze and assess customer loyalty levels. Tracking these metrics can a long way is monitoring customer loyalty.

Myth #18: Does customer retention has a real, measurable ROI?

While it is quite tricky to get the hang of ROI for the spend on customer retention, it is not as impossible it sounds. The better method here would be looking at the CLV (Customer Lifetime Value) instead of ROI. The CLV is a projected revenue that a customer will pass to you in his lifetime.

Customer satisfaction is a critically important metric for any business, and it is only advised that you get rid of all those myths that surround the very concept of customer retention and loyalty. It is as important as the new business that you generate and ignore it at your peril.

Customer experience management              Customer satisfaction Customer value

As brands seek to remain relevant and deliver value to their customers in the digital age, customer engagement has become a focal point on the agenda. Marketers now know that engaged customers buy more, spread more word of mouth, and are more satisfied and loyal.

Highly engaged customers gain more value from your core offering and will devote their own time and effort to creating value on behalf of your brand. Brands that invest in a well-thought-out customer engagement program are seeing meaningful business results through co-designed products or services, user-generated content, grassroots publicity, and broad brand reach.

To get to these kinds of results, you need a well-designed and managed engagement strategy—not just a collection of ad-hoc tactics.

In our experience working with clients, we have identified five key steps to developing an effective customer engagement program:

1. Align The Organization
   The strongest customer engagement programs don’t rely only on individual marketing touch points. They leverage the entire customer experience as a continuum for customers to deepen their relationship with the brand.

This “continuum of engagement” will require a cross-functional team across the company—marketing, product, customer service, etc.—to develop and execute a seamless customer engagement program regardless of channel or stage in the customer life cycle.

Executive support is critical at the early stages—helping secure resources, selecting members of the cross-functional team, and establishing a chain of command. An effective practice when selecting program sponsors is to find an executive champion outside of marketing who will co-sponsor the initiative along with the CMO.

Furthermore, a critical step in this phase is to define what “engagement” means for your brand.

2. Design Your Strategy
   After gaining executive support and buy-in from key teams, you’ll want to develop an overarching strategy for your customer engagement program. Not only should this strategy be aligned to key organizational objectives, it should provide a guide for the relationship your brand wants with customers. It should outline the value your customers will get from engaging with you, identify your business goals for the program, establish measures of success, and present a plan for tapping customers’ key motivations to engage.

In this phase, you’ll hypothesize a “theory of engagement” for your program: which types of engagement activities deliver the most results and which emotions these activities should tap into to drive customer behavior. This ideation process is a valuable part of aligning the team around the objectives of the engagement program. You should validate and refine your hypotheses using data, insights, and driver modeling.

The outcome of the strategy phase will be a customer engagement ladder that depicts a customer’s journey toward high levels of engagement with your brand. Your ladder should be designed to realize increasing value for your customers. A well-designed engagement ladder becomes the architecture that supports tactics and campaigns.

3. Develop Tactics
   A customer engagement program needs to operate seamlessly across channels. To maximize value, it should be consistent and synced, regardless of where a customer engages. Since today’s customer expects always-on, personalized, and unified experiences from brands, it’s critical to offer the right engagement opportunities—tailored to each customer—across all channels: mobile, web, social, and physical.

Of particular importance, mobile is one of the most powerful platforms available to brands. Even very simple mobile engagement produces strong impacts on both web and physical engagement, as well as on sales. In addition, depending on your industry or business, social media offers multiple opportunities to facilitate and encourage customer engagement.

Online and traditional advertising, loyalty programs, brick and mortar locations, and customer service also offer engagement opportunities. They should be optimized to put customers on the engagement path and help them move up the ladder over time. These programs can act as feedback loops to help route customers back onto the engagement ladder over and over, regardless of where they interact with the brand.

4. Pilot And Scale
   When preparing to introduce new components of an engagement program, build in the discipline to filter ideas and test them with customers to prove their value. Testing techniques that have been effective for our clients include agile pilots, A/B testing, and cohort analysis.

Once a new program has been validated and optimized through piloting, it’s time to scale. Scale requires putting the right processes and systems in place to offer and manage each new program for the broader market.

5. Measure And Manage
   The measurement strategy should provide leaders and teams the information needed to make smart business decisions and optimize the engagement program. When determining what to measure, it’s important to identify the key performance indicators (KPIs) that matter most and find ways to streamline information so the critical insights come clearly to the surface in actionable ways.

A challenging but valuable exercise is to develop a customer engagement score—combining multiple behavioral measures of engagement into one KPI. Increases in this score can be linked to improved sales and other business results, helping quantify the ROI and value of your engagement program. Furthermore, customer engagement scores can also contribute to predictive customer lifetime value models.

Other sophisticated methods of customer engagement measurement can produce what we call “magic numbers:” flags that call out critical behaviors requiring action, such as flags that indicate “at risk” customers who are likely to churn and need reactivation or “ready to advocate” individuals who should be recruited into advocacy programs or provided with special referral offers.

Customers today decide when and how to interact with brands or whether to ignore a brand entirely. A customer engagement program is essential to capture and retain customers—not just their dollars, but also their respect, affinity, excitement, and willingness to spread word of mouth.

Now is the time to think through this process and deepen your relationship with customers—and in return your brand will increase satisfaction, loyalty, reach, and sales.

CUSTOMER ENGAGEMENT       CXREFRESH       CX    CUSTOMER EXPERIENCE      GLOBAL CX

Each of us understands what it means to be disappointed by a poor customer experience or delighted by the employee who goes above and beyond. Given the potential upside, dumping money into the customer experience (CX) seems like a no-brainer. But is it, really? Can you engineer an excellent CX by throwing resources directly at the customer or by demanding that your employees deliver service with a smile?

Many businesses certainly seem to think so. The market for customer experience management services and technology is expected to grow to nearly $17 billion by 2022. Companies are spending lavishly on comprehensive CX strategies and building or buying high-tech systems in order to mine what they see as untapped veins of growth. And the data insists that this preoccupation with CX is justified.

However, the methods that many organizations are using to try and duplicate those glowing figures just aren’t delivering. Only 37 percent of businesses surveyed said they were able to tie CX activities to revenue and/or cost savings. That means the majority are, in effect, just spending a lot of money on CX — and keeping their fingers crossed.

When it comes to the customer experience, keep in mind a simple equation — EX = CX

The employee experience (EX) equals the customer experience (CX). A superlative customer experience is the direct result of a solid employee experience. Yet, many businesses jump right past this simple fact, opting to address the CX as if it were something they could conjure up solely as a result of products, process, placement, pricing and profit.

So, you want to take care of your customers? Start by taking care of your employees. Employees interact with your customers, make them smile and carry your brand message. If your employees are having a great experience, so will your customers.

What, then, do we need to keep in mind when we consider the EX = CX equation, and why is the EX side so important?

1. Your company is your people. People, not legal entities, get things done. Who makes the sales, does the hiring, takes care of the customer, buys the media, teaches the student, tends to the patient or takes out the trash? Does the company do that? We cling to the delusion that corporations take action, make decisions and even have personalities. But, that’s a distorted perspective. It’s the people.
2. Your employees are closest to the customer. They are closest to your customers’ needs, challenges and wants. They are best positioned to resolve a concern or to delight a customer. They are also in the best spot to feed this information back up the chain so that your products and services hit the mark.
3. EX = CX. Some organizations spend a fortune on elaborate customer service safety nets designed to keep employees from damaging the customer relationship. Why? Because their employees don’t care. They’re having a lousy experience, so they’re not motivated to provide anything more than that to the customer. Employees will deliver a customer experience that matches their own experience within the organization.
4. Employees are your brand. “Brand” is the Holy Grail of business; we’re always growing, maintaining, repairing, protecting or defending it. But your employees create it. Not your marketing department. Not PR. If your brand is your promise to your customer, then your employees are responsible for keeping that promise. Your employees are your brand. It lives through the performance, interactions and genuine care of the people who bring it to life on the front lines every day.
5. Design your EX. Many consider the employee experience in the same vein as company culture — it’s just “the way we do things around here.” But, instead of simply “letting the EX happen,” design the EX you want to create and that will impact your customers in the way most instrumental to your organization’s success. Instead of orienting all ideas around the customer or organization, focus on the employee, with the thought that if the organization has an extraordinary EX woven into its DNA, an extraordinary CX becomes inevitable.

CUSTOMER EXPERIENCE    CX       GLOBAL CX    EX=CX     EMPLOYEE EXPERIENCE

Delight Customers

If you are trying to build a business that grows in the future, remember the only way is to delight your customers. More importantly it is to create delight with meaningfulness. If you don’t genuinely love your customers and want to solve an important problem, you will only burn money and feel that you have bought customers loyalty.

But money will not buy you loyalty, ever. This is why customer experience is more important than ever.

This is why we started CXREFRESH. It is the community of global CX leaders that are changing the way businesses are readying for growth in future.

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