Typically when businesses try to predict customer loyalty they look at customer satisfaction, which is actually a poor measure of customer loyalty. They use statistics garnered from metrics such as Net Promoter Score. However, just because we are a satisfied customer does not mean we will go back and spend again.
A great measure of customer loyalty is the Customer Effort Score research, which has come out of Harvard and measures the predictive power for re-purchasing and the predictive power of increased spending. Customer Effort Score outperforms Net Promoter Score and Customer Satisfaction (CSAT) in predicting repurchasing and has highlighted that it is increasingly important for businesses to make it easy to be a customer.
There are a number of reasons why we should measure customer effort. It drives advocacy, value for money and loyalty. Churn customers tend to have had more difficulty in doing business with you and therefore they certainly won't be recommending you to their nearest and dearest. It's also highly actionable feedback – it is telling you the pain points for your customers. It's applicable to all channels and all businesses.
At the Henley Centre for Customer Management, we agreed that customer effort is a vital component to understand service delivery from the customer's point of view, so we decided to take this idea further and look at what sort of effort we are putting in as customers. Effort is defined as the physical, mental or emotional energy that is needed to do something. We concluded that there are three different types of effort – cognitive, emotional and time – and what can bring out each emotion in a customer.
Cognitive effort might be when a company website is too difficult to navigate or there is very little product information. Our emotional effort can be measured in terms of the relationships we form with staff. For example, it is a struggle to access the right people, processes or procedures or our complaint is not being dealt with properly. Time effort is when we feel a business is not respecting our time effectively, so for example being kept on hold for a long time when we ring customer service, being given the run around or when we have to repeat the same thing because we are being passed around.
Companies are collating buckets full of data about their customers and what motivates them, what they want and need and how satisfied they are, but they are not doing anything with that data and they are certainly not doing anything with it at the frontline. For example in the call centres and in the stores – these are the very people who have no idea how to improve the service they give based on customers' feedback.
A key way to look at how much effort your customers have to make is by looking at the customer feedback your organisation is receiving from unhappy or struggling customers. If they are complaining, it is highly likely they have found it difficult to be your customer in some way.
Another way is to empower your frontline staff to deliver a low-effort experience to your customers. Incentive schemes that reward speed over quality pose the greatest threat to reducing customer effort. Companies should consider removing the productivity 'governors' that get in the way of making it easy to be a customer.
- Carefully consider what kind of effort your customers have to invest in doing business with you
- Map out the customer effort journey
- Brainstorm low customer effort approaches
- Remember, too much complexity drives poor performance
So much focus goes into what we can do to provide exceptional customer service, and of course that should be the aim; however, if you haven't got the hygiene factor right, you will fail before you have begun. What is the point in trying to delight a customer, if it is difficult to be a customer? You need to get that right first, and then you can put the icing on the cake.
http://www.charter-uk.com/customer-effort-score.php
No comments:
Post a Comment
Thank you for your feedback