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November 20, 2015Persistent gaps in perceptions threaten to get in the way of future customer experience improvements
Back in 2005, Bob Thompson of CustomerThink, conducted a study for RightNow Technologies (now part of Oracle) called The Loyalty Connection: Secrets To Customer Retention And Increased Profits. Part of the study looked at the differences in perceptions that exist between executives and customers on what they consider to be important and, also, what were the main reasons why customers left or stopped using a product or service.
The research found that when customers were asked about why they had stopped using a product or service:
- 74% replied that customer service was the major issue;
- 32% stated that it was due to a quality issue;
- 25% cited a pricing issue; and
- Only 14% said that it was related to functionality.
However, when executives were asked a similar question about the reasons why customers stopped using a product or service:
- 49% replied that price was the major issue;
- 36% stated that customers needs had changed; and
- Only 22% of executives believed that their organisation’s customer service was at fault.
Now, that research came out 10 years ago so it would seem reasonable to assume that some progress has been made towards improving relations with customers and reducing the perceptual differences that exist between brands and their customers. Moreover, we could also assume that progress should be accelerating as since 2010, according to Forrester, we have now entered ‘The Age of The Customer’, where ‘empowered buyers demand a new level of customer obsession’.
Right?
Well, two recent reports would call those assumptions about progress into question.
The first report is a global banking and consumer study that was recently conducted by the IBM Institute for Business Value called Banking Redefined: Disruption, transformation and the next-generation bank. The study surveyed over 1,000 banking executives across 38 countries and around 1,600 banking customers across the United States, Germany, United Kingdom, Singapore and China.
The survey uncovered a number of interesting findings including that:
- 62% of banking executives surveyed believe that they are delivering excellent customer service but only 35% of their customers agree;
- 96% of the bankers surveyed believe that their customers trust them and their banks more than they trust other non-bank competitors. However, only 70% of their customers agree;
- 48% of banks think they are doing a good job are encouraging the loyalty of their customers. But, only 35% of their customers agree; and
- Meanwhile, whilst customers and their banks agree on the growing importance of mobile banking, only 10% of bankers think that the majority of transactions will be conducted through mobile devices in the near future. However, when you compare that to customers, 41% of those surveyed expect the majority of their transactions to be conducted via a mobile device in the next three years.
The second report was conducted in 2014 by Kitewheel, where they surveyed nearly 600 consumers and marketing decision makers to examine the state of perceptions, engagement and communication between brands and connected consumers. One of their most interesting findings concerned loyalty programmes where they found that:
- When asked about loyalty programmes, 73% of customers believe that they should be a way for brands to show how loyal they are to them as a customer;
- However, when asked a similar question, 66% of marketers believed that it should be the other way round and that loyalty programmes are there for customers to show how loyal they are to brands.
Whilst these two studies can’t be compared directly with the 2005 study they do suggest that differences in perceptions still exist, are still significant and that progress to narrow that the differences is not as fast as many would like or would have hoped for.
The next question would then have to be: why is that? Why is progress not happening as quickly as we might like and why do differences in perception exist and persist?
Looking at strong relationships in our personal lives offers some clues about what drives differences in perceptions, beliefs, values and views on what is important. The differences tend to be driven by a number of things, including:
- The assumptions that we make about ourselves, others, what we know, like and value and what they know, like and value;
- How we communicate with each other, how much we do that and how often;
- Our cognitive biases and belief systems;
- Our own experiences and how they influence our perceptions, thoughts and actions;
- The level of empathy we have for others and how much we can and have tried to ‘live in somebody else’s shoes’;
- How much attention we pay to the problems, issues and successes others have;
- How much we care about the people around us and the relationships that we have with them; and
- What we do about all of this.
To reduce perception gaps is not easy and requires time, hard work, emotional labour, persistence and commitment, whether it is in our personal or professional lives.
But, it is work that is worth doing. To avoid that type of work runs the risk that these perception gaps persist and they hinder many of the future efforts to improve customer relations, engagement, service and the overall customer experience.
This post was originally posted on my Forbes.com column here.
Photo Credit: Andy Wilkes via Compfight cc
9 Comments
Adrian, the lack of progress is just really discouraging!
I know why executives are asked, and I understand the importance of identifying that gap. It’s eye opening!!
Let me play devil’s advocate for a moment and ask… why do we even ask executives? Isn’t the most important voice or perception that of the customer? What is/was his experience? Executives shouldn’t even answer the questions but defer to what their customers are telling them.
Annette 🙂
Hi Annette,
I get your point but surely the results show how much they are listening.
Adrian
Adrian, self delusion is a wonderful thing. It is just a pity I suffer from it as much as the next man
James
Hi James,
That’s honest. I guess the question for organisations (and you) is what they are going to do about it.
Adrian
The gap is real. I have talked with a business owner once and was surprised that he thought that customers are only buying because of the price. Actual research must be done if you want to know the real reasons why your customers are buying or not buying.
That’s very true, Ivan
The solution to this is research. You have to pay someone to go out there or just call your customers to know what they really think. You can then use this data to improve your products and services.
Sometimes the simplest of solutions are the best. But, often many firms are not willing to do the work.