Experience Matters: Increase Customer Retention, Satisfaction, and Revenue

Transcript

INTRO: Building a great company is a marathon not a sprint. Each week Krista Ankenman and the team at TANK New Media take on growth challenges, explore technology, and interview business leaders that are always upping their game. If you're ready to build scalable systems to drive your business forward, this podcast is for you.

KRISTA: Hi, everyone, welcome. Today we are with Tori Lock and on a daily basis, Tori works with clients to help make sure they achieve marketing and sales success. And today, we're gonna be talking about the overall customer experience. Hey, Tori.

TORI: Hey. How are you?

KRISTA: I'm good. How are you?

TORI: Good. Happy to be here.

KRISTA: Good. Well, let's dive right in. So just kind of tell everyone what is customer experience in general.

TORI: Yeah. So to jump right in. Customer experience is, you know, it's the key to exceeding your customer's expectations. Brands have to be accurate, dependable and provide the service they guarantee.

KRISTA: OK.

TORI: So really the opportunity lies in the ability to deliver what you promised and then surprise your customer with extra care and support.

KRISTA: So it's gonna going above and beyond to make everybody happy.

TORI: Definitely. Yeah. Anytime you can provide a little bit of delight. You know, it's always good for everybody involved.

KRISTA: Everybody feels good for sure. So why is this important when we think about, you know, the aspects of business, like how does this help overall businesses?

TORI: Yeah. So it's important for improving customer satisfaction. And at the end of the day, customer loyalty, you want your customers coming back. So customers just don't want to buy something, they want a great experience that compliments the product or service that-that they're interested in. And this is why it's important to deliver a level of customer experience and make sure it delights customers and builds these everlasting relationships that customers want. At the end of the day.

KRISTA: OK. And it actually found McKinsey found that 70% of the customer journey is based on how the customer feels they're going to be treated. So, again, it's really important to deliver this level of customer experience kind of across the board at all. At all levels.

TORI: Yeah, definitely. Definitely. Again, anytime you can delight somebody, give them just a little bit extra than what they expected. It's always good.

KRISTA: It's a plus. So how does the customer experience impact the company in general?

TORI: Actually, research has found there's a strong correlation between customer experience and loyalty, according to researchers at Forrester, actually. There's a strong correlation between customers positive experience and their willingness to make a purchase from a company again.

KRISTA: Oh, well, I mean, I guess we kinda think about that. So if we go, you know, let's say to a restaurant, we have a really poor experience, even if the food is great, you know, you're probably less likely to go back.

TORI: You don't really want to experience that all over again. So a positive experience brings people back and makes them want to make a purchase again, which is great for business.

KRISTA: Definitely. So does this really affect the bottom line of a company? Are we really just making everybody feel warm and fuzzy?

TORI: You know, American Express actually found that American consumers continue to reward companies that get service right. Consumers are actually willing to spend up to 17% more on a company that has outstanding customer service. So thinking back on this, whether it's, you know, a retail store or even your grocery store that you go to every week when you have a happy smile at the end of every aisle or whatever it may be, it makes you want to go back not only for the great prices that they have, but you know that it's going to be a happy experience when you walk in the door. And so if you can walk away from any experience like that, feeling good about it, you're surely going to go back.

KRISTA: And I might even be the person who like I'll pay more, like I'll go to a more expensive place, like if I know the services significantly better than going to a place that is cheaper. But maybe I don't have as good of an experience with. And I think, I think that's true. Even we think about like online, you know, online stores and B2B businesses like the experience really does impact the purchases that people are making.

TORI: Yeah. You think about just the daily stress that people go through, whether it's at work or at home, whatever it may be. Anytime you can take that stress or friction out of a single purchase online or at the store, it's a good experience for everybody involved.

KRISTA: And it looks like the Walker study actually found that by the year 2020, customer experience will overtake price and product as the key brand differentiator. So this is something that's really going to become more and more important. 2020 is not that far away.

TORI:Right.

KRISTA: Definitely. But it-it does matter. People, people are making big decisions based on the way that they feel and the way that they're interacting with a brand rather than just price and features.

TORI: And I think it's really exciting to think where this is going to go. As we move forward with different brands going online and, you know, some people getting offline for their purchases, it's really an exciting place to be in the industry, seeing where things might end up.

KRISTA: Yeah, definitely. So do you think that customer experience is specific to consumer brands only?

TORI: You know, really, it doesn't seem like it matters what business you're in. Improving the experience for your customers is the key to increasing retention, satisfaction, revenue and more. In the manufacturing industry, the buying cycle is generally a bit longer for customers. So customer satisfaction through the entire process is-is really key to starting that buying process and making sure it's it's finished with a complete purchase.

KRISTA: Gotcha. So when we think about customer retention, how long should the customer or client kind of stay with that company? Does this have a big impact on longevity?

TORI: Yeah. So again, customer, good customer service leads to better retention rates. Think about it this way, it's easier and more cost effective to retain customers than it is to acquire new ones. So returning customers spend more and buy more often and they actually end up referring family and friends, if this is done well.

KRISTA: Sure. So what are manufacturers doing to help increase customer retention?

TORI: Really to win and keep these customers, manufacturers are prioritizing deeper customer relationships. I found a Salesforce study that found that manufacturers actually have rigorously collected data on internal metrics to operate more efficiently — this is driving down costs and improving margins. So they're starting internally and really analyzing what their company is doing inside before they look at any outside factors. This is actually beginning to change. 71% of manufacturing service teams say they've become more focused on creating deeper customer relationships over the past 12 to 18 months. So about the past year, year and a half and 63% also say that they've increased focus on personalizing service interactions.

KRISTA: OK, so we think overall customer satisfaction has a really big impact on retention?

TORI: Definitely. And even thinking more on that, let's be honest, who wants to work with somebody who treats you poorly? And I think that really does start internally.

KRISTA: It's like kinda common sense, right?

TORI: Definitely. Yeah. And it starts internally with a company, how they treat-how they treat their employees and how things work on the on the background level that moves forward to the customer and those customer retention rates.

KRISTA: And I'm sure it has an impact when you try to increase or cross-sell or up-sell different products and services within the company if there's trust there, if they're feeling important. This probably helps.

TORI: Yeah, definitely. I think buyers want to buy from somebody who they can trust on all levels, not just somebody who's trying to force a product down their throat, but somebody who really takes the time to understand them, what their goals are and why they really need this product so they can really personalize the service that they're providing.

KRISTA: Absolutely. So what are some ways that companies can start thinking about customer experience?

TORI: Again, it really starts where your customers are interacting with your reps. So Accenture found that 89% of customers get frustrated because they they need to repeat their issues to multiple representatives. So that's like making a phone call and you getting passed around to two or three different people and having to re-explain the problem over and over again. And really, that just makes you get in your head a little bit more and you get even more frustrated about the problem at hand. Moreover, 87% of customers think that brands need to put more effort into providing a cost, a consistent experience. So instead of every time you call a provider getting passed around two or three times, you don't make it that one person who can really answer your questions. And if it's not that first person you talk to, maybe you get it... you do get passed to one more person, but make sure that they are the expert in the question being asked, so everything is smooth and questions get answered in one phone call that doesn't last an hour and a half that just makes you mad.

KRISTA: Gotcha. So really kind of thinking about training employees, you know, not just customer service reps it sounds like.

TORI: Definitely, you know, train your employees and customer service representatives to be friendly and willing to answer questions or solve problems through all types of communications, whether that's on the phone, through an email, you know, chatbots and text messages are kind of the new and upcoming thing. Make sure your representatives know how to answer questions and through that type of communications as well. Simply smiling and saying thank you can actually add so much value to customer service face to face. I think about some of my favorite brands, and I think we can all agree, Chick-fil-A as an example.

KRISTA: Oh yeah.

TORI: People love going there. Not only for the best chicken sandwich in America. Sorry Popeyes, but they love the premier customer service and the fast-food industry. A pleasant smile and "our pleasure" at the end of a purchase really adds that extra value that makes people want to come back again and again and again. Take their friends, take their family, anybody they can to share that happy experience along the way.

KRISTA: Absolutely. It's the little things it seems like.

TORI: Definitely.

KRISTA: You're absolutely right about that for sure. You never feel bad about going to Chick-fil-A. So looking back on some of these challenges, you know, that you just kind of mentioned what are some ways to help with some... with some of these sales and service issues that people are having?

TORI: Things like CRM implementation and customer service or sales processes can help improve the customer immensely by using a CRM and or service ticketing system. Sales and customer service teams can see what other reps have spoken with customers about or, you know, just-just little notes that they take a longer way about how the customers feeling in the process. Anything like that can help a company get on top of their account and care for what's going on with that customer.

KRISTA: Gotcha. So what happens if we don't deal with these customer experience challenges?

TORI: Ultimately, it leads to customer frustration and churn. And the worst part is you probably won't even know this is happening or even know that they're going to think about leaving. According to Esteban Kolsky, only one in 26 customers will actually complain about poor experience. Yeah. Definitely so. 67% of them might have cited bad experience or a reason for churn, but you're really never going to know, which is pretty scary to think about. Especially in kind of the digital world that we live in.

KRISTA: They just leave.

TORI: Definitely. It's no more coming in the store and, you know, maybe being a little to see that frustration on their face. You just have no idea what's behind the computer screen.

KRISTA: So absence of negative feedback is not a sign of satisfaction. That's probably something everybody needs to know.

TORI: Right. I always think that a follow up, even if you know, it may seem a little annoying. A follow up is better than never hearing from anybody again. Yeah, I'd rather hear that negative feedback so you can grow a little bit and your company or-or fix those problems because you never know. It's not just that one person may be having the bad experience. It could be multiple people. So fixing it any way you can is definitely a positive note to a negative, negative experience.

KRISTA: Absolutely. So what are a couple of ways we can start addressing this from a customer service standpoint?

TORI: Well, actually, according to Harvard Business Review, 56 percent of customers complain about poor follow up. So again, creating a good follow up experience is key. You may even be able to automate parts of this experience to ensure they-they are being completed. That can be accomplished through things like CRM or marketing automation tools. Just always, you know, again, a good follow up to a negative interaction is just going to help build on the internal side. But also, if you're reaching out to those customers, even if they have had a bad experience, it's going to, even if they do end up leaving, it's going to kind of make them leave on a positive note, at least they had a positive interaction with your representatives or an automated system of any kind.

KRISTA: Absolutely. So how would we think about when somebody is not necessarily even interacting with a person? Is there kind of a self-service way that people can can start addressing some of these customer challenges?

TORI: Yes. So actually, Zendesk found that 50% of customers think it's important to solve product or service issues themselves. And 70% expect a company's website to include self-service application. So people aren't even necessarily reaching out to representatives at this point. They're wanting to find those frequently asked questions, anything that Google can provide an answer on. It'd be so much easier if they could just go straight to your site and ask these questions, than have to, you know, again, get on an hour and a half, call or interact with some kind of automated bot, because that's just not the way some people work. You really got to think about audiences in all form. Maybe millennials are apt to interact with it with a bot of some sort. When you think about baby boomers, they're still wanting to either come in or give a... give you a call to have that interaction and to figure-figure things out.

KRISTA: Sure. So I mean, probably thinking about personalizing that experience to an extent is probably a good thing, too. So if someone's on your site, how is that particular customer going to want to interact with you and your content?

TORI: Yeah. So thinking back to your site again, you want to kind of target all audiences in a way to answer any questions that they may have. Now, again, you can't list a million and one questions on your website, but really think down to the nitty-gritty, the big questions that are being asked and find different ways to answer those problems right there on your site.

KRISTA: Yes. So really understanding your target personas who you're talking to, what are their main challenges, and then answering those big questions that they have and maybe giving them a way to connect with a real person if they're not finding what they're looking.

TORI: Yeah. Yeah. I mean, this could take form in a blog or again, a chatbot it all starts. Maybe people aren't even thinking of a question that they have. But once they read a blog, you know, they really think deeply into the questions that they may have about a service or your product. And then it kind of just leads them down the line. They can have a conversation with a chatbot or maybe give you a call or e-mail. Just finding ways to interact with a human or any kind of communication method. I feel like it is important to allow users this ability.

KRISTA: Awesome. Well, just to kind of wrap this up. You know, we've been talking a lot about customer experience today. Think kind of the top three things somebody maybe could take from this podcast would be, you know, customer experience really has a deep impact on business, and companies overall looking at overall customer retention, customer satisfaction and overall how that's going to impact your revenue. So thank you so much, Tori, for-for sitting with us today.

TORI: Yeah, it's been a pleasure being here.

KRISTA: Absolutely. And thanks, everyone. This podcast is brought to you by TANK New Media, a digital marketing agency that has been generating marketing and sales traction for growth minded B2B organizations since 2009.