The Art Of Losing Customers

It takes a certain combination of events to lose a customer. It is rarely just a single event. It could be cost, customer service, poor quality or maybe just a stronger brand luring the customer to “churn”. Often it is a combination that create that “tipping point” when the customer either consciously or sub-consciously says “that’s it…I’m off”.

In my day job, I hear and learn about good and bad customer experiences and how organisations deal with it. I recently met with a leading Aussie Restaurant chain who are now moving to a model whereby they are valuing their customers and pretty much starting to refund customers on most basic complaints. The point being that the lifetime value of a satisfactory resolution far outweighs the short term cost of a voucher (given by way of a refund). Smart.

At the other end of the spectrum, last week I had an incident with Telstra, Australia’s former State, and now privately owned National telecommunications provider. I even used to work for them and swallowed the cool aid whereby Telstra were doing all sorts of initiatives to improve the customer experience.

In my opinion, the product is good and although premium priced, meets my needs for Internet, Mobile, 4G Remote wifi and Home Phone. I spend $225/month with Telstra and have done so for several years. I had never considered churning. I was loyal. However, in the space of 60 minutes that all changed.

The issue arose when I moved home. I ordered the new home connection in good time and everything was set up and good to go. On the day we moved in however, there was no phone signal to the house. I rand Telstra who were very good in attempting to troubleshoot the issue. However, they soon concluded that an engineer needed to fix the issue. As I often work from home, I was without broadband so had to use my 4G Remote wifi dongle in order to work.

Telstra took about a week to fix the issue and everything was good….until I got the bill.

I had been charged for a Broadband service for the week when I had no service and, to make matters worse, had gone over my monthly 4G Remote Wifi limit and had been charged $120 ($10/GB for 12GB) extra for this cost. Of course, if I had my Broadband service (which gives me 1000 GB/month), this wouldn’t have happened.

Therefore I rang Telstra to get the bill changed. The first lady was a generalist and was not empowered to resolve my issue. She was very helpful and courteous but took almost 30 mins to come to the conclusion that she could not do anything and that my call had to be “escalated” to Customer Complaints.

The Manager then at first failed to understand the issue. He tried to argue that I should not have used my wifi dongle. I tried to explain that I needed to use it in order to work but this seemed to fall on deaf and, dare I say it, ignorant ears. He then said the “best offer” he could give me was for $97. I asked why not the full $120 and the pro rate rebate for my Broadband service. He said it was not the policy to do this and he was only doing this by “breaking the rules”. I was now querying why Telstra would have such an inflexible policy and realised that he also wasn’t empowered to act in the customers best interest. He clearly had a maximum % that he could “refund”.

This got me cross and I asked to speak to his senior. “I am the most senior” he said, continuing with “if you are not happy, I won’t give you the offer and I’ll close the case as ‘customer dissatisfied”. By now, I was beyond dissatisfied. I told him what I thought of both his personal attitude and of Telstra’s so called customer centric strategy.

Interestingly, no more than 15 minutes after I both tweeted and posted a whinge on LinkedIn, he rang back with a “change of heart” and promptly reinstated my $97 rebate. It isn’t the $145 I should have received and it doesn’t allow for the lost income during the hour long call.

The lesson from this is very clear. I’m worth $3000/year to Telstra. In arguing vehemently over an amount that represents less than 5% of this amount, Telstra might lose one customer at $3000/year. However, that is not the whole story. In the first 24 hours, my LinkedIn post had over 5000 views. Not viral as such but how much black paint needs to be dripped into a white paint pot before it becomes discoloured?

So, will I churn? Probably not. I can easily put this down to one poorly trained guy who needs to be empowered and to learn the art of customer empathy. However, it has shifted my position from being loyal to being “open” to move providers.

 

 

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Is this a good or bad Customer Experience? My Australia Day BBQ

How could a great Customer Experience possibly spoil an Australia Day BBQ?

I’m all for technology enhancing my overall experience. But not when it gets between me and an Aussie BBQ.

It was Australia Day and we had friends and family over to our home enjoying the Public holiday celebration with the traditional dips in the pool, cold wine and, of course, the delights of my culinary skills on the BBQ.Just as I was about to serve, a phone call. Thinking it must be important, I left my Snags, Corn, Burgers and Steaks in the hands of the BBQ gods to answer the phone. Imagine my surprise to hear an automated message from a certain Financial Services provider wishing me a Happy Australia Day!!!

This has led me to think whether this seemingly innocent “customer experience” has added or detracted from my view of their brand. To me, it was intrusive and unnecessary, or maybe I was grumpy because I was hungry. Nevertheless, although well intended, I do not enjoy unsolicited calls even to wish me well. Being automated, it was low cost yet also insincere.

Please people, use technology as a tool to enhance a Customer Experience by all means but please think through whether that experience will add or detract from a customers perception of your brand.

Fortunately, the beers stayed cold, the steak was perfect and I was soon a happy camper again.

I am your Customer

I am your Customer

I may also be your Supplier, your Employee, your Partner, your Student, your Stakeholder, your Consumer, your Influencer or your Citizen.

I reserve the right to voice my opinion about you, your products, your people, your services and my experience with you at any time and across any channel I want.

I reserve the right to be wrong but be treated as if I was right and reserve the right to  accuse you of being wrong, even if you were right.

I expect to be treated as if I was your only customer but I also expect to be treated as the best customer, regardless of whether I may or may not be.

I am your Customer.

However, I reserve the right to go to someone else. It is your job to stop me.

I reserve the right to shop around. It is up to you to make me loyal to your brand.

I reserve the right to expect you to get it right first time, every time even though I realise that nobody is perfect.

I reserve the right not to tell you that though.

I reserve the right to avoid telling you anything about myself although I expect you to know.

I reserve the right to expect the same “deals” as an existing customer as you would to attract new ones.

I am your customer.

I creserve the right to be difficult, annoying, irritable, demanding, irrational and a downright pain in the backside. Sometimes all at once.

However, I am YOUR customer and without me and my fellow customers, you won’t have a business. We know that and expect you to get that.

I am your customer but if you accept me on my terms, I will be your customer for life and will help you achieve your dreams.

 

 

Technology 1 Customer Experience 0

When visiting a restaurant, what are your priorities as a paying customer?
I guess it depends upon the purpose of your visit but quality of food, price, ambience and service are usually near the top of most people’s priorities.
As I am working in Melbourne, VIC at the moment, I found myself in Chinatown and was enticed inside one of seemingly hundreds of competing Chinese restaurants.
The restaurant was cozy, quite busy and I was pleased with my choice.
I was shown to my table and was presented with a tablet pc.
I am fortunate enough to eat out on a fairly regular basis but I thought that giving me a PC was over stretching the hospitality somewhat until I realised that it was not a gift but rather a menu!
The waiter promptly disappeared after giving me a brief and impromptu training session showing me how to navigate the menu and place my order.
On each page of the menu, a list of meals appeared with a picture and price alongside them. I looked around and found that each table was using a tablet and the only members of staff were those delivering food.
The items I ordered arrived quickly and with a minimum amount of fuss. The food was good and my bill arrived along with my coffee. I left the restaurant and it was only when I was outside that I realised that something was missing. It was efficient and modern but had no personality. The customer experience had been diminished by removing a key part of the dining experience, the customer interaction. There had been no recommendations, no small chat, no checking to see everything was ok. There had not even been a good bye.
I sometimes find that organisations become obsessed with technology in driving transformation but overlook the important detail of the customer experience. By removing the waiters, I’m sure the restaurant increased its profitability but I also imagine its revenue may be adversely affected.
If I was the owner of that restaurant, I would employ waiters to provide the personal touch and keep the technology to help customers browse the menu and to improve the ordering process.
It does, however, beg the question of whether technology is a friend or foe of good customer experience. To me, it depends upon how the technology is used. Is it an enabler or a driver?
Excuse the pun but this provides some food for thought!

The real “X Factor”

What is the X Factor in building a profitable brand? This post argues that it is the Customer eXperience and demonstrates why organisations have to deliver a consistent and compelling customer experience across each and every touchpoint.

Forget your TV. The real X Factor will allow you to perform better than your competitors and achieve long term results to delight your shareholders and stakeholders.

The X Factor is on most CEO’s agenda’s yet it often alludes many organisations.

The X factor is widely known, yet rarely understood.

So what is this corporate X Factor?

The X factor is eXperience. The Customer Experience or Cx as it is often abbreviated to.

It includes the User eXperience (or Ux), whoever the “user” might be, as a user could be a customer, a partner, an employee, a Supplier. It all adds up to a perception gained by an individual or collectively by an organisation which will affect the relationship between both parties.

Every interaction between an organisation and its Stakeholders is a “moment of truth” where these perceptions, either positive or negative, are gained. The sum of these “moments of truth” lead to an overall “customer experience” that can affect the economic relationship. Let me use an example of how this might apply to Financial Services.

It used to be that upon getting your first job, you set up a Bank account (often with your parents bank) and you banked with this organisation for life. When you came to buy your first house, you might visit your local Manager who would interview you and then arrange a loan. How times have changed. These days, Banking is highly competitive and has moved to touch every point of our lives. It is easy to change banks, or have many banks. Some specialise in certain types of products but they all want our hard earned cash. The transactional cost of changing banks has lowered so that customer loyalty is far less than it was in previous generations. Therefore the retention of customers has become more important than acquiring customers to most banking organisations. So how does a bank retain your business? It can make its products more attractive and tailored, but this comes at a high price to the bank and has not always been a unique differentiator. Therefore banks have gradually come to realise that by improving every touchpoint with their customer, it not only makes the bank easier and convenient to do business with but also improves our perception of their brand.

The Customer Experience must be considered across every single touchpoint, across every single channel and needs to be consistent for every single customer. Therefore if a Bank has great, customer centric staff in every branch, this is clearly advantageous but a Telephone Banking service which uses a poorly designed Interactive Voice Recognition (IVR) menu, long wait times or is not 24/7 might negate all the good work done in the branches. Similarly, a great Mobile App which allows you to do your general banking might be negated by a difficult to use Online Banking web site.

It is true that different customer segments are likely to use different channels, depending upon their needs but few Banking customers will stick to one channel. Therefore every single touchpoint must be looked at and tested from a customers perspective to ensure that they receive a positive and consistent experience. The loyalty generated will drive longer term financial reward, especially in a Social world where good and bad experiences can be shared and communicated globally in seconds.

I have used Banking as an example but the laws of Customer Experience are universal. Create great and lasting Customer Experiences and the rewards will repay the effort over and over.

Avoiding the Tipping Point

Everybody has a tipping point. That moment where an equilibrium is broken and the trend is reversed. Look at any election. What will cause a voter to “switch” from one particular choice to another? That ’cause’ is the tipping point.It is when the reasons to change become stronger than the reason to stay. The weight has shifted on the scales. The tipping point is reached and the scales sway in the other direction. It is the final nail in the coffin. The last straw. The moment of realisation.
With Customer Loyalty, the same is often true. Customers will follow a particular buying pattern or behaviour until they reach a tipping point. If loyalty to the brand or product is low, it does not take much. Buying fuel is, to me, a commodity. Out of habit, I tend to buy petrol at my cheapest local petrol station. However, if I’m running late, I may choose to go somewhere even closer but slightly more expensive. It’s not a big deal. I have no particular loyalty to a particular brand or petrol station. Being a bit cost conscious, I fill up habitually at the station offering the cheapest fuel around but the price differential is not that great. Therefore if I am time poor, I may shop closer to home and pay just a bit extra. Low tipping point. Low loyalty.
However, most Marketeers will tell you that creating a brand is everything. The brand has an intrinsic value that causes customers to perceive it differently and value it more. Brands attract loyalty, but that loyalty also has a tipping point at which that loyalty will be tested once too often or too far and the customer will subsequently defect to another product.
So the goal of most organisations dealing with customer loyalty is to do two things. Firstly, create brand loyalty. Secondly, ensure the tipping point is never reached. The Customer Experience has a major impact on both of these factors and partially explains why there is an increased focus on it. The latter is equally hard to do yet, in my opinion, gets less organisational attention.
Ironically, organisations cannot always wholly control the tipping point. Virgin Blue, the Australian airline, has a pretty good reputation for creating customer loyalty. Partly through its Velocity Frequent Flyer Programme but also by differentiating on attempting to improve all stages of the customer experience. Just over a week ago, Virgin Blue’s ticketing system crashed causing the cancellation of the majority of flights and leaving passengers stranded. It took several days to rectify and had a major negative impact on the brand from a reputational point of view. Ironically, the Virgin system at fault is not their own: It is (apparently) an outsourced solution. Not that this is any comfort to the thousands of irate passengers last week. My point, however, is that Virgin could not wholly control this “tipping point” although they could mitigate the risk. The dilemma facing Virgin Blue now is the longer term impact on its loyal customers. How many of them may regard the problems of last week as their personal tipping point? It will be a real test for the strength of the brand.
Organisations must always be on the look out for these tipping points. Years ago, people joined a bank and tended to stay with that bank for life. Nowadays, banks have made it easy and enticing to switch and, with customer expectations increasing over time, the tipping point is more easily reached than in yesteryear.
The same is true of many services, yet the tipping points are not always studied. How many organisations conduct ‘exit’ interviews on defecting customers? How many organisations attempt to identify weaknesses in their service offerings to proactively remove potential tipping points?
Consumer choice and awareness creates the potential for churn. Yet, often people buy for emotional reasons, whether it is habitual, a remembered good experience, what your parents did or even a familiar ‘name’ heard through mass media. With such a fragile recipe for loyalty, is it any wonder organisations should spend as much time protecting the brand from churn as they do in building the brand in the first place?

Wanted: Customer Centric Recruitment

I am currently searching for a new career opportunity and have been shocked at the way a number of organisations handle the recruitment process from a “Customer Centric” perspective. Some organisations seem to forget that even applicants for opportunities within their organisation should be treated as valuable customers. Maybe this is why they are seeking a CRM Thought Leader in the first place?

An applicant, such as myself, may have been attracted by the hiring companies brand. If that organisation then fails to acknowledge your application or keep you informed, the brand is devalued in the mind of the applicant, who could also be an influencer, customer or shareholder. What does it say about the core values of the company the applicant is hoping to join. Does it not say “you are not important”? In fairness, the majority of companies do appear to acknowledge receipt of the application. It is after that the process seems to break down.

Some organisations recruit through Recruitment Agencies who often regard applicants as little more than a commodity, not an individual with hard earned skills that can add value. This is not just my personal experience. I have spoken to others who have experienced the same. These recruitment agencies act as a filter. They do not often understand the components that might add value to their client. Instead, they look for certain key words to reach a shortlist as quickly as possible. In one example, I heard nothing for two weeks and when I rang them, I found that I had not been shortlisted and they were conducting final interviews that day. That is fine, but wouldn’t it have been a courtesy to let all the non shortlisted applicants know? Agencies often appear unwilling to share information. When I recently asked one supposedly “leading” agency for information about the role or the client, I was sent a generic job description that was clearly drafted on the back of a betting slip.

Luckily, through my career, I have not always used agencies as I have found the majority to be lacking in insight, knowledge and integrity. Harsh? Maybe, but that has been my experience. I have tended to use my network to find new roles and have been lucky to have been approached directly by clients in the past.

However, that is where the lack of a Customer Centric culture breaks through the cracks. The onboarding process often appears to be designed to benefit the hiring company rather than the potential candidate.  I was lucky enough to have been approached last week by a company where I knew some of their key executives. All seemed to be going well until I was put in touch with the recruitment centre who refused to send me any details until I had sent them a formal application, despite the fact that their executives had approached me! Since then, I have left messages for them to acknowledge receipt of the application and to send me the role details. Even allowing for leave, surely there is a process to ensure continuity.

This blog may appear to be a whinge (I am a Pom after all!) but it does amaze me how a supposed Customer Centric culture does not extend to the whole organisation in many places, without any realisation or appreciation for the potential detrimental impact on brand, public image and customer behaviour. Becoming a Customer Centric organisation needs cultural change across the entire organisation. Everyone counts. Everybody can make a difference. I hope that my next role can impress this for my new client or employer.