What’s the $ impact of a poor customer experience?

A new survey conducted by Greenfield Online, has investigated the economic impact of delivering poor customer experiences. The press release on Yahoo! Finance explains how they measured it, but some key take-aways are:

• 72% of both New Zealand & Australian consumers said they had ended a relationship with a company due to poor customer service.
• The Australian’s had ended 1.37 relationships each, at an average of AU$403 (US$338)
• The Kiwis were a little lower, ending 1.17 relationships at an average of NZ$386 (US$257)
• Indian consumers were the most sensistive to poor service, ending an average of 1.84 relationships each

While I’m always a little sceptical of the results of sponsored surveys (this was was sponsored by Genesis Communications Laboritories), the theme still raises a very interesting thought. It’s a commonly held belief that it’s cheaper to retain a customer than acquire a new one. However, to what extent are companies investing in evolving and innovating their customer experiences, to keep up with customer’s changing expectations?

Call centre’s have been around for a long time, and this research suggests that over half the consumers polled still prefer to use the phone, rather than newer channels such as email or web self-service. But recent call centre innovations seem to focus on developing cost-saving self-service, rather than improved customer experiences. And this survey suggests that it’s these same automated self-services, that feel the most challenging for these defecting customers.

Do you have an example of when a call centre either exceeded or failed to meet your expectations of service?

Voice of the customer – Cadbury’s divide chocolate lovers

There are many elements to delivering a great customer experience. And Cadbury seem to have tripped over one at the same time as they’ve succeeded with another.

Cadbury’s recent TV ads have won them many accolades, tweets, posts and comments. The gorrilla feeling the air has nearly 4 million YouTube views, and the eyebrows already have more. I’m sure the word of mouth from these ads has even driven a few extra sales for Cadbury and Phil Collins.

But all is not smooth and milky in Bourville. Cadbury have apparently downsized their Dairy Milk bar to 200g, and customers have rebelled like angry gorrillas. And in the same way that customers can spread the good news about a fun advert, they also have powerful ways of sharing their displeasure. A chocloate lovers action group has sprung up, with a website and twitter account. There’s also a YouTube video, comparing the packaging and showing the reaction of some consumers.

In years gone by, such rumblings may have soon disappeared. But the mainstream media has picked up on it now too, with a story on Campbell Live and a story in the National Business Review by Hazel Phillips. This in turn has inspired one of Cadbury’s local competitors, Whittaker’s, to get on the front foot and create a comparative advert.

Cadbury’s say that they prefer to focus on the ‘fun & enjoyment’ of chocolate, but it goes to show that customer engagement comes from delivering a consistent customer experience across all customer touchpoints.

What’s the price of cheap flights? JetStar’s 1st impressions

I love flying Virgin Blue / Pacific Blue, because they continually remind me that you don’t need to be dull, just because your all competitors are. While most airlines focus on providing a service (A to B, on-time with some food thrown in), Virgin Blue provide a whole experience.

I remember my 1st impression of the Virgin experience, was that more of their staff smiled more often than other airlines. And they made eye contact…as if they were genuinely pleased to see me. This experience continued with safety announcements that were engaging enough to listen to (who says compliance can’t be fun) colourful seat back information cards and unscripted banter.

The point here, is that cheap prices don’t have to mean cheap experiences.

Compare this with the 1st impressions that JetStar passengers have been getting in New Zealand. JetStar launched with lots of cheap or free ticket offers, to gain market interest. But they have been plagued by complaints of long delays, rescheduled flights and bumped passengers.

No doubt JetStar will recover and improve, but their first impressions haven’t aligned with customer expectations. Jetstar took over from parent Qantas, so excuses about untrained staff and strict 30mins check-in cut-offs weren’t what customers expected. What’s more, these experiences are re-setting customer’s expectations in line with the cheap prices. Several people have already said to me “well I can’t complain, the ticket only cost me nine bucks”. Unfortunately, while JetStar see this as just opening offers, customers are starting to see it as a fair price. And while introductory offers can be effective at tempting trial, price alone wont keep them coming back.

Of course, airline service doesn’t have to be great. Ryanair have become very profitable offering overtly ‘cheap service’, to the point of even threatening to charge for toilet visits. But the big difference here, is that their customers are getting exactly what they expect.