Make it Memorable – but for the Right Reasons
The focus for success in customer loyalty building
The growing trend to switch focus from Customer Service or Customer Relationship Management to Customer Experience and Customer Experience Management is a smart one. But it’s important to understand there are three critical considerations that will impact on success. One is ‘what’s the expectation?’ the second is ‘what’s the experience?’ and the third is ‘what will be remembered?’ - and they are not the same thing.
It’s generally thought that the expectation and the memory of an experience will be the same as the actual experience; but research has shown that’s not so. In fact they can be very different. So if the goal is to build long-term customer loyalty, while the experience will influence a customer’s current behaviour; that experience could be ruined by a false or unrealised expectation and it’s the memory of it that will have the biggest influence on future behaviour. So all three need to be carefully managed.
The world expert on this subject is Daniel Kahneman. He’s a professor of psychology who has won a Nobel Prize for his work in this area. He explains how certain elements in any experience can easily overshadow all the others and so become the only thing that is remembered. This leads to these memorable elements becoming the ones that have the greatest (often only) influence over any future behaviour.
For example, a really bad checkout experience at a hotel can ruin what has been a generally good overall visit experience and so make the guest decide never to return. Alternatively a really attentive and helpful server can make what was expected to be an average in-store shopping experience seem great and so stimulate a return visit.
A false, ill-informed or inaccurate expectation, if unrealised, can create disappointment or irritation and so ruin what may be a good or even great experience. There’s therefore little point in managing experiences without also being prepared to commit to managing the expectations of them. But that’s not easy.
Customers rarely view their suppliers as individual departments; they generally consider them to be one whole unit. So the good work in one part of an organisation can easily be negated by no so good work in another and a failure to live up to promises or expectations from anywhere in an organisation is generally seen as a failure of the whole organisation.
This makes it essential to ensure that everything is ‘joined up’ and viewed as a whole symbiotic system. So what is promised in sales and marketing must be delivered by manufacturing, operations and services and followed through into aftersales support. And if there is overpromising or inconsistency anywhere, the source needs to be identified so it can be quickly and effectively corrected.
Once expectations are under control, attention can be turned to the experiences that are likely to become the most influential and memorable. They can be divided into three main categories.
The phrase ‘You only get one chance to make is good first impression’ is true; yet it seems to be overlooked or ignored by many organisations. But with just a little thought and attention to important details it can transform any experience and become so memorable that it positively influences future behaviour.
Here are examples of organisations that have thought about this and done things that work-
· A Country House Hotel constantly monitors their car park so they can send a porter to greet all guests as they arrive at their car to help with luggage and carry an umbrella to keep them dry when it’s raining.
· A Trading Organisation arranges reserved parking bays outside their offices for all expected visitors; each one with a ‘Reserved for …’ label showing the visitor’s name, company and company logo.
· A Soft Toy Retailer always has a smiling staff member at the entrance, with one of the toys, to say hello to passers by and welcome all customers into the store.
During any experience there are often what Daniel Kahneman calls ‘significant events’ that can become locked in a person’s memory. These are events that stand out and are therefore remembered, usually because they contain peaks in sensations that trigger positive or negative feelings or emotions.
Positive feelings (Loyalty builders) - Research has shown that the positive emotions or feelings that are most likely to build loyalty are ‘Happy’ and ‘Pleased’. So the more times in any experience that these feelings can be evoked the more memorable they will become and the more positive influence they will have on future loyalty.
Examples of organisations that have built positive significant events into their overall customer experience are –
· A 5-star Hotel ensures that all their chauffeurs have had a really intriguing past career (e.g. one is an ex fire chief) so that journeys with them can be filled with interesting and memorable conversations.
· A business in the Construction Industry offers free car washes on Fridays to employees in buildings where they have been causing lots of dust during the week, so they don’t have to go home at the weekend with a dirty car caused by ‘the builders’.
· Some Cruise Ships have room attendants that have learned how to do ‘origami’ with towels so that every time the passenger returns to their room they are looking forward finding what new ‘sculpture’ is waiting for them.
Negative feelings (Loyalty destroyers) The same research also showed that the kind of negative emotions or feelings that are most likely to destroy loyalty are ‘Disappointed’. ‘Frustrated’, Stressed’, ‘Neglected’ and ‘Hurried’. It’s therefore vital to ensure that customers never experience any of these feelings; but if they do, to track down the root causes and remove them.
It’s also been shown that the most memorable positive significant event that can happen to a customer is the experience of a great service recovery. Yet this too is something that is either not understood or ignored by most organisations.
It’s therefore easy to differentiate an organisation from its competitors and to create loyalty building memorable experiences simply by ensuring that people throughout the organisation are expected to and skilled in delivering what I call ‘Dazzling Recovery’.
Here are examples of this –
· Having made a mistake over a honeymoon couples’ room booking for the first night; the Hotel not only upgraded their room for the rest of their stay but also wrote the word ‘SORRY’ in rose-petals on the bed in their new room. The upgrade was appreciated, but it was the ‘SORRY’ message that was remembered.
· If a rented car breaks down, the smart Car Hire Companies don’t just replace it with another similar one, they arrange for a free upgrade to a better one for the rest of the rental period. This is to ensure that the memory is of the better replacement and not the faulty original car.
· A Large Manufacturer has a ‘Recovery Team’ that is brought in whenever they get anything wrong for a customer. Their job is to ‘act for the customer’ and make sure that whatever is necessary is done to not just fix the problem but also to recover in a dazzling way and so build the customer’s loyalty.
The last impression is just as important as the first impression. Some would say it’s even more important because as the last experience a customer has and its memory is often the most lasting. Yet this too is something that rarely gets the attention it warrants. However it’s really simple to create a memorable last impression that will positively influence future behaviour.
These examples are of great last impressions -
· An office furniture supplier has a ‘take home’ pack for all visitors that contains a variety of things (e.g. water, chocolate bars, fruit, hand wipes, etc.) that are appropriate to their visitor’s mode of transport.
· A perfume and skin care products manufacturer has established an in-store wrapping process that is done with every purchase that creates some ‘theatre’, adds value to the product and provides a memorable positive last impression.
· There’s a Scottish hotel that gives every guest, after they have settled their bill, a small container with the message ‘for your journey’ containing two locally made shortbread biscuits so their last experience is not of paying the bill but of receiving a parting gift.
Impact on Loyalty
I think the core purposes of Customer Experience Management are to create differentiation, improve competitive advantage and build customer loyalty. It’s therefore important to understand the relative impact the different memorable events are likely to have on customers’ current and future behaviour. TARP from America have been researching the subject of customer service and the impact it has on business results since 1971 and have some of the most useful and up to date data on this. In his latest book, Strategic Customer Service, John Goodman their founder and Vice Chairman, details their latest findings.
The simplest way to explain this is to imagine that each customer has a ‘loyalty account’; an account of the ‘feelings’ they have towards their suppliers and how those feeling will influence their future behaviour. Like a bank account, it could be in credit or debit; the more in credit the more loyal that customer will be, the more in debit the more disloyal. And like a bank account it will receive deposits and withdrawals based on the experiences the customer has with the supplier.
Based on the TARP research the various customer experiences explained above would have the following relative affect on the loyalty account.
· Positive Experiences – Lets say that every positive experience, whether it be during a First Impression, a Significant Event or a Last Impression, will increase the loyalty account by +1 - a one-element increase in loyalty.
· Negative Experiences – Using the same scale, then every negative experience will decrease the loyalty account by -3 – a three-element decrease in loyalty. This means that each negative experience will need three positive experiences simply to neutralise its negative impact on loyalty.
· Recovery Experiences – Again using the same scale, every recovery experience will increase the loyalty account by +6 – a six-element increase in loyalty. So this is the most powerful loyalty builder and should be used at every opportunity. Also note that a recovery experience usually begins with a negative experience; the overall impact on loyalty is therefore actually +9 (from a potential -3 to a +6).
The key is to remember that the expectation, the actual experience and the memory of it all need managing separately. And with a little care and attention it’s possible (and easy) to ensure that expectation and experience management will positively influence current behaviour and spend and memory management will positively influence future behaviour and loyalty. So perhaps it’s time for another switch in focus, from Customer Experience Management to Customer Expectation, Experience and Memory Management?
- 8/4/2016:Focus on Experiences!
- 20/7/2016:The Challenge of Service Recovery
- 1/4/2016:In Customer Loyalty Management... all jobs count!