Commentary
The Straw That Broke The Market's Back
- by Gord Hotchkiss , Featured Contributor, May 9, 2013
Customers are fickle -- and I suspect they’re getting more fickle. Perhaps they’re even feeling a little entitled.A recent survey shows that customers tend to bail on a company not because of a big time screw-up, but because of the accumulation of a lot of little annoyances. Soon, their frustration reaches a tipping point and they look elsewhere.
It would be easy to point the finger at the companies and demand that they get their collective acts together. But I suspect there’s more at play here. It would be my guess that customers are getting harder to please. And I would further guess that the Web is largely to blame. I think it comes down to a constant rise in our collective expectations, while the reality of our experiences fall behind.
The balance between our expectations and the actual experience determines our loyalty to any course of action. If we have low expectations and a poor experience, we aren’t really surprised, which dampens our subsequent disappointment and leaves us more willing to forgive and forget. If we have low expectations but a good experience, we’re pleasantly surprised, making us more apt to return. If we have high expectations and a good experience, we get a double hit of happiness. First, we enjoy the anticipation, then we appreciate that the experience actually lives up to our expectations. For a vendor, the scariest scenario is the last of the four: high expectations but a poor experience. In this case, we walk away disappointed and frustrated.
Now, balancing expectations and experience wouldn’t be that difficult for any moderately competent company if those expectations were realistic. But I suspect that more and more of us are entering into our respective experiences with unrealistic expectations. We’re setting our vendors up to fail.
Expectations are set partly based on our past experiences, but they’re also set by the experiences of others. We create our expectation set points based, in part, on what we hear from others.
The Web has created an open, accessible market of experiences and hearsay. We hear about the bad, a feedback loop that increasingly is calling out poor customer service. But we also hear about the good. Correction – we hear about the exceptional. The “good” is not remarkable. It generally falls within our expectations and so goes without comment. But either the very good or the very bad is exceptional, and we are more apt to comment on it online. Not only do we comment, we also embellish, accentuating the plusses and minuses to make it a better story. Therefore, what we hear from others sets either a very low or very high bar. We steer clear of the low bars, but the high bars stick with us, contributing to the setting of future expectations.
The other thing the Web has done is create expectations that overlap domains. Previously, when our expectations were set based on our own experiences, they tended to stay domain-specific. We had an expectation of what it would be like to buy a car, stay at a hotel, eat at a restaurant or purchase a new pair of shoes. With the Web, cross-pollination between domains is increasingly common. A head marketer for a well-known industrial manufacturer once said to me, “When it comes to online experience, my competitors are not the traditional ones. I’m competing against Amazon and eBay. That type of experience is what people expect.”
This “nudging up” of expectations is done without much rational consideration. We don’t care much for the reality of operational logistics in any particular domain. We just want our expectations to be met, no matter where those expectations might come from. And when they’re not, we pull the plug on that particular vendor, assuming another vendor can do better in meeting our inflated expectations. The Web has also engendered a virulent “grass is always greener” view of the world. We know a competitor is just a click away (whether or not that vendor is any better than the incumbent).
I’ll be the first to call out a bad customer experience, but when it comes to the increasing fickleness of customers, we should remember that there are two sides to this particular story.
There's no doubt in online/social media, squeeky wheels stand out. But speaking just as a consumer for a moment, I have to say I think even with the advent of data-driven marketing, CRM, personalization & interaction, the quality of actual service experienced on a human level has gone DOWN. I'm talking about the people you get on the phone when you need a real question or issue to be addressed...if you can even get a human being on the phone. I'm thinking here of phone companies, cable companies, big banks, airlines, etc., where it seems to me technology has been an excuse to move budgets from customer service to customer acquisition. The consumer is bombarded by multi-channel efforts to recruit them, and then immediately orphaned once they sign on. Too many large companies provide the bare minimum in actual service, if that.
So Ron, why do you think that is ?
Some elements of service can be boiled down to KPIs and managed on a spreadsheet, but it's also an art and has to involve real people, and I think the quants have taken over the asylum. It's like we're not chasing quality service which involves a qualitative aspect...we're chasing a quantitative facsimile of quality service.
Thought provoking Gord. As both a consumer and an executive I try and treat customers as I want to be treated. I think a lot of big companies & our Government lost some of that focus.
What's often forgotten are that expectations are really "silent demands" which turn into resentments when they are not met. How are companies supposed to meet unknown expectations and then handle customer resentments? Companies forget that it's cheaper to make existing customers happy verses acquire a new customer.
If a company looks at customer acquisition cost versus retention costs and their acquisition cost is cheaper, something is messed up.
Often, the disconnect between management, marketing and sales leads to mismanagement of customer expectations. And, as consumers, we know that advertisers are trying to sell us on a lot of "vaporware". What's the point in blaming someone when we believe the hype?
We all know the real "truth in advertising" and set our own false expectations; then want to blame someone else when our beliefs seem incorrect.
Grass is always greener is a belief and perspective that some folks will believe. And since perception is not a fact, but a reflection of the belief of the perceiver; then do we question our beliefs?
What happens if it turns out that the grass wasn't greener? Well, then our mind must choose between "what is" or "what should be", and when there is a conflict, it will always report what should be. Unless of course we're being really, really honest with ourselves.
I pretty much agree with Ron's comments above. The level of service, which is the slow world was usually performed face-to-face has DECLINED through the effort to automate it.
The effort to automate which we all anticipated has turned out to be an exercise in off-loading services the vendor performed onto the user. We do the queries. We do the payment process. We do the printing. And the vendor has supposedly put some snow on the slide to enable us to do it all, in a trice, wearing our pajamas.
It takes hours and hours to buy an airline ticket - unless I call my travel agent. Trying to reach someone to deal with my problem at PayPal has just taken 24 hours.
Service and support are critical pieces of brand reputation but they so often get outsourced to the other side of the world.
Your view that the internet has raised expectations seems only half right to me as a customer. It's raised my expectations that I can find what I want somehow somewhere. But my expectations for a hassle free experience have become fragile over time.
Well done Ron - I appreciate anyone who reminds me that sometimes, a qualitative approach trumps a quantitative done. In general I totally agree with your comments, but I still believe that there is an inflation of expectations on the customer side as well.