“The way to win customer loyalty is to delight them.” This is the mantra that many organizations follow. But, is it really true? In this book, the authors (Matthew Dixon, Nick Toman, and Rick DeLisi) present research data to debunk this conventional wisdom. They prove that the way to customers’ loyalty isn’t through delight, but an effortless experience. In this summary of The Effortless Experience, we’ll be explaining why and how to reduce customer effort to mitigate disloyalty. For more more details and tips on how to implement an effortless experience, do get our complete book summary bundle (in text, graphic, and audio formats).
The Effortless Experience: Overview
In a competitive market, a good product/service may be quickly replicated by rivals. So, many companies turn to customer service as a differentiating factor. The question is, how effective is this strategy?
In 2013, CEB (now acquired by Gartner) set out to answer 3 vital questions about customer service:
1. How far does customer service truly drive customer loyalty?
2. What can customer service do to drive customer loyalty?
3. How can you use customer service to improve loyalty and reduce operating costs?
CEB defines customer loyalty using 3 behaviors:
1. Repurchase: they keep buying from you;
2. Share of wallet: they buy more from you over time; and
(iii) Advocacy: they say good things about you to others.
CEB conducted a global quantitative research study involving 97,000 customers from hundreds of organizations. They controlled for many variables (e.g. company size, customer psychographics and demographics) to accurately isolate the elements that affect loyalty. They found that customers aren’t looking to be delighted; they just want an effortless experience. These findings led to further research and recommendations on how to make the experience faster and easier to improve customer loyalty.
In our complete version of The Effortless Experience summary (click here for full 14-page summary), we’ll break down the insights into 3 parts: (i) Key research findings, (ii) 4 pillars for reducing customer effort, and (iii) Implementing an effortless experience. In this free article, we’ll outline the key ideas.
Research findings: Effort matters more than delight
The 2013 CEB research study uncovered 4 unexpected findings:
• It doesn’t pay to delight customers. Customers whose expectations were exceeded were only marginally more loyal than those whose expectations were met. In short, once customer expectations are met, loyalty plateaus.
• Satisfaction doesn’t predict loyalty. Many companies use customer satisfaction (CSAT) to evaluate service success. However, the data showed almost no statistical relationship between customer satisfaction and loyalty.
• Customer service interactions are 4x more likely to drive disloyalty than loyalty. Customer service is usually activated only when things go wrong, and it’s a feat just to bring the customer from a negative to neutral state. Unfortunately, companies often fail to meet customer expectations, making things worse.
• The data identified 5 drivers of disloyalty, of which 4 had to do with the perceived effort that customers must put in to get their issue resolved. So, a key to reducing disloyalty is to reduce customer effort.
Creating an Effortless Experience
The CEB team investigated sources of customer effort, and uncovered 4 best practices shared by most “low-effort service organizations”. Here’s a brief overview of the 4 pillars for reducing customer effort, and how you can start to implement them in your organization. Do get the specific strategies, tips and examples in our full version of The Effortless Experience summary (get complete summary bundle here).
Best Practices in Low-Effort Service Organizations
• Make self-service easy and sticky. Most customers actually prefer self-service if it’s simple and guided. When they try to self-serve, fail, then “switch channels” to call the company, it’s a lose-lose for both sides. In our full 14-page summary, we elaborate on how to address the 3 key reasons for channel switching.
• Minimize repeat calls with “next issue avoidance”. Many companies recognize the importance of First Contact Resolution (FCR), i.e. to resolve an issue on the first call/contact. However, they don’t track or measure it correctly. The question you should be addressing is: “How can I ensure this customer doesn’t have to call us back?” Learn how to address 2 types of implicit issues and minimize callbacks using “next issue avoidance”.
• Reduce customers’ perceived effort. Customers’ perception of effort matters twice as much as the actual effort they put in to resolve an issue. You can still have a win-win outcome even if you can’t give them their preferred option. The secret is to use “experience engineering”, and we elaborate on the 3 key techniques in our complete The Effortless Experience summary.
• Give reps more control over customer interactions. Control quotient (CQ) is about judgment and control in a high-pressure environment–it has a higher impact on frontline reps’ performance compared to basic skills, problem-solving skills and emotional intelligence. The good news is, you can unlock the CQ potential in most reps by creating a high-CQ environment with 3 factors.
Implementing the Effortless Experience
Obviously, each of the 4 pillars above come with specific nuances and application techniques, which we’ve covered in our full version of The Effortless Experience summary. Becoming a low-effort organization requires that you integrate the philosophy across the entire organization, and there are certain baby steps you can take to get started including:
• Measuring customer effort at 3 levels to establish how you’re doing, how customer service affects loyalty, and what you can do to improve.
• A phased roll-out including: a compelling “change story”, pilot teams to test/learn the most best approaches, training/coaching, and incorporation of your new practices in all phases of the customer life cycle.
Other Details in The Effortless Experience
In the book, the authors explain the methodology and outcomes of their various research studies, including the survey methods, sample questions, tables, charts and graphs of the research data. They also dive into detailed case studies to show how various companies analyzed their customer touchpoints, trained their service reps, and used a range of techniques to reduce actual and perceived customer effort. The book ends with 6 appendices with sample toolkits and assessments that can be used for your organization. Do get a copy of the book for the full mojo, get The Effortless Experience full summary bundle for a detailed overview of the insights and implementation tips, or check out more information from the Gartner website.
Learn how to create an effortless experience to gain true customer loyalty!