All too often, when we talk with leaders about customer experience, they’ll nod their heads knowingly and say something along the lines of, “We provide great customer service.” Or they might relate a tale of some time when an employee went above and beyond to fix a customer’s problem.
But customer service is just one aspect of the entire customer experience. It usually comes into play when something has gone wrong; it is the place where companies fix things when part of the experience has been less than satisfactory. A customer orders the wrong size and needs to exchange it; shipping has been delayed because of weather (or in the last year, because of the post office or COVID-19-related supply chain problems); a bill is incomprehensible or contains an error. Says Gary Moore, CEO of ServiceSource, which provides outsourced B2B sales and support, “Customer service is important, and important to get right, but it’s rarely memorable unless it’s lousy.” That’s why it is so critical for companies to avoid or do away with the mentality that service equals experience.
When companies conflate customer service and customer experience or put too much emphasis on extraordinary efforts to satisfy customers, they sell both customers and employees short. Don’t address the symptoms while ignoring the underlying disease. Customer service needs to be put into context — which means putting customer experience first. Here are seven ways to do the proactive work needed to achieve this prioritization.
Develop a relationship mindset, not a transactional one. “Brand loyalty doesn’t happen because of transactions,” says Moore of ServiceSource. “Loyalty revolves around customer experience, which is made up of every touch point.” To create a relationship rather than just have a series of interactions with a customer, he recommends looking at the potential life cycle of a client relationship — which includes selling, onboarding, maintenance, and renewal. What happens after the sales rep’s handshake? Notes Moore, “I’ve seen companies that do a great job of selling, but then make a mess of onboarding. Or maybe they onboard, but then they don’t do health checks.”
Relationships are built on moments great and small, and human connection matters. The impact of a relationship mindset shows up in a new study from AchieveNEXT (where one of the authors is chief knowledge officer), which looked at how insurance brokers and carriers are managing relationships in a COVID-affected, virtual environment. Respondents gave themselves high marks for the ability to retain and service existing policyholders, despite the disruptions of the pandemic year. A third say they are fully confident in this area, and a negligible 2.5 percent say they lack confidence. But writing new business has not been as easy. One in 10 lack confidence, and just more than a quarter describe themselves as fully confident of their capabilities. Automated processes maintained customer service, but the reduced human touch weakened the ability to create experiences and establish relationships.
Proactively learn about your customers’ experiences — and what they want them to be. Most customer service starts when a customer calls with a problem. Sure, the quality and substance of your reaction matter, but by that time, you’re already in the rough. By contrast, customer experience starts with hope — with the reason the customer chooses you in the first place. To design a great customer experience, “start by figuring out who or where your entry point is to the customer,” advises Sandy Nash, chief financial officer of Strategex, a consulting boutique that serves a range of industries with a specialty in manufacturing. Because customer experience is about seizing and expanding opportunities, leaders with P&L authority should be engaged throughout the relationship, not just at the beginning.
Most customer service starts when a customer calls with a problem. By contrast, customer experience starts with hope — with the reason the customer chooses you in the first place.
At J. Knipper and Company, a New Jersey company that specializes in providing pharmaceutical samples to physicians and hospitals — the “starter dose” a patient gets before going to a pharmacist — the mission is to “build the shortest path between patient and therapy.” Until a few years ago, the reality that physicians and hospitals experienced was something else: a forest of seven different systems, each managed by different departments.
“Dealing with us was like dealing with one of those voice-response systems where you keep getting passed around,” admits Eric Johnson, Knipper’s chief commercial growth officer. Today, each customer has a single portal, simplified pricing, and a dedicated account manager — a solution that could not have been possible unless senior leadership heard about the problems directly from customers and insisted that bridges be built across departments.
Follow the data; follow the money. Because customer experience is strategic, not tactical, you need to know where the value is coming from, and where you’re throwing good money after bad. First, identify your valuable customers, advises Strategex’s Nash, then go deeper to analyze why they are valuable. Are they spending money broadly or deeply, or both? “We have years and years of data to prove the 80/20 rule — that 80 percent of your revenue comes from 20 percent of your customers.” More than that, she adds, it’s not uncommon for the top 5 percent of customers to produce half the revenue. “Words get people’s attention; data causes action,” she notes.
This analysis matters because the resources spent servicing unprofitable customers can be a distraction from work that should be done to create a great experience for those who matter most to your business. “Once you know who your top customers are, you can create a customer experience for them, with the appropriate expectations on their side and effort on the employee side,” Nash says. And you can set different experience and service expectations for less-valuable customers. This can be as simple as offering clearly branded tiers of service or membership (with appropriate pricing and perks spelled out).
For a top-tier customer, for example, it might be ensuring, not merely promising, that senior-level management will always be involved. We know of one firm that lost a valuable client — valuable because of both monthly billings and because it is a household name — because the company founder turned responsibility for the relationship over to subordinates despite having explicitly guaranteed his direct involvement in the contract. “We didn’t get what we were paying for, what we were promised, and what we had become accustomed to,” the client recounted to us.
Even if you’re not in a business that lends itself easily to segmentation, it’s well worth the effort to design tiered experiences and communicate what they are to customers. “Businesses underestimate the value of customers’ emotions, but it really is all about how they feel,” she says. “Your top customers deserve a different experience, and they want to know they are getting one.” It also doesn’t hurt, frankly, to create some sense of “fear of missing out” among customers who might consider upgrading or enhancing their relationship with you.
Make your customers’ work easier. In his 2016 book, Shadow Work, sociologist Craig Lambert documented the scores of ways in which customers perform tasks that companies once did for them, from pumping gas to executing stock trades. Self-service can be cheap and convenient for customers as well as for companies, but it adds up. And it has an unintended consequence: It removes any obvious incentive for companies to make these jobs easier, which is why drugstore self-checkout has improved so little in the 20 years.
When Knipper embarked on its customer experience overhaul, it created separate meetings for customer experience and customer service, so that big-picture questions weren’t occluded by day-to-day minutiae. “What I set out to do was to change the way we do business and how we take CX and embed it in our operations, our training and evaluations, and our platforms as a whole,” says Johnson, Knipper’s chief commercial growth officer.
The company’s mission of providing the shortest path between a patient and his or her therapy set the agenda for the overhaul, as it does for regular checkups with customers. “We talk about whether we’re easy to do business with, how things are going, and, if we’re not perfect, what we might address,” Johnson says. While the frontline employees are present in those conversations, it’s senior leaders that run the meetings. This active engagement by leaders sends a powerful message to customers that the quality of their experience is a top business priority.
Make employees’ work easier, too. Happy employees are a key factor for a company’s success, asserts Strategex’s Nash: “Employees who love the company and value what they are doing will work to help the customers.” Yet too many companies apply empathy only to customers, not to employees. Why not make the experience better for employees, too?
Knipper, for one, saw it as a win-win by making it easier for customers to engage with employees, while also making it easier for employees to engage with customers. The company’s central database has different portals. The physicians’ portal looks almost identical to the one used by sales representatives, so when the customer solutions side is engaging with a customer, the doctors are seeing what the customer is seeing. “You can help guide the customer more easily that way,” notes Johnson. Knipper also created one client portal that pulls all the data from different places into one view, critical from an internal perspective because customers usually engage with the company for more than one service.
Support customer experience with actual resources, not just lip service. In most companies, customer service has a budget line. But customer experience — whose budget is that in? Marketing, sales, operations, and even finance all affect customer experience, but often, none is accountable for it. Resources means not just money and people but, just as important, processes, including commitment and measurements, notes ServiceSource’s Moore. “There are three areas that degrade customer experience: commitments you make that you can’t keep, failures in the way you align processes and teams with the customer, and a lack of resources.”
Overpromising can be reduced if sales teams get bonuses when customers renew as well as when they sign up in the first place. Well-designed quarterly business reviews and KPIs can help align processes so that they address the right issues at the right organizational level. As for resources, Moore points out, human resources matter as much as or more than any other kind, especially in a service business — and, unfortunately, people can’t always be retained: “When we lose an employee, we also lose relationships. So we don’t stint on hiring and training and spending the money that’s necessary to reestablish the relationships with clients.”
Close the loop between customer service and customer experience. Customer service shouldn’t be a dead end or an island unto itself. Develop feedback loops between customer service and other key departments: product development, sales, onboarding, and customer success. Says Nash of Strategex: “Think of customer experience as a sphere — it should be holistic, it should make you feel good emotionally. Inside CX is a smaller sphere, which represents the product or service itself; it should be reliable and do what you say it should. And inside that is a third sphere, which is customer support for when something goes wrong. It should be small.”
Ultimately, notes Knipper’s Johnson, the goal is to provide an experience where the touch points add up to customer satisfaction. “That’s a byproduct of the entire experience,” he says. Customer service plays a part, but it should be a supporting role, not a starring one.