Implications of CX Consistency for Researchers – Part 2 – Intra-Channel Consistency
This post considers the implications of intra-channel consistency for customer experience researchers.
As with cross-channel consistency, intra-channel consistency, or consistency within individual channels requires the researcher to identify the causes of variation in the customer experience. The causes of intra-channel variation, is more often than not at the local level – the individual stores, branches, employees, etc. For example, a bank branch with large variation in customer traffic is more likely to experience variation in the customer experience.
Regardless of the source, consistency equals quality.
In our own research, Kinēsis conducted a mystery shop study of six national institutions to evaluate the customer experience at the branch level. In this research, we observed a similar relationship between consistency and quality. The branches in the top quartile in terms of consistency delivered customer satisfaction scores 15% higher than branches in the bottom quartile. But customer satisfaction is a means to an end, not an end goal in and of itself. In terms of an end business objective, such as loyalty or purchase intent, branches in the top quartile of consistency delivered purchase intent ratings 20% higher than branches in the bottom quartile.
Purchase intent and satisfaction with the experience were both measured on a 5-point scale.
Again, it is incumbent on customer experience researchers to identify the causes of inconsistency. A search for the root cause of variation in customer journeys must consider processes cause variation.
One tool to measure process cause variation is a Voice of the Customer (VOC) Table. VOC Tables have a two-fold purpose: First, to identify specific business processes which can cause customer experience variations, and second, to identify which business processes will yield the largest ROI in terms of improving the customer experience.
VOC Tables provide a clear road map to identify action steps using a vertical and horizontal grid. On the vertical axis, each customer experience attribute within a given channel is listed. For each of these attributes a judgment is made about the relative importance of each attribute. This importance is expressed as a numeric value. On the horizontal axis is a exhaustive list of business processes the customer is likely to encounter, both directly and indirectly, in the customer journey.
This grid design matches each business process on the horizontal axis to each service attribute on the vertical axis. Each cell created in this grid contains a value which represents the strength of the influence of each business process listed on the horizontal axis to each customer experience attribute.
Finally, a value is calculated at the bottom of each column which sums the values of the strength of influence multiplied by the importance of each customer experience attribute. This yields a value of the cumulative strength of influence of each business process on the customer experience weighted by its relative importance.
Consider the following example in a retail mortgage lending environment.
In this example, the relative importance of each customer experience attributes was determined by correlating these attributes to a “would recommend” question, which served as a loyalty proxy. This yields an estimate of importance based on the attribute’s strength of relationship to customer loyalty, and populates the far left column. Specific business processes for the mortgage process are listed across the top of this table. Within each cell, an informed judgment has been made regarding the relative strength of the business process’s influence on the customer experience attribute. This strength of influence has been assigned a value of 1 – 3. It is multiplied by the importance measure of each customer experience attribute and summed into a weighted strength of influence – weighted by importance, for each business process.
In this example, the business processes which will yield the highest ROI in terms of driving the customer experience are quote of loan terms (weighted strength of influence 23.9), clearance of exemptions (22.0), explanation of loan terms (20.2), loan application (18.9) and document collection (16.3).
3 Types of Customer Interactions Every Customer Experience Manager Must Understand
Every time a customer interacts with a brand, they learn something about that brand, and adjust their behavior based on what they learn. They will adjust their behavior in ways that are either profitable or unprofitable for the brand. The implication of this proposition is that the customer experience can be managed in such a way to influence customer behavior in profitable ways.
In order to understand how to drive customer behaviors via the customer experience, it is first, is important to define the customer behaviors you wish to influence, and to align marketing message, performance standards, training content, employee incentives and measurement systems to encourage those behaviors.
It is impossible, of course, to plan every customer experience or to ensure that every experience occurs exactly as intended. However, companies can identify the types of experiences that impart the right kind of information to customers at the right times. It is useful to group these experiences into three categories of company/customer interaction: Stabilizing, Critical, and Planned.
Stabilizing
Stabilizing interactions promote customer retention, particularly in the early stages of the relationship.
New customers are at the highest risk of defection. As customers become more familiar with a brand they adjust their expectations accordingly, however new customers are more likely to experience disappointment, and thus more likely to defect. Turnover by new customers is particularly hard on profits because many defections occur prior to break-even, resulting in a net loss for the company. Thus, experiences that stabilize the customer relationship early on ensure that a higher proportion of customers will reach positive profitability.
The keys to an effective stabilizing strategy are education, competence and consistency.
Education influences expectations, helping customers develop a realistic expectations. It goes beyond simply informing customers about the products and services offered by the company. It systematically informs new customers how to use the brand’s services more effectively and efficiently, how to obtain assistance, how to complain, and what to expect as the relationship progresses. In addition to influencing expectations, systematic education leads to greater efficiency in the way customers interact with the company, thus driving down the cost of customer service and support.
Critical
Critical interactions are service encounters that lead to memorable customer experiences. While most service is routine, from time to time a situation arises that is out of the ordinary: a complaint, a question, a special request, a chance for an employee to go the extra mile. The outcomes of these critical incidents can be either positive or negative, depending upon the way the company responds to them; however, they are seldom neutral. The longer a customer remains with a company, the greater the likelihood that one or more critical interactions will have occurred.
Because they are memorable and unusual, critical interactions tend to have a powerful effect on the customer relationship. We often think of as “moments of truth where the brand has an opportunity to solidify the relationship earning a loyal customer or risk the customer’s defection. Positive outcomes lead to “customer delight” and word-of-mouth endorsements, while negative outcomes lead to customer defections, diminished share of wallet and unfavorable word-of-mouth.
The key to an effective critical interaction strategy is opportunity. Systems and processes must be in a position to react to these critical moments of truth.
An effective customer experience strategy should include systems for recording critical interactions, analyzing trends and patterns, and feeding that information back to the organization. Employees can then be trained to recognize critical opportunities, and empowered to respond to them in such a way that they will lead to positive outcomes and desired customer behaviors.
Planned
Planned interactions are intended to increase customer profitability through up-selling and cross-selling. These interactions are frequently triggered by changes in the customers’ purchasing patterns, account usage, financial situation, family profile, etc. CRM analytics combined with Big Data are becoming quite effective at recognizing such opportunities and prompting action from service and sales personnel. Customer experience managers should have a process to record and analyzing the quality of execution of planned interactions with the objective off evaluating the performance of the brand at the customer brand interface – regardless of the channel.
The key to an effective strategy for planned interactions is appropriateness. Triggered requests for increased spending must be made in the context of the customers’ needs and permission; otherwise the requests will come off as clumsy and annoying. By aligning information about execution quality (cause) and customer impressions (effect), customer experience managers can build a more effective and appropriate approach to planned interactions.
For additional perspectives on research techniques to monitor the customer experience in the stabilizing phase of the relationship, see the post: Onboarding Research: Research Techniques to Track Effectiveness of Stabilizing New Customer Relationships.
For additional perspectives on a research methodology to investigate “Critical” experiences, see the post: Critical Incident Technique: A Tool to Identify and Prepare for Your Moments of Truth.
For additional perspectives on research methodologies to investigate “Planned” experiences through out the customer life cycle, see the post: Research Tools to Monitor Planned Interactions Through the Customer Life Cycle.
The Human Element: Sales and Service, Bank’s Last Link in the Marketing Chain
What if I told you that after all your efforts with marketing (product, positioning and price), there is a one-in-ten chance the branch representatives will undermine the sale?
Now more than ever, it is critical for banks to establish themselves as the primary provider of financial services, not only for deposit accounts but across a variety of financial products and services. Increasing the average products per customer will require a strategic approach to both product design and marketing. However, at the end of this strategic marketing process, there is the human element, where prospective customers must interact with bank employees to complete the sales process.
As part of our services to our clients, Kinesis tracks purchase intent as a result of in-branch sales presentations. According to our research, 10% of in-branch sales presentations observed by mystery shoppers, result in negative purchase intent.
What do these 10% failed sales presentations look like?
Here are some quotes describing the experience:
“There was no personal attention. The banker did not seem to care if I was there or not. At the teller line, there was only one teller that seemed to care that there were several people waiting. No one moved with a sense of urgency. There was no communication materials provided.”
Here’s another example…
“It was painfully obvious that the banker was lacking basic knowledge of the accounts.”
Yet another…
“Brian did not give the impression that he wanted my business. He did not stand up and shake my hand when I went over to his desk. He very rarely made eye contact. I felt like he was just going through the motions. He did not ask for my name or address me by my name. He told me about checking account products but failed to inquire about my situation or determine what needs I have or might have in the future. He did not wrap up the recommendation by going over everything nor did he ask for my business. He did not thank me for coming in.”
In contrast, here is what the shops with positive intent look like:
“The appearance of the bank was comfortable and very busy in a good way. The customers were getting tended to and the associates had the customers’ best interests in mind. The response time was amazing and I felt as if the associate was sincere about wanting me as a customer, but he was not pushy or demanding about it.”
Now…after all the effort and expense of a strategic cross-sell strategy, which of the above experiences do you want your customers to encounter?
Would it be acceptable to you as a marketer to at the end of a strategic marketing campaign, have 10% of the sales presentations undermine its success?
These are rhetorical questions.
Time and time again, in study after study, we consistently observe that purchase intent is driven by two dimensions of the customer experience: reliability and empathy. Customers want bankers who care about them and their needs and have the ability to satisfy those needs. Specifically, our research suggests the following behaviors are strongly related to purchase intent:
- Friendly/Smile/Courteous
- Greeting/Stand to Greet/Acknowledge Wait
- Interest in Helping/Offer Assistance
- Discuss Benefits/Solutions
- Promised Services Get Done
- Accuracy
- Professionalism
- Express Appreciation/Gracious
- Personalized Comment (such as, How are you?)
- Listen Attentively/Undivided Attention
As part of any strategic marketing campaign to both bring in new customers as well as increase wallet share of existing customers, it is incumbent on the institution to install appropriate customer experience training, sales and service monitoring, linked with incentives and rewards structures to motivate sales and service behaviors which drive purchase intent.
Changes in Word of Mouth Advertising Based on the Customer Experience – Part 2
Previously we observed changes in customer purchase behavior based on the customer experience.
Every time a company and a customer interact, the customer learns something about the company, and adjusts their behavior based on what they learn.
To explore this proposition, Kinesis conducted a survey of 500 consumers asking them to recall an experience with any provider that they found to be particularly positive or negative, and determined how these customer experiences influenced customer behavior.
Here is how respondents told us they changed their behavior based on the experience:
This post specifically addresses positive word of mouth as a result of the experience.
Respondents shared positive word of mouth a median 4.3 times as a result of their positive experience, compared to negative experiences, which were shared about 20% more often (median 5.2 times). In fact, they were more likely to share negative word of mouth across all mediums:
Word of Mouth as Result of Experience
|
Positive Experiences |
Negative Experiences |
|
| Friend or family (Excluding Online or Social Media) |
69% |
80% |
| Coworkers (Excluding Online or Social Media) |
42% |
54% |
| Online Social Media |
28% |
47% |
| Online Reviews |
20% |
33% |
Customers are far more likely to share negative experience using online mediums. While they are about 1.2 times more likely to share a negative experience with a relative, friend or coworker via an off line medium, they are 1.7 times more likely to share negative experiences over positive via online mediums.
Again, every time a company and a customer interact, the customer learns something about the company, and changes their behavior based on what they learn. And, as this study shows, they certainly will share this experience with others. But what about the recipients of this word of mouth advertizing? How does one customer’s experience influence the behavior of others?
Approximately 90% of respondents said their purchase decisions were influenced positively (93%) or negatively (85%) by social media or word of mouth reviews.
With customer trust at an all time low, and social media providing a much more far reaching medium of person to person communication, positive word of mouth is becoming far more important in terms of defining the brand. Increasingly social media is becoming the media. With 9 out of 10 potential customers saying their purchase decisions are influenced reviews of others, it is increasing important that managers manage their customer experience to support and reinforce the brand.
Changes in Purchase Behavior Based on the Customer Experience – Part 1
Every time a company and a customer interact, the customer learns something about the company, and adjusts their behavior based on what they learn.
To explore this proposition, Kinesis conducted a survey of 500 consumers asking them to recall an experience with any provider that they found to be particularly positive or negative, and determined how these customer experiences influenced customer behavior.
When asked to characterize the cause of the positive or negative experience, these customers’ descriptions were grouped into four common themes that mirrored each other regardless of whether the experience was positive or negative. The most common themes for both experiences were: speed of service, pleasantness of personnel, efficiency of service, and the success of the outcome.
Causes of Positive & Negative Experiences
| Positive Experiences | Negative Experiences | |
| Speed of Service/ Problem Resolution | 72% | 69% |
| Pleasantness of Personnel | 70% | 63% |
| Efficiency of Service/ Not Passed Around to Multiple People | 60% | 71% |
| Outcome Successful/ Problem Resolved/ Expectations Met | 55% | 49% |
The speed of service was cited with about the same frequency (7 out of 10 cases) as a cause of the experience being positive or negative. Pleasantness of personnel was mentioned 70% of the time as a driver of positive experiences compared to 63% for negative. Efficiency of service (or lack thereof) was more commonly cited as a reason for the experience being negative (71%) compared to positive (60%). The fourth most common theme mentioned as a reason for the success or failure of the customer experience is the successful outcome of the experience itself (55% for positive experience, 49% for negative).
Again, every time a company and a customer interact, the customer learns something about the company, and adjusts their behavior based on what they learn. So…how did these experiences (positive or negative) influence customer behavior?
Here is how respondents told us they changed their behavior based on the experience:
Changes in Customer Behavior Based on Experience
| Positive Experiences | Negative Experiences | |
| Change in purchase behavior (Buy more or less) | 54% | 57% |
| Told others (Positive or negative) | 36% | 43% |
| Considered change in purchase behavior | 32% | 38% |
| No change | 14% | 5% |
Over half of the respondents said they changed their purchase behavior as a result of the experience, 54% of the customers recalling a positive experience told us they purchased more from the provider as a result of the positive experience, while 57% told us they purchased less as a result of the negative experience.
Furthermore, about a third of the respondents told us they considered a change in purchase behavior as a result of the experience; 32% considered purchasing more as a result of the positive experience, and 38% considered purchasing less as a result of a negative experience.
Finally, roughly four out of ten told others of the experience. Thirty-six percent of participants told us they gave positive word of mouth as a result of the positive experience, while 43% gave negative word of mouth as a result of the negative experience.
Again, every time a company and a customer interact, the customer learns something about the company, and changes their behavior based on what they learn. The two primary ways customers change their behaviors based on the customer experience is both their own purchase behavior and sharing the experience with others.
It’s the People: Keys to Customer Loyalty in the Grocery Customer Experience
The business attribute with the highest correlation to profitability is customer loyalty. Customer loyalty lowers sales and acquisition costs per customer by amortizing these costs across a longer lifetime – leading to some extraordinary financial results. However, the question remains, what service attributes drive customer loyalty?
To answer this question, Kinesis conducted surveys of customers who had recently visited a grocery store, collecting impressions of a variety of service attributes.
In order to determine the relationship of these attributes to customer loyalty, we identified each customer as a promoter or detractor as a result of the experience, according to the Net Promoter methodology. Net Promoter is generally accepted as a strong proxy measurement for loyalty, and serves as the basis for evaluating the relationship of these attributes to customer loyalty.
The 12 service attributes with the largest gaps between promoters and detractors are:
- No wait for service
- Employee made eye contact
- Employee offered friendly verbal greeting
- Employees attentive to customers
- Employees look presentable
- Name badges worn
- All items have shelf tags and price labels
- Employees offer further assistance or offer friendly parting comment
- Product knowledge of employees
- Quality and variety of products meets expectations
- Samples offered
- Walk customer to item or area (if asked for assistance)
It’s the People
The performance of the individual employees weighs heavily on customer loyalty. Eight of the 12 attributes are directly related to employee behaviors: eye contact, friendly greeting, attentive to customers, name badge worn, offer further assistance or friendly parting comment, product knowledge, and walking customers to the item or area.
Every time a company and a customer interact, the customer learns something about the company, and adjusts their behavior based on what they learn. When customers encounter an employee who cares about their needs, they learn that the company, through the employee, cares about their needs as well. Customers respond to this information with an increased desire to positively spread word of mouth, a behavior strongly correlated to customer loyalty.
What are some of the ways your employees care about the customer’s needs?
Own the Call: A Key to Customer Loyalty
What service attributes from your agents drive customer loyalty?
To answer this question, Kinesis conducted surveys of people who had recently called a contact center. Impressions of the customer experience with particular attention to the performance of the agent were collected across a variety of attributes. In order to determine the relationship of these attributes to customer loyalty, we identified each customer as a promoter or detractor as a result of the call, according to the Net Promoter methodology. Net Promoter is generally accepted as a strong proxy measurement for loyalty, and serves as the basis for evaluating the relationship of these attributes to customer loyalty.
It’s the People
Not surprisingly, the performance of the individual agent weighs heavily on customer loyalty. The average overall impression rating (on a 5-point scale) of the agent is 1.4 times higher in calls where the customer was identified as a promoter (4.9) compared to those identified as detractors (3.5).
Further evidence of the importance of the agent can be found in a comparison of the specific attributes ratings for promoters compared to detractors.
|
Promoter As Result of Call |
Detractor As Result of Call |
|
| Took Ownership of Call | 4.9 | 3.2 |
| Confidence in Agent | 4.9 | 3.3 |
| Value as a Customer | 4.8 | 3.6 |
| Interest in Helping | 4.9 | 3.8 |
| Use of Understandable Terms | 5.0 | 3.7 |
| Job Knowledge | 5.0 | 3.8 |
| Professionalism | 5.0 | 4.0 |
| Friendliness/Courtesy | 5.0 | 4.3 |
The agent taking ownership of the call and the confidence the customer had in the agent are both 1.5 times stronger in calls where the customer is a promoter as a result of the call, compared to calls where they are a detractor.
Own the Call
What does ownership of the call mean?
Ownership of the call was defined in this survey as the extent to which the agent appeared to be the voice of the company, took responsibility for the customer’s concerns, showed a desire to be of assistance, and advised of possible solutions and assured resolution.
Every time a company and a customer interact, the customer learns something about the company, and adjusts their behavior based on what they learn. When customers encounter a contact center agent who owns the call, they learn that the company, through the agent, cares about their needs, wants to help resolve the need, and will stay engaged until the need is met. Customers respond to this information with an increased desire to positively spread word of mouth, a behavior strongly correlated to customer loyalty.
What are some of the ways you take ownership of the call?
The 5 Service Dimensions All Customers Care About
Reprinted with permission from Chris Arlen, of Service Performance.
by CHRIS ARLEN
Not All Dimensions Are Equal
All dimensions are important to customers, but some more than others.
Service providers need to know which are which to avoid majoring in minors. At the same time they can’t focus on only one dimension and let the others suffer.
SERVQUAL research showed dimensions’ importance to each other by asking customers to assign 100 points across all five dimensions.*
Here’s their importance to customers.
The 5 Service Dimensions Customers Care About
What’s this mean for service providers?
#1 Just Do It
RELIABILITY: Do what you say you’re going to do when you said you were going to do it.
Customers want to count on their providers. They value that reliability. Don’t providers yearn to find out what customers value? This is it.It’s three times more important to be reliable than have shiny new equipment or flashy uniforms.
Doesn’t mean you can have ragged uniforms and only be reliable. Service providers have to do both. But providers first and best efforts are better spent making service reliable.
Whether it’s periodics on schedule, on-site response within Service Level Agreements (SLAs), or Work Orders completed on time.
#2 Do It Now
RESPONSIVENESS: Respond quickly, promptly, rapidly, immediately, instantly.
Waiting a day to return a call or email doesn’t make it. Even if customers are chronically slow in getting back to providers, responsiveness is more than 1/5th of their service quality assessment.
Service providers benefit by establishing internal SLAs for things like returning phone calls, emails and responding on-site. Whether it’s 30 minutes, 4 hours, or 24 hours, it’s important customers feel providers are responsive to their requests. Not just emergencies, but everyday responses too.
REPORTING RESPONSIVENESS
Call centers typically track caller wait times. Service providers can track response times. And their attainment of SLAs or other Key Performance Indicators (KPIs) of responsiveness. This is great performance data to present to customers in Departmental Performance Reviews.
#3 Know What Your Doing
ASSURANCE: Service providers are expected to be the experts of the service they’re delivering. It’s a given.
SERVQUAL research showed it’s important to communicate that expertise to customers. If a service provider is highly skilled, but customers don’t see that, their confidence in that provider will be lower. And their assessment of that provider’s service quality will be lower.
RAISE CUSTOMER AWARENESS OF YOUR COMPETENCIES
Service providers must communicate their expertise and competencies – before they do the work. This can be done in many ways that are repeatedly seen by customers, such as:
- Display industry certifications on patches, badges or buttons worn by employees
- Include certification logos on emails, letters & reports
- Put certifications into posters, newsletters & handouts
By communicating competencies, providers can help manage customer expectations. And influence their service quality assessment in advance.
#4 Care about Customers as much as the Service
EMPATHY: Services can be performed completely to specifications. Yet customers may not feel provider employees care about them during delivery. And this hurts customers’ assessments of providers’ service quality.
For example, a day porter efficiently cleans up a spill in a lobby. However, during the clean up doesn’t smile, make eye contact, or ask the customer if there is anything else they could do for them. In this hypothetical the provider’s service was performed fully. But the customer didn’t feel the provider employee cared. And it’s not necessarily the employees fault. They may not know how they’re being judged. They may be overwhelmed, inadequately trained, or disinterested.
SERVICE DELIVERY MATTERS
Providers’ service delivery can be as important as how it was done. Provider employees should be trained how to interact with customers and their end-users. Even a brief session during initial orientation helps. Anything to help them understand their impact on customers’ assessment of service quality.
#5 Look Sharp
TANGIBLES: Even though this is the least important dimension, appearance matters. Just not as much as the other dimensions.
Service providers will still want to make certain their employees appearance, uniforms, equipment, and work areas on-site (closets, service offices, etc.) look good. The danger is for providers to make everything look sharp, and then fall short on RELIABILITY or RESPONSIVENESS.
At the End of the Day
Customers’ assessments include expectations and perceptions across all five SERVQUAL dimensions. Service providers need to work on all five, but emphasize them in order of importance. If sacrifices must be made, use these dimensions as a guide for which ones to rework.
Also, providers can use SERVQUAL dimensions in determining specific customer and site needs. By asking questions around these dimensions, providers can learn how they play out at a particular location/bid opportunity. What dimensions are you in?
* For a description of the SERVQUAL methodology, see the following post: SERVQUAL Model: A Multi-Item Tool for Comparing Customer Perceptions vs. Expectations
The Shape of Satisfaction
Measuring satisfaction with a rating scale virtually always creates a very distinctively skewed curve, such as the one below, where approximately 85% of the responses are split between the top-two responses (4 and 5), and the remaining 15% trail off to the bottom end of the scale. This is what I like to call “The Shape of Satisfaction.” The distribution illustrated below yields an average rating of 4.2. Typically, in satisfaction measurement, we see average ratings in the 4.2 to 4.3 range.
Shape of Satisfaction
As a point of comparison to other providers, if we were to ask the same respondents to compare their satisfaction with the company to that of other providers with which they do business, we would typically get a normal distribution similar to the following – where an equal number of respondents say their satisfaction is higher or lower compared to other companies they do business with.
Satisfaction Compared to Other Providers
Therefore, a typical satisfaction rating in the 4.2 to 4.3 range is normal and does not necessarily represent a source of competitive differentiation.
Furthermore, when satisfaction data is compared to customer loyalty data, research has observed for a five-point scale similar to the one to the left, customers who assign a rating of “4” are approximately 60% less loyal than customers who assign a rating of “5”.
Various theories attempt to explain the phenomenon of the skewed satisfaction curve. Of these, I believe the most logical and intuitive explanation is a self-selection process. First, being a customer is a self-selective process where dissatisfied customers are more likely to leave the company. Second, companies generally satisfy their customers, because if they are not competitive in terms of satisfaction, they would be destroyed by customer attrition and cease to exist.
What are the implications of the shape of satisfaction?
First, there are significant implications for the interpretation of customer satisfaction data. Simply having an average rating of 4.2 on a five-point scale does not necessarily denote strength. Rather, managers should understand a comparative advantage does not necessarily exist until the average on such a scale exceeds 4.3.
It is important to understand how your customer satisfaction compares to your competitors. One way to collect such a comparative context is to ask customers to compare your service to that of your competitors. This is much less likely to be skewed as the satisfaction curve, and will determine if your satisfaction is strong relative to your competitors.
The second implication is the importance of measuring loyalty rather than satisfaction only. Loyalty can be measured via a number of means: likelihood of referral, NetPromoter, primary provider, etc.
Third, it is important to focus on the other extreme low end of the satisfaction curve. Drill into the 15% of customers who are not satisfied, and attempt to adjust your product and service mix to shift even just a few customers up the satisfaction curve. Even slight improvements in shifting these customers up the curve will have significant improvements in customer loyalty and profitability. Again, each point increase on a five-point scale increases customer loyalty by 1.7 times, and depending on the industry, a 5% increase in loyalty equates to 25% to 85% increase in profitability.
Kinesis CEM 
4 Ways to Understand & Monitor Moments of Truth
The customer value equation is an on-going process by which the customer keeps a running total of all the benefits of a product or service (both tangible and intangible) and subtracts the sum of all the costs associated with the product or service (tangible and intangible). If the product of this equation is positive they will start or maintain a relationship with the provider.
But is this a continuous process? Or do many customers travel through the customer journey in a state of inertia until they reach critical points in the customer journey where they feed knowledge gained, at these critical points, into the customer value equation?
The fact of the matter is not all points along the customer journey are equal. In every customer journey there are specific of “moments of truth” where customers form or change their opinion of the provider, either positively or negatively, based on their experience. Moments of truth can be quite varied and occur in a skilled sales presentation, when a shop owner stays open late help dad buy the perfect gift, or when a hold time is particularly long.
In designing tools to monitor the customer experience, managers must be aware of potential moments of truth and design tools to monitor these critical points in the customer journey. Some of these tools include:
Mystery Shopping: Mystery shopping allows managers to test their service experience in a controlled manner. Do you have a concern about how your employees respond to specific customer complaints or problems? – Send in a mystery shopper with that specific problem and evaluate the response. Are you concerned about cross-sell skills? – Send in a mystery shopper with an obvious cross-sell need and evaluate how it is handled. With mystery shoppers managers can design controlled tests to evaluate how employees react when presented with specific moments of truth.
Customer Comments: Historically, comment tools have taken the form of cards; however, increasingly these tools are migrating onto online and mobile platforms. The self-administered nature of comment tools make them very poor solutions for a customer survey, as we tend to hear from an unrepresentative sample of customers who are either extremely happy or extremely unhappy.
However, this highly self-administered nature of comment tools makes them perfect to monitor moments of truth. Customers on the extreme end of either scale probably are at a moment of truth in the journey. In designing comment tools, be sure to limit the amount of categorized questions and rating scales; rather give the customer plenty of “white space” to tell you exactly what is on their mind. Over time, an analysis of these comments will give you insight into the nature and causes of moments of truth.
Social Media: Similar to collecting comments from customers, social media can be an excellent tool for identifying common causes of moments of truth. Customers who take to social media to mention a product or service are likely to be highly motivated – again, at the extreme ends of the satisfaction spectrum.
Survey Tracking: Finally, ongoing satisfaction tracking of all customers can be a source of intelligence regarding moments of truth. To turn a satisfaction tracking study into a moment of truth monitor, focus your attention on the bottom of the satisfaction curve. If a customer assigns a satisfaction rating of “1” or “2” on a 5-point scale, drill into these customers’ responses on a case by case basis to determine what caused the low rating – this will most likely reveal a moment of truth.
Here are four ideas to identify and monitor moments of truth.
How do you monitor your moments of truth?