New "Loyalty Metric" Tries To Change The Conversation But Adds Nothing New

Last week, an article caught my eye claims that exceeding customer expectations (which 89% of executives believe creates positive impact to business results) actually has little effect on bottom line. Rather, that service interactions are four-times more likely to result in a negative outcome than a positive one.

The authors, the Corporate Executive Board’s Customer Contact Council, believes that exceeding customer expectation results in virtually no gain in customer loyalty. Further, that service and support centers have little stake in building customer loyalty at all. The Council believes that instead of Customer Satisfaction, one should ask a single question to determine the Customer Effort Score, a proprietary metric. This metric, the authors believe, more accurately measures the customer's reaction to a service event, by measuring the customer's effort during the event.

My View:

My reaction here is pretty blunt. I think this research is garbage, from professional and personal experience. Somehow this magic question (that the Council doesn't reveal presumably unless you buy the research) will unlock the driver of dissatisfaction. Good answers yield good results; bad answers get bad results.

I believe companies that position themselves as premier service organizations need to establish ways to measure all drivers of satisfaction...finding "Perfect Knowledge" of their customers needs. Effort put forth by the customer can be just one measure. If a company delivers well across all drivers, then the customer is loyal--resulting in retention, references for others, and cross-sell opportunities. If you fall flat on that one measure, the customer will be unhappy.

Personal example today: two of my home computers had to have some work done, and the settings for the wireless network were deleted. I called my cable operator that also maintains our internet access and told them my issue. He said he would walk me through the process. So instead of fixing it on his end, he walked me through the multi-step process and within 10 minutes both computers were operational. My effort--full participation which I wasn't expecting. My satisfaction? Complete.

At the end of the day, service providers need to understand their customers needs, deliver to those needs, measure how they are doing meeting those needs, and fix anything that is broken. The result from exceeding customer expectations is a multiplier of benefit...customers stay, tell others, and buy more!

To link to my response to the posting on another blog, go to http://experiencematters.wordpress.com/2009/05/29/meeting-expectations-is-not-the-goal/