In your book, The Effortless Experience: Conquering the New Battleground for Customer Loyalty, a big point is that in business, delighting the customer has very little business value. That’s pretty bold.
In our research we found out that the “delight” moments don’t increase loyalty, which goes against conventional wisdom in contact centers. In our data we found that customers are delighted only about 16 percent of the time, and companies that focus on delight are running about 10 to 20 percent higher operating costs. So it’s expensive, and it’s not delivering the intended results.
We also learned that customers who were delighted or whose expectations were exceeded in service interactions were no more loyal than those whose expectations were simply met.
What should utilities be doing if not delighting their consumers?
We found that the point of maximum return from loyalty is simply doing what customers expect, which is delivering goods, and straightforward service and products. Customers are looking for utilities to fix their problems quickly and efficiently and let them get back to what they were previously doing.
Companies need to not only be thinking about building loyalty, but also focusing on actually preventing customer disloyalty by reducing customer effort and making things easier for them.
How does the emerging popularity of self-service, especially through digital channels, play into reducing customer effort?
Most customers go to company websites before they pick up the telephone. They are looking for a little-effort experience to address their particular issue. About 60 percent of customers who contact a call center go to the website first, but were frustrated for some reason and then picked up the phone and called.
Self-service is a huge opportunity and customers are open to it, but utilities need to provide an experience that is easy, convenient and effective at connecting customers with what they are seeking to accomplish. Creating a simple, guided, self-service experience is one of the best ways to create that little-effort experience for customers.
Our New Energy Consumer research found that there are still some specific areas in which customers prefer live customer service interactions. How do those types of preferences fit into the overall effortless experience?
There are always going to be those times when the customer has to call their utility and, frankly, when the utility would prefer that the customer call them. Take a service shutoff, for example—speaking to a utility representative live is going to be much less frustrating for the customer than a lengthy email exchange, and more cost-effective for the utility.
Interestingly, in our research we found that a huge chunk of customers’ effort is not a function of what they have to do in certain service interactions, but how they feel about it. That means that even when a customer is dealing with a challenging situation, like a service issue, it comes down to the way a utility’s representatives pose answers and position resolution that matters.
As utilities broaden the range of products and services they provide, how will this expansion further impact the way they need to improve customer interactions?
It’s important to be able to offer a great set of products and options at the right price. But it’s also important for utilities not to drill a hole in the bottom of that loyalty bucket. I would argue that as the power sector becomes more competitive and utilities move into new marketspaces, it’s even more important that we actually focus on effortless service.
How has your work in this area changed your perceptions of your interactions as a consumer?
I’m now more acutely aware of all the things companies do to make customers disloyal. I prefer to get back to my life, to the things I was doing before I had to pick up the phone to discuss an issue, and I see how companies are doing everything they can to prevent that from happening. However, on the flip side, I not only recognize how often companies get wrong, but also really appreciate when they get it right.
I understand, outside of work, you are quite active in some elite sports.
I used to compete in triathlons, but now focus on cycle-cross racing, which is something my son and daughter are also getting into.
Cross-cycle racing is a combination of mountain biking and road racing. The course is a mix of pavement, grass and gravel, barriers, hills to ride and sometimes carry your bike up, and lots of mud and dirt. It’s exciting and good fun. Kids tend to love it because they get to ride bicycles in terrain that their parents wouldn’t normally let them.
At the start of your career you were on the path to being a professor. Looking at your current career, do you see any similarities with what you originally planned to do?
I was planning on teaching economics, political science, and political economy and trendsetting, and was heading down that path when two things happened. I realized that I wasn’t that interested in academia, and I became more interested in private sector issues, which led me to CEB.
While studying call centers and some of the other areas I focus on are newer to me, the disciplines of research and teaching are still consistent with what I set out to do career wise.
It sounds like you’re still teaching, but in a bigger classroom, with more tangible outcomes.
It’s been a gratifying experience: When you’re able to give someone with decades of experience managing customer service a new way to think about their own world, it is very powerful to see that light bulb go on.
It’s also rewarding when companies come back and say something worked, that they implemented these new ways of thinking and saw the payoff.