A recent blog post on Harvard Business Review titled, “I Don’t Understand What Anyone Is Saying Anymore,” was unfortunately very relatable.  The core of the article explored how business conversations have evolved into bits of nonsense (e.g., “synergy”, ”value-add”) that make understanding each other much more of a challenge than anything else.

We all fall victim to the excessive use of acronyms from time to time.  And while I too find myself guilty of using a lot of acronyms, I also related to something else in the piece, because its description ties perfectly to research produced by both the SEC and our sister program, the Customer Contact Council:

“Another term that has lost its meaning is ‘Let’s exceed the customer’s expectations.’ …Customers almost universally never experience their expectations being met, much less exceeded. How can you exceed the customer’s expectations if you have no idea what those expectations are? I was at a [hotel] a few weeks ago. They had taken this absurdity to its logical end. There was a huge sign in the lobby that said, ‘Our goal is to exceed the customer’s expectation.’  The best way to start would be to take down that sign that just reminds me, as a customer, how cosmic the gap is between what businesses say and what they do…”

While this was a retail customer setting, the same principle holds true for sales and service organizations.  Attempting to exceed customer expectations is a losing battle. You’ll unnecessarily spend resources trying to delight your customers, when research shows that doing so has only a marginal impact on customer loyalty.   Read More »

What if I told you that the long-standing beliefs driving your customer engagement strategy actually turned out to harm you in the long run?

Imagine the surprise of sales and service execs when they found out that, in the service channel, going above and beyond when serving the customer doesn’t pay off. The break-through research from our sister program—the Customer Contact Council—dismantled many of these universally held beliefs about customer loyalty.

Finding #1: Customer service organizations should care first and foremost about mitigating disloyalty—customers are four times more likely to leave a service interaction disloyal as compared to loyal.

Finding #2: The primary thing service organizations can do to mitigate disloyalty is to focus on reducing the effort customers must put forth to get their issues resolved. In other words, make it easy for the customers to solve their problems.

Finding #3: It is not only that the problem is resolved that matters, but also how.  The customer’s perception of how much effort they put in is about two times as influential as the actual actions taken by the customer.

(SEC Members, read more about these findings in Are You a Low-Effort Service Organization?)

Fascinating, isn’t it, especially if you think about the implications these findings have for your sales strategy.  Do sales organizations need to worry about eliminating unnecessary effort for customers? As it turns out, they do.   Read More »

Through our research of what drives customer loyalty (willingness to buy, willingness to continue buying, willingness to recommend), thousands of our members’ end-customers have told us that the thing they value most…is for a supplier to challenge their thinking.

Customers value a supplier that provides them with a different way of thinking about their business and how to compete more successfully.  Essentially, customers want to be taught.

But it’s not enough to teach customers simply because they value it.  You’ve got to get PAID for it.  The last thing you would want is to teach customers to value something that your organization is not uniquely positioned to solve.  One of our members accurately described that as “teaching the customer into the desert.”

Instead, you need teaching that reframes the way the customer assigns value.  Teaching that leads customers to value the areas where you uniquely outperform your competitors.  Teaching that leads to a commercial result.  Hence the term we’ve coined here at the Council, commercial teaching.

Now, to teach in this manner, you first have to have the knowledge around how you’re uniquely different from your competitors.  After all, it would be impossible to lead customers to value your unique strengths if you don’t even know what they are in the first place.  Read More »

This week marks the official release of the Customer Effort concept into the “wild” with the publication of our article, entitled “Stop Trying to Delight Your Customers,” in the July/August issue of Harvard Business Review. If you haven’t seen the article, feel free to download a complimentary copy. You will also find some cool podcasts and our Customer Effort Audit tool available to download.

As you’ll read in the article, our research shows that “delighting” the customer—in other words, going above and beyond—yields only marginal additional loyalty from the customer.

We also found that customers are four times more likely to leave a service interaction disloyal as compared to loyal, and the primary thing companies can do to mitigate this disloyalty in the service channel is to focus on reducing the effort customers must put forth to get their issues resolved.

Put succinctly, loyalty in the service environment is a matter of reducing effort, not delighting the customer.

One thing this article pushed us to do was to think about the prescriptive advice we would give companies who want to pursue this low-effort journey. It’s not easy summing up more than four years of research around effort, what causes it and what leading companies are doing to eliminate it, but we managed to come up with the following list of five things that low-effort companies do (and are different, we have found, from what most companies do):     Read More »

In a lot of conversations I’ve had with heads of sales lately, their CFOs have been reaching out to sales to discuss reinvesting in growth.  CFOs are currently mulling over how to reinvigorate top line growth without killing margins.

During the last year or two, most companies have gone through significant cost cutting.  This has meant that despite the destruction of demand, most companies were actually able to expand margins.  As we come into what most CFOs believe will be an upswing, we’ve seen them turn attention from a sole focus on managing cost/margins, to a joint focus on top and bottom line.  Put simply, they want to get back on the growth train but without killing the margins they’ve worked so hard to attain. 

Over the last 3-6 months we’ve seen CFOs starting to loosen the purse strings to get growth going; they’re doing things like fund more innovation, look into M&A adjacencies, and remove restrictions on hiring and travel.  We expect to see this trend continue over the next few quarters but it will likely still be slow.  And CFOs are struggling with where and how to make smart investments. 

There are several ways for sales organizations to help CFOs as they think through these joint objectives.  A few questions members are asking are:

• What can sales do to drive the top line without sacrificing the bottom line?
• How can they identify wins that will help make a case for more robust investment in sales?
• What role should sales play in making broader growth investment decisions?

Here’s how I’ve navigated these conversations with CSOs – by helping them change their conversations from driving sales value to driving enterprise value.     Read More »