Although the global economy may have turned a corner, consumer attitudes and behavior will play a major role in corporate profitability during the recovery. Companies trying to generate new opportunities for organic growth must deliver the experiences that customers value to encourage them to buy their products and services.

Accenture surveys thousands of consumers annually, and in their recent study, "Accenture 2009 Global Customer Satisfaction Survey," they conclude that it is imperative that enterprises replace one-size-fits-all customer service approaches once and for all with service models that deliver differentiated experiences. Doing so requires companies to get a clear understanding of their most valued customers' expectations and requirements. At the same time, companies must understand the current and potential value of those customer segments. Consumers benefiting from such tailored approaches and who are potentially involved in designing the service experiences a company provides are less likely to jump ship the first time something goes awry.

WHY DO COMPANIES need to reinvent their services? Staying the course is simply too costly. Consumers are more demanding than ever, and many companies are not keeping pace. Consequently, consumers are jumping ship and choosing new providers in record numbers. More than two-thirds of consumers (69% of them in 2009) reported switching providers in one sector or another due to poor customer experiences. The highest percentage of switching caused due to poor service occurred in the retail (31%) and banking (27%) sectors. By comparison, the lowest level of switching occurred in the life insurance (nine percent) and airline (eight percent) sectors.

Consumers in emerging markets were far more likely than those in mature markets to have switched providers (87% vs. 64%). For example, 81% of consumers in South Africa, 85% in India, 88% in Brazil and 93% in China left at least one provider in the past year due to poor service. At the other end of the spectrum were consumers in the United States, where only 56% of consumers switched companies in the past year due to poor service.

And the opportunity to satisfy customers via traditional escalation procedures is going away. While consumers may ask to speak to a supervisor or take another action when they encounter a service issue, we identified a new trend, with more consumers choosing to stop doing business with an offending company immediately, as opposed to pursuing other remedies. Sixteen percent of consumers reported that they'd taken this drastic action. In some countries, the same action was taken by as many as 28% of respondents. But the repercussions of bad experiences don't stop there. Nearly nine in 10 consumers tell people around them about their bad experiences. Consumers in emerging markets, specifically South Africa, China and Brazil, are the most inclined to tell others.

Furthermore, one in six consumers complained to a larger audience via online sites such as Facebook. One of four consumers (25%) said they post negative comments about bad experiences online. Surprisingly, 40% of emerging market consumers reported using social media to share bad service experiences - something to consider if a company's growth agenda includes new markets.

That said: One disenchanted customer can impact the buying decisions of other customers many times over. Consumers increasingly "control the conversation" in this time of digital transformation, presenting new challenges for marketers attempting to manage corporate reputations and shape brand perceptions.

SO WHAT ARE the triggers that contribute to switching? Consumers care most about how well-informed and personable their customer service representative is, how fast and efficient customer service is, how often they are referred to another service agent and how long it takes a company to resolve their issue. Similarly, while consumers demand more from many aspects of customer service, they are most likely to expect service to be more convenient and speedy, and for their customer service agents to be more knowledgeable. In fact, 74% want more convenient customer service; 67% want more knowledgeable or better-trained representatives; 66% want faster customer service; and 64% want more channel options for getting service.

Marketing-savvy companies have long understood that different customers desire different things and value them differently. Yet while this knowledge informed their marketing strategies, it had less influence on later stages of the customer life cycle. In this time of heightened cost pressure, rapidly changing market dynamics and consumer values, companies can no longer afford a one-size-fits-all model for customer service. They must shift toward a more customer-centric model - creating and delivering value-based, differentiated service experiences that result in predictable buying behaviors, service experiences and loyalty.

Differentiated service experiences contribute to the creation of more relevant services that are more attractive to customers, and they help companies marshal limited service resources more effectively. In other words, companies need not try to be all things to all people, but should strive to make smart decisions about what makes the most sense for themselves and their customers.

AMONG THE MOST successful practices high-performance businesses use include putting customers in charge, letting familiarity breed loyalty, demonstrating state-of-the-art in "do-it-yourself" and making collaboration a focus of innovation.

One way an enterprise can meet the service expectations of a diverse customer base is to enable customers to configure their own experience. As consumers' needs and behaviors continue to diverge and fragment, enabling them to have more influence or even control over how they interact with a company can go far toward building close, lasting relationships across the generational and geographic spectrum. For instance, a company may decide to enable its highest-value customers to choose for themselves which channels they will use to obtain service, which service agents they want to interact with and which service options they expect to be offered. The company might enable customers in other tiers to choose from predefined "service bundles" or direct their transactions toward lower-cost channels.

Customers tend to prefer businesses that make them feel welcome - something difficult for large enterprises to do in ways that feel authentic. One way to foster this feeling is to enable customers to build personal relationships with specific service personnel, through repeated interactions over time. For instance, when a customer expresses satisfaction with the technician who installed his home theater system, the company should send the same technician the next time the customer needs service. Companies may even enable customers to contact preferred agents directly through email or short message service (SMS) when they need help or information. Customers who feel strong connections to service agents may perceive the cost of switching to be simply too high to defect to other providers.

Over the past decade, many customers have grown to prefer self-service. For instance, many air travelers now prefer to check in and print their boarding passes from their home computers or airport kiosks rather than waiting for personal service from a counter agent. As consumers' familiarity with self-service channels increases, so will their expectations for speed, convenience and personalization.

Many companies find that fostering more collaboration - with external customers, between employees and across value chain partners - can be a powerful tool for differentiating service. Emerging collaboration technologies have the potential to improve the speed and quality of service interactions. Picture, for example, a field technician who can transmit a video image of a customer's broken device to the home office, where product experts diagnose the problem quickly and relay precise repair instructions. Or imagine a call center agent and an end user having a three-way phone conference with a product engineer about how best to configure the customer's home computing system. Such examples illustrate in real terms how companies can turn the old adage that customer satisfaction is everyone's job from a business principle into real business practice.

These practices depend on seamless integration across all channels customers use to obtain service. They also require robust business intelligence and analytics tools that enable companies to gather and analyze a broader range of data, including customer actions, preferences and product usage information. These capabilities make it possible to understand a customer's true value to the company, predict customer behavior more accurately and identify innovative ways to engage customers in future interactions. Using these tools and applying innovative customer approaches can help a company curtail the steady erosion of customer loyalty that many companies are experiencing.

Given the many and varied challenges facing companies, they cannot be all things to all customers. They must embrace differentiated models, closely aligned to the distinct needs and preferences of the most valuable and profitable customers and prospects while providing appropriate customer service experiences for less-engaged or less-profitable segments. The result may be a better return on customer service investments - in terms of customer loyalty, preference and advocacy.

CHRIS ALLEN is the managing director for the CRM Service Transformation practice at Accenture, a global management consulting, technology services and outsourcing company.

Most Read  

This section does not contain Content.