Great Expectations – Customers as Competitors

expectations2.jpg I’m seeing an interesting trend in my client work. The metrics used to measure the health of customer relationships are declining, yet the companies have not really changed anything operationally. So how does one explain this disturbing trend? First, getting to the heart of the matter would require a deep dive into the metrics to look for other trends, correlations, and insights. Until that happens, I’ll offer up one cause that may be impacting all sorts of other companies.

The rapid growth of the internet and supporting technologies has given consumers increased strength in the customer/company relationship. As customers have grown in power, so have their expectations, and their expectations are your real competition. Whatever you want to call it, this growth in popularity of customer-centricity is taking hold in a variety of industries. The believers are investing serious time and resources into understanding customer expectations, and improving their value and relevancy to thier customers. It’s paying off. Look at the growth of or the ratings for GEICO, or any of the blogs listed in my blogroll and you’ll find examples of companies who are improving thier customer relationships through improved products, services, and customer experiences with positive results.

As consumers see improvements with one company they begin to expect it from other companies, and often in totally unrelated industries. If I can open a CD account online with a bank in Indiana, why can’t my local credit union do the same thing? If it’s easy to get someone to help me at Home Depot, why do I have walk the isles at Lowe’s looking for the same assitance? When you call in for assistance to the California Franchise Tax Board the representative now gives you the the option to leave feedback following the call! If the Tax Board wants my feedback, why doesn’t everyone?

When it comes to customers and their expectations, being good enough isn’t. For many products and services, most customers won’t think about switching until thier current provider screws up or just doesn’t meet their expectations. Not meeting expectations is the initial driver to look elsewhere. It’s these expectations, whether realistic or not, that are the new competition. As more companies earnestly focus on improving thier value to their customers, the bar gets raised for all companies. Companies who have bought into a customer-centric way of doing business will be the winners. That means that customer-centricity is part of the life-blood of the company, that it is measured and rewarded, and that customer expectations are understood and often exceeded.


The Customer Strikes Back

referring.jpg No, it’s not the title of the next movie in the Star Wars series. It is part two in a three-part series from Accenture on customer service in the technology industry. The survey mentions several review sites such as,,, and Are they effective? The report states that:

“According to Henderson research, there are now more than 25,000 websites dedicated to poor customer service, and there were more than 100 examples in the past year of actions individuals took to virally communicate their displeasure via the Internet resulting in a company’s changing its policy.”

Average customer service is not good enough. The report findings show that there is a direct relationship between how satisfied customers are with the service they receive and how likely they will be to continue to patronize a provider. According to report “only about one-fourth of customers said that they would buy again from a company that, in their minds, provides only average service, and just 19 percent said they were likely to be more loyal to such a company.”

Service is more important than innovation. According to a customer service survey conducted by Harris Interactive for Verint Systems, consumers overwhelmingly prefer good customer service over the hottest, most innovative product offerings, and most consumers will tell others about their customer experiences – whether bad or good. Some 88% reported that they find a company with good customer service much more enticing than one with the new and innovative products.

The take-aways:

  1. Be sure to gather customer feedback about your customer service and know that good enough, isn’t.
  2. Add customer service to your competitor analysis, and include website customer self-service tools in your analysis.
  3. Monitor consumer review websites for feedback about your business and your competitors.
  4. Take all your customer feedback seriously, even if you only get a few responses. Many customers will not directly tell a company about their experience, so be sure to both clarify and quantify any issues that get reported from customers.