Setting the Pace, Winning the Race
Happy New Year! It's 2008, and the race for the customer continues at a fast clip.
To win, you have to realize that it's a relay of sorts: Every department that impacts your customer throughout the lifecycle of that relationship must hand the baton off smoothly. Product features, pricing, promotions, fulfillment, and pre- and post-sale service must all be flawless to create a winning overall customer experience. Fumbling the transition at any point could cost you the race.
The reason: The competition is on your heels and consumer expectations are far out in front.
Today, the race for the customer takes place in what we call a multipolar world, where new centers of economic power are emerging and new players are suiting up to compete with comparable products and services -- and more attractive pricing. Besides having more choices, consumers are more empowered -- through social networks, consumer blogs, and the like -- to compare their options and readily change providers.
On a playing field where the pacesetter in function or price can be quickly matched or even outpaced, many providers will be left with one competitive advantage -- the quality of the customer experience they deliver. However, our research reveals that the majority of consumers believe the service they experience today falls short. Only 3 percent of consumers we surveyed -- in Australia, Brazil, Canada, China, France, the United States, and the United Kingdom -- described the quality of the service they experience as excellent. Even worse, 47 percent said their service expectations are met only sometimes, rarely, or never.
Given these findings, it stands to reason that nearly six out of 10 consumers said they had switched providers in one or more industry categories during the past year because of a poor service experience. Our research also suggests these defections represent the new normal, with the percentage of customers who leave due to bad service rising annually. Can businesses really afford to let their performance be handicapped in this way?
Winning the race for customers requires a deep, sustained commitment -- it's more a marathon than a sprint. While many consumers believe their expectations go unmet today, imagine how much more demanding they'll be in the future: More than one-half (52 percent) said their expectations for service have increased over the past five years; one-third said their expectations are higher now than only a year ago. Companies will need to work ever harder to meet these ever-rising standards.
Much as world-class athletes train to stay competitive, winning companies will have to strive continuously to understand the customers they want to retain as those customers change, and will have to use that knowledge to deliver always-relevant offers and experiences in ways that are fast, efficient, and profitable.
The prize is worth the effort. A satisfying customer experience helps companies hold on to customers: More than three-quarters of the consumers we surveyed (77 percent) said they are much more inclined to continue doing business with a company that delivers a positive service experience. A reputation based on service also helps attract customers: 59 percent said customer service is the differentiating factor for choosing a new provider.
This year, I challenge you to win the race for the customer. Study your customer base. Determine what the most valuable segments want. Rally your workforce and partners around meeting these expectations -- make a clean handoff at each transition. Consider the use of social networks, viral marketing, and other innovative Web 2.0 marketing techniques to reach and influence your target customer base. As the year unfolds, monitor your progress using metrics aligned to customer-centric goals, and strive to be at your "personal best."
Achieving high performance requires delivering a consistent, differentiated customer experience -- getting it right will help boost customer loyalty and, by extension, growth, profitability, and shareholder value. With the right approach, 2008 could be the year you set a new record for business performance at your organization.
Woody Driggs is the global managing partner responsible for the CRM service line at Accenture. He can be reached at CRM.Woody.Driggs@accenture.com.