Every week, Sumair and I will post our most interesting service-minded stories for the week as part of a Friday recap. We’ll comment on one story each and then add 3 others for your review.
For the second iteration, and week 7 of 2017:
Topic: Bottled Water and Customer Loyalty
Source: MIT Sloan Management Review, January 17, 2017 (Link)
Commentary: The author of this article spent a significant amount of time investigating the impact of offered features on new customer acquisition and customer retention in a hotel setting. In comparing the impact of free wireless internet vs. bottled water vs. the availability of a fitness center, the author found that the availability of free water had the greatest impact on retention numbers and future visits. From an ROI perspective, the delivery of free water was also the cheapest investment of the three options.
In general, the author highlights:
a- The features that attract new customers aren’t the same as the ones that retain customers
b- Offering more features can often be counter-productive when it comes to customer satisfaction and retention
c- Customers might not always know what it is that they value in terms of retention.
As companies place emphasis on long-term relationships with customers, they must understand what attracts customers to a set of products and services while also acknowledging the features that drive satisfaction and retention. The bundling of new features and services isn’t always a winning strategy.
Topic: Rapid Customer Growth Leads to the Need for more Service Capabilities
Source: Forbes.com, February 14, 2017 (Link)
Commentary: It’s the age-old question: the chicken or the egg, what came first? Today, organizations are beginning to grapple with a modification of this riddle – the issue of customer growth outpacing the ability to deliver a customer experience worth staying. What should come first new customers or a customer service organization that can support these customers?
Organizations are often mature at marketing and selling to a prospect base which will come in the front door. The problem is, these same firms are finding it tough to hold on to these customers as their expectations outpace the service capabilities available. This article highlights how even the smartest executives of our generation (NOTE: Elon Musk) have been extremely innovative with products first, but need to also invest in the customer experience in order to make those innovations worth it for a changing customer base. Ease of use, service on the customer’s terms, and having an 800-number (SEE: article) are now minimal level requirements that customers demand. Service organizations can no longer think about their business from an operational perspective solely (i.e., how can we lower our costs, or be more efficient to get more jobs done in a day), they need to keep up with the tools and support capabilities which make customers want to renew, buy more, and tell others. I think the customer support team and strategy should come first, and let the customers follow!
Our Three Other Articles
1- The Most Desirable Employee Benefits (Harvard Business Review, Feb 15, 2017)
2- M&S’s Nathan Ansell on proving the value of customer experience (Marketing Week, Feb 10, 2017)
3- Hold the phone! Crap customer service cost telcos 2.9 BEEEELLION in 2016 (The Register, Feb 15, 2017)
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Till next week.