The decision by Bundeskartellamt, Germany’s competition authority, to rule against Facebook’s plans to merge user data from Messenger, WhatsApp and Instagram is hugely significant and perhaps the first step towards the separation of data from the digital monopolies.
The proportion of people expecting to spend more post-Brexit has doubled compared to just six months ago, according to the Institute of Customer Service. This can be attributed to higher inflation, a fluctuating pound pushing up import prices and expected slower jobs growth, squeezing household spending on products such as food, alcohol, tobacco and clothing.
At the same time, consumers reported they would choose to pay an average of 17% more for outstanding customer service. Despite uncertainty about the future, customers are willing to increase spending in exchange for a positive experience with a company. This gives businesses food for thought.
Firstly, company directors should be asking themselves which factors contribute to a positive customer experience. For instance, research commissioned by Yonder Digital Group in January this year found that human interaction, as well as a choice of live and digital contact points, remains critical in the customer journey.
Secondly, companies should consider how to encourage more positive feedback. When a customer is extremely satisfied with the way a company deals with their query, a glowing review on social media or to family and friends goes a long way in creating brand trust. However, the received wisdom is that consumers have a negativity bias and predominantly take to Twitter when they have a bad experience with a company.
Yonder set out to take a closer look at this by surveying 1,000 UK consumers, asking them to affirm whether they share good and bad customer experiences, and how they share these experiences.
Passing on positivity
As social media posts reach large numbers of people at once, from close friends and family to acquaintances and virtual connections, we have become a society that delights in sharing experiences of all kinds; in particular, Instagram’s 600million active users share scenic holiday pictures, beautiful plates of food and well put-together outfits. What these posts have in common is their overall positivity, encouraging fellow social media users to click the ‘like’ or ‘share’ button.
Social media has changed the consumer mentality. This is confirmed by Yonder’s research, which found that more respondents post about good customer experiences (38%) on social media than bad ones (31%). Businesses fear bad reviews online but, contrary to common perceptions, companies who are delivering excellence in customer services are in fact getting more coverage than companies behind the curve.
One example of this phenomenon is TripAdvisor, a site enabling users to post travel-related reviews. The volume of reviews and opinions on the site increased from six million in 2006 to over 350 million in 2016. Of these, the majority are positive, with the average rating more than 4 out of 5.
Word of mouth prevails
As social media becomes ever more pervasive and visible in our daily lives, it is easy to assume that it is the preferred channel for customers wishing to discuss an experience. Yonder’s research found that, on the contrary, a far larger proportion of people tell friends and family about a good customer experience (89%) than post about it (38%).
There is no digital replacement for the satisfaction of telling a friend about compensatory vouchers received after a long delay, a friendly conversation with a customer services agent who goes the extra mile, or unexpected complimentary products. Rather than a perfunctory rating, this anecdotal experience-sharing is more detailed and personal and, therefore, more memorable.
How then can companies encourage customers go away and discuss their experience with others? Customers should be made to feel valued; they should feel that their journey is as effortless as possible and that any marketing they receive is relevant and tailored. Further, previous Yonder research found that customers increase business with companies providing a speedy, efficient service across channels, and these loyal customers are then more likely to recommend the company to others.
Does age matter?
Yonder’s research affirmed that younger age groups are more likely to share experiences digitally, finding that 25 to 35-year-olds are almost three times more likely to post about a good customer experience than 55 to 64-year-olds. It is not surprising that more digitally-savvy generations instinctively reach for a smartphone or laptop when they want to share a thought, but does the same disparity exist when it comes to word of mouth?
In fact, the proportion of consumers using word of mouth to tell each other about positive brand experiences is consistent across all age groups, with more than 80% confirming they pass on good reviews verbally. Focusing on social media and making assumptions about age will not therefore lead to a real, in-depth understanding of customer preferences.
On the other hand, rigorous, objective analysis of customer data produces useful insights, such as preferred means of contact, which can then be used to serve customers better, market to them more effectively and even produce better products. When customers provide information about themselves, it should not therefore be left to languish in company databases; good practice data handling should be applied in order to create customer profiles and a 360° view of the customer’s journey.
Instead of complacently hoping that customers won’t post or pass on bad feedback, businesses should be proactively encouraging positive experience-sharing. This involves a comprehensive and strategic approach based on concrete analysis rather than general assumptions, enabling overall improvement of the customer journey. Yonder’s research shows that while digital platforms and tools are highly valuable in creating a good experience for customers, the human element remains vital, from the beginning of a purchase right until the end, when happy customers then go on to share their experiences with others. To achieve long-term success, companies must ensure their customers feel cared for, from beginning to end.
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