Let’s say you set out to improve your company’s customer experience to drive better organization performance (kudos to you). What will be more important in attaining that goal: exceeding customer expectations, or solving customers’ problems?
That’s the question that came to my mind after reading Robert Passikoff’s recent article on Forbes.com, “The Final Frontier: Customer Expectations.” Passikoff points to a shift in the past 15 years: customer expectations have increased significantly, rising 24 percent in all categories. That number has increased even more in the technology sector. An entire book could be written (and probably has been) on why customers’ expectations are on a sharp upward trajectory.
But my question is not the focus of Passikoff’s article. He notes that measuring customer expectations is a tricky business and turns to customer loyalty as a correlating metric. After explaining how customer loyalty is measured and providing an example from the wireless carrier industry, Passikoff concludes, “… brands that are able to better meet – even exceed – growing customer expectations always end up on the top of the list.”
Fair enough. On the surface, it’s a good point, and one that seems hard to argue with. But I’m going to argue it anyway. Because here’s the thing: Customers seek out businesses because they have needs, and they expect those businesses to solve those needs. The business either solves the problem, or it doesn’t. Period. End of story.
Expectations are like averages; they don’t exist in the real world (only in your customer’s mind, and perhaps subconsciously at that). Therefore, to “exceed customer expectations” is a weak goal. I’d go as far as saying that expectations are a “false god,” sapping a lot of focus, energy and resources from what should always be the goal: solving the customer’s problem.
Passikoff started a great conversation about customer expectations and satisfaction, but then took us down a road that’s essentially a dead end. Tying customer loyalty scores to customer expectations is not the answer. Why? Loyalty scores are important, but they don’t take into account all the reasons customers stick with a company. The “how well” question is the field of loyalty. The “if/if not solved” is the field of performance.
Take the example in Passikoff’s article that examines how wireless carriers rank on the Customer Loyalty Engagement Index. AT&T came in first, followed by Verizon, Sprint and T-Mobile (in that order).
Passikoff notes that this list correlates very highly with customer behavior, such as churn figures, and that, according to the latest data from the Better Business Bureau, AT&T had the fewest complaints and lowest complaint rate of these four wireless providers. All this, even though there was speculation last year that AT&T would see an exodus of customers to Sprint and Verizon when the iPhone became available on those carriers. It didn’t happen; AT&T continues to outsell Sprint and Verizon.
Although these numbers seem to confirm the Customer Loyalty Engagement Index’s ranking, there’s something the data does not reflect: captive customers. I happen to be an AT&T customer, but I am is because I can’t get out of my contract, and when I’m at a point where I can, it’s difficult. So, I perceive I am stuck – loyal, but captive.
How many people are in the same boat as I am? Locking customers in prohibits a measure of loyalty AT&T should trust. Until we come up with a “complacency” or “frustrated and stuck” index and begin dissecting truly loyal, enthusiastic consumers from those who don’t have the time or resources to navigate the breaking of a contract, loyalty is one metric—but not the most important metric we can fully trust to drive improvements in customer experience and organization performance.
Which brings me back to a goal we can trust: solving the customer’s problem. AT&T solves my need for road-warrior connectivity and that’s why I show up in the positive in their revenue and profit performance.
Now, think about the problem or need your company exists to solve. The desire that triggers them to act. Do you know how often, and how well, you solve that need? Do you provide an effective solution? This is where we should focus our time and energy: On solving our customers’ problems.