Question: Think about 100 of your best customers. If that group of 100 good, loyal customers had one bad experience with your company, how many of them do you think you would lose? A couple? Maybe 10%? You will find the answer to this question, based on a new research from PwC, at the end of this post.
Have you ever stopped and considered just exactly what is it like for your customers or clients to do business with your company? You might want to think about that very deeply, as new research from PwC shows that three out of four Americans say that the customer experience is a critical factor in their decision to do business with you (or to continue to do business with you)…and this is a global phenomenon, according to the survey’s findings.
See key takeaways from this important research on your customers…
This latest study from PwC was conducted in 12 countries around the world and the results were remarkably consistent. The importance of the customer experience is growing over time, and more marketers are paying closer attention to how they can improve. Around the world, 73% of people in the 12 countries surveyed said the customer experience is “an important factor in their purchasing decisions.” [Countries participating in this survey includes: United States, Canada, Mexico, Colombia, Brazil, Argentina, U.K., Germany, China, Japan, Singapore, and Australia.]
But in the U.S., that number bumps up to a full 75% of respondents. Interestingly, 65% or almost two-thirds of respondents, said that a positive customer experience with your company is more influential to their purchase decision than great advertising. But unfortunately, less than half of the respondents say companies are doing a good job in providing a positive customer experience.
The Four Key Takeaways from This New Research
So there is certainly room for improvement for all of us. Here are the major takeaways we learned from this research:
- Speed & Convenience are Tops for Customers – Yes, there are many factors that customers use to determine just what constitutes a positive experience – the survey identified 18 different factors. But first and foremost, your customers want the process of working with you to be fast and easy.This lines up with data from a couple of other studies including research from the CMO Council which showed that consumers said the most important attribute of a great customer experience is a “fast response time to their needs and issues.” And yet another study from the Economist Intelligence Unit which discovered that “fast response times and a simple purchasing process are the leading elements of an ideal customer experience.”
- People Will Pay MORE for a Great Experience – Survey respondents told researchers from PwC that they are more than willing to pay a premium for products and services as long as they are delivered as part of a great customer experience. And the premiums that customers are willing to pay are pretty significant.The amount of premium that customers say they are willing to pay varies depending on industry. However, overall, survey respondents said that they are willing to pay up to as much as 18% more (coffee in the U.S.). They are even willing to tack on another 9% over already high cable subscription prices for a provider who can deliver a more positive customer experience.
- THIS is Important: Customers Say Employee Interactions are Critical – After speed and convenience, the next two factors respondents identified as critically important to the customer experience are Friendly Service and Knowledgable Service. How important is friendly service? Fully 6 out of 10 respondents said they would stop doing business with a brand if the service was not friendly.Let’s put a finer point on that – about 7% of the respondents said that “employees have little impact” on the customer experience. TEN TIMES that many, 71%, say that your employees have a “significant impact” on their overall customer experience. Not only that, but almost half of the survey respondents said they would stop doing business with any company if its employees weren’t knowledgeable.
This point, the importance of employees to the customer experience, bears further discussion. Testing that concept, the survey offered the statement, “Once technology becomes advanced we won’t need people for great customer experiences.” About 23% of the respondents “strongly agreed” with that statement. But more than TWICE that amount, fully 55% of respondents, “strongly disagreed” with that statement. Customers want to deal with people…friendly, knowledgeable people.
Even more data adds to the point…71% of the respondents said they prefer to interact with a human rather than with a chatbot or other automated solution. More than 8 out of 10 survey respondents said that they will want to interact with a real person MORE as technology improves.
- Generational Similarities and Differences – One thing I found interesting was that, in general, the findings tracked across all of the generations. It seems in this day and age, many experts keep calling out differences between them, but in regard to customer experience, all generations pretty much value that equally. However, there were some interesting elements that pertained specifically to Gen Z.In this survey last year, only 24% of Gen Z respondents reported that they “feel loyal to brands.” Now, just one year later, that figure rises to 40% – a significant uptick suggesting that Gen Z is beginning to get more involved in forming brand loyalties.
As we said above, generally, Gen Z wants the same things from their customer experience as do Millennials and Gen Xers…but there were a couple of interesting differences. For example, 63% of Gen Z respondents said they are willing to pay more for products from a brand that offers a better mobile experience (as compared to 54% of the overall respondents who said this.) Almost as many, 60% said they are looking for “fun” as part of the experience (52% overall). And almost that many again, 59% said that “design” was an important attribute of the overall experience for them (50% overall). Finally, 39% of Gen Zers said they value “trust” as an important attribute as well (28% overall).
This survey was conducted with 15,000 people in 12 countries by online survey and in-field interviews.
Bottom line, ask yourself this question: are we doing a better job than our competitors of delivering a superior experience to our customers, with fast and easy processing and friendly and knowledgeable support? If you don’t know the answer to that question, then you’ve got some homework to do.
ANSWER: The answer to the question posed at the top of this post is that you would lose almost a third of all of your customers (32%), based on just ONE bad experience with your company according to the data in the PwC survey. A surprisingly big number, I would say…and clearly showing how important the customer experience has become to your customers – even your good, loyal ones.