Why bother spending large sums of money on advertising and other forms of marketing communication when you can get your customers to spread the word for you, far more effectively and free of charge?
This is the question spurring many companies to search for the secrets of customer satisfaction – and hence staff motivation, the foundation for achieving customer satisfaction. Yet, according to new research by communications consultancy MCA and Mori, companies still have a long way to go before they can boost customer satisfaction levels.
Forget service with a smile. UK companies are still contending with service with a snarl. Treatment of customers by staff is the number one turn-off factor for customers, and with one in six saying bad treatment has put them off purchasing a company’s product or service in the past three months, things are not looking hopeful. This level of dissatisfaction rises to over one in five for consumers aged under 35, ABs and households with income above &£30,000.
When quizzed about their experience of 12 key benchmarks of staff brand ambassadorship (such as showing a genuine interest in helping; having the knowledge and skills to do the job; appearing committed to doing their best; showing appreciation for the customer’s interest/purchase; and showing pride in the company’s products or services) one in five consumers said they hadn’t experienced any at all.
Over 50 per cent complained that in services such as banking and travel, and in sectors where products are sold which require more assistance (such as computer hardware and software, household electrical items and furniture), the staff did not have the knowledge or skills to do their job well. Over 80 per cent did not think the staff they encountered were enthusiastic or showed pride in their product or service.
MCA chairman Kevin Thomson says: “It is hardly surprising that one in six consumers has been put off from making a purchase, when such a high proportion of staff are seen to be unhelpful, unappreciative, unwilling to give their best, and lacking in pride for their company.”
What is more worrying about these figures is the correlation between consumer experience of these service benchmarks and the willingness of consumers to make a repeat purchase or recommend the product or service to another without being asked. Simply, the more service benchmarks consumers experience, the more word of mouth recommendations they make.
If a company notches up four or more brand ambassador benchmarks, for example, the recommendation rate rises fivefold to over 50 per cent, when compared with the recommendation rate for a zero-rated service. Likewise, companies which have succeeded in offering four or more brand ambassador benchmarks increase their likelihood of a repeat purchase by more than double, from 31 per cent for a zero-rated service (where, factors such as quality and price make repeat purchase worthwhile), to 76 per cent for a four benchmark-rated service or higher.
Unfortunately, only one in five consumers said they had experienced a service which achieves four service benchmarks, suggesting that many companies are failing to put the strategies in place to enable their customers to feel satisfied.
Thomson says: “Companies that can get their employees to act as brand ambassadors have a unique competitive advantage. If a company hasn’t got brand ambassadors it is destroying its value.”
But this is not necessarily true. With the rise of self-service supermarkets, petrol stations and cashpoints – and now Internet shopping – the type of service many customers seem to like the best is self-service. It puts customers in control and saves companies a lot of money. Amazon.com customers, for example, never speak to, or see, an Amazon.com employee, yet its customer loyalty is high. For some, therefore, the way forward may be to automate personal service out of the equation, rather than tackle the subject of how to motivate brand ambassadors.
But wherever automation is neither possible nor desirable, the challenge of encouraging brand ambassadors is unavoidable. MCA and Mori have some practical tips. Mori researcher Peter Hutton suggests developing an understanding of the links between employee satisfaction and customer satisfaction through joint and integrated marketing and human resources research projects. But Hutton also warns that sharing budgets in this way can lead to problems because it does not fit with the way directors traditionally do business.
MCA marketing director Lorrie Arganbright adds two more suggestions: feed research into customer attitudes towards employees back to the staff concerned, and have a definite view and statement about what the brand values really mean.
But tips such as these only scratch the surface. Because brand ambassadors only thrive in certain work cultures, fundamental change is needed to many companies’ prevailing management styles. A 1998 MCA/Mori research project, for example, concluded that “low levels of commitment and understanding are endemic across all levels of staff”, including managerial levels. Only a quarter of employees questioned were strongly committed to helping their organisation succeed. Thomson argues: “Customers are experiencing the side-effects of low levels of staff employment.”
Arganbright adds that getting staff to be enthusiastic about a brand “requires looking at the nature of the relationship between the organisation and its people. Yet, in many organisations, this relationship is tenuous and does not function well”.
This problem is doubly compounded for the many organisations which rely on retailers, dealers or franchisees to sell their products. How can these companies persuade people they don’t even employ to become ambassadors for their brand?
Fred Reichheld, the loyalty guru, has one answer. “The only way to get your customers and employees to be loyal to you is for you to be loyal to them. Share the upside with them,” he told the Institute of Direct Marketing’s recent symposium.
In other words, see marketing less in terms of efficient and effective selling messages and more in terms of constructing win-win systems that align the goals and incentives of organisations, their value chains, staff and customers. This is what that seemingly innocuous phrase “word of mouth” adds up to.