Consumers are willing to pay for better customer experience
September 27, 2017
Consumers today, are spoiled for choice. If they want to buy something, they can get it from ten different businesses. This doesn’t affect them, it affects your business! One of the best ways to ensure your sales don’t dip is to offer a great experience.
66% of consumers discontinue using a brand due to poor customer service.
Kan- tar-IMRB survey for American Express
Product features and prices can be quantifiably and objectively measured, and delivered to consumers. But there’s one element which differs from business to business, and that’s the way you treat your customers along their conversion journey and how they feel about it.
But what’s interesting here is that consumers are actually willing to pay more for a product, if they are guaranteed a great experience.
Consumers are more empowered than ever
Consumers are in command of their own buying journey. Today, they don’t wait for business marketers to provide them with information on products and services. According to research by Chain Store Age81% of consumers conduct their own research before interacting with a brand and making a purchase.
A typical consumer knows what products or services they need, what options they have, why they should be opting for a brand and what more can they avail from the business.
Word-of-mouth marketing is trending
When consumers don’t receive the experience they desire, they spread the word – through phone calls, on social media, via surveys and more. By 2020, a fifth of consumer sales will happen through word-of-mouth marketing, and that’s something all businesses have to adapt to sooner rather than later.
When customers share their story, they’re not just sharing pain points. They’re actually teaching you how to make your product, service, and business better. Your customer service organisation should be designed to efficiently communicate those issues.Kristin Smaby, customer service expert
No wonder, businesses have to make extra efforts to keep their customers happy.
Consumers most likely to pay for a better experience
According to BW Disrupt, 8 out of 10 consumers will pay a premium for a prompt service in return for a better customer experience. Marketing Week also states that consumers aren’t looking for over the top experiences. 62% of them are willing to pay more to businesses with a simple proposition and experience.
Yet, almost 31% of businesses face a challenge in keeping up with the consumer’s expectations. With technology and the digital landscape evolving at a faster pace, it is only getting tougher to impress the consumer market with an omnichannel experience.
Hook the existing customer to drive sales
A Medallia study reports customers who rate an experience higher, spend 140% more than those who have a poor experience. Another report by Capgemini states that 81% of consumers are willing to pay extra to a business that guarantees a better customer experience.
Although your customers won’t love you if you give bad service, your competitors will.
Renowned business trainer Kate Zabriskie
Always remember: in most cases, majority of your business comes from your existing customers. Therefore, there is a clear opportunity for a business to make better use of resources to treat every consumer as an individual and deliver a good experience.
Disconnect between business offerings and customer expectations
A June 2017 Capgemini report clearly states that customers get frustrated by businesses that don’t respond to their feedback or compliments in the online channel. The report notes that 1 in 5 consumers stopped purchasing from a company after a poor experience.
The report also stresses that there’s an absolute disparity between what the business offers and what the average consumer expects. A few reasons for this disconnect are as follows:
- Evolving customer technology landscape
- Lack of training for an omni-channel customer-facing service
- Evolving customer behaviours
- Lack of customer experience budgets
- Internal ownership of the digital customer experience
Creating goodwill with customers requires an ongoing investment in customer experience technology. With customer expectations evolving at a frighteningly rapid pace, it is necessary for businesses to maintain momentum.
As serial entrepreneur and bestselling author Gary Vaynerchuk aptly puts it,
You have to be no less than a customer concierge, doing everything you can to make every one of your customers feel acknowledged, appreciated, and heard. You have to make them feel special.
Customer experience can have a major impact on any business’s bottom line. Investing in customer experience technology, staff training and the correct business intelligence systems offers a huge return on investment:
- Increase in the amount of money a customer is willing to spend.
- Increased customer loyalty and ‘lifetime value’.
- Positive word-of-mouth marketing.
By ignoring your customer’s experience expectations, every one of the above advantages can very quickly turn to a major disadvantage. Lower sales, loss of customers and negative marketing.