Is Amazon Making You a Lazy Shopper?

Let’s face it – in this age of convenience it’s easy to cut corners, and as a working parent of young kids, I welcome any opportunity to be ‘lazy.’ I’ve also noticed that over time I’ve continued to return to the products and businesses that make my life easier.

For example, I’m a huge fan of Target. I could spend hours in their store buying all sorts of things I may or may not need. But when it comes time to purchase a household item online, my default is always Amazon.

Why, if I love Target so much, wouldn’t I consistently choose Target as my retailer of choice? Their prices are comparable, they offer free shipping, and Target also has product reviews and comments.

My answer is simple – Amazon is easy. I can reach my end goal with the least amount of time and effort when I shop with Amazon. And let’s be honest, I’d much rather spend my time with my children then spend hours of time researching purchases online.

 

Why has laziness become so important?
“Busy” is the most common answer to the age-old question “how are you doing?” I hear that response so much that I try not to use it myself. Busy is the new normal, and according to Nielson, our quest for convenience is driven by two primary forces – new consumer challenges and changing lifestyles.

We are busier, more connected, and more on-the-go than ever. As a result, we are stressed, receive too much information, and constantly fatigued by the amount of complexity surrounding us.

While over time all these challenges have changed our lives, one thing has remained the same — we still have only 24 hours in a day and seven days in a week. As we work to prioritize our precious time, we need to reserve our mental and physical activity for the things that matter most. And, outside of big-ticket items like a home or car, that doesn’t include most of our purchases.

So going back to my earlier example, while I may be brand loyal and have an emotional connection to the Target brand, if it means spending more time with my loved ones, I’ll choose convenience (and Amazon) every single time.

 

How does a company like Amazon make my life easier?
While the definitions of ‘easy’ and ‘convenient’ are somewhat subjective, our research at The Verde Group suggests that most people view them similarly.

When we measured the ‘ease of doing business’ for a partner logistics company, we then segmented the results by age but found no statistical differences. The amount of perceived effort necessary to work with our client did not vary appreciably by age or gender.

This is good news for CX executives wanting to deliver a frictionless experience across their entire customer base. And they need to look no further than Amazon for ways to offer that simple purchase experience:

 

  • Customers want trustworthy information and Amazon provides that by encouraging customer reviews. They offer programs (the newest being the Amazon Influencer Program) that make it easy for social influencers to showcase and promote Amazon products.
  • Shoppers can quickly weigh their purchase options and can see all competing products on one page, with prices, features, and reviews. As a result, they feel a sense of confidence when making purchases, knowing that they have done their due diligence.
  • 1-Click ordering. Enough said.
  • Accessibility of customer support. In one place, customers can track their package, make a return, seek technical help, or report a problem. It’s easy for them to find help and to navigate to their end goal.

This last point is an important one. Our research has reported that customer service is a critical component of assessing ‘ease of doing business.’ In fact, we’ve seen up to 50% of all loyalty risk coming from customer support issues.

And that makes sense. If there’s a need to reach out to customer service, then most likely something has already gone wrong with a product or service. If a customer is already upset before speaking to someone, it’s easy to see how a poor experience (like a long hold time or information repeated over and over) can increase their frustration.

Knowing the potentially high impact this service interaction can have on customer loyalty, it’s critical that customer service receives the attention and resources needed to achieve satisfactory problem resolutions.

 

The lazier I get to be, the more I’ll buy from you. Am I alone in this evolution?
Don’t worry, you and I aren’t alone! When it comes to service, companies create loyal customers primarily by helping them solve their problems quickly and easily.

In the book “The Effortless Experience,” the authors report that four of the five drivers of disloyalty involve additional effort that customers are compelled to put forth. The Verde Group’s research confirms this as well. If a customer feels it is easy to do business with our selected client, then they are most likely to be a promoter of that company. And if the customer believes that the company is not easy to do business with, there is a high chance that the customer will be a detractor.

With that in mind, here are three steps to improve your customers’ laziness:

  1. Identify the points of friction in your purchase experience and develop a plan to improve those areas. Prepare to spend significant time diving into the customer service experience. Is that experience helping your customers solve their problems quickly and easily? What about your return policy?
  2. Learn what your customers are doing before, during, and after their shopping experience. Are they leaving your site or store to compare prices? To help your customers to make easy purchase decisions, you must start with understanding what they are doing today.
  3. Make “simplicity” the mantra of your customer experience. Across touchpoints, both online and brick and mortar, ask yourself: “is this experience simple for the customer?” If the answer is no, then go back to the drawing board.

These types of improvements in your customer experience are likely to increase loyalty, positive word of mouth, and customer recommendations. As consumers, we’re all “busy” and overwhelmed. The last thing we want is to have to jump through hoops to give a company our money.

If you’re like me, just keep letting me be lazy, and I promise I’ll keep coming back.

Sarah Pierce is Senior Vice President at The Verde Group

 

 

The Customer Experience Risk – It’s What You Don’t Know That Should Keep You Up at Night

The Verde Group - Customer Experience Risk

You may be like many executives who’ve had more than a few sleepless nights worrying about your customers. Particularly the customers with problems (and on average that’s 3 out of 4 of your customers – source: The Verde Group white paper) — the ones who light up the phones and fill your inbox with concerns, complaints, and helpful suggestions. Surely if you don’t act and fix their issues, they’ll take their business elsewhere, right?

It’s a common hypothesis that you should prioritize your initiatives around those known problems or the ‘squeaky wheel’ issues. The ‘known issues’ are causing friction in your customers’ experience and should be addressed, however, they may not deserve the resources or priority that you think.

In fact, it’s often the best, most loyal customers who bother to take the time to contact you and complain. And by and large, they’re not a flight risk. There’s a good chance there is no direct correlation between the frequency of customer complaints, the likelihood of retaining that customer, and the revenue impact to your business. This group of customers are passionate about your product or service, and they want to make it work.

How do you determine what the real customer issues are that may be financially impacting your business? With limited resources to address them, you can’t afford to get it wrong.

Majority of unhappy customers don’t complain. Over 67% of customers who experience a problem never tell the company about it. Customers cite “it’s not worth my time” and “they don’t believe that complaining will do any good because no one cares”. These are the customers who spread negative word of mouth and then vote with their wallet by taking their future purchases elsewhere. (source: The Verde Group white paper)

Where to start? Build a data-driven hypothesis
In a prior role, I was charged with building business strategies for a start-up SaaS company to reduce customer defect and maintain the very costly customers we worked so hard to acquire. It was early days in the subscription business model, and while we had a hypothesis as to why customers would defect, we didn’t know with certainty what was driving the churn.

We had spent a lot of time analyzing the customer complaints and surveys that came in through our support desk. We could tell you with confidence, the issues that our customers were experiencing.

But as we started to dig into the customer data points associated with that segment of customers (those that contacted us) we were surprised to see that they were some of our most engaged users. They were contacting us multiple times a year and using the product more frequently and recently compared to those customers who never contacted us.

The profile of these customers was contradictory of our institutional belief, so we had to learn more. Following a big subscription renewal period, we began to analyze the data points available on customers who defected. Did they purchase through a certain channel? Did they use specific feature sets?

Examining the data of our lost customers provided us with working theories as to why they left. But the data alone was far from providing us with the necessary insight to be able to put plans in place to reduce future customer churn. We needed to understand the context of the internal data points we were seeing. We needed to understand the “why” behind these behaviors.

Ask ‘what really happened?’
What you’re looking for here is the opportunity to have a genuine dialogue with your ex-customer — an open-ended conversation where you let them talk and share their experiences. It’s important to listen without pre-conceived notions of what the customer will say. Go in with an open mind and the only goal being to listen and learn.

Using the data you already analyzed, target specific segments of users when recruiting for the listening sessions. For example, one group may be users who showed great engagement with the product, yet still defected. This focus enables great efficiency in learning the root cause because you already have some insight into their behaviors.

Each user has a unique experience, but through qualitative research such as IDI’s or focus groups, themes will emerge that will provide the insight that you’re looking for. Often, they will introduce an issue that you didn’t uncover when reviewing the data and provide critical insight in doing so.

Socialize your learnings
At this point, you have detailed customer feedback in one hand, and objective, measurable data in the other. The customers’ experience with your product or service is end-to-end and holistic. What you learn through this process will not fit nicely into just one area of the business or function.

In order to put plans in place to address the top drivers of churn, you will need cross-functional support and leadership buy-in. This is a critical and often overlooked step in the process. Don’t forget that the insights you uncover may be completely new to this audience. It may take some time to help colleagues understand these “silent killers” and why they haven’t heard about them before.

Build your action plan
Now that you have organizational alignment, you’re ready to prioritize the issues you’ve uncovered and start building a plan to address those specific issues.

Start with what you consider to be the easiest fixes that have the most substantial revenue impact. Don’t overcomplicate the solution but rather stay laser focused and have clear metrics in place to measure the impact. It’s easy to start to have scope creep and before you know it you’re attempting to build a plan that is unattainable.

Clarity of ownership is critical in getting plans off the ground. Make sure everyone involved knows their role and expectation in solving the issue at hand.

After achieving some early momentum, move on to evaluate the business case the more complex, resource-intensive solutions.

No resting on your laurels
Once you’ve moved from a reactive mode to proactively addressing customer issues, don’t make the mistake of stopping, or even slowing down. You’ll need to repeat the data review/customer conversation cycle on an ongoing basis to stay in tune with your customer’s experience and keep raising the bar on your performance.

In the end, it’s not the customers who complain the loudest or most frequently that should keep you up at night. It’s worrying whether you really understand your customer’s experience and whether you’re truly addressing the issues that are financially impacting your business.

Of course, if you leverage your data, have genuine conversations with your customers (and ex-customers), build organizational support and create a measurable action plan, you might just sleep like a baby.

Sarah Pierce is Senior Vice President at The Verde Group.

Start Small To Create a Company-wide View of the Customer

The Verde Group - Customer Insight

I’m sure you’ve heard the ancient parable about the blind men and the elephant.

It’s the story of a group of blind men who encounter an elephant for the first time. They all touch a different part of the animal, then draw different conclusions as to what they’ve experienced. In some versions of the story, the men violently disagree and almost come to blows. The moral of the story, of course, is that people often form different conclusions based on a partial view of the same information.

This is precisely the challenge many companies have when collecting, analyzing and actioning their customer data for customer insight. How best to link multiple sources of data to capture a complete, holistic picture of the customer experience?

Islands in The (Data) Stream
For many companies, views of the customer experience are functionally focused. For example, the team in charge of packaging design understands everything about the customer’s perception of their packaging. Sales knows about product features and benefits and is competition-savvy. Customer service is full of experts about everything that can go wrong with the product.

Often, especially in large organizations, each of these teams captures, prioritizes and actions different (and incomplete) data about the customer experience. However, customers don’t view each of these areas separately — their perception of their purchase experience and the company as a whole is much more holistic.

From a company-wide perspective, this functional approach is wildly inefficient. It’s hard to know what to prioritize and take action on if you’re only focused on your small area and can’t see the big picture. It can lead to competing (and sometimes conflicting) action plans, duplication of efforts, and resources spread too thin to be effective. 

More Than a Systems Issue
A common theme, again in large companies, is to put the problem down to deficiencies in systems. With the mountains of data collected and stored, the refrain goes, it must be a systems limitation that prevents customer data from being pulled together into a centralized view.

It’s true that it’s difficult to consolidate disparate data sources like customer service data, transactional data or product usage. Systems issues are real enough. However, even more than systems, this is a leadership issue. Leaders must embrace the need for a complete, ‘single source of truth’ for the customer, and acknowledge that it’s worth the time, money, and organizational disruption to do it. It’s a long-term initiative and not an easy call for leaders to make, given other more pressing, short-term issues.

It may be easier for startups to implement the ‘single customer view’ as a priority than for established businesses. It’s simpler for smaller companies to build from the ground up — to agree on what data should be collected and how it will be shared and actioned. Startup mode gives these companies the luxury of building systems around the process, rather than the other way around.

Look at how Netflix has leveraged their data gathering and their understanding of the customer experience. By collecting and analyzing user preference information, the company can recommend shows they ‘know’ you’ll like based on your previous viewing habits. Moreover, armed with a holistic view of their customers, they are creating bespoke programming that’s almost certain to be a hit with their target audience.

Starting Small The Best Approach
Ironically, the optimal solution to tackling a customer view that’s too narrow is one that involves starting small and staying focused. Remember the elephant? Not that you would, but if you had to eat him, ‘a bite at a time’ is the right approach. The same goes here.

The idea is straightforward — pull together cross-functional teams and build agreement on a small number of ‘must-have’ customer data fields that you think are the most important and impactful to your business. Next, brainstorm about the best way to collect that data if you aren’t already, determine how it can be easily shared and interpreted even if it is a manual process while gaining traction with leadership/ Once the organization begins to see that there is consistency in how teams are looking at the customer experience, it is time to leverage that data and build coordinated action plans from your findings.

Once the cross-functional team has had success with limited data streams, you may see a snowball effect. Perhaps you started with a Top 5 list of must-have customer data fields, but the team can now see gaps and opportunities that lead you to expand the initiative.

While the cost benefits of this approach can be substantial — less duplicated effort means a lower cost of data collection — the real benefits to the organization are far greater.

This focused, cross-functional approach yields a single ‘true picture’ of the customer,  supported across the enterprise. Stakeholders share data and analytics and execute universal programs and get-well plans. The company develops a greater understanding of the customer experience, and that understanding is the key to building deeper, more meaningful relationships with its customers.

Sarah Pierce is Senior Vice President at The Verde Group.