The worst time to let customer service slip is when the economy’s on the upswing. New research shows us why.
You might think it’s most important to amp up the customer experience when the economy is in a slump because that’s when customers buy less and are less willing to switch providers.
But on the contrary, customers think more about past service experiences — and let them affect their current and future buying decisions — when the economy is doing better, according to new research published in Marketing Science, a journal of the Institute for Operations Research and the Management Sciences (INFORMS).
“We find that customer experience matters more to customers when the economy is strong,” said researcher V Kumar, the Regents’ Professor at Robinson College of Business at Georgia State University.
Make improvements now
Researchers found that the companies that invest in increasing customer satisfaction, reducing failures and errors, and implementing efforts to recover lost customers during a good economy — rather than just riding the coattails of the good times — perform better than they would during lesser economic times. For example, researchers found that the same customer experience improvements yield a 10% gain in revenue in a down economy and a 20% gain in a strong economy.
Now’s probably as good a time as any to invest time and any resources you have into improving the customer experience. The best places to focus your efforts include:
- personal transactions. Customers measure the majority of the experience on how the person they deal with makes them feel. The key here is to allow front-line employees the time to work with customers and the authority to handle nearly all situations.
- mobile service. Nearly 60% of Americans have smartphones — and almost all of them expect to have the ability to get help at their fingertips at any given moment. Work with IT to start or enhance more services available on mobile devices.
