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Making More From Less

Alex Deckard
March 19, 2019 |

How to Better Align Expectations for Increased Customer Loyalty & Satisfaction

What drives customer loyalty? Turns out it is simply meeting customer expectations. In his book, The Effortless Experience: Conquering the New Battleground for Customer Loyalty, Product & Research Officer Matt Dixon found that customer loyalty is not increased through additional offerings or features. Instead, behavior and loyalty is driven most when a customer’s expectations are most inline with the end delivery. Furthermore, it turns out that one bad customer experience has a far greater impact on a brand or business than a similarly good experience.

So what’s this mean for us as a services agency? The better we can set customer expectations from the beginning, the more likely we are to meet them – thus increasing customer loyalty and overall satisfaction. Hence the million dollar question – “How do we better establish ourselves to meet expectations?”

Project Repeatability

The more repeatable a project is, the better equipped we are to address the potential “unknowns” that are present such as customizations, timelines, etc… We can accomplish this by reusing and building components that address common requests (such as our Magento Quick Order Extension). Furthermore, we can utilize templates and demos to quickly establish expectations as they relate to features and functionality.

In addition to adjusting our workflow and process to address repeatability, let’s also think about this from a sales perspective, ie; “How can we leverage existing projects and experience to win similar work?”

Project Specifying

Understanding what we can deliver on within the customer request is critical to being able to meet expectations. If we over-promise to win the work (be it timeline, functional, or resource specification), yet can’t deliver within the requirement, we are setting the project (and ultimately the business) up for failure. While it may seem like a short-term win to get that immediate revenue in the door, think about it from the long-term perspective with the following metrics (in the event we don’t meet expectations):

  • 81% – People are 81% more likely to leave a bad review from a negative interaction than a good review from a positive interaction.
  • 500% – It’s 5x more expensive to get a new customer.
  • 300% – Satisfied customers typically spend 3x their original investment.

In other words, every time we don’t meet expectations, customers are more likely to leave a negative review, we spend more money trying to replace that customer, and there is a huge opportunity cost in loss revenue from that existing relationship.

Better Defined Offering

The reality is we won’t (and shouldn’t) win every job. There will always be better options for some customers’ needs. By embracing this fact, and better defining our products and solutions up-front to meet the needs of our target market, we are more likely to win work and customers that lead to repeatable, successful, long-term relationships – which, as the above research shows, is more profitable than continually having to develop new relationships.

This means that there will be some clients who feel our offering isn’t right for them – and we should be OK with that, because if for every two or three jobs we may lose, the one that we win is more likely to be a success, thus leading to a more profitable, long-term relationship.

Remember, not only is it 5x more expensive to get a new customer, but satisfied customers spend up to 3x their original investment. In other words, on paper, revenue from one satisfied customer equals at the very least five unsatisfied customers (and this doesn’t even consider the opportunity cost or negative repercussions of a sale gone bad).

Alex Deckard

Alex has over a decade working as a web & UX designer with a strong e-commerce background. In his work, he takes pride in his ability to effectively communicate and relate design decisions to clients, as well as values, first and foremost, the client’s trust. When not behind a computer, Alex can be found roaming the vast expanse of the American West with his wife, daughter, and two dogs.

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