In the world of Customer Service and Support, services marketing and customer experience (CX) are individually very valuable (just like peanut butter and jelly). However, when they are combined into one coordinated effort, with the amount of each based on your current situation, the combination is wonderful (like a PB&J sandwich).
CX (Customer Experience)
CX deals with all aspects of measuring, analyzing, and taking corrective action about how customers feel about each interaction with the business. We do our thing using such tools as:
- Surveys: We ask our customers how satisfied with the various aspects of each transaction like calling in to solve a problem or did the service engineer do what they expected or were they happy with the time it took to get a replacement part. We also ask about how the customers feel about the overall relationship they have with our business.
- Analysis: Getting a pile of surveys is interesting but, until you can get the complete story, you cannot take any corrective action. Sometimes we look at the survey data, immediately see the problem, and maybe even the solution. And sometimes we combine survey data with either operational data or other external data in our databases (Big Data).
- Corrective Action: Once we understand the problem or issue, we can design and implement one or more fixes. Using controlled experiments, we can determine which solution works for your customers.
CX is a growing field with an ever-increasing body of knowledge that is helping all kinds of businesses improve the way they are perceived by their customers and prospects. This helps build loyalty and referrals.
Services Marketing
Services Marketing deals with creating, pricing and communicating information about service products (1 or more services bundled together). Services Marketing differs from product marketing because products and services have different attributes. The five most common attributes of service (according to Wikipedia), compared to products are:
- Intangibility: Intangibility describes the lack of physical evidence that the customer will receive, particularly in what are known as “pure services” (e.g., legal services).
- Heterogeneity: Also known as variability, this fundamental explains how each service encounter is different. Customers are the only people who can judge their satisfaction, and due to this subjective nature it can be difficult to standardize a service.
- Simultaneous Production and Consumption: Refers to the inseparability in the service environment between the production and consumption of the service. Both employees and customers affect the service outcome, implying that the customer is a co-producer of the service.
- Perishability: The immediate and time-bound nature of services means that they cannot be reused, returned, or resold, unlike product-based companies.
- Lack of Ownership: Services are experiential in nature, especially pure services. There is often nothing physical to take away from the service, relating back to intangibility. For example, at a theme park, you might get a ride photo to take home.
By creating enduring memories for customers, the company can try and build customer loyalty and help to overcome the lack of differentiation.
So, dealing with these attributes is challenging to say the least and explains why the service group of a product company frequently fails to get customer’s attention until it discovers and implements Service Marketing.
Combining Services Marketing and Customer Experience
The combination is critical for service businesses because customers have different expectations of the same service and so evaluate each experience based on a unique expectation. By combining the two fields we can design, measure, and improve our service delivery to maximize the likelihood of repeat business. As an example, point #5 in the description of services marketing includes these words – Services are experiential in nature, especially pure services. There is often nothing physical to take away from the service, relating back to intangibility. The only way you will find out if your customers are satisfied is by asking them, which is CX at its most basic! This probably explains why most CX initiatives are started by the Service Department of the company.
When it comes to designing, pricing and selling service contracts (a very intangible product), we use CX techniques to understand what your customers consider valuable, how price sensitive they are, and which subset of all possible services will resonate with different segments of your customer base. This is how you maximize your contract capture and renewal rates – which is the goal of all profit center (and profit center like) service businesses.
Are you still offering generic Gold, Silver and Bronze contracts or do you offer unique contracts focused on providing value to individual customer segments and create new growth opportunities? If you are still in the 3-tier world then contact Sam and find out how to update your offerings.