The Customer Service Survey

Customer Experience Doesn't Matter...Until it Does

by Peter Leppik on Mon, 2015-06-01 16:47

Consumer Reports is out with a survey today about cable TV companies. They had a couple of not-surprising findings:

  • Consumers hate their cable companies, and
  • More and more consumers are finding alternatives to cable TV

Both of these are well-known trends, and it's hard not to conclude that they're deeply related. For decades cable TV companies have enjoyed monopoly status in most markets, and since revenue growth was mostly a matter of selling bigger packages to existing customers and buying up smaller companies, cable companies have largely ignored their customer experience.

The result is a horrible service experience (which is not only bad for customers, but is also shockingly inefficient and expensive) and years of pent-up ill-will.

It's no wonder that when viable alternatives to traditional cable TV become available, customers started cutting the cord. This is especially true of younger consumers, who never got into the cable habit to begin with and don't see why they should spend hundreds of dollars a month for TV. For them, Netflix is much better and much cheaper.

Customer experience doesn't always drive revenue growth, as there are many factors which go into buying decisions. But customer experience does drive goodwill and loyalty.

In those industries where customers' choices are limited by things like the lack of viable alternatives and difficulty switching vendors (such as cable TV, airlines, banks, and mobile phone companies) it can be very tempting to under-invest in customer experience.

But that's a dangerous approach. If your customers don't like you, they'll head for the exits when an alternative becomes available. And it doesn't matter how deeply entrenched your business is: sooner or later there will be an alternative.

It's extremely difficult to turn around a bad reputation. So even if you think customer experience doesn't matter to your business, someday it will. When that day comes, will your customers be loyal? Or will they flee?

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