Inside the 2018 Gladly Customer Service Expectations Report

The formula for good customer service is pretty simple.

Customer service quality is the extent to which the experience meets the customer's expectations. So consistently meet expectations without falling short and you're doing well. Exceed expectations occasionally and you can elevate the perception to "outstanding."

Of course, you have to know what customers expect.

The customer service platform Gladly shares a range of customer expectations in its 2018 Customer Service Expectations Survey. The report surveyed a group of 935 adults whose demographics roughly mirrored the U.S. population.

Here are a few insights that really stood out for me.

Graphic with the words “Do you know your customers?”

The Impact of Service Failures

You've probably seen research that poor customer service is bad for business, such as this report from NewVoiceMedia that pegs the cost at $75 billion per year.

Gladly's report adds some new, deeper insight.

It found that 76 percent of customers are willing to give a company another chance after a service failure. That number drops to just 8 percent after three service failures.

Chronic issues can really impact a company's bottom line. There's the obvious impact of lost business, but companies can suffer other damages as well.

The Gladly report found that 67 percent of angry customers will actively try to dissuade family and friends from doing business with a company. This jibes with research from Dr. Venessa Funches who found that 70 percent of angry customers will spread negative word-of-mouth.

Customer impact aside, repeatedly addressing the same issue is expensive. If a company's cost per contact is $5 and an issue is solved on the first try, that issue costs $5. But if it takes three tries, that costs jumps to $15 while the likelihood of lost business, goodwill discounts, and other expenses also increases.

This makes it critical for companies to capture customer feedback and use it to root out chronic problems.

Customers Rely on Reviews

The report found that 55 percent of customers rely on customer reviews to make purchasing decisions, compared to 36 percent who rely on family and friends.

This is a lost opportunity for many companies. Many organizations, particularly large ones, routinely ignore online reviews.

There are three big reasons why you shouldn't!

First, most online review platforms are a form of social media. So your conversations with customers aren’t just between your company and that customer—anyone listening in can see your response. Replying to an angry customer may or may not win back that individual, but it will send a signal to other potential customers.

The second big reason is these reviews provide tremendous insight. If customers are repeatedly calling out the same problem in your business, it's probably time to address it!

The third reason is you can use reviews to drive traffic to your business. For example, an active Google My Business profile can help boost your company's search results.


Step Up Your Contact Center Game

Contact centers clearly have a lot of room for improvement.

  • 98% of customers try to bypass IVR to get straight to a human.

  • 87% of customers are frustrated by having to repeat themselves.

  • 76% receive conflicting answers from different agents.

Let's take a look at each of these.

While IVR was once a useful tool, today it is mostly annoying to customers. A separate study by Mattersight found that 66 percent of customers who called a contact center were already frustrated by the time they got a live agent on the phone. It's important realize customers are likely calling because they've either tried self-service and failed or they believe a live agent is the best way to handle their issue.

Another big issue for customers is having to tell their story over and over again. If a customer emails about an issue, tweets about it, and then calls, many companies lack the omnichannel technology to give the customer service rep insight into those previous interactions. To the customer, telling their story yet again feels like salt on the wound and only amplifies their frustration.

Finally, agents need better information. 

Conflicting information can have disastrous consequences, such as when a Spirit airlines customer service rep mistakenly told a passenger she could bring her pet hamster aboard a flight. Once the passenger arrived at the airport, she was told by the gate agent she could not in fact bring her hamster on the plane.

The story ended tragically with the passenger flushing her pet down the airport toilet.

Take Action!

A good place to start is to identify your company's most chronic customer complaints. What causes the most dissatisfaction? What issues are more likely to trigger repeat contacts?

Get a handle on those and you'll likely improve service, reduce costs, and add more positive word-of-mouth.


How Demanding Extras Can Undermine Service Quality

It's interesting to read other people's customer service stories.

There's often a valuable lesson involved. But, I'm also fascinated by how these stories are written. They typically follow a three step logic process:

  1. The author is a perfectly normal, reasonable customer.
  2. Company X does something astonishingly bad.
  3. Don't be like Company X.

It's the first point, "The author is a perfectly normal, reasonable customer" where many of these stories go off the rails. 

Unreasonable Customers

Here's an example from a well-respected author. She detailed a service failure where she was dining with her husband and had ordered a glass of wine with her meal. The author explained that she drank all the wine before finishing her meal, so she asked her server for a little more.

The author expected the wine to be free. 

She was incredulous that the server wanted to charge her for an additional glass of wine, even though she didn't want a full glass. 

The point of her story was about empowering employees to assess the situation and provide extras when warranted. It's a good point.

But, the author also did what many customers do. She undermined her own service experience by demanding something extra and then getting upset when she didn't receive it.

She hurt her credibility by writing about it as if her server was clearly in the wrong.

 

What Should Customers Reasonably Expect?

A customer's perception of service quality is a function of how the experience matched the customer's expectations. On a basic level:

  • Good service is when the customer's expectations are met.
  • Outstanding service is when the customer's expectations are exceeded.
  • Poor service is when the experience falls short of the customer's expectations.

This makes expectations crucial to customer service. A customer with unreasonable expectations is much more likely to receive what she perceives as poor service.

So, what's reasonable?

On a broad level, customers can reasonably expect to receive the products and services that a company promises to provide. 

It gets trickier when a customer wants something that's not explicitly promised.

Let's use the author's restaurant example. The restaurant sold wine by the glass. If a guest orders a glass of wine, it's reasonable that she would expect to receive a glass of that wine at the price listed on the menu.

It would also be reasonable to say that if there was something wrong with the wine, the customer could immediately send it back for a replacement without being charged.

But, what about asking for more than a glass of wine but less than two glasses?

The author made it clear she would be willing to pay for a second glass of wine if she had wanted that much. But, she wanted less than that so she expected it to be free. She requested what essentially amounted to a free sample or a bonus portion.

Some restaurants actually address this directly. A typical glass of wine contains five to six ounces while a taste of wine (like you'd get when visiting a winery) is usually about two ounces. So, a few restaurants have glass and taste prices for wines on their menu. (This restaurant apparently didn't have this option on the menu.)

I don't fault her for asking. But, I think the author was wrong to be upset when she wanted something that the restaurant never promised her.

 

Where Do Expectations Come From?

Just as the author was being unreasonable to demand free wine, it would be unreasonable to expect all customers to be reasonable!

So, it's helpful to understand how customers develop their expectations so we can help them avoid these types of situations.

Customers generally develop their expectations from four primary sources:

  1. Our communication to the customer
  2. The customer's past experience with us
  3. Word-of-mouth from others (includes online reviews)
  4. Experience doing business with other companies

Let's go back to the wine example. Can you think of ways that any of these expectation sources might have influenced the customer to expect a free taste of wine?

Two jump out to me:

The first is number two, the customer's past experience. Many restaurants are perfectly willing to give you a free taste of wine before you order a glass. It's a way to allow customers to try a wine before they buy it. 

If the restaurant had done this with the author, it would make more sense for her to expect a free taste. 

The second expectation source that may have influenced the author is number four. Perhaps she had gotten free tastes before buying a glass of wine at other restaurants. Or, she may have recently dined at a restaurant that had pricing on the menu for two ounce pours. 

Again, her expectations would be more understandable if she had had one of those experiences.

 

Resources

Dealing with unreasonable customers is a big challenge for customer service professionals. Here are a couple of resources to help you navigate through these situations.

One is Adam Toporek's book, Be Your Customer's Hero. It was written to provide practical advice directly to frontline employees. Chapter 59 focuses on this issue direction, "Focus on what you can do, not what you can't."

There are also two training videos on Lynda.com. 

The first is How to Manage Customer Expectations for Frontline Employees. It focuses on effective communication techniques for situations like the one where the author demanded free wine.

The second is The Manager's Guide to Managing Customer Expectations. This video addresses the issue from a manager's perspective by providing tips for preventing situations where customer expectations go unmet.

You'll need a Lynda.com account to view the full videos, but you can get access with a 10-day trial.


Customer Experience Success Story at AT&T

Customers view service relative to their expectations. 

  • Good service meets expectations.
  • Poor service falls short of expectations.
  • Outstanding service exceeds expectations.

Here’s an email I received from my friend Larry. He expected to receive poor service from AT&T, but was pleasantly surprised in several ways.

Hey Jeff,

I wanted to share a GREAT customer service experience with you.

While I was out of town this weekend there was a power outage and I thought I lost my internet modem. I have not always had the best of luck when dealing with AT&T and am quick to say it. But I want to also be quick to point out my good experience.

First, I went to the local store. I got there about 15 min before they opened at noon. The parking lot was packed and there was a line at the door. 

When the door opened at noon, it was an amazing sight…there were a ton of employees inside and everyone who came in the door was immediately greeted and helped. No waiting at all. This caught my attention in a positive way.

I was met by a young lady who took me to a table and I explained my problem. We trouble shot the modem and immediately determined that it wasn’t the modem, but the power cord. We got the cord from another new piece of equipment and everything worked just fine. 

A power supply costs $10. A new modem costs $100. I asked for the $10 option. 

Initially she suggested we order one and I could have it come to my house or to the store and pick it up. She was unable to find the part # for the cord, and went to ask for help finding it. 

After a few minutes, she came back and I asked if there was a cord in the store I could borrow or rent for a few days until it arrived. She didn’t object and tried to order the cord for me. After another couple minutes, she just took my broken power cord and replaced it with the working one from the new modem box without charging me and said they will fix it on their side because she could not order a new one.

This is a great example of a front line employee taking the initiative and going above and beyond to FIX a customer issue. Instead of being without internet for several days or having to unnecessarily purchase a new piece of equipment. I was out of service for a couple hours and left a very satisfied customer who wanted to share that experience.

I am also sharing this on FB.

~ Larry

Notice how expectations played a role in Larry’s experience.

Larry’s initially low expectations made it easier for him to be pleasantly surprised by good service.

He was worried about wait times when he saw the large crowd. Excellent staffing levels allowed Larry to receive service much faster than he expected. 

Larry expected to pay for the repair. The associate took the initiative to find a solution she was empowered to deliver and gave Larry a replacement power cord at no charge.

These pleasant surprises prompted Larry to share his experience with AT&T on Facebook and with me. It all came down to one customer, at one store, served by one associate.

AT&T promises smart, friendly, and fast service at their AT&T stores. It sounds like they delivered. Here's a video describing the promised customer experience:

Outstanding customer service you'll never notice

Our regular UPS driver came to the door yesterday afternoon. I had to sign for the package because he was delivering a shipment of wine. As I was signing, he remarked that the package had the wrong address on it. "I'm glad you knew where to bring it!" I said.

He replied that it was easy for him to track down the correct address because of my unusual last name and the shipment contained wine. (Yes, I am a huge wine enthusiast: www.sharethebottle.com.) 

I paused for a moment to think about what had just happened as I brought the wine in the house. The wine shipment had arrived just as expected. That by itself wasn't amazing, but the fact that it arrived on time was due to the actions of a very alert UPS driver who knew the regular customers on his route. He took extra initiative to ensure my expectations were met.

Could it be that some of the very best customer service happens behind the scenes? 

Customers tend to notice service service that is either exceptionally good or exceptionally poor. We are unlikely to notice when things go exactly the way we expect them to. 

What would have happened if the UPS driver had not taken the initiative to deliver my wine to the correct address? The shipment could have been delayed a day or two while a customer service representative tried to track me down. I might have been inconvenienced if I had to go to the UPS station to pick up the package instead of it being delivered to me. The wine might not have been delivered on time for an upcoming party if it took too long to resolve the problem.

All of those situations would have landed squarely below my expectations. I would have likely been upset at the winery, UPS, or even both. 

Instead, I'm happy.

How many times do unsung customer service heroes spot a problem before it occurs and just fix it? When it does happen, the experience will likely register as "average" on the customer's radar, but we should all agree that the effort was outstanding.