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How Customer Experience Failures Effect Business

Whether it’s an unhappy customer in the service drive because the repair is taking too long; or a customer in sales for 4 long hours attempting to buy a car and less than happy as a result; or a customer making a post-purchase call to report issues with a vehicle they just purchased; dealership managers can sometimes feel as if they are constantly putting out fires and that everyone is unhappy. Sometimes the problem gets addressed to the customer’s satisfaction -- sometimes it doesn’t. You can’t please everyone, right? So what happens when you can’t?

 

A study conducted by SDL asked 2,784 consumers if they could recall their major customer experience failure in the last 10 years. Of those surveyed, 76 percent reported that this experience occurred in the last 2 years. Of those, only 55 percent could remember a good experience. The good news is that only 6 percent of those surveyed indicated that their worst customer experience involved the automotive industry. This certainly makes sense when you consider the frequency a customer visits a dealership, as compared to other retail businesses such as grocery stores.

 

An interesting statistic from the study is that the failures most often happened after the sale (32%). While the remembered successes happened during the shopping or purchase phase. This would seem to align with feedback we encounter from consumers in the auto industry. Think about your online reviews. I would venture to guess that the majority of your positive reviews tell the story of an excellent BUYING experience. While the majority of your negative reviews discuss post-purchase failures.

 

So, what are consumers saying are their biggest customer experience failures? The top four answers include long waits or poor response times (35%); employees not empowered to assist them (31%); unknowledgeable employees (30%); and conflicting or inaccurate information (29%).

 

By contrast, the consumer experience success stories showed the exact opposite with the top three being that employees were pleasant and helpful (35%); employees were knowledgeable (27%); and employees empowered (24%).

 

Something to think about is that these very same traits are directly related to the automotive buying experience. Think about those Internet leads that aren’t responded to at all, or if they are the response is too slow. Or, a failure to give customers the information promised (mainly price). Or sales associates that can’t provide information. The “just get them in” attitude is a relic and customers simply aren’t biting on it anymore. Car shoppers have access to more information and choices on where to buy a vehicle than at any time in history.

 

When a failure does occur, the younger the customer, the more likely they are to simply walk away and never patronize a business again. The older a customer is the more likely they are to want a solution. These failures are costly, too. Businesses can only win back a customer 20 percent of the time (1 in 5). And, if they do come back, they are 59 percent less loyal than they were before.

 

In addition, businesses who fail their customers will lose 65 percent of the revenue they would have received from that customer in the year after the fail. The sad part is that, of these failures, 24 percent could have been fixed for less than $20 -- or one-hour worth of work. And it gets worse. 64 percent of failed customers will stop recommending the business and those with the capability to do the most damage to a business’ reputation – namely those with large social media footprints – will broadcast these failures more aggressively. These are the customers that are anti-brand advocates on Facebook, Twitter and online review sites viewing their crusade against a business as a means of HELPING other customers by sharing their poor experience.

 

The news isn’t all bad, however. While the consequences of leaving a customer failure unrectified can be costly, there is light at the end of the tunnel. The study compared what these customers SAY will win their business back, versus what will REALLY win their business back. The top answer was the same – if the business owned the failure, admitted their mistake and showed the customer that their poor experience helped the business improve.

 

We’re not perfect and things happen. As you can see, it doesn’t take much to win a customer back or rectify a failed customer experience. The first step towards avoiding these failures is ensuring that the customer experience during the purchase phase is great. Respond quickly, provide information, empower your employees and provide accurate information. Doing these things will exponentially increase the odds that you create brand advocates. When you do fail, simply suck it up, be humble and fix the mistake. That’s all most customers want from a business. Allowing ego or policy to prevent you from satisfying a customer’s issue can result in future revenue loss and seeing these consumers standing on a virtual mountaintop warning others against doing business with you. And it’s much easier to soak in a customer’s praise than silence an unhappy one.

Views: 53

Tags: SDL, automotive, customer, dealership, experience, failure, loyalty, retention, social, study

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