Is Customer Experience the New Marketing?

 In May, Telligent hosted a webinar with three guest speakers – Kate Leggett from Forrester Research, Inc., Lewis Simons from Cox Communications, and Brendan Cosgrove from Kaseya. While the official title of the webinar was Social Customer Service, a more apt title could have been Customer Experience (through Customer Service) is the New Marketing. This point came through loud and clear from all three speakers.

Kate Leggett started things off by sharing some of the research from Forrester Research, Inc. that really helps build the business case for social customer service. Ninety percent of customers surveyed by Forrester Research, Inc. consider customer experience critical to their company’s success with the majority of them believing its importance to be increasing.1 The facts support this feedback.

  • When there is a positive customer experience, 70% of buyers demonstrate a willingness to make a subsequent purchase2
  • 65% of buyers who had a positive experience are likely to recommend the product or company to others2
  • The direct effect of a positive customer experience, as measured by additional purchases, reduced churn, and word-of-mouth related sales, has been calculated in the tens of millions, and even billions annually for some industries2
    • $31 million for retailers
    • $590 million for airlines
    • $1.2 billion for wireless service providers
    • $1.4 billion for hotels

Given this type of direct financial benefit, one would expect customers are now routinely receiving a positive experience. Surprisingly, only 3% – down from 11% in 2007 – of buyers in 2011 had an outstanding experience. A mere 34% had good experiences.3 This indicates considerable opportunity for companies to differentiate themselves based on delivering outstanding customer experiences.

Lewis Simons continued the conversation by sharing his experience with Cox Communications’ January launch of customer support forums. The company opted to use forums as a vehicle for online support because more than one fourth of its customers had used an online forum in the past year to find information about a product or service. Cox understood that this is a communication channel to which more and more customers are gravitating to get answers.

In just four months, Cox is already seeing two primary benefits from forums. First, it is able to identify issues (that may be shared by multiple customers) faster than with offline methods. And once the issues are uncovered, the company can engage quickly to rapidly resolve issues. Second, customers helping customers (crowdsourcing) extends Cox’s support capability, improving customer experience by delivering answers to questions faster.

Brendan Cosgrove wrapped up the webinar by sharing some of the benefits Kaseya has experienced with its community over the last two years. To begin, Kaseya is more engaged than ever with customers.  The company experienced a 300% increase in the number of customers engaged. Often in support communities, companies become concerned with the sentiment of the engagement, expecting it to be negative since most customers in the community are experiencing challenges. However, Kaseya observed that 65% of all discussions, and 85% of the discussions of power users, have a positive sentiment.  This is a fantastic result considering that, in general, a large number of discussions receive neutral sentiment.

Kaseya has also benefited from crowdsourcing. Kaseya has seen 14 times more questions being answered in its community without the direct interaction of a Kaseya employee than they have experienced in the past.

Key Takeaways

Online social support communities have the potential to create tremendous value for companies that execute them well. Here are some final words of advice from our webinar speakers:

  • Be where your customers are (e.g. in online communities, accessible via mobile)
  • Deliver answers quickly, but make content readily available online (e.g. FAQs, how-to videos)
  • Integrate community into your overall customer experience strategy (e.g. with traditional support channels)
  • Listen, engage, be transparent and be personal

1 Forrester Research, Inc., "Best Practices Framework for Customer Service", 2011, May 26, 2011
2 Forrester Research, Inc., "The Business Impact of Customer Experience", 2012, March 26, 2012
3 Forrester Research, Inc., "The Customer Experience Index", 2012, January 23, 2012