Katharine Biggs, Content and Marketing Manager at parcelLab, offers insights from ‘The impact of Covid-19 on customer experience in retail’ whitepaper to outline the major differences between customer service and customer experience, and looks at how successful brands who have invested in CX have reaped a wealth of rewards.
The retail industry is not short of a buzzword or two, or acronyms for that matter. In fact, it was only when I started working for parcelLab that I came across WISMO (Where is my order?) and when we’re talking about communications with customers, this is one acronym that unfortunately many retailers are having to address, with customers clogging up customer service lines to find out the status of their order.
Ah, there it is – customer service. This phrase has certainly had its fair share of column inches over the last few months, with one national newspaper going as far to say ‘service falls victim to Covid as retailers keep customers hanging on’. The truth is, during what was an unprecedented period of ecommerce growth, many retailers weren’t prepared for the surge in online orders and thus weren’t prepared for the massive influx of enquiries that followed when parcels weren’t showing up where and when they were supposed to. But that’s a whole other article for another time.
What I want to talk about here is the difference between customer service (CS) and customer experience (CX). You cannot have a good customer experience without good customer service – that’s a given. But far too often these two phrases are used interchangeably. It’s important to understand the major differences between the two and why CX is so important to the overall customer perception of a brand.
Customer service is defined as the support provided by a brand to their customers who are facing issues, whether that be issues with checkout, WISMO enquiries during delivery, faulty items… the list is endless. Customer service is reactive; it comes into play when a customer is dissatisfied and gets in contact. It is near impossible to pre-empt this happening. In short, customer service is just one part of the overall customer experience.
As Gartner describes it, customer experience is “the customer’s perceptions and related feelings caused by the one-off and cumulative effect of interactions with a supplier’s employees, systems, channels or products” or, as Forrester Research puts it, “how customers perceive their interactions with your company”. There we have it – these definitions clearly show that the two key elements of customer experience are: Perception and Interaction.
A customer’s perception is how they view your brand as a result of a single or through multiple interactions. Perception can change throughout the customer life cycle, based on their experiences with your brand. Interaction can also happen throughout the customer life cycle. This can be talking to the customer service team, live chat, self-service help options and social interactions, among many other things.
So in regards to retail, customer experience is the customer’s perception of a brand, influenced by various interactions, across the customer journey, from perusal and information gathering right through to returns. The experience is circular and never-ending. It’s proactive.
All companies (retailers included) should create a strategy and invest time and money in creating excellent customer experiences. Steps should be taken to ensure customers do not become dissatisfied. When customer service is needed, brands need to make sure it is easily accessible and informative, so that customers continue to build a positive relationship with the brand.
The two go hand in hand – you cannot have a good customer experience without good customer service.
It’s a well-known fact that it costs 5x the money to acquire a customer than to retain one. Customer experience is key for creating lasting relationships with customers and turning casual browsers into loyal brand advocates. A negative experience with a retailer can very quickly change a customer’s perception and encourage them to take their business elsewhere i.e. To a competitor, which is precisely what you do not want! Therefore, retailers need to constantly review their customer journey and audit the experience to ensure it remains exemplary.
Many brands have invested a great deal in improving their customer experience and thus have been able to reap the following rewards:
- Reduce customer churn – a satisfied customer, who receives a consistent personalised experience across all touchpoints, is more likely to return and purchase again.
- Create and keep brand advocates – creating a memorable customer experience creates happy customers. Happy customers turn into loyal ones. And loyal customers are the best brand advocates you could ask for!
- Boost revenue – a satisfied customer is much more likely to buy from a retailer again and again. This translates into actual revenue increases. Repeat customers can account for as much as 50 percent of all sales.
- Reduce customer service enquiries – most enquires happen during the delivery window and are caused by poor customer experience. A good experience is when the retailer keeps the customer informed proactively on the status of their order and pre-empts any delays.
In today’s current economic climate, the need for an excellent customer experience is arguably more crucial than ever. The high street might be slowly getting back to normal but what retail never could have anticipated is such a vast and unexpected change in consumer behaviour, spurred on by the coronavirus pandemic.
Customer service is vital to any organisation but remember it’s just one piece of the puzzle. If you consider that customers will take into account the whole picture when choosing which retailers to buy from, shouldn’t you be thinking about that too?
By Katharine Biggs
Content and Marketing Manager
parcelLab’s ‘The impact of Covid-19 on customer experience in retail’ whitepaper is available to download in full here.