The Power of Customer Word-of-Mouth

Psst! Joe Bloggs is a fantastic builder. He did an outstanding job for us. Pass it on.’ Word-of-mouth is the most powerful advertising tool your company can have. Chris Bell looks at the issues.
If price is much the same, what prompts you to choose one retailer, one tradesperson or one company over another when seeking a product or a service?

Forget the multi million-dollar advertising campaigns. It’s all about word-of-mouth.

According to statistics released by Nielson Media Researches, 83% of New Zealanders surveyed relied on word-of-mouth recommendations over all other forms of advertising.

How many of your customers are recommending your business to friends and family?

Recent research carried out at the London Business School concluded: “Media fragmentation has made it more difficult and costly for businesses to reach target markets. People are becoming more selective and internationally aware, thus less likely to follow predictable mass media consumption patterns.
As a result, companies keep spending increasing amounts of money on advertising that is becoming less effective; customers are tired of being marketed to.”

A recent U.S. survey found that 95% of CEOs surveyed understood the importance of a customer experience strategy to their business, but alarmingly, only 13% knew how to go about developing one.

If you are going to capitalise on and encourage more customer promoters of your business, you need to deliver a consistently unique and memorable customer experience. It must be totally customer focused, building strong relationships and encouraging loyalty.

Regardless of the size of business or the type of industry, the following seven steps are vital to the development of a successful customer experience strategy.

1. Committed leadership. Customer service, not lip service. Unless there is total commitment to long-term strategy, you are absolutely wasting your time and money. Your people will be paying less attention to what you say and much more to what you do.
2. A committed vision. Where does your organisation want to be in the future? Do you know? And, more importantly in today’s market, do you your people know? Without a clear, well-communicated vision that motivates and inspires, we are all just going to work to do a job. A vision is the difference in many cases between engaged and disengaged people and it’s your people who will play the key roles in your customer experience delivery.
3. A customer experience statement. A statement clearly defining the experience your business will deliver consistently to every customer.
Without it, everyone will have his or her own version of what your customer experience should be – resulting in inconsistency. You will never build real customer loyalty by delivering an inconsistent experience.
4. Identifying touch points. A touch point is any point that a customer or prospective customer touches your organisation and from that “touch” forms an opinion of your business.
5. Service Standards. Once you have identified your customer touch points, put them in priority from the customer perspective. Then write a service standard for every touch point. This is where your customer experience statement starts to come alive.
6. Measurement. If it can’t be measured, don’t do it. It’s important that you know that everyone is meeting each standard consistently.
7. The On-going Journey. Creativity is an important element in any customer experience strategy. You will not develop a sustainable competitive advantage by doing what others are doing. Nor will a competitive advantage be sustainable unless it has these key elements – inspirational leadership, a customer focused culture and the right people in the right positions with the resources they need to deliver the experience.
Stand out from the crowd in 2016 by developing your unique team and customer experience.

Chris Bell is managing director of Customer Experiences; a company that specialises in helping businesses improve the way in which they interact with customers and clients.