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Mystery shopping reveals three common sources of profit leakage in professional and business services…Guest Article from Service Reality:
Increasingly, buyers of business or professional services expect more for less. Tough economic conditions, increased promiscuity and aggressive new market entrants with deep pockets and marketing savvy have permanently changed the rules of engagement.
The following article draws on mystery shopping evidence from companies that provide professional or business services. The mystery shopping revealed three common leaks in the new enquiry pipeline which are impacting enquiry conversions, profits and returns on marketing investment. For ease of reference, clients and customers are referred to collectively as customers.
Profit leakage can often occur following a mediocre or poor experience when making a new enquiry, which causes an existing or prospective customer to hesitate or go elsewhere.
This can happen at any point of interaction in the customer enquiry journey, from visiting the website, talking to the switchboard/call centre, or during the initial consultation with an adviser.
The following evidence is drawn from our experience of mystery shopping samples from the top two hundred law firms, medium and large accountants, global B2B software providers and major financial services providers.
Our mystery shoppers posed as business owners or buyers of serious personal injury across a variety of new enquiry scenarios. These included referrals from a friend or existing customer, website enquiries, and phone calls to switchboards/call centres, partners or account managers.
Across all the above sectors, the three most common sources of profit leakage were as follows:
|“We know that brands that improve the customer journey experience see revenues increase as much as 10 – 15 percent whilealsolowering the cost to serve 15 – 20 percent.”
Jesko Perrey (Director, Global Brand and Marketing Spend Effectiveness Group, McKinsey)
A growing number of companies that provide business or professional services are increasing profits by measuring what happens to prospective or existing customers when they make an enquiry. The enquiry can involve people at various levels in the company, and can include an existing customer with a new requirement, or a new customer responding to a referral or a marketing event. Some of the companies that have adopted this approach have witnessed an exponential impact on profit, revenues and customer retention as a result. Conversely, companies are learning that a negative customer experience is punished more severely than ever and business customers are increasingly likely to broadcast their complaints on social media.
You only have to think about your personal experience with websites and call centres in retail, leisure and utilities to acknowledge that we expect companies to be easy to buy from and work with, and how frustrating it is when they fail to meet our expectations.
How quickly do you leave a website if it doesn’t give you the information you want or the content bores you? What do you do if the link you click on is broken or the call-back button doesn’t work properly? How do you feel if you are put on hold for longer than a minute or two, or you get put through to the wrong person or voicemail without being asked? How irritating is it when you have to keep repeating what you want each time you are transferred to yet another person in the same company?
High service expectations extend to buying business and professional services – why wouldn’t they? They also lead to an increasing willingness on the part of disaffected customers to publish their feelings on social media, including Linked In, or rating sites like Trustpilot.
Service companies are finding that the unique way in which they deliver their own version of a great customer experience is something that differentiates their brand. It is also something that is very difficult for competitors to mimic. Retail and Leisure brands have known this for years, which explains why the global annual mystery shopping spend in these sectors is estimated to be $3 billion. How does your company measure what it feels like for a potential or existing customer when they use your website, switchboard or call centre? Do you know what impression your partners or account managers create during an initial telephone consultation with a prospective customer? Which member of your senior management team is accountable for improving end-to-end customer experience across the company?
The biggest influence on customer loyalty and buying behaviour will probably always be the quality of the advice and strength of their relationship with your front line relationship managers. However, the rules of engagement have changed. Customers have learned to expect more. They are more discerning and less tolerant than they ever have been. Relationship strength and the customers’ propensity to buy is increasingly influenced by their overall experience of using your company.
It was easy to see the points at which they were losing potential customers and where they were giving new and existing customers a negative impression of the brand. It was also easy to see where new enquiries were tying up fee earners with non-productive conversations due to poor filtering at the front end of the new enquiry process. The impact of this project was immediately noticed by partners and staff. The evidence (good and bad) generated by the audit was irrefutable and emotive, which proved to be a powerful catalyst for change.During a recent project with a top 50 law firm, we audited what it felt like for customers to make a new enquiry from start to finish. We quickly identified that they were leaking profit in several key points of interaction between customer and firm. We tested a variety of customer personas (business and personal) and simulated a number of evaluation and enquiry journeys. We tested the performance of the website, and taped the subsequent conversations with switchboard, support teams and fee earners.
Our client was able to galvanize teams into action and unite partners in a way they hadn’t seen happen before. New enquiry conversion rates doubled across the firm within six months.
Tim Dixon Phillips
Tim is a founder and director of Service Reality – mystery shopping for professional services – servicereality.co.uk