00:03
Ciaran
Hello and welcome to Customer Friendship Conversations, the show where we bring you the latest trends, tools and insights into delivering customer experience as it’s meant to be. I’m Ciaran Nolan and I lead relationship management for Dixa. This is an especially exciting episode of the podcast because today’s guest just isn’t a CX leader. He’s also the best selling author of The Challenger Sale, The Effortless Experience, The Challenger Customer and The Jolt Effect. I’m speaking to Matt Dixon. His books have been translated into more than a dozen languages and they’ve sold more than half a million copies worldwide. I’ve been a longtime fan of Matt, having read his book The Challenger Sale in my previous job, and The Effortless Experience prior to joining Dixa. On a personal level, I’m a huge fan and I’m so happy to have Matt joining us today. And here is today’s conversation.
00:51
Ciaran
Matt. Thank you for joining Customer Friendship Conversations. How are you doing today?
00:55
Matt
Hi, Ciaran, I’m doing well, thank you for having me.
00:58
Ciaran
Yeah, excellent. And you’re joining us from where?
01:00
Matt
I am just outside of Washington DC today, though, which is nice, because my home office, I spend a lot of time on airplanes and today I’m at home, which is nice.
01:10
Ciaran
Excellent.
01:11
Matt
Good.
01:11
Ciaran
Well, we’re delighted to have you join us. So thank you so much for taking the time. So, Matt, to kick off, why don’t you tell us a little bit about you and what you do?
01:19
Matt
Absolutely. So I struggle to explain what I do for a living, so it’s often a bit confusing. I think my parents, they know I live in the Washington DC area, they don’t really know what I do, so they assume I work for the CIA or something like that, which I assure you am a I would call myself a sales and customer experience anthropologist, maybe. So I’m a researcher by trade and I use research based methods to understand changes in customer buying behaviour, changes in customers service preferences with the brands they do business with. And then on the flip side, is to understand what do best organisations do to adapt to those changing customer preferences, those wants, those needs, those likes and dislikes. Customers are tricky to pin down. And so I’ve made my career really going out and doing research around customer service, customer experience, sales, marketing, both B2B and B2C.
02:18
Matt
And we put a number of our findings into some books, some of which I think we’ll probably talk about today in this conversation. So I spent a lot of time travelling around the world and advising companies large and small about how to improve their customer experience, how to improve their sales effectiveness, you name it.
02:34
Ciaran
And were just saying, before we came into the recording today, I actually read Matt’s first book, or one of your first books, I guess, The Challenger Sale.
02:42
Matt
Yes, our first, yeah, seven or eight.
02:45
Ciaran
Years ago when I was actually entering a sales career. And this is a nice full circle for me, which is really great.
02:53
Matt
Yeah, it’s only nice, Ciaran, if you liked the book, in which case it is a nice full circle.
02:58
Ciaran
See, it is a nice full circle for me. And, yes, I did enjoy the book a lot and I even picked it up again this morning in advance of today to have a flick through. Reminded myself of the teaching and tailoring pieces, which I personally love. So, yeah, great to have you. And one thing that you probably know is that your book has been referenced, I think, on at least two podcasts and is relatively, as regularly, I should say, mentioned in a number of customer meetings, both from us and also from our customers. So we’re really thrilled to have you on the show today.
03:31
Matt
That’s great to be here.
03:32
Ciaran
I guess to kick off, Matt, you’ve mentioned you’re working in the sales and customer experience space. You’ve been tracking a lot of the big industry trends and changes over the last number of years. What’s your own personal approach to customer experience? What do you think good customer experience looks like?
03:49
Matt
Yeah, it’s a great question. I think if I were to think of one word, maybe Ciaran, that I think really encapsulates what I think customers would agree as a world class customer experience. And I think this is true not just when things go wrong, so in the call centre, in the service organisation, but also early on when it comes to first learning about a product or a service, right. In the marketing kind of above the funnel domain. I think it also applies within the funnel when we’re talking about buying a product or service. And certainly, as we talk about in the effortless, experience applies in the world where that product is broken or you need help getting something resolved and you have to reach out to the company for help. But I think the one word I would use to describe a great customer experience is easy.
04:37
Matt
This idea of an easy customer experience puts us a little bit, I wouldn’t say at odds with most customer experience thought leaders, but in a little bit of a different category. I think if you picked up any book about customer experience, the number one phrase you would see is that a great customer experience is one that is delightful. It is surprising, it is exceptional. It kind of delivers this over the top sort of experience. It doesn’t just deliver what the customer expects, it delivers more than what they expect. But the research is very clear, and this is true not just in the service channel. It’s true in sales, it’s true in marketing that companies who get it right really focus on simplicity. They focus a little bit less on surprise and wow and delight. And don’t get me wrong, you need to, as a company, you really do want to have a brand that is delightful and surprising and unique and powerful.
05:27
Matt
You want a product that wows the customer. Of course it can’t be the same as your competitor’s product, maybe a price that is delightful, it is delightfully priced relative to your competitor’s product. All of those things, when you think about it, while we want to do those things to differentiate, really, the glue, I think the thing that keeps our customers loyal to us, it keeps them coming back. It keeps them spending money with us. It keeps them saying good things about us as opposed to bad things is when we can deliver a simple experience so that’s everything from the way we price, the way we talk about our products and services, the way we sell our products and services to the customer, it’s an easy sales experience. It’s easy to buy our products and services and that’s easy to get problems resolved. And that’s really when I think about what is the gold standard, I think that’s it because at the end of the day, our customers don’t have extra time to dig into complicated pricing or brand messages or to navigate a protracted and difficult sales experience or to get the runaround in the service channel when they need help from us.
06:25
Matt
What they want to do is spend more time with their loved ones, with their job, doing whatever they don’t want to have to spend time with us as a supplier. And so the extent to which we can make a simple product, deliver a simple uncomplicated brand message and pricing approach, deliver a great simple sales experience and deliver a great after sales experience that’s what keeps our customers coming back over and over again saying great things about us.
06:51
Ciaran
And what I love about that is it’s very topical you’re saying this. I was in Berlin last week on a panel with a number of CX leaders and were talking, you know, a lot of the times customer experience teams are driving loyalty, you know, ensuring loyalty with the customers who already had a problem. They are not focusing on the customers that didn’t have a problem and actually had a really seamless experience and are likely saying really good things. So what I love about what you’ve just talked through there is it’s not just when a problem shows up, it’s all of the steps in the process for our customer experience, pros and leaders listening. How have you found in your experience that CX leaders can lean in and kind of influence that entire process, a lot of which might be outside of the realms of responsibility?
07:41
Matt
First of all, I think a lot of CX leaders and it’s a really good question – a lot of CX leaders get pulled into the squeaky wheel problems and oftentimes those show up in the call center and in the service channel. And for sure for most companies I think that is an area that they should focus on, because what effectively they’re doing is building up goodwill with customers by delivering a compelling brand message, a compelling price, a compelling product, compelling store experience, whatever it is, even a compelling sales experience. And then we kind of drop the ball when our customers have a problem and we run them through the grist mill or the grind of the typical service experience. So that is an area that I think most CX leaders are very acutely aware, is a shortcoming in their organization and they’re rightfully focused on that.
08:27
Matt
But to your point, there are many other touch points in the customer experience that CX is typically not engaged with. If I were to take a step back, what I think is imperative is that all CX leaders cast a broad net when it comes to measurement and understanding of the broad end to end customer experience and try to understand where are the moments of highest effort and greatest friction happening. They may actually be in the call center, but again, those tend to be the squeaky wheel. We’re very aware of that as an area of focus. But what about the sales experience? What about our web experience when customers come to learn about our products and services, right? What about if you’re in business to business? What about your customer success team and the team that’s charged with helping install the product and get value for the customer out of the product?
09:12
Matt
There are lots of opportunities, or lots of, I would say, areas where there’s often friction in the experience. And so I think progressive CX leaders are casting a very broad net. They’re tapping into data, both structured data surveys, but unstructured data, increasingly recorded calls, clickstream, patterns on the website, email exchanges, chat exchanges, slack exchanges, you name it, but really trying to cast a broad net and almost be agnostic as to where that friction is coming from. But take a measurement first approach, which is where is the friction and which ones are minor irritants and which ones are like big boulders in the road that we’ve got to move out of the way in order to create customer loyalty.
09:51
Ciaran
And what I love about that is know what you’re saying there is looking outside of it and kind of bringing the insight that CX leaders have, which is very significant into the organization. And actually, on that same panel last week, I’m going to quote Tiana, who was on the panel with us, and I thought the line she had was really amazing. It was. I joined the organization as the head of Customer Experience and I decided I was going to join multiple meetings around the organization and made it very clear that I would stay at the table if I thought my input was interesting and that I wasn’t going to walk away from any table and I would decide when it was time for me to leave the table or leave the meeting, which to me, I just thought was a really excellent approach. But secondly, it helped really put the customer experience front and centre in the organisation, not just when it goes wrong, but in all of those teams you spoke about before, something might go wrong as such.
10:47
Matt
Yeah, that’s a great point. And I think the reality is, if you look at almost every CX leader out there is charged with the MPs survey or whatever the annual regular outreach is, survey based outreach to customers. I think that point, though, from the panel you’re referencing is a great one, which is it isn’t actually just about the measurement, it’s actually engaging with those business partners. So let’s imagine we take a broad based measurement approach and we find out that, you know what, there’s a disconnect between what we’re telling customers in the sales process and what they actually experience when they get the product or the service. And that is leading to customer churn and frustration and customers saying, that’s not what the salesperson told me, that’s not what I learned about on the website. I thought the product would work in a different way or it would deliver these kinds of outcomes, and I feel cheated or I feel like I was misled.
11:40
Matt
That’s a huge potential point of friction and disconnect in the customer experience and we can spot it through measurement. But to what extent are you, as a CX leader then, working hand in glove with your colleague in sales to try to fix the way that salespeople are positioning the product? And it’s probably not a nefarious thing. It may just be that, oh, I thought the product did do that. That’s why I’m telling customers that I didn’t know. But let’s close those gaps, right? So I think a lot of times CX leaders will kind of stop at the measurement piece and then kind of deliver out dashboards and say, hey, we can improve here and here, but then they’re not really partnering with those business leaders. They’re not sitting in those meetings exactly to your point, and rooting out those problems and then coming up with fixes such that they don’t appear in the survey next time around as a deficiency.
12:23
Matt
And I also think you made a great point about spotlighting those things that we’re doing really well, because those can become powerful differentiators in the market. The things that create Raving fans amongst our customers are those things that we’re then messaging around above the funnel to pull people into the sales conversation? Are they things we’re talking about during the sale and holding up as real differentiators in helping to create daylight between ourselves and our competitors?
12:48
Ciaran
And I think I can imagine a lot of our listeners one relationship that they all really want to, and this is from me, travelling the world, visiting clients, one relationship they all should be really leaning into is their relationship with it more and more. What we’re finding is our most successful clients are those who have a very strong relationship with the It team, the head of It, product management and other areas. Because oftentimes, and not just oftentimes, most of the time, particularly in online, it’s the website that creates the majority of the problems.
13:22
Matt
Yeah, no, you’re right. The website is where a lot of hopeful customers who want to learn about our products and services or maybe even shop around. So think about there are many listeners out there who have more of an ecommerce posture, right? You’re not talking to a salesperson. Our customers buy the products themselves on our website or maybe through other channels, third party partners, retail distributors, et cetera. But that is a place where a lot of great customer hope and actually think about this on the other side. After the customers bought the product, now they’ve had a problem. They go to our website and try to self serve on the issue. They get all turned around and confused and they have to, in frustration, pick up the phone and call to talk to a representative. But it’s a place where a lot of customer hope goes to die, I think is the website.
14:06
Matt
And I think you’re exactly right. It creates a death spiral. I think, when we look at self service can be such a powerful thing. We know our customers, left to their own devices, that would rather self serve than talk to us. They’d rather learn about our products and services on their own, on our website. They’d rather buy them on their own, if they can, without talking to a salesperson. They’d rather self serve on their issues if it’s easy. But once they have a bad experience, they’re not inclined to go back and try it again. So I had this experience just the other day with my wireless provider. So I had, a number of months ago, had a billing issue, I took them up on their offer when I called up, said, would you like to chat with our virtual agent? Sure. And I tried it and it was just a disaster.
14:49
Matt
And I ended up having to I spent 30 minutes with the virtual agent getting nowhere, had to end up calling them. And so this time, when I had a billing issue three months later and I got the same offer, I said, no, I know how this is going to go and I declined it. So think about that. You’re learning those behaviours and then that’s driving up a very expensive support channel, which, candidly, is more effort for me as a customer. I would far prefer that the digital options, the website, the virtual agent, et cetera, did what they were supposed to do and put the tools in my hand. But you’re absolutely right. So you need that close relationship with the web team, with the It team, so that you’re able to actually root out those problems and run them to ground.
15:27
Ciaran
I think one point you made there, which was super interesting, was speaking to the right people at the right time. And one thing we’re seeing amongst our customer base, and again discussed in a number of panels recently, is a lot of organisations are realising that the cost of acquiring a customer in this climate is actually much higher than it was before. And there’s a pivot within customer experience teams to now move to drive customer experience as a profit centre. So examples we’re seeing is in some luxury brands we work with, where the customer experience team are doing callbacks, they’re saying, hey, your basket isn’t finished yet. They’re not there to just throw a discount at them, they’re there to advise them, help them through the process, wonder what went wrong. But also at key points in the customer journey, if they’re noticing things aren’t moving on the page, a pop up, live chat.
16:22
Ciaran
And what we’re seeing is that those people who are already your customers from a customer acquisition cost perspective, are much more profitable. So maybe invest in them a little bit.
16:35
Matt
The recent I think the math on this has always been true, that it’s cheaper to retain a customer more profitable than it is to acquire a new one, but I think that’s especially true right now. Ciaran, to your point, acquisition costs have never been higher for organisations. Customers are bombarded with offers. We hear like, I was talking to a B2B sales organisation the other day and they found that their response to outreach, so literally, emails, phone calls they place to try to get sales visits has never been lower, because customers, again, are bombarded by every make and manner of supplier. And most of the outreach is kind of spammy, right? It’s sort of generic and it falls on deaf ears. It’s really difficult to get face time with customers and to sell products and services makes it even more important that we’re retaining our customers.
17:18
Matt
A couple of other thoughts that your comments kind of brought to mind for me. One is, I love that idea of the proactive outreach, right? So how are we taking those moments of friction? So it could be, as you’re saying, that you’re not seeing the progress, the customer’s progress on the website, or they put a lot of items in their shopping cart and never did anything with them. Or they filled out a survey and said, boy, you guys really did a poor job on this service interaction, or in this sales experience, or, no, that when you get the pop up on the website or the pop up after a chat and you say, you know what? No, that was actually a really difficult experience. It didn’t do what I thought it was going to do. How often is that going into a black box? Which does two bad things?
17:59
Matt
One is you miss out on an opportunity to improve things in general and then improve the situation for that customer. The second bad thing about not responding and putting this feedback into a black box is it teaches the customer that you don’t care about their feedback. And so the next time you offer a survey, if they gave you really poor marks and took the time to write in there, you guys really did a bad job here. I expect more from you. Blah, blah, blah, and nobody reaches out, then what incentive do I have as a customer to do that again next time I wasted my time effectively giving you that valuable feedback. You’ve done nothing with it. And so I think that’s a brilliant strategy. And every CX leader listening to the show should absolutely have a response team, right? So you’re taking those negative comments, whether it’s negative tweets, it could be LinkedIn or Facebook messages, it could be survey scores, what have you, and creating a moment to reach out to those customers to say, can we get some feedback?
18:53
Matt
Clearly, this didn’t go as well as either of us would hope. Please give us some feedback. What could we have done better? And more importantly, what can we do to make this right for you? Now, that is a really powerful moment for the customer, and that really cements the loyalty, because that’s teaching them. This company cares about my feedback, and they care about making it right, and they care about improving. Those are companies I want to do business with. The other point I’d make, Ciaran, is that I would encourage CX leaders to think even I remember before I talked about a broad based measurement approach. I think many CX leaders are wedded to surveys as an instrument that they use to get this feedback, whether it’s pop up surveys, email surveys, IVR surveys after spending time on the phone with an agent in the service department.
19:33
Matt
But what I would encourage CX leaders to think about is predictive measures. So think about all your call recordings just as an example, or email exchanges or chat interactions. What percentage of those customers are taking the time to fill out a survey? Most companies would say it’s around 10%. For some companies, it’s lower than that. Some companies, it might be a little higher, but it’s around 10%. That means 90% of the people you interacted with gave you no feedback whatsoever. But every company out there is recording those interactions, those phone conversations, those email exchanges, data that’s sitting in platforms like Dixa, right? Chat interactions, SMS exchanges. We’re capturing all this data. Are we able to use modern technology like AI and ML to actually extrapolate from the unstructured data what we think the customer’s experience was? Right. So, for an example, think about a phone conversation.
20:22
Matt
Maybe I call into a company and I have a frustrating interaction, but I don’t fill out a survey. But we can use a model that can go through the call recording turn it into unstructured text. Mine it using machine learning and surface up that. You know what? This customer was quite unhappy. He was quite frustrated. It didn’t sound like he had a great experience. And then score it and then feed it into that queue for the CX team and say, hey, this customer didn’t file a survey, but the model says and our analysis says he had a really bad experience. So put him in the queue to reach out to now, that’s an even more powerful moment. Think about that. Where I didn’t take the time to fill out a survey, but you listened to the interaction and you knew it was a bad one and you reached out to me to say, hey, we listen to all of our interactions, we study them and based on our understanding, this did not go very well.
21:12
Matt
What can we do better and how can we make this better for you? Worst case scenario, the customer says actually, I don’t know what I said that made you think it was bad because I thought it was great. No harm, no foul, but these models are pretty accurate and chances are you’re going to get a customer says thank you for listening, I appreciate that you picked up the frustration, my voice, I was quite frustrated. Here’s why. Here’s what you guys can do to make us better. That’s just gold for a CX leader to be able to fix these problems at scale and again, get on that path towards an easy experience at every touch point for your customers.
21:43
Ciaran
Yeah, absolutely. And I often use this example. At the time, actually, this company wasn’t our client, but I had a subscription service for a lovely flower company here in London where a box of flowers I think was delivered every ten days or maybe every week. Yeah, really nice. Something I looked forward to. And I was actually moving house. I bought my first apartment and I was moving house and I was staying with a friend for six weeks, so I cancelled it. And obviously in the cancellation flow, I probably just clicked. Probably the worst type of customer, clicked anything just to get it know, done. I won’t get flowers for six weeks. My friend won’t appreciate them anyway, so that’s all good. Moving to an area of London. Anyone who knows London relatively well will know I live very close to the very famous Columbia Road Flower Market, which is a really beautiful flower market, every Sunday, and even when I was buying here, I was like, I’ll probably go there every Sunday and buy my flowers.
22:39
Ciaran
But anyway, I’m walking through London and I get a call and I’m like, hey, hello. And they’re like, hey, this is the flowerbox subscription company. We see that you have cancelled your subscription. What’s up? And I’m like, oh, actually, yeah, thanks for calling. I’m actually moving a house, I bought an apartment, I no longer need it. Thanks for the call. And straight away they’re like, you know what, in six weeks or whenever you’re ready, your account is going to be loaded with a box of flowers for free on us. And I was just like, that was for me. I don’t know what the value was. It’s nothing life changing, but for me, that is a way to drive customer loyalty. I have not probably bought many flowers from Columbia Road flower Market now at all. I’ve continued my switch from when I can they put up their price at one point and I had no problem with that.
23:28
Ciaran
And I tell everybody about it. I’m a raving fan as such, and I’m just like, what a good experience. But it doesn’t happen near enough.
23:37
Matt
No. And you know what I love about that story too, Ciaran, is the fact that it was also a retention play, right? Because you’d cancelled, they’d lost the customer, you’d churned out effectively. And sure, you might have rejoined or come back, but as you said, you’re moving house. And so now you’re in between, do I go with this delivery service or go to Columbia Road? Things are going to change, but now you’re open to going in a different path. They reach out to you with that very compelling offer and now you’re back in, right, and you’ve had no thoughts about just because of you’ve got the memory of that wonderful experience, it doesn’t cross your mind to go to Columbia Road?
24:10
Ciaran
No.
24:11
Matt
Cancel again, right?
24:12
Ciaran
Yeah, it crosses my mind to go there for an expensive coffee, but other than that, I’m going around Europe. But I guess, Matt, we spoke a lot about the creators, what works well, what doesn’t work well, what good looks like in the book. You talk a lot and I know this is something customer experience leaders spend a lot of time thinking about is channel spread Dixa. We’re an omni channel platform. We have so many channels feeding in at one time and one of the biggest things our customers spend time thinking about is what channel should I be on? Where geographically to cover all age groups, to be in the right place at the right time. And I think all of us, and I think maybe you referenced this earlier with your provider example. Really bad chat bot experiences, or for me, experience of my own recently was a really nice American furniture company.
25:03
Ciaran
Scraped my wooden floor taking in a bed and they only done email support. And I’m like, Wait, you’re a premium brand and they go to market as a premium brand. They’re a household brand. I’m like, But I can only contact you on email. Like, what is that about? So would you maybe talk to that a little bit and also how that can drive disloyalty?
25:21
Matt
Yeah. So by channel spread, just for the listeners, one of the things we talk about that Ciaran is referencing from the effortless Experience. Is this idea know, you look at any company, well, most companies, I think your example of the furniture company might be an exception, where they really only offer one channel, which, by the way, we can talk about that too. That’s also risky. But I think the bigger risk for most companies, they offer too many channels. And so as a customer, you go to the website. So imagine in this situation you’ve had an issue and you need to track down what sort of remediation there is, or how do you put in a complaint or get resolution. And you show up on the website and they’ve got FAQs, they’ve got maybe knowledge articles, perhaps they have an expert community, they have a phone number, they have Twitter or X page handle, they’ve got an Instagram page, they’ve got email, they’ve got a form you can fill out.
26:11
Matt
And I think for most companies, their website, especially the support page on the website, has turned into a choose your own adventure, right? Here are all these different options. And what we find is that this idea companies have know the customer is in charge, let them choose the channel that they prefer. So Matt might prefer chat, Ciaran might prefer a phone conversation, but don’t impose your preferences on the customer. Let the customer choose their own adventure is actually something that no customers actually want. There’s a very small minority of customers out there who are very particularly wedded to given channels, but the vast majority of customers don’t have any preference whatsoever about channels. What they prefer and what they optimise for is what’s the easiest channel for me to solve this issue? And so I’m not saying to turn these channels off, but rather provide a bit of guidance when your customers go to your site.
27:01
Matt
And so it might be that if you show up and you say, well, if you’ve got an assembly issue, right, or you need to order a replacement fabric for your bed or what have you, right, here’s where you might go for that. If you’ve got a complaint about delivery, here’s where you might go for that. If you actually need to talk to somebody about what the color really looks like, because it looks one way you want to get a sense of, because this is an important decision, it’s hard to return this item, call our phone number and we’ll have a conversation with you about it. But what you’re doing there is it’s a bit like the Harry Potter sorting hat, right? So we show up and it tells us where we’re going to go or what channel is best suited for the issues that we have.
27:36
Matt
Now, how do we figure that out? There are database ways to figure it out, but actually, what I advise most companies is sit down with your most tenured and experienced representatives and what you should do is get on a whiteboard and write down all of the channels you offer. So the website, the mobile app, the phone, Instagram, Twitter, blah, blah, et cetera. You list all these options out, email and then on the other axis you should list out what are the most common issues. So it might be complaints, return issues, spare part ordering spare parts or replacement parts, getting repair service, et cetera. And you list those out on the other axis. Now what you should do is give every and you pick whatever scale you want. It could be A through F, it could be one through ten, but score each one of those channels on how good it is at resolving each one of those issues and what you’re going to find is each one of those channels is not equally good.
28:25
Matt
They’re not tens across the board or as across the board. They don’t get a gold star for their effectiveness with each of those issues. What you’ll find instead is email, for instance, is a fine channel for certain issues, but it’s actually a really lousy channel for other issues. Chat, great channel for certain issues, really lousy for other issues. And what ends up happening is your customer goes to your website and when they’re in a rush and they don’t really feel like going down a certain path and then getting frustrated and saying, you know what, I spent 30 minutes of my time with this virtual agent and it got nowhere. Now I’m going to pick up the phone. When the customer shows up and they see all these options, their default posture is to pick up the phone and call. Now they might know they’re going to sit in queue for a while.
29:03
Matt
They might know they’re going to have a frustrating interaction with an agent and have to demand to speak to their supervisor to escalate the conversation. They may know that’s going to happen to them, but at least they know they’ll get a resolution. At least they know they’ll be able to talk to somebody. So the phone becomes kind of the lowest common denominator in that world. And so again, the guidance, no pun intended to companies is to provide more guidance. Don’t just throw choices and options up there. Give your customers a bit of prescriptive guidance. If you’ve got this issue or this need, go here, if you got this issue or this need, go there and your customers will thank you for it and they’ll be more likely to stick in those self service channels.
29:38
Ciaran
Yeah, I absolutely love that, the way that you’ve kind of talked through that because I think a lot of the time it’s actually quite unusual to see companies do that to help you understand what way you should go. And for me, working in customer experience technology and having worked in large technology companies, I try to do as much as possible off the phone. But a lot of the times you do go and you’re right and I love the way you’ve put it’s just like a barrage of possibilities. And it’s kind of like, maybe I’ll send a tweet, but I might call at the same time. And if I don’t call, I might email and let’s see who gets back first. And then really, I’ve sent three, two to three requests into an organisation, and not to mention phone, as we all know, is by far the most expensive channel.
30:24
Matt
Oh, of course. Yeah, absolutely.
30:26
Ciaran
I guess from a perspective of the book, the Effortless Experience book overall, and I’m genuinely a big fan of this. And when I was joining Dixa in my interview process, they actually told me, basically, don’t show up unless you’ve read this first. So it was really important for me to read it. Maybe you’ll tell us a little bit about the book, how you got about writing it and what kind of reception it’s had over the years.
30:52
Matt
Yeah, so this was probably a ten year research exercise. We started this research yeah, we started it back in 2008, time frame, actually. And this was right around the time that most service Net Promoter Score was a big focus for companies. It still is for a lot of companies out there. But this is right around the time where Net MPs was all the rage. And it was in this environment that many service leaders I was running a research organisation serving heads of customer service at companies large and small, B2 B and B2C around the world. We had about 400 heads of customer service that we worked with. And it was right around this time that service leaders were very focused on what they could do to help the company further its MPs objectives. So if our objective was to achieve X percent Net Promoter Score, what can we do in customer service to help make that happen?
31:47
Matt
And so the question we started researching is, what effect does a customer service interaction have on a customer’s loyalty and what can customer service leaders do? Our ingoing hypothesis actually, Ciaran, was what should they do? We all know that the keys to the customers hard are to delight them and wow them and surprise them. But that’s hard for companies to do at scale. And so we came into a study with that as an assumption, and we want to know what are the things that are most delightful to customers that create the most surprise, the greatest wow moments? And what we actually found is in the research is that those customers whose expectations were exceeded were actually no more loyal than those whose expectations were simply met. There’s a point of diminishing marginal utility beyond meets expectations. We spend a lot of money and effort and time resources trying to surprise our customers, but they don’t really pay us back with their loyalty.
32:35
Matt
So this was a pretty surprising finding again, in this world where delight in wowing the customer had been talked about and just taken as a pillar of faith for a very long time in customer experience. We came out and said, actually, it doesn’t really pay off, it’s not an economically rational strategy. And it further turns out that when you look at customer service interactions in particular, most service interactions are more likely to create customer disloyalty than loyalty. They’re actually four times more likely to leave the customer in a state of disloyalty. And when we further unpack that, what we find is it’s a set of, I would call it usual suspects of bad customer experience that deliver that disloyalty or create that disloyalty. These are all moments of high effort, moments of friction, like forcing your customer to call you back over and over again, sending them to a website and making them choose from among five or seven seemingly attractive channels, having them go down one path, get frustrated, then have to back out and go down another path.
33:29
Matt
So that channel switching phenomenon, asking customers to repeat themselves, treating them robotically and generically instead of a personalised and tailored way. Throwing up obstacles like policies or procedures that don’t make sense to our customers and just seem to them like roadblocks on their way to getting what they really want, which is a resolution, satisfactory resolution of their issue. So if we summed it up, when we summed it up, we said, look, what great companies realise is that the key to playing to customer loyalty? Yes, you need delightful products and brands and store experiences and pricing, right? Absolutely. But when things go wrong, when the customer reaches out to you for help, the better thing to do is not delight and surprise them, but to actually make the interaction easier. And it turns out customers with low effort, low friction interactions were much more likely to stay customers, to remain customers, much less likely to churn out.
34:17
Matt
They were much more likely to spend more with those companies over time, so greater share of wallet and they were much more likely to say good things about those companies. So it really reframed the way that service leaders thought about what their job is when it comes to customer loyalty. So we wrote an article in Harvard Business Review back in 2010. It was called Stop Trying to Delight Your Customers, for which we got a shortage of hate mail for the title. But it was quite provocative and it really did kind of shake things up out there in the market. And then we decided we’d continue doing research around this phenomenon. Now, we knew that making things easy was important, but there were so many different facets of like, what is it that creates frustration and effort for a customer? How do we reduce the effort and make the interaction easier, make the experience easier for our customers?
35:07
Matt
And so we had built out really a book’s worth of guidance, case studies from companies, tools and resources. And so we decided at one point in 2013 just to pull up and write a book on it, which is the effortless experience, as you alluded to.
35:21
Ciaran
Yeah, I love it. And I think one thing you’re talking about there, at the time you wrote it was MPs was all the rage. I think right now, what we’re seeing at Dixon, what, you know, travelling, visiting our clients and speaking to our clients every day is AI is now all the our for a lot of people in customer experience. They, I think, are at a point of also being a little bit overwhelmed by the possibilities and not really sure how do you use AI, what do we do with it, et cetera. So what is your thoughts on how AI is going to influence the customer experience space? I personally think it has the ability to make things a lot more effortless, but there’s a lot of work to be done there. What are you thinking around that?
36:06
Matt
Yeah, I agree with you. I think there is still a lot of work to be done and I think there is this, using my wireless provider example before, there is this kind of learned behaviour effect in customer experience. Because I had such a bad interaction with the virtual agent last time, I was very unlikely to go back. And so now that’s a learned behaviour with this provider, I know they’re virtual now, what’s unfortunate is they probably improved it in the three months since I used it last time. But for me, as a customer, I got burned once. As the old saying goes, fool me once, shame on you. Fool me twice, shame on me. So I’m not going to spend my time with it again. You know what? Unless somebody I know says, you know what, I actually did try the virtual agent. It was amazing.
36:47
Matt
It was really easy. I didn’t have to wait in queue, I didn’t have to talk to an agent and get frustrated about being fed the generic answer. But it actually allowed me to get my issue solved in a seamless way. Unless I hear that from somebody, my default posture, especially with this company, is I’m just going to pick up the phone and call, because I know they’ve not perfected the virtual agent technology. Now, I think what’s interesting here we think about AI is some of these behaviors. Also, these learned behaviors kind of translate over. So I think one of the things that’s tricky about technology, like gen AI, or think about Chat GPT, is it’s a little bit of a garbage in, garbage out problem. So you really need to deliver quite accurate and effective prompts to get quality information back. And short of teaching our customers how to do that, I think what is likely going to happen for a lot of companies is that their customers go to their gen AI.
37:38
Matt
Let’s say, for instance, we want to create a natural language interface that sits on top of our knowledge base and all of our content and allows a customer in natural language to query the knowledge base and to get information back. If you don’t get good prompts, you’re not going to get good information back. And when that happens, the customer won’t blame themselves, they’re going to blame you. And so then they’re not going to try it again. And so I think my recommendation for a lot of companies is before you put those tools out there to your customers, use those tools internally. Because I think what’s really powerful is because you can train your agents and you can train your managers and supervisors on prompting and on using these tools effectively. And I think what you’re going to see is that those teams and those agents and those organizations that make heavy use of gen AI are more productive, they’re more effective, they can wrap up calls faster, they can resolve issues and they can handle more customer issues than a team that doesn’t.
38:32
Matt
And so my general guidance here is to think about internal first. So think about how do we use this to reduce the effort of the employee experience before we use it to reduce the effort of the customer experience. I think customer-facing applications will definitely come. They will be a fast follow. But I don’t yet know that we’re in the place to deploy these technologies to our customers and for them to get value out of those tools. And if they don’t again, they won’t blame themselves, they’ll blame you and they won’t try it again. These will become learned behaviors in a bad way, same as my interaction with the virtual agent. It probably was my fault, but I’m not going to try it again.
39:09
Ciaran
I absolutely love the way you’ve talked about the learned behaviors because in a lot of my conversations I’m saying to clients, I know your executive team is putting you under pressure to rush out these things, but please make sure they’re high quality. You don’t want to be in a situation where your customers kind of in their first piece are kind of like, this isn’t that good, it’s not answering my question, it’s not working. And what I love about what you talk about there is here at Dixa, we’re actually building right now our own chatbot. It’s actually based off the knowledge base, but that same knowledge is being used right now within the agent interface to really, as you say, help the agent answer questions, help the agent find the right knowledge article, wrap up the call quickly, fix spelling and grammar, language translation. So, super interesting stuff.
39:56
Ciaran
So I know that was probably intentional from you, but that’s exactly how we’re thinking about it at Dixa, which is really good to hear.
40:03
Ciaran
I think it’s really smart and we’re coming into the last part of the podcast and usually we ask three questions which are quickfire, but given that you’re not day to day running a CX team like the rest of our guests. I actually had a slightly different question for you sure. And what I wanted to do, and I actually asked this on a panel and I’m on a panel again on Wednesday night in London and I plan on asking it then, and I absolutely love the answers, is you are obviously probably a demanding customer, having worked in the CX space. You might say yes or no, but maybe you’ll tell us about your best ever customer experience.
40:39
Matt
Oh, boy. Emerging kind of consumer brands. And now that some of these companies have become quite big, actually. So Warby Parker, the eyewear glasses company, Sonos, which makes the streaming music devices, what I will say is they mess things up and screw things up as much as any other company. But what I like about working with them is because they built their customer service operations in a greenfield way. I find that a lot of big companies the big telecom companies, the airlines, the hotel brands, the big established retail players, financial services companies, they’re encumbered by decades and decades of legacy policy procedure, old systems, just legacy ways of doing things that are very hard to undo. And so I find that when you call up some of these companies, you do get that kind of old school, scripted, generic, checklist oriented interaction. It’s quite frustrating.
41:37
Matt
But when you call some of those newer companies, they built their service organisations in a greenfield way, so they didn’t come in with 50 years of policy and procedure and QA checklists, they came in with a different posture. And so it feels like a different conversation with some of these companies. It feels like a more human interaction where you’re talking to somebody who isn’t under the handle time clock with a checklist and being told to say the customer’s name three times and thank her for her loyalty, but rather is treating you as the person that they in delivering the kind of experience that they think that will resonate with you. Right. And that will get you what you’re looking for. And so it just feels fundamentally different. It feels less rulesy and less scripted. And so that’s just to pick a few. I think there are some bigger companies that are making headway in that direction and I’m pleasantly surprised to see that.
42:25
Matt
So I see that from my airline, I see it from the chatbot example notwithstanding, with my wireless company. I think they’ve made some great headway to making that agent experience just feel fundamentally different. It doesn’t feel generic, it feels like I’m talking to a subject matter expert who’s free to speak to me the way they think I want to be spoken to, who can connect with me on a more personal and human level. And I really quite like that. I find that cuts through a lot of, again, the strictures and the legacy approaches to delivering experiences. And again, it feels like it stands out from the crowd and it feels much more human.
42:59
Ciaran
Yeah, I don’t know if you know the brand guessing you do, given that you named two very well known direct consumer brands away. The suitcase company, of course, yeah, amazing company. And I had a recent experience with them. My airline, I think, cracked my suitcase. It wasn’t me. And I just walked into their store in Soho and they were like, yeah, just bring it in. We’ll give you a new one.
43:20
Matt
Yeah, I was just oh, OK.
43:22
Ciaran
They were like, Where were you? And I was just standing there. I think I nearly fell over. I was just like, oh, no questions, no paperwork. This is it. And it’s that thing of it’s just it’s human. You want to be spoken to like that. You’d want to as we say at Dixa, you want to treat your customers as if they’re your friends. And that’s a really nice experience.
43:41
Matt
Very similar story. Now you’re reminding me of the company, the clothing company Bonobos, which I think is now owned by Walmart, if I’m not mistaken. But it was a blazer I needed for work travel, and when it arrived, one of the buttons was missing. And so it came with a spare button, but it was kind of shorn off or something, and I needed it for work, and so I took it to my dry cleaners and I had them sew it back on. But of course I had to pay for it. I went to Bonobos and they said, well, just how much was it? We’ll be happy to refund you. And they didn’t even ask for a receipt for the I said, oh, it was like $10 or something. They said, no problem. We’re going to give you would you like that in Bonobos credit, or would you like us to refund that amount to your credit card?
44:23
Matt
It just could not have been easier. And I was like, no forms. No. I didn’t get the run around. I didn’t have to demand to speak to a supervisor. I didn’t have to blast them on Twitter and wait for somebody to get back to me. It was just simple experience. They said, well, that was our fault. You shouldn’t have to pay for it. I understand you need it for a work trip, so you had to have it done, but just let us know what it costs and we’ll pay you. Like, OK, yeah.
44:44
Ciaran
And I guess the last thing any company would want is you blasting them on. Yeah. Listen, Matt, thank you so much for joining us in Customer Friendship Conversations. I found this insanely insightful and can’t appreciate you taking this time enough, so thank you very much.
45:02
Matt
Thanks, Ciaran. I appreciate the invitation.
45:05
Ciaran
Thanks for listening today’s episode of Customer Friendship Conversations. If you’ve enjoyed the show, then make sure you’re following us on your podcast platform of choice. It means that you’ll get notified each time we release a new episode, so you won’t miss out on any of the other amazing customer friendship heroes we’ll be showcasing in the coming months. Of course, a rating or review is a huge help to the show, so we always massively appreciate those as well. And if you’re interested in learning more about customer friendship, then head to Dixa.com to discover everything you want to know about customer experience as it’s meant to be. I’m Ciaran Nolan. And another huge thank you to Matt Dixon for helping us author another insightful episode of the show.