Less pain, more gain: Making it easy for customers

Less pain, more gain: Making it easy for customers

Customer Effort (CE) is becoming an increasingly important key metric in measuring customer experience. Research suggests that it is a more powerful predicator of customer loyalty compared to other key metrics, such as Net Promoter Score (NPS); meaning that rather than ‘delighting’ customers, it is far more effective to concentrate on minimising their effort and solving their problems as they go through the customer journey. Indeed in a digital world where technology has made life easier, CE is expected to become an ever more important concept for businesses to consider.

When a customer interacts with a business, they are incurring a cost that is more than just the initial money spent at the time of the purchase. These costs could relate to anything, from the amount of time taken to arrange delivery of the product, to the frustration of waiting for it to arrive, especially if late. CE measures the customer’s perception of the time and energy they have to spend during this interaction, however effort is far more than a simple ease measurement.

Research findings suggest that CE is more effective at predicating the propensity of customers to repurchase and increase spend than NPS and Customer Satisfaction (CSat). In a study for the Harvard Business Review [1], Mark Dixon and colleagues conducted a comprehensive study of 75,000 customers and their interactions with companies across a range of global industries. For those who perceived their interaction to be of low effort, 94% intended to repurchase and 88% claimed they would increase their spending. Furthermore, CE was also found to be a driver of NPS; 81% of customers with a high effort level had the intention to spread negative word of mouth, compared to just 1% for those who reported low effort. Facts International’s own Key Driver Analysis for the retail processing operations of a well-known national bank has also come to the same conclusion.

Despite the wide adoption of the Customer Effort Score (CES) as a key research metric, this only tells part of the story. Since effort means many things to different people, without fully understanding the different types of CE, only limited insight can be drawn. Academic theory, such as that conducted by Henley Business School [2], identifies there are four different dimensions of CE; Cognitive (thinking), Emotional (psychological), Time, and Physical – each changing by sector as well as customer type. A noteworthy consideration is that the different CE dimensions are interrelated and interact with each other. Also, there are some activities where effort can be embraced, for example the cognitive effort of searching for a holiday.

When designing a survey tool for CE, there are a number of challenges that need to be considered, such as the transferability across industries, the fact that effort can be perceived as a benefit, the wording of survey items and what type of experience the research should be based on (transactional vs reputational).

There are a wide range of approaches, both qualitative and quantitative, which we at Facts International use to operationalize these concepts of Customer Effort into a successful and insightful research tool. Contact us for more information about how we can use CE to help answer your business questions.


 References

[1] Dixon, M., Freeman, K and Toman, N. (2010) Stop trying to delight your customers. Harvard Business Review, 88 (7/8), p. 116–22

[2] Clark, M. and Bryan, A. (2013). Customer Effort: Help or Hype? Henley Business School, University of Reading. Available at: http://www.ccma.ie/upload/news/files/1372936500_Cust_Effort_BT_and_Henley_whitepaper_FINAL_15.4.13.pdf

  +44 (0) 1233 648 530 Get in touch