Tips & Hints

The importance of customer perception to your service and what you can do to improve it

Published on 06 January, 2022

Sometimes it's easy to fall into the trap of only viewing your customers as transactional entities that grow your business and contribute to the health of your bottom line. It's important to remember that while your customers are the key contributor to your sales and revenue, they are also sentient human beings with thoughts and feelings. Thoughts and feelings that play a very big part in how and when they decide to give you their business and purchase your products and services. Their loyalty should not be taken as given, and you should always try, as a business, to be mindful of how your customers perceive your brand and service. In doing so, and working to improve this perception, you can build long-lasting customers relationships that you know you can count on.

What is customer perception?

Customer perception is how your customers, and potential customers, perceive your brand. It's what they think and how they feel about your business, based on direct and indirect interactions that take place. Customer perception exists alongside customer experience, which is how those individual interactions make your customers feel in the moment. Imagine your worst ever customer experience with a brand. Maybe the company lost your shipped item and refused to accept the blame or issue a refund. Maybe they took a duplicate payment from your bank and passed you around 5 different departments and then told you that you needed to speak to your bank before they could help. To a business, these disappointing interactions may have felt like a drop in the ocean. But to you, not only might they leave you feeling angry and frustrated in the moment, they may also have left you believing that the company in question is useless, unhelpful and not worth your time or money. And this perception may persist, preventing you from doing any more business and prompting you to tell your friends and family — and even strangers online — that the company is a total let down. So that's not just one customer the business has lost, but potentially dozens or hundreds.

Why is customer perception important to your business?

Customer perception doesn't just have the power to turn one customer and their close network away. It can ruin years of hard work spent establishing yourself as a brand with certain values and service levels. For 1 in 3 customers, it takes just one bad experience with a brand they love to stop them from going back. This statistic doesn't even take into consideration pricing, competitor activity or quality of your products — this 1 in 3 customer will forget all about those other factors following a single bad experience. It can cost businesses between 5 and 25 times more to acquire a new customer than it can to retain existing ones, so losing customers because of bad experiences and lasting perceptions should be avoided at all costs.

Improving your customer perception by creating better customer experiences can also have tangible business results. Companies can grow revenues between 4% and 8% above their market when they prioritise improved customer service experiences. Around 89% of businesses that provide "significantly above average" customer experiences perform better financially than their competitors. So, if you're yet to invest in finding out how customers perceive your brand, it's time to get started!

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How to measure the customer perception of your service

If you really want to get a strong handle on your customer perception and whether your improvement strategies work, you should start out by benchmarking your current performance and setting metrics that will reflect your progress. To do this, you can use a mix of qualitative and quantitative data from your customers. Try these data collection methods for rich, useful benchmarking data:

How to improve customer perception

Now you have a clear benchmark of how your customers perceive your brand, it's time to look inward and create an improvement strategy. We've listed the key steps you should follow below.

Collect customer feedback on an ongoing basis

Using customer feedback to gauge how your customers perceive your company isn't just for benchmarking purposes. Keeping in regular contact with your customers about their experiences and how your business is making them feel is the best way to stay on top of how they perceive you. Schedule regular surveys and focus groups, and welcome honest feedback at every turn. Position yourself as a company that is ready and waiting to not only receive feedback but listen to it and act on it. The very act of creating this dialogue and feedback loop with your customers can have a positive impact on how they perceive you.

Collecting feedback in this way can be challenging because it usually takes a strong opinion — good or bad — to instigate feedback, and this doesn't always provide an accurate or balanced view of your customer perception. You can consider incentivising feedback participation with a prize draw, as this can help attract a broader range of customers.

Stay close to your customers at every touchpoint

Don't save following up with your customers for the moments that their journeys end with you, or when they're unhappy and need help. Check-in with them after important engagements, or even just as a regular courtesy follow up. Reaching out to them shows that you genuinely care about their experience and always have it front of mind, which in turn can strengthen your relationships and build out a very loyal customer base. Follow-up messages can also help to prevent customer churn. Regular contact means you're not missing any chance to improve your customers' experiences, and they give you the chance to cross or upsell when faced with a positive experience. Staying this close to your customers when they have a negative experience also gives you the chance to win them back and turn the situation around before they decide to leave your business and move to a competitor.

Invest in better customer service training

Treating each other with kindness and humanity is something that is becoming more important in today's world. But don't assume it's a given within your customer service team. Within a service environment, treating customers this way takes skill and training so the right questions can be asked and the right processes followed to deliver an exceptional customer experience. Industry standards of customer service are increasing all the time, as are customer expectations. You must keep on top of these and ensure that your people are provided with the necessary skills and training to provide the excellent service your customers now expect.

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Carry out a company-wide audit

Having the right processes in place is an issue that many businesses face, especially big companies with long-standing processes that have become entrenched over many years. Often, these processes and protocols are seen as 'just the way we do things around here', and are so ingrained in the day-to-day workings of a business that they can eclipse the needs of the customer by putting processes over people. Customer service teams may feel bound to these ways of working, with no freedom to act autonomously and treat the customer in a more human way when the need arises.

Changing these processes and protocols to allow for more flexibility and, crucially, more humanity might seem like a daunting task. But now is the time to be brave and make the change otherwise your business risks losing its humanity to process forever. If this is not done then in time your customers will realise they can get the service they expect elsewhere and will leave.

Strive for excellence consistently

Fantastic, loyalty-building experiences should not be reserved for difficult or high-risk customers. Every customer on your books deserves the same consistent treatment, and every time they use your company their experience should be the same. This is key to creating a positive customer perception. If you're not sure where to start, try creating and establishing a set of values for your business. These should act as an anchor for all of your interactions, be they with customers, clients or partners. Training and regular reviews can also help to shape a team that delivers the same great experiences across the board time and time again.

Summary

Customer perception can make or break a business, and the experience your customers have with your company plays a massive part in shaping that perception. Every interaction a customer has with your brand needs to create a great experience that makes them think and feel positive things about your business. How you deliver your customer service is a huge opportunity to shape your customers' perceptions, but before you get started on improving anything, it is important to benchmark your current performance. This means that when you roll out improvements, you will be able to measure their impact on your business. The bottom line to improving how customers perceive your business is to treat them like humans — as you would want to be treated — and shape your business around this mission.

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