When Ipsos introduced a new Customer Experience (CX) metric called the Customer: Company Effort Ratio (C:CER) which consider the effort put in by both the customer and company, the response from the CX community signaled we had made a breakthrough. The C:CER metric, which came from extensive research in the USA, Australia and the UK, proved to be three times more accurate at predicting a customer’s tendency to use a company’s services or products again, following a poor experience or complaint, than the Customer Effort Score alone.
Building on recent research and analysis in multiple sectors in the UK, South Africa and across Latin America, this paper sheds new light on why it is essential for organizations to get the perceived balance of effort right in the eyes of customers. We report on the quantification of the links between the balance of effort put in by the company and customers across the sales cycle, and actual customer behavior, providing clear evidence of the revenue implications of not getting the balance of effort right.
In our R&D across 14 sectors, half of the customers interviewed believed they were working harder than companies to resolve an issue, with the ratio of effort varying significantly across sectors. In insurance, utilities and public services, only 10% of customers felt that the company had put in more effort than them. Even in the case of the ‘best performing’ online retailers, praised for the efficiency with which they deal with customer issues, still only just over a third (36%) of customers pointed to companies putting in more effort.
The Customer: Company Effort Ratio (C:CER) relates closely to one of the six Forces of CX: Fair Treatment – making customers feel that there is a fair exchange in their relationship with organizations. When customers believe that they are putting in more effort than the company to sort out an issue or get something done, they feel unfairly treated. This can have drastic consequences on relationship strength and customer outcomes, including churn and negative word of mouth.
When customers perceive that they have had to put more effort than a company into sorting out a situation, they are:
- More than four times as likely to stop using them
- Three times more likely to share their negative experience on social media
- Around twice as likely to tell friends and family about it.
Designing the right interventions
Company effort is not just about delivering financial rewards. Companies can salvage negative experiences by being proactive, dedicated, transparent, and simply showing respect.
The real challenge is to understand how to optimize interventions in order to maximize return on investment made in complaints and case management systems, and ultimately reduce churn and negative word of mouth. In this paper, our Ipsos Customer Experience team also gives guidance on how to determine which issues should be prioritized and the most suitable and cost-effective response.
- Getting the balance of effort right, throughout the customer journey, is crucial, as it impacts customer behavior and financial performance
- The balance of effort relates to perceptions of Fair Treatment, one of the six fundamental building blocks of emotional attachment and relationship strength – the Forces of CX
- Organizations need to identify situations where the balance of effort is not optimal, and intervene to reduce negative outcomes such as churn or bad mouthing
- A critical success factor is the ability to leverage the vast amount of behavioral data held about customers (the what) and combine it with survey data (the why) to create more targeted and effective interventions to drive a return on company effort.