“Customer experience is the new marketing battlefront.”
- Chris Pemberton, Gartner
We’ve all encountered instances where our interactions with businesses or customer service teams could have gone better.
While minor mishaps are often forgivable, major customer experience failures can leave lasting scars on both customers and the companies involved.
Customer experience fails aren’t just minor hiccups like an awkward phone call or a pricing misunderstanding.
They represent significant errors that are difficult to forget and even harder to forgive for those affected.
But amidst these challenges lies an opportunity for growth and improvement. By examining these failures, businesses, regardless of size, can glean valuable insights.
Whether you’re a small startup or a corporate giant, understanding these situations can help your company navigate them effectively and, more importantly, prevent them from occurring in the future.
A. The Cost of Poor Customer Experience
Let now look at the cost of poor customer experience and the prime causes that lead to unhappy customers:
A. Neglecting Customer Needs
Prioritizing the growth of your company over fulfilling customer needs is a common mistake that many customer success managers (CSMs) make.
Instead of focusing on helping customers achieve their goals with your product or service, some CSMs may push customers down the sales funnel, ultimately jeopardizing customer satisfaction.
A notable example of this mistake is seen in the case of MoviePass, a subscription-based service that allows customers to watch one movie a day for a monthly fee of $10. Despite its initial popularity, MoviePass faced over 1,500 complaints to the Better Business Bureau, leading to the suspension of its service.
One customer complaint that gained attention involved a customer from San Francisco whose account was abruptly canceled without notice.
Upon contacting customer support, she learned that her account was terminated due to violation of the terms and agreements—specifically, for viewing a “premium movie,” which was against the subscription policy and resulted in cancellation without a refund.
Handling the Situation:
In this scenario, MoviePass failed to prioritize customer needs over company policies. To address this issue effectively, MoviePass should have ensured that its policies were clearly communicated to customers during sign-up, including what constitutes a “premium movie.”
Furthermore, instead of simply terminating accounts for policy violations, MoviePass should have proactively reached out to customers to educate them on policy adherence and provide assistance in understanding the subscription terms. By offering proactive customer service and clarifying policy confusion, MoviePass could have preserved customer loyalty and prevented the negative repercussions of neglecting customer needs.
B. Lack of a Dedicated CSM Leader
Effective customer success management relies heavily on strong leadership to drive strategy and ensure seamless customer experiences.
Having a dedicated CSM leader is crucial as they oversee team performance and equip customer success managers (CSMs) with the necessary tools to assist customers effectively.
Identifying the right individual to lead your CSM team is essential, particularly during critical moments when their expertise is needed the most.
A notable example highlighting the importance of effective leadership in customer service can be observed in the case of American Airlines.
The airline industry is notorious for its challenges in customer service, often resulting from high-stress environments and complex protocols at airports.
In one incident, an American Airlines flight attendant requested a passenger traveling with a $30,000 cello to disembark from the plane, citing that the instrument was “too big” for the aircraft.
Subsequently, the passenger was asked to board another flight departing an hour later. However, she encountered further difficulties as the crew of the subsequent flight refused to allow her on board, leading to her being surrounded by airport police under the assumption that she was non-compliant.
Eventually, it was discovered that the airline’s policies did permit the transportation of such musical instruments, and the passenger could have flown on the original flight.
Handling the Situation:
This incident underscores the necessity of having a dedicated CSM leader who ensures that team members are well-versed in company policies and protocols. In situations involving disputes or misunderstandings, having a knowledgeable manager readily available can mitigate confusion and resolve issues promptly.
Customer service is a collaborative effort, and having a capable leader who can take ownership of challenging situations is crucial. By empowering CSMs with effective leadership and clear guidance, companies can navigate complex scenarios like the one encountered by American Airlines with greater efficiency and customer satisfaction.
3. Insufficient Proactive Customer Service
In the realm of customer experience, proactive service stands out as a crucial component. While reactive support addresses issues as they arise, proactive customer success takes a preemptive approach, identifying and resolving problems before they impact the customer.
This proactive stance not only fosters a sense of security and satisfaction among customers but also cultivates long-term loyalty and advocacy.
A prime example of the importance of proactive service can be seen in the case of retail giant Target. Several years back, an anonymous individual created a Facebook page posing as Target’s customer service team.
This imposter responded to customer complaints with mocking and inappropriate remarks, causing confusion among Target’s online community.
While the impostor aimed to defend the brand, their actions did not align with Target’s values and were misconstrued as official responses. Target could have mitigated this situation by proactively monitoring social media channels for such fraudulent accounts.
Anticipating customer reactions to changes in branding, Target could have intervened early, preventing the issue from escalating and tarnishing the brand’s reputation.
Handling the Situation:
Incorporating proactive measures into customer service strategies is vital for modern businesses.
By actively engaging with customers across various channels and addressing concerns before they escalate, companies can foster trust, satisfaction, and advocacy.
Investing in conversational marketing tools and maintaining open lines of communication throughout the customer journey are essential steps toward delivering proactive and exemplary customer service.
4. Excessive Customer Engagement
Maintaining open communication with customers is vital for understanding their needs and ensuring their satisfaction.
However, there’s a fine line between proactive engagement and overwhelming customers with communication. Over-engagement often stems from a desire to address potential issues or concerns, but it can inadvertently lead to irritation and frustration among customers.
Each customer interaction should be purposeful and considerate, respecting their time and preferences. Sending multiple messages or calls to customers out of fear of losing them can backfire and strain the customer relationship.
Additionally, over-engagement may divert resources and attention away from customers who genuinely require assistance, causing inefficiencies in customer support operations.
A notable example of over-engagement can be observed in the case of Comcast, a telecommunications company.
In a widely publicized incident, a Comcast representative attempted to dissuade a customer from canceling their service instead of assisting them with the cancellation process.
This persistent effort to retain the customers resulted in a negative experience and garnered negative media attention for Comcast.
Handling the Situation:
To avoid over-engagement, customer service representatives should prioritize understanding and addressing customer needs promptly and efficiently.
When customers express a desire to cancel or discontinue service, it’s essential to respect their decision and facilitate the process seamlessly.
Maintaining a balance between proactive communication and respecting customer boundaries is crucial for fostering positive customer relationships and loyalty.
5. Eliminating Customer Success Silos
When different departments within a company fail to share information and align their goals, it creates what’s known as a data silo. These silos hinder the ability to deliver seamless experiences to customers, impacting not only customer support but the entire organization’s performance.
A prime example of this is when sales, marketing, and customer success teams operate independently without exchanging vital customer data.
Without this integration, it becomes challenging to gain insights into customer behavior and effectively target specific customer segments.
Breaking down these silos is crucial for fostering cross-functional collaboration and achieving strategic objectives. By encouraging interaction between teams, companies can enhance the customer experience and ensure a unified approach to addressing customer needs.
Spectrum, an internet service provider, encountered a customer success silo when a customer scheduled a maintenance visit to set up her internet.
Despite assurances from the support team that the maintenance worker was en route, he arrived two hours late and left after encountering a locked entrance.
Subsequent attempts to reschedule the appointment were met with delays, leading to frustration and, ultimately, the customer canceling her subscription.
This breakdown in communication between support and maintenance teams highlighted the negative impact of customer success silos on customer satisfaction and retention.
Handling the Situation:
To prevent such incidents, companies like Spectrum should prioritize alignment between support and operational teams.
Implementing communication channels such as internal messaging systems can facilitate real-time updates and ensure that teams are promptly informed about customer issues.
By sharing relevant information across departments, companies can make informed decisions and deliver crafted solutions to customers.
6. Avoiding Generic Customer Outcomes
While creating standardized processes can streamline operations, applying a one-size-fits-all approach to customer success undermines the goal of delivering personalized experiences.
Each customer is unique, with distinct needs and preferences that require individualized attention and guidance.
Failing to tailor customer interactions to their specific circumstances can lead to dissatisfaction and hinder long-term relationships.
Customer success managers must prioritize understanding each customer’s goals and objectives, setting specific key performance indicators (KPIs), and adapting their approach accordingly.
A notable instance of failing to address individual customer needs occurred during a conversation between a Samsung customer service representative and a frustrated customer. The customer expressed concerns about needing to be present to sign for a package despite conflicting work commitments.
Instead of exploring alternatives to accommodate the customer’s schedule, the Samsung representative adhered strictly to company policies, resulting in a negative experience and public backlash.
Handling the Situation:
In situations like this, companies should empower their customer service representatives to exercise flexibility and discretion when addressing customer concerns.
By prioritizing customer needs over rigid policies, companies like Samsung can demonstrate genuine empathy and commitment to customer satisfaction, fostering loyalty and positive brand perception.
7. Engaging with Unsuitable Customers
Efficient customer success involves identifying and nurturing relationships with customers who align with your business’s goals and offerings. However, engaging with customers who are not a good fit for your product or service can drain resources and hinder overall growth.
Identifying bad-fit customers early on is crucial to avoid investing time and effort in prospects that are unlikely to yield profitable outcomes.
Collaborating closely with marketing and sales teams can provide valuable insights into potential customers, enabling you to identify and disengage from unsuitable leads before they become costly customers.
A notable example illustrating the importance of disengaging from bad-fit customers is seen in the experience of Kyle Racki, CEO of Proposify. Racki noticed a customer consistently expressing dissatisfaction with their software despite efforts to address their concerns.
Recognizing that the customer’s expectations were unrealistic and causing undue stress on his team, Racki made the decision to part ways with the customer. In a tactful email, he apologized for the inability to meet their needs, offered a refund, and even suggested alternative solutions from competitors.
The outcome was unexpectedly positive, as the customer appreciated the honesty and dedication to their best interests, resulting in a positive resolution and potential advocacy for Proposify.
Handling the Situation:
Kyle Racki’s approach highlights the importance of prioritizing customer needs and integrity in customer interactions.
When faced with bad-fit customers, it’s crucial to communicate openly, take responsibility for any shortcomings, and offer solutions or alternatives where possible. This approach not only maintains the company’s reputation but also fosters loyalty and trust among customers.
8. Lengthy Response Times
In today’s fast-paced world, customers expect prompt resolution of their inquiries and issues. Prolonged response times can lead to frustration, tarnished brand reputation, and, ultimately, customer attrition.
Research suggests that the acceptable waiting time for customer service inquiries is two minutes or less. Exceeding this threshold can result in dissatisfaction and negative word-of-mouth, particularly on social media platforms where customers often share their experiences.
To mitigate long response times, businesses must establish clear guidelines and training programs to streamline support processes and boost efficiency. Implementing intelligent call routing systems can also help prioritize and direct inquiries to the appropriate departments, minimizing call transfers and improving overall customer satisfaction.
Comcast‘s reputation for poor customer service is underscored by incidents of excessively long wait times and inadequate resolution of issues. Customers have reported being placed on hold for hours or experiencing multiple call transfers without resolution, exacerbating frustration and dissatisfaction.
Handling the Situation:
To address prolonged response times, Comcast can implement a ticketing system that incentivizes representatives to resolve customer inquiries promptly. Additionally, leveraging AI-based chatbots can provide instant responses and assist with basic inquiries, reducing wait times and improving overall customer experience. Furthermore, ensuring clear pathways for handling complex issues can help streamline support processes and enhance customer satisfaction levels.
9. Falling Short on Meeting Customer Demand
Is it possible to have too many customers? Not really, but it is possible for customer demand to outpace your ability to provide adequate support.
When your business experiences rapid growth and an influx of customers, it’s a positive sign that your product or service is in high demand.
However, it’s crucial to ensure fairness to all customers and to prioritize those with the highest lifetime value to your business, regardless of its size.
In November 2022, TicketMaster faced a significant challenge during the volume of sales of tickets for Taylor Swift’s Eras tour.
Due to overwhelming demand, TicketMaster’s servers crashed, and the majority of tickets were purchased by bots operated by third-party sellers.
This led to fans being forced to pay exorbitant prices for tickets, sparking outrage and even resulting in a lawsuit against TicketMaster.
Handling the situation:
In such situations, customer service leaders must be adept at crisis management. Having a predetermined response strategy in place, such as a canned response from management, can help streamline communication and direct customers to appropriate support resources.
Additionally, offering transparency and updates to affected customers can help mitigate frustration and maintain trust in your brand, even during challenging times.
By prioritizing customer satisfaction and effective communication, businesses can navigate periods of high demand while preserving their reputation and customer loyalty.
B. Summarizing The Cost of Poor Customer Experience
In today’s competitive market, delivering an exceptional customer experience is crucial for retaining customers and improving brand loyalty.
However, despite best efforts, customer experience failures can occur. Understanding the common reasons behind these failures and implementing strategies to address them is important for any business striving for excellence.
This article explores nine real cases of bad customer experience resulting in expensive lessons for huge brands.
From these incidents, the business will identify how not to get entangled in such incidents or situations so that customer experience still becomes the priority, then loyalty and trust would occur, leading to growth as well.
Suggested read: NPS Survey Questions: How to Elevate Customer Experience
C. Common FAQs on Customer Experience Failures
Can technology help reduce customer experience failures?
Yes, technology can play a crucial role in reducing failures. CRM systems help manage customer information and interactions efficiently, chatbots provide immediate assistance for common queries, and data analytics can identify patterns and predict issues before they escalate.
How does feedback contribute to improving customer experiences?
Feedback is vital for knowing your customer’s needs and pain points. By regularly collecting and analyzing feedback, businesses can identify areas for improvement, make informed decisions, and make changes that improve the overall customer experience.
What are some popular and effective ways to gather customer feedback?
Effective ways to gather feedback include surveys, social media monitoring, direct customer interviews, feedback forms on websites, and follow-up emails after a purchase or service interaction. Offering incentives for feedback can also increase response rates.
How can a company measure the impact of improvements made to address customer experience failures?
Companies can measure the impact through metrics such as customer satisfaction scores (CSAT), Net Promoter Score (NPS), customer retention rates, and the total number of repeat purchases. Monitoring changes in these metrics before and after implementing improvements provides insights into their effectiveness.
