Why is it that some businesses are so successful at generating revenue through outstanding customer service—while others struggle to keep churn at bay?
We’ve been asking this question a lot lately. Most recently, we took a look at concrete best practices from companies at the top of the American Customer Satisfaction Index.
Of course, ACSI rankings aren’t the only benchmark out there. Plenty of others offer even more clues as to what the best customer service companies do differently.
So today, we’re turning to another widely acclaimed list for two more excellent examples to consider when building out your customer experience strategy.
What NPS tells us about customer service
When it comes to understanding the customer experience, few metrics are as reliable as the Net Promoter Score. Though NPS provides just one insight—how likely people are to recommend a company to others—it’s the one that can be tied directly to success. Research has long shown a strong correlation between NPS and company growth.
So, when a list ranks companies based solely on NPS, it’s an important one to watch.
The Satmetrix Net Promoter Benchmarks draws on responses from more than 68,000 customers of more than 190 brands and 20 sectors. Each individual industry has a top performer based purely on NPS. This makes the results especially telling.
In looking at the latest list, two businesses in particular stood out. So we looked a little deeper into what’s contributing to those companies’ uncharacteristically high Net Promoter Scores.
In several sectors that are notoriously rife with customer service complications, one organization has managed to cultivate customer loyalty for nearly a century.
USAA, which stands for United Services Automobile Association, has spent a solid decade at the top of the NPS benchmarks list for three different industries: auto insurance, banking and home and contents insurance.
The USAA bank has grown when others teetered on the verge of collapse, and Reddit alone is filled with stories from customers who are repeatedly blown away by the competency and generosity of support agents within the company’s insurance branch. Start reading about the company’s history of customer support, and you’ll quickly come across adjectives like “phenomenal” and “amazing.”
So, what has USAA been doing all these years to remain in such enviably good standing with customers?
It would be easy to assume that USAA’s success is based solely on heavy lifting in areas like hiring and training.
In fact, the answer is far simpler.
From the start, customer service has always been a core component of company culture. As one writer for Forbes put it:
“Every employee here is a customer—a member—of USAA. You get your membership with your initial onboarding documents. This, combined with serving members every day, keeps employees in constant touch with how USAA does business.”
USAA clearly understands how important it is to “bake” customer service into everything you do.
Key takeaway: Strive to embed customer service into your company’s DNA—instead of treating it as an afterthought.
Any business person familiar with the Ritz-Carlton Leadership Center has no doubt heard about the brand’s famous $2,000 rule. Employees at all levels are empowered to spend up to two grand per guest, per incident, to resolve an issue or improve a stay—without having to go through levels of leadership for approval.
People are often amazed by the amount, but the real magic to this method goes much deeper.
In fact, according to Ritz-Carlton executives, the full pre-approved $2,000 is rarely used.
The power of this approach lies in the fact that employees “are able to make decisions in the moment to quickly resolve a guest issue or to make an experience beautiful and memorable.”
This theory has been born out in research, too. Analysts measure it based on the amount of effort a customer has to put in to get a problem solved. The lower the customer effort score (CES), the higher the likelihood of loyalty. Studies have shown a drastic difference in churn rates based on this one factor alone.
Key takeaway: The less effort your customer has to put in to get an issue resolved, the more likely you’ll be to cultivate that customer for life.
There are many more excellent examples of outstanding customer service strategies to emulate, and we’ll continue to explore them on the Sugar blog. In the meantime, applying these key takeaways alone can have a tremendous impact on the bottom line.