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If you’re aspiring to satisfy your customers, then you are aspiring to mediocrity.
That’s the stark reality in today’s business environment, where customers who are seemingly “satisfied” defect all the time. With a few clicks of a mouse or taps on a smartphone, it’s easier than ever for people to find and switch to alternative products and services. How can a business possibly compete in an environment like that, one where it’s increasingly difficult to stand out from the crowd, one where even satisfying customers doesn’t ensure success?
It’s a question that vexes many a business leader, yet a select number of organizations seem to have found the answer. They’ve figured out how to flourish in good times and bad, how to combat the scourge of commoditization, how to succeed in even the most challenging environments. Consider these examples:
- In 2008–2009, during the height of the “Great Recession,” Hyundai Motors grew its revenue by double digits and increased its market share by an astounding 40 percent. What makes their feat all the more impressive is that they achieved these gains in the middle of a historic economic meltdown, when almost every other auto manufacturer was seeing their sales plummet.
- From its humble beginnings as a local Texas-based air carrier, Southwest Airlines became the largest and arguably most successful US domestic air carrier, earning a profit for 47 consecutive years. It’s an accomplishment that would be impressive in any business, but even more so in the airline business—a notoriously competitive industry that has struggled to make a single dollar of cumulative profit over the last half-century.
- In 2003, Apple launched the iTunes Music Store, which allowed customers to purchase and download music for 99 cents a song. In its first week, people bought more than one million songs on iTunes. It was an excellent debut, made all the more impressive given that iTunes users chose to pay nearly a buck a song for music that was available for free on other file-sharing platforms.
- During the early 2000s, ING Direct became the fastest-growing financial institution in the United States. The upstart (now a unit of Capital One) entered the brutally competitive, high-volume, low-margin banking business and proceeded to win against larger and more established institutions. In less than a decade, ING Direct became the largest savings bank in the United States. But what was most impressive was that they did it by eschewing some of the banking industry’s most reliable practices for revenue generation.
- In 2012, electronics retailer Best Buy—like most every other brick-and-mortar retail chain—was struggling to survive in a post-Amazon.com world. How could one possibly compete with the ease and convenience afforded by Amazon and its patented “1-Click” purchase button? Fast-forward five years later and Best Buy was thriving, having pinpointed the one thing they could provide to customers that Amazon would never be able to replicate. Even Amazon CEO Jeff Bezos was impressed, calling Best Buy’s turnaround “remarkable.”
Hyundai, Southwest, Apple, ING Direct, and Best Buy are among the companies that have achieved extraordinary success despite facing enormous economic and competitive headwinds. And while they all operated in very different industries, facing very different hurdles, their ultimate success was born out of the same strategic playbook: they focused on the customer experience.
The impressive success of these firms was a consequence of the impression they made—on sales prospects, on customers, and even on employees. And in response, people became obsessed with these firms and their offerings, going out of their way to patronize (and rave about) them.
It’s a strategy that has relevance to companies large and small, public and private, business-to-consumer (B2C) and business-to-business (B2B). That’s because these days, many sources of competitive differentiation can be fleeting. Product innovations can be mimicked, technology advances can be copied, and cost leadership is difficult to achieve let alone sustain.
But a great customer experience, and the internal ecosystem that supports it, can confer tremendous strategic and economic advantage to a business in a way that can be difficult for competitors to copy.
Businesses that effectively employ this strategy have a number of things in common. They’ve realized that “customer experience” is about far more than just “customer service.” They’ve recognized that cultivating customer loyalty is as much about shaping people’s memories as it is about shaping their experiences. And most important, they’ve discovered a discrete set of science-based techniques that help them turn more sales prospects into customers, and more customers into raving fans.
This book is the story of those techniques and the widely admired organizations that have used them to great effect. More than that, however, this book is also your personal roadmap, a guide for leveraging these proven principles within your own business so you can turn your company’s customer experience into its greatest competitive advantage.
Chapter 12 — “Give the Perception of Control”
In the late 1970s, Richard Mills, a University of Southern California psychology student, conducted an unusual experiment to test theories around the emerging concept of “perceived control”—the idea, posited by other academics, that the more control people exert over their surroundings, the happier they are.
Mills approached the local American Red Cross blood donation center and enlisted their help in a study. For one group of people, the Red Cross phlebotomist asked the donors to choose from which arm they wanted blood to be drawn. The other group was given no such choice; the nurse merely advised that blood would be drawn from the donor’s nondominant arm.
The donors who were given the opportunity to select an arm for the phlebotomy reported feeling significantly less discomfort from the procedure, as compared to those who were given no such choice. That’s right—simply allowing people to choose which arm blood was taken from had a meaningful influence on their perception of the experience. But wait, it gets even more interesting.
Mills tested a different set of donors with another type of experimental intervention. Instead of giving the donors in this group the choice of arm, they were given information about the procedure—a two-minute recording that described, step by step, how the blood would be drawn and what physiological and psychological sensations the donor might experience. Just like the donors who were able to choose an arm, the donors who heard the detailed explanation of the procedure reported feeling less discomfort than those who received no such information.
Mills’s study had indeed added to the growing body of evidence that when people are able to exert control over various aspects of their life, they feel better, physically and psychologically. We as a species are, for lack of a better term, control freaks. We like to have our “hands on the steering wheel,” wielding control over our lives and what goes on around us.
The problem is, in many circumstances, we simply can’t have our hands on the steering wheel; we can’t truly control what’s happening to us. Instead, we have to delegate that control to another party—to the nurse, for example, who draws our blood. Or to the mechanic who fixes our car. Or to the financial advisor who manages our investments. The fact is, in the real world, we can’t control every experience we go through, because sometimes those experiences have to be delivered to us by others, based on some special expertise or knowledge they possess.
The risk in customer experience, though, is that the moment we delegate control to another party—that nurse, that mechanic, that financial advisor, or some other entity—it’s quite likely that we’ll feel less good about the encounter. In essence, a loss of control sows the seeds for customer dissatisfaction.
The good news, however, is that Mills’s research, and the many studies which followed it, pointed to a highly effective proxy for giving customers direct control of an experience, and that is giving them the perception of control. That’s really what the blood donors in Mills’s study had. They certainly didn’t have direct control of the experience, because after all, they were letting a complete stranger stick a sharp object in their arm and draw blood.
However, the mere act of choosing which arm they wanted to use for the draw actually gave the donors the sense that they had some control over the procedure. In objective terms, that small decision—which arm to use—really doesn’t translate into the donor exerting control over the experience. Left arm or right arm, it’s still a stranger coming at you with a needle. But from a cognitive standpoint, it makes a big difference. That small choice, even though applied to a seemingly minor facet of the blood donation procedure, makes donors feel meaningfully better about the experience.
It turns out, though, that there’s more than one way to give people the perception that they have control of an experience. One approach, as we saw with blood donors’ arm choice, is to help people influence the experience, so the experience conforms to their thoughts (e.g., “I want to use my left arm for this procedure”).
But another equally effective approach is to help people influence their thoughts, so their thoughts conform to the experience (e.g., “I understand how this donation procedure works”). Or to put it more simply, it’s about managing expectations. That’s essentially what Mills did with the test subjects who were given a detailed explanation of the blood draw procedure before they went through it. By sharing that information up front, donors felt more in control and had a better experience, merely because they knew what to expect. The removal of uncertainty and ambiguity is inherently pleasing, because it helps us feel more in control of our destiny.
What’s astonishing about this approach (technically referred to as “secondary control”) is that it can fundamentally improve people’s impressions of an experience—even if the underlying experience isn’t changed at all. The Perception of Control principle is almost magical in that way, as we’ll see in the next example.