Customer Expectations

Influencing Factors & Management

These days, many companies not only compete based on drivers such as price and quality but increasingly based on customer experience, which means understanding customer expectations is crucial for a company’s success today. Understanding and recognizing needs and deriving value-added solutions from them is the basis for meeting and exceeding customer expectations.

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It is all about customers: they buy products, services, and goods; they guarantee a company’s profit. To do this, you have to offer them something that motivates them to buy and then confirm and reward their action as well. Because hardly anyone buys rationally. Most of them rely on their gut feeling, e.g. their emotions. To sum up, you have to meet customer expectations and work on your customer orientation to increase customer satisfaction and ultimately strengthen customer retention. But what are customer expectations? What constitutes them and how do you deal with them?

Customer Expectation and Influencing Factors

As soon as a prospective customer comes into contact with a brand, he already has certain ideas in his head that are fueled by his usual buying actions, by the market, and of course by the company itself. Sounds complicated, but examples make it easier to understand: Nowadays, customers are used to companies being found online with just a few clicks. In addition, customers expect a well-stocked and clearly arranged online store when a company offers products, as well as a short shipping time. Retail giants like Amazon condition customers to promptly receive their orders. Therefore, having to wait several weeks for an order to arrive is basically a no-go Easy and customer-friendly service, such as a comprehensive option for contacting the company and receiving a prompt response, which is also part of the usual customer expectations.

You can already see how widely diversified expectations can be and that they can also exist consciously and unconsciously. After all, some customers cannot even express their expectations in advance. It is only when they are fulfilled—or not—they become aware of their expectations. By fulfilling such unconscious expectations, positive surprises arise and companies are often able to even exceed them.

These demands on retailers, sellers, and shops seem to be complex. But you can easily test these expectations on yourself to understand them better: What does a business have to offer to get you interested in its product in the first place? When do you enter a store, or do you prefer to browse in an online store completely? What are the basics that a business must at least fulfill to get customers to browse through its product portfolio?

Customer-related, company-related, and competition-related factors have a fundamental influence on customer expectations. Thereby, customer-related factors are made up of aspects such as the personality of the customer and the specific situation. These include needs and wishes, for example.

Company-related factors, on the other hand, include customers’ previous experiences with the company. These consist of personal experiences from previous service claims, as well as (advertising) communication from the company itself, and communication about the company from family, friends, and experts.

Customers’ previous experiences with competing companies define the competition-related factors. As with the company-related factors, communication from the competition, for example, specific offers and reports from family friends, and experts as well.

Customer Expectations in the Age of Digital Transformation

Digital transformation is also naturally influencing the expectations of buyers. After all, new technologies are well suited for companies to continually set new standards in their industry to drive innovation and surprise customers. This, of course, also creates pressure to keep adapting to new opportunities and to keep growing. The reason for amazement just a few years ago may be worth only a yawn today.

As already mentioned, large companies, in particular, are constantly managing to raise customer expectations to unimaginable heights. Whereas next-day delivery was an expensive additional service until a few years ago, in which courier services specialized, today it has almost become standard. A company’s presence on various channels that supplement each other is also standard today, and no customer will be amazed if a company’s app can be downloaded for free. Such channels include an online store, an app, a brick-and-mortar store, and also a catalog. The magic word here is omnichannel, i.e. the focus on all channels and omnichannel management, which implements a cross-channel strategy in marketing.

Anyone who wants to throw the towel in at this point as an SME or family business should pause for a moment. It does not take a huge company to meet customer expectations. The technical possibilities in marketing, such as a good CRM system and an ERP system, are fundamental. They enable collecting important data locally in one place, link it, and design sophisticated strategies based on it. With this extensive information, one takes a step in the direction of the transparent customer.

The Transparent Customer

In order to know the expectations of its own customers, a business needs basic information that influences purchasing behavior. The term “transparent customer” summarizes the trend to collect, evaluate, and use this data through various methods. Typical collection methods include:

Companies can use this information to place personalized advertising, optimize internal processes and, of course, increase customer retention. After all, evaluating this information provides a good overview of what customers expect from their own company and which measures have been particularly successful in this regard. This requires an internal location where all the threads relating to customer expectations come together: the management of customer expectations.

Managing Customer Expectations

As soon as companies manage to focus on customers and their needs, the overall experience of customers with the respective brand becomes important. This overall experience is called customer experience (CX). In order to perfectly integrate this extensive topic and plan strategies, there is the so-called “customer experience management” (CXM). Its central task is not only to meet customer needs but to exceed them in all aspects. The more refined a company’s customer experience management is, the better it can exceed customer expectations. After all, the overall experience is fed by all points of contact, the so-called touchpoints, which customers have with the company or the brand.

Through digitization, there are numerous of these touchpoints, such as a website, newsletter, social media, blog, and more. All of these channels can be smartly used in CXM to satisfy and exceed the customer’s overall experience and what they want from the company. But how exactly do you manage to meet a customer’s expectations as a business owner? This requires various strategies that must be adapted to one’s own target group of buyers.

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    Strategies for Meeting Customer Expectations

    Customer expectations and the needs of buyers can hardly be separated from digitalization. That’s why a business needs to keep an eye on digital trends. When incorporating them into your strategies, you should have the following items on your agenda:

    Speed

    Customers expect speed, and not just in shipping their goods, but also in answering their questions and other general responses. If you have an account on social media and do not keep it up to date, you should not be surprised if customers are leaving.

    Accuracy

    Not only must a product be accurately crafted, but a company’s image, what it stands for, and how it presents itself must also be able to stand up to rigorous scrutiny. This means that spelling mistakes, flippant phrasing, and rudeness are an absolute no-go.

    Availability

    A customer has an urgent question, picks up the phone, and reaches … the answering machine?! The well-deserved evening is understandable, but the fact that a chatbot or other direct communication options are not even used is very annoying from the customer’s point of view. Therefore, round-the-clock availability and the formulation of clear times and channels of availability should be on the list of priorities.

    Make recommendations easy
    Omnichannel

    Keyword channels—Customers expect to find the company and product on more than one channel. Therefore, the website and other online platforms are among the important touchpoints for creating awareness of the company and its competencies.

    Credibility

    Authenticity attracts customers because if a brand comes across as credible, this has a positive effect on buyers. This makes credibility a valuable asset that needs to be shaped. To achieve this, a business and its employees must work on an internal mission statement and implement it in a way that is 100 % transparent and credible.

    Communication

    Companies should not conduct a monologue, but strive for a dialogue with their customers. In other words, it is important to show customers clearly that you want to hear them, to communicate actively, and to really listen to them. Customer criticism can then be incorporated into the optimization of processes so that customer wishes can be exceeded even more effectively.

    Of course, there are not only Dos on the long list but also points that should be avoided. Because as the following statistics show, there is also behavior that annoys consumers: These five points illustrate which behavior can negatively influence customer expectations. The point “too many emails” is particularly important, because some companies tend to overwhelm their customers with a veritable flood of different mailings. Some companies send customers extensive surveys to get their opinion, but this falls into the category of “nice try, bad job.” However, this leaves the question: How can contacting the customer be done better and easier?

    The Net Promoter Score® and Customer Expectations

    One of the strategies is communication and surveys. Here, some will wonder how it is actually possible to ask all buyers for their opinion. Only very few companies will have such a manageable number of buyers that you can simply call and ask them. Moreover, this is also a point that annoys more than half of the consumers: too many sales and marketing calls.
    Many companies prefer to offer their customers the option of formulating feedback via email, but this can easily get lost in the flood of daily messages in the virtual inbox. A better option here is the Net Promoter Score (NPS®). This is a metric that measures the likelihood of buyers recommending a company to others. According to experts, this recommendation is based on customer satisfaction. After all, only those who were satisfied with a product, a service, and a company will want to recommend it to their friends and family.

    What makes the NPS so effective is its briefness: Respondents give their rating on a scale and further have the opportunity to provide feedback in their own words in an open text field. This short survey is therefore clear and not time-consuming. In addition, it can be perfectly incorporated into post-purchase processes, such as the final thank you email. In this way, you can satisfy a customer’s expectations by thanking them and asking them directly for their opinion, and you also gain optimization potential for your own company through honest feedback.

    The feedback field offers another advantage: positive feedback can be used to acquire new customers because many prospective customers research reviews online before making a purchase. Authentic reviews can be used as the basis for one’s own decision for or against a product. Therefore, positive feedback from your own buyers can serve as a pro-argument for new customers, taking into account the laws on data protection. Our articles on customer feedback and feedback software provide more information on this topic.

    The Goal: Exceeding Customer Expectations

    Customer expectations are multi-faceted, but they are an important factor in enabling a company to do business successfully in today’s world. Understanding customer experiences and customer expectations are fundamental to this. Those who manage to understand digitization as a comprehensive opportunity to exceed specific customer expectations will succeed.

    To do this, you can leverage comprehensive strategies in marketing and management and also use your creativity. After all, customer expectations are not always obvious—some can be understood, recognized, and exceeded with a wow-effect through the targeted collection of data and its evaluation. Direct customer contact is also promising if you know how. The NPS, for example, offers an answer to this.

    You first have to process this wealth of information and then see which of the points you want to integrate and implement in your own business. Because one thing is quite clear: Only those who succeed in aligning their company with their customers, continuously exceeding their expectations, and optimizing themselves will survive in the constantly changing market and generate additional sales revenue.

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