We have recently seen countless examples of well loved companies and customers favs leaving the market. As much as we try, we can't seem to understand why satisfied customers still leave?
Scenario: You are completely satisfied with your cellphone provider. Very few complaints, if any; an overall great experience. But then, the company you work for undergoes restructuring and you have to take a pay cut. A friend tells you that his family plan is more inexpensive than yours and offers free Netflix for a year.
"See ya!" says the customer. But why? You were completely satisfied!
A-ha! So, you think customer satisfaction and recommendation potential are enough to keep customers from leaving you? Think again!
The truth is, although customers may have had a great experience with your brand, are very satisfied and would recommend your company to others; if their lifestyle or the market shifts, it will affect their perceptions, expectations, and ultimately their decision to stay or leave you for your competition.
But what is going in customers' minds while they're making decisions? The answer is, A LOT! And it’s both emotional and rational.
The Decision Thought Cycle
There is still so little we understand about behavior psychology. Truth be told, most of the human mind is still a mystery. But there are a couple of things we have been able to map out, and one of them is the Decision Thought Cycle. Let’s look at the factors that are directly tied into our buying decisions.
A purchase decision is always sparked by a need. We will always have needs to fulfill.
For example, let’s say I need transportation to get my kids to school and commute to work. The need has always existed, it's how we fulfill that need that has changed. In the past, we traveled by horseback, now we use cars. In the future, perhaps we’ll teleport.
There are certain expectations we carry as it relates to what we’re seeking to purchase. Those expectations can be low or high. Whatever the case, we have them and we want them met. As you know, expectations can change. But when customers see the latest and greatest innovations in the market, it raises their expectations.
Since the technology is available, I may search for an electric, autonomous-driving car. In doing so, I expect to save money on gas, be ecological, and not exert energy driving. I immediately go into search mode to find a solution to fulfill my need while addressing my expectations.
3. The "Worth It" Analysis
It is at this stage that we weigh the costs vs. benefits of our forthcoming decision to arrive at our "worth it" conclusion: the last and most powerful conclusion in the decision-making process.
This is when we ask ourselves that final question, "Is it worth it?"
Back to the electric, autonomous-driving car that I’d like to buy. I'll assess whether it's within my budget, the best relative price, if the quality meets my expectations, etc.
This is also the point where I decide on what compromises I am willing to make. Does the car have to be autonomous? Can I live without those seat warmers or that nice sunroof? Does it have to have those gull-wing doors?
At this part of the cycle, I must point out an external force that plays a strong role in this process: influencers.
Influencers are people and factors that influence you along the journey in the decision-making process. Influencers can talk you in or out of what you need or expect. This can also come in the form of reviews and ratings that we might encounter during our worth it analysis. Influencers help us validate if we’re managing the decision correctly, and add an element of social proof.
4. Customer Decision
Finally, we’ve arrived at our decision on what is worth it or not.
Based on my worth it analysis, I’ve made the best choice considering the intensity of my need, my expectations, my available budget, and the offers available in the market.
I’ve decided that instead of the electric, autonomous Tesla, I’m buying a hybrid Ford. I’ll still fulfill my expectations of saving gas and having an eco-friendly car, and found it easy to compromise on the self-driving feature.
5. Continuous cycle
As long as needs exists, the entire cycle from expectation to decision will continue. The urgency will only reduce once the need is somehow addressed. Our minds run through this cost-benefit analysis every time we make a purchase.
The One Conclusion That Matters
The Worth It Conclusion has long been overlooked, but it’s the last piece needed to round out your existing Customer Experience Management. It has the most impact on customer decisions and it’s the only one that leads companies directly to the source of what is causing the money flow from customers' pockets to their bottom line profits.
With the speed of change in today's technology and expectations, customer satisfaction and recommendation levels are no longer enough to guarantee loyalty. As soon as innovation enters the market, it sets new expectations and your customers will leave you if your business is not quick enough to adapt.
This is why companies should never stop innovating their customer experiences and updating their value propositions.