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Delighted clients?

September 09, 2019

What do you think about marketing?  Not the vapid fluff that you see in a million so-called research articles, which are in fact near-naked sales pitches.  Not the endless list of processes; blogs, adverts, market research…I want to know foundationally, fundamentally what marketing should be – what it really could be and how to deliver that consistently.

A researched view

Finnish Academic Christian Grönroos has an thoughtful take.  In his research (Defining Marketing 2005) he states that marketing revolves around customer relations, where the objectives of the parties involved (the customer and the firm) are met through various kinds of exchanges (transactions).

So far this seems pretty close to the marketing principles formulated by luminaries like Kotler, but there is a deep difference in emphasis. Customer relations are the key point here and the exchanges take place in order to establish and maintain such relationships.

Whilst this is not always true of course, the research found as a general rule the longer the relationship the greater the profitability, which is not the purpose of your business, but a necessary and inevitable consequence of carrying out your business well.  Yes, even for non-profits.

Customer delight

As we stay in the world of research in this area, we see a phrase re-occurring in many different papers and journals – “Customer delight”. [1]

Following this lead will take us from Grönroos’ broad definition into a more specific feature of marketing, but worth doing because it seems to be well established in marketing academia that Customer Delight is an essential part of part of marketing. 

It’s interesting because it’s often overlooked – at least in our sector.  Sales, leads, campaigns and events are the key ingredients in a marketing department’s daily diet.  Client satisfaction falls to relationship managers, (which at least acknowledges that marketing is not the same thing as the marketing department), but client delight sounds dangerously like those fluffy papers we brushed past at the beginning of this article.

Much of the research on delight has been done in the hospitality industry, but some has focused on the finance sector.[2]

Satisfaction isn’t enough

One now quite old study carried out by Francis Buttle of Macquarie University in 2002 found that customers may switch some or all of their business to another supplier even when they are fully satisfied.[3]

Whilst Buttle and Aldlaigan steer clear of the word “delight”, they do talk about going beyond satisfaction, as they set out the 3 factors that their research revealed were at the heart of positive customer attachment to a banking organisation.

Are we still on track?

We will return to these, but at this point we need to ask if we are still on the right track.  Our aim was to understand what marketing is and how to do it better.  We discovered the work of Grönroos and his emphatically European approach to marketing, in which he claims that the essence of marketing is to establish and prolong client relations.

We then followed the track laid down by the many researchers into customer delight and discovered that satisfaction alone would not prevent customers from switching to new providers.  In other words, satisfaction does not help us to attain that essence of marketing; to establish and in particular, maintain and prolong client relations, which means we need to go further, “beyond satisfaction” to ensure we meet our goal.

Now for the important bit

When I worked for a large financial firm, we implemented the Lean methodology across the company, and especially in operational roles it works very well.  However, on principle one element that I feel has a much broader application, is the part relating to the Voice of the Customer and how you respond to that.

One of the things we learned whilst wrestling with Kano models and becoming fluent in pidgin Japanese (why?) was that once you had eliminated dissatisfiers from your operation, and added satisfiers, there was little value in going too much further.

I know it sounds counter-intuitive, but the point is, going further than your customer wants will cost you and will not prolong your client relationship one iota.  The most bandied about illustration is the perfect car.

If the car you are selling has all the functionality your customer wants, would you think, even for a second, of dropping a second engine into your vehicle, just to “go the extra mile”.  When it’s put like that, the absurdity is easy to see, but even in less absurd examples, the principle is the same. Going further than your customer wants is wasteful, unproductive and maybe even damaging.

The one area where there may make a difference, and perhaps reveals the reason for so much research in this domain, is the hospitality sector, where the chocolate on the pillow and the little extra courtesies appeal to our sense of indulgence and may well drive our loyalty.

So what do we do?

It’s a good question.  Remember we are trying to get to the essence of marketing; establishing, prolonging and maintaining relationships for as long as possible.  We’ve seen that, in the banking sector at least, satisfaction does not generate loyalty, and we’ve also seen that going further than the customer wants, doesn’t drive loyalty either.

To practice the essence of marketing, we have to understand what it is that drives loyalty and longevity of relationship and implement that in our business.

Stop delighting your customer

That is exactly the question that 3 researchers set out to address in 2010 and they wrote an article in the Harvard Business Review setting out their findings.[4]

This was a study of 75,000 people looking at the links between customer service and loyalty, which was defined as “customers’ intention to continue doing business with a company, increase their spending, or say good things about it (or refrain from saying bad things).  The key findings were as follows:

  • Consumers tend to punish bad service much more than they reward ‘delightful’ service
  • What builds loyalty is reducing the work a customer must do to get their problem solved

Beyond satisfaction

How does this tie into the factors in Aldlaigan and Buttle’s report on the banking sector; “Beyond Satisfaction: Customer attachment to retail banks”?

This research went back to first principles to measure the factors that generate positive attachment (loyalty) and came up with three broad categories:

  • Organisational credibility

Organisational credibility leads the customer to express confidence in the bank.  It covers aspects such as reliability, fairness, trust and respect.

  • Relational values

This describes the effectiveness of personal relations at the bank.  The customer knows, likes and has a good rapport with the team members with whom he interacts.

  • Value congruency

Finally, this describes the ethical relationship the client has with the bank.  The client might say she supports the investment policies of the bank, or shares the same values

In conclusion

As owners, founders and CEOs of our business, we have been offered a view of marketing which emphasises the establishment and prolongation of customer relationships as its key role.

If that is accepted, it is clear that marketing cannot live in the marketing department alone. It is a company -wide task and mindset, with the marketing department contributing alongside sales, product management, operations, client support, finance, legal and HR.

One of the reasons why marketing is a broad-based discipline is that to build loyalty – the prolongation of client relationships – we must do more than simply satisfy our clients.  There will always be a better offer for clients that are simply satisfied.

This has led academics and practitioners alike to embrace the idea of exceeding client needs in the hope that this will delight them and cause them to become loyalty, but some research has challenged this idea, and some workplace methodologies agree.  The hospitality industry is an exception.

The better approach is to remove dissatisfiers and to ensure that all satisfiers are met as fully as possible as a starting point.

Once that has done, there are 4 factors that seem to be effective at driving loyalty:

  1. Reducing the effort that a client exerts to solve a problem
  2. Creating an organisation that is credible in terms of trust and reliability
  3. Building effective personal relationships
  4. Operate with values to which clients relate

Loyal relationships – the essence of marketing - are not generated by a few cheap tricks (or even expensive ones) but from the culture of our organisations.  

Let us know if we can help you!

Engage your prospects

 

 

 

[1] To name but a few:

Popli, Sana “Ensuring Customer Delight” Quality in Higher Education

Rust, Roland, Oliver “Should we delight the customer?” Journal of the Academy of Marketing Science

Schneider, Benjamin, Bowen “Understanding Customer Delight and Outrage” Sloan Management Review

Torres, Edwin, Kline “From Satisfaction to Delight” International Journal of Contemporary Hospitality Management

Yang, Ching-ChowIdentification of Customer Delight for Quality Attributes…”  Total Quality Management

 

[2] Buttle, Aldlaigan “Beyond Satisfaction: Customer attachment to retail banks” International Journal of Bank Marketing

[3] Buttle’s finding from his 2002 study was cited in “Beyond Satisfaction: Customer attachment to retail banks” a study he co-authored with Abdullah Aldlaigan in 2005

[4] Dixon, Freeman, Toman “Stop Trying to Delight Your Customers” Harvard Business Review, July/ August 2010

 

Ian Dalton

Written by Ian Dalton

Ian is the former group CMO of Euroclear SA/NV, a co-founder of QPQ an Ireland-based FinTech and CEO of Flagship Marketing, a Fintech growth agency. He holds a Law degree from Cambridge University (UK) and postgrad diploma in digital marketing from the Institute of Digital Marketing. He is also a trustee of the Children's Charity, The Giraffe Project