This is a follow-up on my previous blog post about Customer Experience Management and Premium Price. Throughout the literature review process, we searched high and low for affecting factors, and we ended up with testing 7 key variables. Now, that the results from the Master thesis are ready, I can`t wait to share the findings with you!
The research setting of this thesis is within a selected IT/Software company in the business-to-business (B2B) sector, and the questionnaire was sent to the customers of this software company.
The process of finding the variables that have an effect on a customer’s experience was long and tough, but when the most important ones were uncovered and discussed, it all came into place. These are the 7 variables we hypothesized to have a significant effect on the Customer Experience:
1. Personal Contact
3. Customer Needs
Now, let`s discuss each of the 7 wonders and reveal their importance:
The personal contact variable was tested using two extreme poles; one being personal contact in the form of face-to-face contact, while the other pole being impersonal contact, such as contact through websites. The main argument is that personal contact has a positive effect on the customer experience.
This variable involves an exchange process between the company and the customer and concerns the willingness to make adaptations as circumstances change, illustrated by the two-way process between the buyer and the company. A flexible service offering, in this case, requires the seller being willing and able to adapt to the customer`s request after the initial service was offered. We therefore argue that by being flexible, the customer experience will improve.
Further on, we also tested a variable called customer needs. Understanding the real customer needs is of increasing importance in business-to-business markets, as well as creating service offerings that address these needs. However, needs are difficult to measure due to diversity, but we focused on the understanding of customer needs related to the nature of the business, the business context and the specific requirements requested by a customer related to a product or service. We hypothesize that understanding the overall customer needs has a positive effect on customer experience.
This variable is related to the pro-activity in the quality control of the service offered, and focuses on what follows the transaction, as the firm engages in a relationship which is found to be more important than the transaction itself. The argument for this variable is that follow-up will improve the customer experience.
To which extent a company is able to fulfill the promises they have made to their customers has been identified as an important factor influencing customer experience. We located the variable Trust, which is based on the belief in the supplier and how the salesperson influences a buyer`s anticipated future interaction with the firm. The variable had two targets, to measure trust in a company and in a company`s sales force. We hypothesized that trust has a positive effect on the customer experience.
Knowledge is an important variable in a business-to-business relationship in order to create a positive customer experience. The objective of a supplier is to identify the relationships that have the highest profit potential given the available resources, and then develop sufficiently attractive offers (relative to the competition) to create transactions. The type of knowledge measured by this variable is the one called tacit knowledge and involve employee know-how or competencies gained through observation, imitation and mutual experience. We argue that knowledge has a positive effect on the customer experience.
This variable refers to how timely and effectively the manufacturer deals with retailer problems, how it overlaps with complaints and acting upon those complaints. Responsiveness can be a crucial element in an organization`s customer service recovery process. The main argument here is that responsiveness has a positive effect on the customer experience.
.. And you will receive the most valuable ones! I would like to focus on 3 of the main findings:
First of all, the results from the variable named Flexibility display a direct effect on Premium Price, without even requiring a positive customer experience! This is a valuable finding, which means that you can actually justify charging a higher price than your competitors, by becoming more flexible. The results display that the respondents appreciate a flexible service offering, which basically can be boiled down to this simple statement: “being flexible wins more customers”.
Secondly, the findings from testing the variable Trust, display that it has a highly significant effect on creating a positive customer experience. This form of promise fulfillment is important to nourish due to its direct effect. Improving the promise fulfillment and building trust is of great importance and the approach of appealing to a customer`s emotions, is key to creating a positive experience.
A third and interesting finding emerged when testing the variable Knowledge. It actually displayed a negative effect on the customer experience. We did not expect this, but the explanation for this result could potentially also be related to the emotional aspects of experiences. A customer might be feeling inferior in regards to the overall knowledge about the service offering. However, this should not be a major problem and could be influenced by the company`s employees and its customer contact service.
The 7 variables discussed will of course vary according to the business contexts, so I encourage you all to uncover the drivers that influence your own customer’s experiences interacting with your company. The road might be long, but it will be worth it!
voice of the customer
Customer Experience Management
increase response rate
voice of the employee