CX, ROI and Reality: The Numbers Are Real, and So Are the People
In our last article, “How to Calculate the ROI of CX for Your Business,” we discussed the gains brands stood to make industry-by-industry with good customer experience. The estimations that experts like Forrester and Temkin put forth seem larger than life once calculated, but they are very legitimate. Case in point, United Airlines suffered a one-day billion-dollar loss following its widely publicised passenger dragging incident.
Clearly, a takeaway from this now infamous fiasco is that customers are in control, and poor CX has a real-life cause and effect with revenue in today’s market. And while United’s mistake was larger and more publicised than most, there are thousands of other untracked poor customer experiences that are causing revenue dips at this very moment. They aren’t making national headlines, but they are still causing customers to leave and become detractors. Sure, each customer may cost a small amount individually, but as a collective, they create catastrophic losses, not just in revenue, but in loyalty, brand image and consumer trust.
Moreover, with social media, these types of widely publicised and scathing follies will become more frequent—something we witnessed in the weeks following the United Airlines backlash. In particular, United and many other airlines were criticised, videotaped, and their horror stories shared across social media and news outlets repeatedly. United’s poor treatment of customers snowballed into a mob mentality that raised headlines such as: “United Airlines Facing Backlash after Giant Rabbit Dies on Flight,” “American Airlines Accused of Racism After Woman Downgraded,” and most importantly “Airline Passenger Bill of Rights to Go to Parliament This Week.”
Suffice it to say, it doesn’t matter if it’s one dollar or one billion dollars, the loss of customer trust is never good for your brand, and it will continue to hurt your business until you find out why the customer is unhappy, and you learn how to get them to trust and advocate for you again. Doing this is not only good business, as our previous article’s industry estimations show, but more importantly, it’s the right thing to do.
Why would you want customers to be unhappy, or treated poorly? They’re real people who are paying for your services and products (this was another key takeaway from the United Airlines incident). You will always have rules and regulations to contend with when handling customers, but sometimes those rules need to change or break—especially if there is a trend of customers getting treated poorly (or sub-humanly), and then getting mad as hell.
Late night talk show host, Jimmy Kimmel put it best in his recent monologue that grilled United’s outdated policies. He said:
“When you break this down, a man was forcibly dragged off a flight because they oversold it, which how that happens in the first place, I don’t know. And by the way, they almost certainly could have gotten volunteers by offering more money… It’s not the passenger’s fault that you sold too many tickets on your plane.”
Obviously, United and the other airlines who share this same overbooking rule, know the practice is an inconvenience to customers. But, what really matters is: Do they actually care about how customers feel when they enforce this rule?
Pretty clearly, the answer was ‘no’ prior to the passenger dragging fiasco, whereas now, it likely is a resounding ‘yes.’ This change of heart did not come from the CEO’s sudden empathy for the customer who got dragged off the plane—because, as we all know, he initially defended the airline’s callous actions. But, instead, it came from the company’s huge losses to revenue. At some point after the billion-dollar loss, he must have realised that customer experience does actually matter. It does affect the bottom dollar, and caring about how customers feel and are treated might be the better option for revenue in the long run.
There is an ROI to CX; it affects each industry differently, and you can absolutely calculate it if you take the time to do the research (and if you read the news). Hopefully, how the customer feels is actually important to your business and culture, because if it’s not, you might be in store for a similar United-style debacle—an occurrence that only stands to become more common in the coming years.
To learn more about the ROI of CX, read our previous articles: