With the increased focus on customer experience, it makes sense to revisit a concept known as Moments of Truth. Nearly 30 years ago, Jan Carlzon, former CEO of SAS Airlines wrote the book called Moments of Truth. He defined a moment of truth “as any interaction with a customer or any event in which a customer uses or experiences a company’s product.”

Customer experience and moments of truth are inextricably intertwined.  There is even a more important business reasons to understand and address moments of truth.  How an employee handles a moments of truth has huge impact on customer satisfaction, retention and advocacy.

Employees are the Keepers of Moments of Truth

Fostering a superior customer experience and retaining customers for the long haul requires companies to empower employees to own a moment of truth. Perhaps this story will help illustrate the concept. I suspect you may have similar experiences. I recently had the opportunity to experience several moments of truth in my attempt to purchase a new smart phone from the company that I have been using for nearly two decades.

Because I was a current business customer, the rebate offer being made to new customers was not applicable. This is an interesting message to send to existing customers – you are not as important as the next new customer. It took, five, yes five separate phone calls to resolve this situation.  One suggestion was to cancel my account and then open a new account to secure the product. Really? A hassle for me and a big expense to the providing company.

Only one person was creative enough to figure out how to achieve the same financial benefit without violating their company’s business process. They offered a credit toward my next bill equivalent to the rebate. This is a good example of an employee recognizing a moment of truth.

Moments of Truth Provide Insights into Your Probability for Customer Success

Operationalize Your Moments of Truth to Improve Customer Experience

Any C-level executive who cares about customer experience and its impact on customer acquisition and customer retention needs to operationalize moments of truth. What does this mean?

First, it means you need to design business processes to anticipate various customer interactions and events. As part of this process, map the expected and unexpected customer interactions and identify those that are moments of truth. All moments of truth in which the customer is highly engaged are critical to your relationship with the customer. Moments of truth that are not anticipated and planned for in advance require your employees to make non-routine decisions — decisions for which there are no rule books, and no pre-existing “correct answers.” These are the moments of truth that can most threaten — or strengthen — a customer relationship, but it depends entirely on how your employees handle the situation, which is why the more you can map the unexpected and operationalize these the better your odds are at satisfactory moments of truth.

Second, every employee who has contact with customers, from accounting to sales, from the contact center to marketing, from shipping to technical support, needs to be trained on how to handle both expected and unexpected moments of truth. Empower your front line and all customer facing personnel to handle moments of truth in a way that produces a win-win for both the company and the customer. You say you’re a customer-centric company. Then train all of your personnel to begin every customer problem-solving exercise by asking themselves the question, “What’s in the customer’s best interest in this situation?”

It’s not really optional. Moments of truth create value for the company. They can improve loyalty, extend customer lifetime value by extending tenure, and drive advocacy behaviors like recommendations. They can also reduce churn and reduce service costs by reducing complaints. All of which translate into a financial return.

Measure Moments of Truth to Improve Customer Experience

Before you can measure “moments of truth”, you need have a true understanding of your customers’ expectations. Once you have the big picture of these expectations you can link Corporate, Marketing, and Customer service operational strategies and ALL of the touchpoints your customers encounter to create a consistent experience and have a positive impact on customer satisfaction and loyalty. This will take work, but there’s money to be made here! A Forrester Research study found that there was $1.3 billion in additional revenue for companies that improved their customer experience from below average to above average.

Take these 4 steps to measure and improve moments of truth and the customer experience:

1. Identify each touchpoint your customer has with your business. A touchpoint can be digital (your website, your social media, your email, online statements, self-help, online chat), or offline (telephone, event contact, direct mail – including invoices and statements).

2. Determine overall satisfaction. Customer satisfaction is consistently one of the most important key indicators for a service/support organization. A study by McKinsey & Company found that overall satisfaction is a 30% better predictor of customer happiness than the level of happiness for each individual interaction. Therefore, invest in regular customer satisfaction research. A highly satisfied customer is extremely valuable because of the greater likelihood of future product purchases, the willingness to be a referral source and the likelihood of renewing maintenance and support contracts. Most every company we’ve worked with collects some form of customer assessment, either formal or informal. Satisfaction surveys vary widely in both breadth and depth, but they narrow down to two types:

• Transactional Satisfaction. This survey measures customer satisfaction across all types of interaction with your company including sales calls, support calls and emails.
• Image-Based Satisfaction. This survey measures the image your customers have regarding your product/service and the likelihood of repeat purchases and recommendations to friends.Address problems – as quickly as possible. When problems arise, speed and completeness of resolution are critical. For many customers, time is more important than money. Determine how long the most frequent problems take to resolve, and benchmark these against both leading firms and customer expectations so you know which ones to tackle first.

Map the touch points to the appropriate place in the customer journey.

3. Collect and Analyze Data. Measuring and analyzing how your customers experience each moment of truth provides you with the insight you need to determine what to change and where to invest to keep your best customers. Syncing Marketing, Account Managers, Customer Service and the customer-facing personnel against these three capabilities will enable you to consistently deliver the positive experience you want your customers to have.

4. Establish performance targets for each touch point. You need a way to determine how well you are delivering the expected service quality for each touchpoint.  Set performance targets, monitor your performance, and create a process for addressing gaps when they occur.

These steps and process will help you keep customers and that’s money in the bank.

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