Failure Demand: The Hidden Cost of Neglecting the Customer Experience

Amidst the constant pursuit of growth and profitability, there’s a hidden menace that often goes unnoticed in most organizations: a little problem that turns into a failure demand. This looming force can make or break your organization, leaving a lasting impact on customer experience, loyalty, and ultimately revenue/profitability.

Imagine a scenario where customers reach out to your support team repeatedly, encountering the same issue over and over again. Or consider the countless hours wasted on handling complaints and resolving preventable problems. These are all examples of failure demand, the unnecessary work created when organizations fail to meet customer expectations the first time around and create friction for customers.

To truly understand the magnitude of failure demand and its consequences, we turn to John Seddon‘s book, I Want You to Cheat. This long-heralded book challenges traditional notions of service delivery to customers and sheds light on the fundamental flaws in many organizations’ approaches to how they focus on the customer experience.

Seddon’s book offers a shift in how you should think about minor customer failures and their impact on your business. It forces you to question whether you are truly delivering value to your customers in a way that drives them to become brand advocates.

Let’s look at failure demand, and explore its implications on organizations, hindrances to growth, and the slow but steady increase in customer churn. If you listen to the information you’re getting, and implement changes, your customers will reward you for it.

Understanding failure demand

Understanding Failure Demand

When was the last time you put yourself in your customers’ shoes and evaluated your own business? It’s easy to get caught up in the day-to-day operations and lose sight of the customer’s perspective. However, to truly understand and address failure demand, we must view it through the lens of our customers’ expectations.

“Customer experience isn’t an expense. Managing customer experience bolsters your brand.” – Stan Phelps

Customers are the lifeblood of any organization. Their satisfaction and loyalty directly impact your success. Yet, it’s astonishing how often businesses neglect to assess their own offerings and services from the customer’s point of view. Companies can get so wrapped up in their processes, systems, and internal metrics that they can forget the ultimate judge of the value proposition: the customer.

To break free from the weight of failure demand, you need to take a step back and evaluate your own experiences as one of your customers. Ask yourself, “When was the last time I did business with myself as our customers do?” Put yourself in the shoes of your target audience and go through the entire customer journey – from initial contact to post-purchase support.

  • Are your processes convoluted and time-consuming for customers?
  • Are there areas where you make it easier on yourself vs making it easier for the customer?
  • Are your support teams responsive and well trained?
  • Are your employees empowered to deliver legendary customer service to make costumes happy?
  • Are you consistently delivering on your promises?

These questions may lead to realizations and revelations about the areas where failure demand is hiding in plain sight and where your team needs to improve.

By adopting the point of view of your customer, you can identify pain points, bottlenecks, and areas where expectations are not being met. The end result empowers you and your team to take proactive steps in eliminating failure demand and improving the overall customer experience.

Remember, failure demand is not just a consequence of subpar service—it’s a symptom of underlying issues within an organization. By immersing yourself in the customer’s shoes, you’ll gain invaluable insights that enable you to get back to the basics of delivering an incredible buying experience.

The price of failure demand

The price of failure demand

Failure demand may seem like a small inconvenience at first glance, but its true cost goes far beyond the surface. In this section, we will look into the real-life consequences of failure demand. From seemingly minor customer interactions to the waste of valuable resources, time, and energy, failure demand leaves no stone unturned in its quest to slow down and turn back success.

It’s often the accumulation of small mistakes that gives rise to a larger problem. Think about those times when customers encounter repeated issues, necessitating multiple calls/emails with your support team. While each interaction may appear insignificant on its own, the collective effect can give the impression of a recurring trend of ineffective service. These seemingly minor experiences add up, eroding customer trust and satisfaction.

The financial ramifications of failure demand are, without a doubt, significant. Resources that could be allocated to value-adding activities are wasted on handling preventable problems and firefighting. Valuable time and energy are consumed in addressing issues that should never have occurred in the first place. This misallocation of resources drains profitability and stifles growth.

Operational inefficiencies caused by failure demand further compound the problem. Ineffective service processes and systems result in a lack of responsiveness and unnecessary delays. As a result, customers are left frustrated and dissatisfied, leading to increased churn and negative word-of-mouth. The ripple effects of these subpar experiences can have long-lasting consequences, impacting your reputation and future customer loyalty.

Recognizing the true price of failure demand is crucial for organizations seeking to excel in today’s customer-centric landscape. By addressing the root causes of failure demand, businesses can redirect their resources towards proactive measures that enhance the overall customer experience. This includes streamlining processes, implementing effective training programs, and investing in technologies that enable seamless interactions.

Identifying failure demand in your organization

To truly understand and address failure demand in your workplace, it is essential to examine every step a customer must navigate when interacting with your company. From making a purchase to seeking support, and from returns to warranty inquiries, each stop on the journey presents an opportunity to deliver exceptional customer experiences or fall short.

The customer journey begins with the initial purchase research. This pivotal moment sets the stage for the entire relationship between your company and the customer. It is crucial to ensure a seamless and frictionless experience, enabling customers to make informed decisions and complete purchases effortlessly. Whether you sell widgets or services, always focus on making it easy.

Returns and exchanges are another crucial touchpoint in the customer journey. While no business wants to encounter returns, they are an inevitable part of commerce. By streamlining and simplifying your return process, you can turn a potentially frustrating experience into an opportunity to impress customers with exceptional service, ultimately fostering loyalty and positive word-of-mouth in the long run.

Amazon is a perfect example of a company that handles returns with ease. The company makes it incredibly easy to return a purchase you no longer need. They offer free return shipping and in many situations, don’t even require you to box up the item. You’ll take the item to a UPS store or Whole Foods, drop off the item as you have a QR code scanned, and the return is done.

When customers require support from your team, whether for troubleshooting, questions, or buying advice, it is essential to provide efficient and effective responses that move the customer to their next step. Responsive and knowledgeable customer support can make the difference between a satisfied customer and one who becomes frustrated or seeks alternative solutions. Remember, it’s considerably less expensive to keep a customer than to find a new one.

Customer feedback, complaints, and recurring requests should never be dismissed. They hold valuable gold nuggets into the gaps in your processes and areas for improvement. By actively listening to and addressing customer concerns, you can identify patterns and trends that may indicate areas of failure demand. Even if the customer is wrong, leveraging this information allows you to make informed decisions, refine your products and services, and enhance the overall customer journey.

As you work through the customer journey, pay close attention to gaps in your processes. Identify places where customers face unnecessary waiting periods, confusion, or frustration about their next steps. These gaps present opportunities for optimization and streamlining, ensuring that each step of the customer journey is smooth, satisfying, and efficient.

How to uncover the root cause

Insufficient training and knowledge gaps among customer service representatives can significantly contribute to failure demand. When employees are ill-equipped to handle customer inquiries or lack a comprehensive understanding of products and services, it leads to prolonged interactions and potential errors. Investing in thorough training programs, continuous education, and knowledge-sharing platforms can empower your team to confidently and efficiently address customer needs, minimizing failure demand instances.

Flawed processes can also be a prime breeding ground for failure demand. Inefficient workflows, broken escalation procedures, and unnecessary handoffs between customer service agents create bottlenecks and confusion. By critically evaluating and streamlining your processes, you can reduce friction and ensure a smoother customer journey. Clear and well-defined workflows enable swift issue resolution, minimizing the need for customers to repeat their concerns or navigate complex channels.

TextExpander is a powerful tool that enhances customer communications with speed, accuracy, and gives it a human touch. TextExpander allows customer service managers to create reusable Snippets of text that can be expanded with a single keystroke by agents all over the company. It eliminates the need to type repetitive responses, providing consistent and error-free messaging across emails and chats. With TextExpander, you can swiftly address customer inquiries, provide instant support, and convey empathy while maintaining a personalized touch.

Imagine the connection between addressing root causes and reducing failure demand as the analogy of a seamless “1-click to check out” experience pioneered by Amazon. In the same way, adopting efficient processes, robust training, and tools like TextExpander enables a simplified “1-click help” interaction for customers. By tackling the underlying factors contributing to failure demand, you empower your team to provide efficient, accurate, and personalized assistance with a single interaction. This not only enhances the customer experience but also reduces the strain on resources and minimizes the potential for future failures.

See how TextExpander works

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Wrap up

In the journey to curb failure demand and unlock success, streamlining interactions and providing customers with the right answer on the first try take center stage. Streamlining interactions is the key to delivering exceptional customer experiences. Customers crave simplicity, efficiency, and a seamless journey from start to finish. By optimizing your processes and eliminating unnecessary steps, you can reduce customer effort and eliminate frustration.

The goal is to create a frictionless experience where customers can quickly obtain the information they need, leaving them with a good experience and impressed with your organization.

Equally critical is the concept of providing the right answer on the first try. Nothing frustrates customers more than having to engage in multiple interactions or receive conflicting information. By investing in comprehensive training, knowledge management systems, and continuous improvement, you equip your team with the resources necessary to deliver accurate and timely solutions. This reduces the need for follow-up interactions, minimizes failure demand, and adds trust to your brand.

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