Unhelpful, uninformed and uncaring customer service can cause lasting damage to a brand, according to a new study from Tenet Partners. Among consumers who said they stopped using a brand more than six months ago due to problems, two out of three (67 percent) did so because they no longer felt they were getting sufficient value for their money. More than half of these consumers (56 percent) blamed customer service for their defection. One in four of them (24 percent) cited product quality as the reason they left.
“Customer experience significantly influences brand strength and brand value,” said Hampton Bridwell, CEO of Tenet Partners, the new brand innovation and marketing firm created from the merger of Brandlogic and CoreBrand. “It takes years and significant financial investment to build a strong consumer brand, but all that time, money and effort is wasted every time a customer has a bad interaction. Over time, those are costs companies cannot afford.”
Tenet’s study links newly-fielded consumer research with CoreBrand’s heritage of corporate brand data to understand the impact of the customer experience on brand value. The findings demonstrate the powerful financial implications of poor customer experiences on corporate brands, particularly in the consumer products, financial services, technology, food and beverage, and retail industries.
Across these industries, the study found that brands can have more than a 40 percent higher brand value when customers perceive them as helpful, knowledgeable and caring. Consumers are also more likely to trust, respect and recommend these brands, creating a virtuous cycle for customers and shareholders. The study strongly shows that tried and true pillars of service, value and quality are still most important to building brand value.
“For two decades, CoreBrand’s data has been providing an accurate measure of brand value and performance. For this reason, CoreBrand Analytics remains a vital practice within Tenet,” explained Tenet Partners Chairman Jim Gregory. “This study is breaking new ground by using this same data to help inform how to implement better customer experiences to protect and grow corporate brand value.”
When Innovation Pays Off
In addition to exploring what causes the most harm to brands, the Tenet Partners study also examined the role of innovation in building them up.
“Innovation is a term leaders must challenge their organizations to think of in broader terms. Companies and shareholders get the greatest return from innovation that is brand-led and enhances the overall customer experience. This embodies the sum of business processes, service culture and communication touchpoints of an organization,” added Tenet Partners CEO Bridwell.
“Apple, American Express and Starbucks stand out as brands that get it right,” he said. “They don’t innovate solely for the sake of innovation or introduce new products or services in knee-jerk reaction to their competitors. Instead, they have an incredibly deep understanding of who they are as companies, who their customers are, and what they want today and in the future. These best-in-class companies pursue focused innovations that are in service of their customer experience.”
Participate in the study
To further its understanding of the connection between customer experience and brand value, Tenet is asking consumers to provide feedback on their real-life experiences with different brands. Complete a five-minute survey on your computer or mobile device by going to http://www.tenetpartners.com/cxsurvey. A real-time look at consumers’ perceptions of each brand will be available immediately following at http://www.tenetpartners.com/cxsurvey-dashboard2014. Take the survey and review the data as many times as you have an experience with the included brands.
The Tenet Partners study surveyed more than 1,000 consumers, comparing the stated performance of select household brands in the consumer products, financial services, technology, food and beverage and retail industries to identify the drivers of customer experience. These measures were then correlated to BrandPower, an aggregate measure of Familiarity and Favorability used by the CoreBrand Analytics team as an indicator of monetary brand value and performance for more than 1,000 companies across 50 industries.
The CoreBrand Analytics practice of Tenet Partners focuses on marketing decision support and investment return optimization. With the only continuous survey of nearly 25 years, CoreBrand continues to examine the corporate reputations and brand value of major public companies by annually surveying more than 10,000 opinion elites from the top 20 percent of U.S. businesses.
About Tenet Partners℠
Formed from the merger of Brandlogic and CoreBrand, Tenet Partners is a brand innovation and marketing consultancy that helps companies create brand value and unearth business opportunities by putting customers at the center of their business strategies.