How Customer Experience Builds Great Brands
Despite a growing emphasis on profitability, some e-tailers still seem to believe that the way to solve problems is to throw money at them. Net researcher eMarketer reported that e-tailers spent 70 percent of their second-quarter revenues on sales and marketing. Although that figure is now declining, it is a disturbing starting point. When investment money was loose and marketing budgets were fat, many e-commerce companies slid into a fatal trap. They somehow confused building a business with building a brand — and building a brand with building awareness. So the mantra became “brand-building,” and millions of dollars of VC money were thrown at advertising these startups. Who gets rich in this environment? The media, the portals and the ad agencies.
But a brand is not just about awareness; it is not logos slapped on every possible surface; it is not even about the Web site’s look and feel. A brand is the sum total of what customers think and feel about a product, service or company. And the way to create those impresions in the minds of customers is to give them a great experience, every time.
Being proactive
Happily, some e-commerce companies are waking up to this fact. They are focusing on the customer experience, and they are seeking to satisfy customers every day.
What this means is paying close attention to each element of that experience — to be sure it is consistently excellent. And when it’s not great, taking proactive steps to fix it and apologize. A customer whose complaint has been handled well can turn into an even more loyal and valuable customer.
The elements of the customer experience live at each point of contact with a brand. This means making sure each contact is as good as it can be: the navigability of the site, the speed of product delivery, the tone of the customer-service rep on the phone, the ease with which returns are accepted. All of these points of contact are an opportunity to build — or erode — the brand.
E-commerce companies tried at first to compete on price, thinking that this was the Net’s edge. But consumer behavior has turned out to be fairly consistent in all distribution channels. Consumers — and business buyers for that matter — want to have a relationship with their vendors. They hate change. They find comfort in consistency. And the result is that they have a preference that works right into vendors’ hands: Customers want to be loyal. So smart e-commerce businesses are now differentiating themselves on customer experience.
Great e-commerce brands, such as Amazon and Dell, were built this way. These two companies first got the value proposition and the customer experience right and then allowed the word to spread. Only when they were confident that the new customers were going to be satisfied, buy more and tell others, did they invest in any serious advertising campaigns. They built the brand the old-fashioned way: by earning it.