As many as 47% of customers say they’ll abandon a brand if the service they get causes them frustration. Rami Jaulus, NGG CEO, clarifies the differences between customer-oriented and product-oriented strategies. Which one comes out on top?
I’ve recently spoken to a customer of an insurance company, who told me of the exceptional service she received after a waste pipe broke down and flooded her entire house. Her insurance company reacted immediately, provided her with alternative accommodation, helped salvage furniture and precious items, and even paid for the reconstruction works until the house was made habitable. The customer said her experience was so positive that she will never, ever leave her insurance provider.
I immediately asked her whether she renewed her policy after the accident and if she got a good price. She said she did renew her policy and that the price she got seemed reasonable. Unfortunately, I went through a similar experience, but in my case, my provider upped my premium by 50%, forcing me to seek out a different provider.
To me, that’s the difference between customer orientation and product orientation.
It all starts with customer orientation: providers that develop a customer-first approach will be able to care for their customers in case of an insurance claim – which is mostly a traumatic ordeal for the customer – and then resume its relationship with that customer as if nothing had happened. That provider will be rewarded with the customer’s everlasting loyalty.
Insurance companies that worry about premiums first and put customers second will consider the economic potential of their product and will of course increase premium rates once the claim has been handled.
The customer, and this has always been the case, will feel frustrated and change providers. As many as 47% of customers say they’ll abandon a brand if their interactions with the company cause them frustration. The difference is, of course, speed and extent of response – today, everything is more available, faster, and more comprehensive.