Forrester Wave Report
Leslie Stretch, Medallia CEO, and Borge Hald, Medallia Founder, Reflect on Being Named A Leader by Forrester in The Forrester Wave™ Customer Feedback Management Platforms, Q4 2018 Elena:...
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Consumers today are sophisticated and do their research before making a purchase. They expect to have a seamless and positive experience and, if those expectations aren’t met, consumers know they have options. For companies looking to create a competitive edge, having a strong brand recognition, or even a stellar product isn’t enough. Customer experience is the tipping point, and without a strong plan to create and maintain a positive experience, businesses will lose out.
Medallia partnered with Ipsos on a study which I truly believe shows us some fresh indications of where we should be putting efforts if we want to differentiate – and of course also confirm some key areas that we are continuing along the right path. The research was conducted by Ipsos across 8,002 consumers over 4 countries and across 6 vertical sectors: retail (both online and offline), banking, insurance, mobile network providers, and hotels.
The findings illustrate that customer experience is the top reason consumers cite for choosing a particular brand when making a purchase. The data also shows that consumers are quick to both penalize and reward a brand based on their experience. In fact, 77 percent of respondents claim to have chosen a product or service from a company because of good experiences they had with it, while 64 percent of respondents said they have avoided a brand because of a bad experience they had within the last year.
Millennials and Gen Z are the least brand-loyal, as 70 percent of millennials and 68 percent of Gen Z have avoided a brand or product because of a bad experience. Businesses with a high proportion of these younger consumers may need to take a more creative approach to promote loyalty and consider tactics such as tie-ins for products and services that millennials love (e.g., credit card companies that offer early tickets to sought-after events).
The research also shows us that brand reputation contributes just 16 percent of the purchase influence, while opinion leaders such as celebrities only influence a purchase decision by 3 to 6 percent – so you maybe want to carefully think before you ask David Beckham or Beyonce to endorse your brand. These results are extremely useful in helping us to re-assess CX strategy and marketing expenditure today, and are an invaluable peek into the future of what is increasingly important to our consumers. Read the full report.