The Complete Guide to Customer Expectations

Customer expectations

Excellent customer service and high customer satisfaction must start with understanding customer expectations. You need to know who your customers are and what they want.

When measuring customer satisfaction, companies generally ask customers whether their product or service has met or exceeded expectations. This is an important question to ask and is a key factor behind satisfaction.

When customers have high expectations and the reality fall short, they will be disappointed and will likely rate their experience as less than satisfying. For this reason, luxury resort, for example, might receive a lower satisfaction rating than a budget motel—even though its facilities and service would be deemed superior in ‘absolute’ terms.” – Marketing Metrics

Customer expectations set the bar for customer satisfaction which also affects repurchase decisions and customer loyalty. If a customer feels like you did not deliver a service that was expected, they won’t come back and buy from you again. On the flip-side, if you deliver a service that exceeds customer expectations, you can bet they will come back to buy again, and tell all their friends about the experience.

One of my favorite quotes about customer expectations is from Roy Hollister Williams, a best-selling author and marketing consultant best known for his Wizard of Ads trilogy.

“The first step in exceeding your customer’s expectations is to know those expectations.” – Roy Hollister Williams

Here’s what you’ll find in this complete guide to customer expectations:

  • The hard facts with included research
  • Benefits of understanding customer expectations
  • Knowing your customers’ needs
  • Setting customer expectations
  • Meeting customer expectations
  • Fixing and resetting expectations
  • 4 examples of companies exceeding customer expectations

The hard facts about customer expectations

A study by A. Parasuraman, Leonard L. Berry and Valarie A. Zeithaml which was posted by the MIT Sloan Review, found these key insights when they were researching customer expectations across 16 focus group participants:

  • Customers expect service basis – there is a perceived expectation that every customer has when going into a business relationship. For example, a hotel customer thinks that when they pay more they expect more.
  • The service process is the key to exceeding expectations – companies are supposed to be accurate and dependable and provide the service they promised. It’s unlikely for a hotel to exceed customer expectations if they only just have the customers room ready. The opportunity lies in the ability to surprise the customer with an uncommon swiftness, face, courtesy, competence, commitment, or understanding.
  • Customer expectations are duel-leveled – The study found that customers’ expectations had two levels: desired and sufficient. The desired level is the service the customer hopes to obtain while the sufficient level is the service which the customer finds acceptable.
  • Customers want relationships – relationships are important to customers. Many of the customers interviewed want to be ‘relationship customers’, they want ongoing, personalized relationship with the same representative from the company. They want a company representative to contact them, rather than always having to initiate contact themselves.
  • Manage promises – to manage expectations, companies can first start managing their promises. The study found that some observers recommended deliberately under-promising the service to increase the likelihood of exceeding customer expectations. This is something I regularly recommend to our customers all the time. There’s nothing worse than over-promising and under-delivering! Keep in mind that there are some risks with under promising as it can reduce your competitive appeal, so make sure you are aware of your competitive environment.

It is essential for businesses to manage customer satisfaction. To be able do this, firms need a reliable way to measure satisfaction. A customers’ expectation is that metric.

A lot can go wrong during your business relationship with customers; it’s necessary to make sure you are always thinking about setting expectations, meeting expectations or resetting expectations.

The benefits of understanding customer expectations

Customer satisfaction is a result of the service level you deliver compared to what your customer expects to receive.

Here are the four benefits you can get from understanding customer expectations:

  • It lets you know what service levels are expected to keep customers happy and achieve high customer satisfaction
  • It enables employees to focus on fulfilling customers’ expectations
  • It gives you the opportunity to exceed expectations and create raving advocates
  • It can help you resolve customer complaints. Since complaints are a result of failing to meeting expectations, you have the ability to quickly fix the problems and retain the business

Understanding your customers’ needs

Excellent customer service means different things to different customers. In order to understand what your customers feel is a good level of service, you first need to,ask them. Find out what your customer wants from your product or service. Now work out how and whether you can meet those needs.

If your customers need 24/7 live chat support, you must find a way to make it available. I like to you set expectations based on customer needs.

But I can’t afford to give them 24/7 support, Ross.

That might well be the case, so you must ensure your product or service is priced accordingly so you can meet needs while being profitable. Something might have to give, but remember the minute you start not meeting customer’s needs, that’s when you risk losing their business.

Most customers have a set of basic needs that they want from a service, make sure you understand them and work them into your customer service strategy.

Read more: Know your customers’ needs

Setting customer expectations

Right from the first contact you have with a customer it’s important to set expectations. Too many times I’ve talked to customers where they’ve had sales guys over promise and set expectations so high that their poor account managers had no chance of meeting them.

Once you now know what your customer needs, you can begin setting expectations. Here you can tell customers what service levels they can expect to receive, what support is available to them, what results they should be getting and what KPI’s you’ll be working towards. Every industry and even every customer might have a different set up expectations. This is because there needs will be different, so you must adjust accordingly.

At R&G Technologies, the sales guys and account managers are very transparent with all customers. They take the approach of leaning on the side of under-promising so that they are always seen to be exceeding customer expectations. This works very well for them because they get a lot of happy customers and a lot of business referrals. Gordon Tan, Managing Director of R&G, instructs his employees to treat every customer interaction as if they were going to ask for a business referral once the job was complete. This is a great way to set the scene and encourage employees to give a super level of service.

Related: How to set and meet customer expectations

Meeting customer expectations

Meeting customer expectations is the most valuable part of customer satisfaction. A satisfied customer is one that has had their expectations met. To do this, you must make sure you deliver a consistent level of service that is based on the key areas and KPI’s you have set for each customer when you set expectations.

There are many ways you can do this. I recommend breaking your product or service packages up into different levels. For example, at KISSmetrics they have Starter, Basic and Professional plans. Each plan has different customer expectations that have been established and need to be met.

The goal here is to not just meet customer expectations; it should be to ‘wow’ customers and exceed them. When you exceed expectations, you create an experience that the customer remembers. This experience is often passed onto friends which generates word of mouth referrals and can help create a positive impression of your company.

An awesome example of exceeding expectations was showed by a customer service rep at Netflix. He went above and beyond the required level of service when chatting to a customer via live chat. Netflix service rep Michael responded to a live chat inquiry by introducing himself as “Captian Mike of the good ship Netflix” and then asked which member of the crew he was speaking with. “Lieutenant” Norm took the bait, responding as if he was a ranking Star Fleet offer from Star Trek. The live chat correspondence continued for five minutes while the problem was identified and a solution provided. Michael didn’t need to add the personal touch and act like he was on Star Trek, but he did. That experience exceeded Norm’s expectations and he felt the need to post it up on social media sites. It soon went viral.

See also: The full article about the Awesome Netflix Customer Service Conversation.

Fixing and resetting customer expectations

From time to time you are going to fail to meet customers’ expectations. It’s the nature of the beast. There are a number of reasons why this might happen from poor customer service, under-trained staff, expectations set incorrectly, or even growing pains where expectations have changed.

The key is how,you go about acknowledging you have stuffed up and how you put systems in place to fix and reset customer expectations. What I like to recommend is immediately when you have find out that you’ve failed to meet expectations is to call your customer. Get the complete picture of what’s going on and try to tee up a face to face meeting. This shows that you really care about their business.

See also: 9 Customer Retention Strategies that work

At the meeting your aim will be to fix any discrepancies that have caused the problem in the first place. Some will be fixable like training employees, but you may also need to reset customer expectations. Here you’ll have to explain to your customer that things have changed. For instance, one of our Client Heartbeat customers (an IT Support company) was experiencing some really bad customer satisfaction scores. It turns out that the expectations from the customers were off. The company had grown significantly over the past three years and the initial customers who would get serviced within two hours, now had to wait up to six hours. The company’s service levels had changed, as it grew bigger, they were not able to be as quick and responsive as they use to be. They were now a much bigger company and had bigger systems in place to manage the service levels.

Unfortunately during this growth, the change was not passed on to the early customers, so as a result; there expectations were still as if they were three years ago. They were expecting to be serviced within two hours,  just like it use to be.

Now that it was taking six hours, they felt the service was not living up to expectations and considered it bad. You should of seen the customer satisfaction scores, they were 4/10 … 5/10 – really worrying!

I worked with the company to develop a strategy that involved resetting customer expectations and educating customers on what service level they should expect moving forward. The initial customers were told why this change had happened and be assured their business was still extremely important to the company.

So far everything has been going well for the company and the news has been well received by customers. A lot of customers only knew the company had experienced growth and that the environment was different to what it was like three years ago. They just needed to be educated and informed.

4 amazing examples of companies exceeding customer expectations

1. Amazon exceeds expectations with delivery

Amazon has been known for outstanding customer service, consistently outdoing their customers’ expectations. One particular example of this involved Joe Nocera in the Christmas of 2007.

Joe bought a PlayStation 3 from Amazon, a $300 gift for his son. Like most things you buy online, it was shipped to Joe’s apartment and since he was at work, left at the doorstep (signed by a neighbor). Unfortunately for Joe, someone saw the package and took it before he arrived home. Distraught, Joe contacted Amazon, knowing full well it was not their responsibility but thought he’d give it a go, a Hail Mary.

To Joe’s surprise, the Amazon customer service representation was very understanding and without a blink, had another PlayStation 3 shipped out to Joe, arriving on Christmas Eve, just in time! Amazon didn’t even charge him for shipping!

This is a great example of Amazon exceeding Joe’s expectations. They went above and beyond, something that 99% of companies wouldn’t have done. As a result, they have one very happy and loyal customer who will forever be spreading the love and talking about his amazing experience.

Fun fact:

Amazon actually aims to get you your packages faster than your predicted delivery date. So when it says three days to arrive, they’ll do all they can to get it there in two – exceeding your expectations. Crazy right? But how can they do that? According to the Grasshopper blog, Amazon takes advantage of local distributors and freelance couriers.

Read more about the lost PlayStation 3: Put Buyers First? What a Concept

2. Zappos – never argue about returns

“Zappos is a customer service company that just happens to sell shoes.” – Tony Hsieh, CEO of Zappos.com

Zappos is considered by many as the company that delivers the worlds best customer service. They are always going out of their way to exceed customer expectations – it’s literally ingrained in their culture.

In this particular instance, one customer required some new hard-soled shoes as she had just come out of some harsh medical treatments which left here feet number and sensitive to pressure. Unaware of what shoes would work, she ordered six pairs, knowing the company had a 100% returns policy.

The shoes arrived promptly and two hit the mark, perfectly. So she got on the phone to chat with a customer service representative to find out what she needed to do to return the other four. One thing led to another and the two got chatting about diabetes-related issues that the customer and customer service rep’s father had in common.

Two days later, an enormous bouquet of lilies and roses arrived at her door, from the Zappos customer service representative!

This gesture showed exactly what Zappos is all about. They really cared about their customer and went beyond what was expected to send her some beautiful flowers that left a lasting impression. The customer has since vowed to buy every pair of future shows from Zappos.

By focusing on delivering superior customer service, Zappos had exceeded expectations.

Read more about this amazing customer service from Zappos

Fun fact:

Zappos has a 100 percent satisfaction guaranteed return policy. The company will never fuss about any return. In fact, Zappos actually encourages customers to order several products, check them out, and return what they don’t want. Here’s a Zappos-produced video on the company’s return policy. – Armando Roggio

3. How Callaway keeps customers coming back

I came across this great example of excellent customer service in Gregory Ciotti’s recent article on the HelpScout Blog.

It involves Callaway, an upmarket manufacturer of golf equipment. In this instance of exceeding customer expectations, George, an avid Callaway user, emails the Callaway Customer Service Team to inquire about getting a replacement grip for his putter. George noted in the email that he had been searching the internet for a place to buy a replacement grip, but just couldn’t find anywhere (see the transcript below).

The email requested if Calloway had any grips in stock and he’d be happy to pay a fair amount for a replacement, that’s how much he loved his putter J.

The response from Callaway representative Sean was impressive. He simply asked for a home address and said he’d ship one over for free. Easy, taken care of, no questions asked.

This is a great example of a company doing something small, but certainly exceeding a customers’ expectations for the service. George was happy to pay (probably a premium), but Callaway recognized this is an opportunity to offer excellent customer service and arrange a replacement for free.

George shared his story via Reddit and the community was very impressed. Here are a couple of quotes from Reddit users.

Bmcclure937 said, “Callaway definitely has great customer service. This is part of the reason why I love their products (bags, irons, drivers, putters).”

Casfacto added, “Customer Service win! I just wish I used my putter enough to need a new grip.”

And George (george91) also followed up with, “I want to buy more Callaway products. Lots more.”

All in all, great job by Callaway, definitely setting the bar high for all golf manufacturers!

If you enjoyed this example, I definitely suggest you check out Gregory’s seven examples of excellent customer service. You won’t be disappointed.

4. Good example of failure to meet customer expectations, then fixing it

Not every customer experience is going to turn out a winner for your company. It’s important to realize when you’ve stuffed up and make it right, quickly.

That’s exactly what happened to a customer who purchased a wallet from Rogue Wallet. Reddit user br4in,  shared his experience with the company via a on Reddit.

br4in had bought a wallet from Rogue Industries in 2009 and had noticed some material coming loose. Then, out of the blue (he never contacted the company), he received a package from Rogue containing a brand new replacement and this letter. Here’s an extract from the letter:

The unit which we shipped out to you may not meet your expectations. And at the end of the day, those the  only ones that really count. If those expectation were met, that is great – but if they haven’t been, then please accept our apologies.

Based upon some very appreciated customer feedback, I have decided to replace your existing vegan wallet with a complete free upgrade. Out supplier let us down but that responsibility, ultimately, is our and ours alone. – Rogue Industries

What a stunning thing to do. My hat is off to Rogue Industries, this is a great example of recognizing the company had failed to meet expectations, then went about fixing the expectations and sending out a replacement product, free.

All their customers must be feeling very satisfied, and I dare say Rogue Industries has gone a long way to retaining some of their not so satisfied customers who may have been upset with the quality of the original product.

rogue wallets letter

Read the entire Reddit Conversation here

High Customer Satisfaction starts with understanding customer expectations

By understanding customer expectations and knowing how to set and meet them, you can go a long way to achieving high customer satisfaction. Customers know what is a good level of service and what sucks. Use the information I’ve discussed today to sure you set expectations correctly right from the first encounter. Then implement the strategies I’ve recommended to ensure you meet expectations and keep customers happy.

More awesome articles that you should read:

Tagged: Customer Satisfaction, Customer Service

About Ross Beard

Ross Beard is on the marketing team at Client Heartbeat, the simple customer feedback tool. Learn how Client Heartbeat makes improving customer satisfaction easy.



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