A mantra among businesses that have difficulty competing on price is that survival is based on the customer service level being provided.
But rarely has there been an effort to quantify the effect of being a customer service leader vs. being a customer service laggard.
While this was a study about publicly traded companies, Watermark Consulting here said firms that deliver great customer experiences are rewarded, not only by investors, but by consumers as well.
Jon Picoult, founder of Watermark Consulting, noted that between 2007 and 2009, firms he considered "customer experience leaders" generated total returns that were 41% better on average than companies in the S&P 500, and 145% better than those considered to be customer experience laggards.
This analysis is based on the 10 highest and 10 lowest ranked publicly traded companies in Forrester Research's 2007 Customer Experience Index study.
"Some business leaders are skeptical about the return on customer experience investments," said Picoult. "They're reticent to invest in improving and differentiating their customer touch points, because it can be difficult to quantify the resulting bottom line benefits."
The Watermark study demonstrates at a macro level that businesses that deliver to their customers a very positive, memorable experience are rewarded handsomely in the form of better financial performance; because they are publicly traded, they also benefit from increased market value.
Picoult said "These companies' operational excellence and attention to detail, their simple and straightforward communications, their well-equipped and genuinely helpful customer service staff-the sum of these parts pays off in the end, even if the precise impact of individual components is uncertain."
To learn more about this study, go to
