CX is the new buzzword and board room priority. And rightly so, as professional services firms strive to execute client-centric strategies to meet buyers’ increasing expectations and demands for transparency. All this, while working to be competitive in the face of rampant buyer power being exercised with a growing choice of firms and experts.
It is commonly accepted that excellent CX supports growth, and poor CX the opposite.
What is less well understood is this: Clients will pay more for excellent CX.
Our beatonbenchmarks research in Australia and New Zealand shows that in professional services excellent client service is strongly correlated with high NPS (high promoters, low detractors) and loyalty.
Therefore investments in delivering excellent CX will pay back handsomely in increased repeat business from very happy clients, and more new clients as a result of referrals from your promoters and fewer detractors turning off potential clients.
In addition, our beatonbenchmarks research also shows a clear statistical correlation between a firm’s overall client service rating and clients’ fee perceptions.
This is demonstrated in the chart which plots competitor firms on overall client service (OCS) ratings against perception of fee levels, i.e. price. Note, OCS is used as proxy for CX in the beatonbenchmarks measurement model.
The red diagonal is called the ‘fair value line’. It shows that for higher levels of client service, clients rate price higher and vice versa.
Firm A (bottom left) has the poorest client service rating and also the lowest price – it sits on the red fair value line indicating appropriate fees for the level of service i.e. ‘cheap and cheerful’.
Firm B (top right) also sits on the fair value line with the 2nd highest client service rating and 2nd highest price, i.e. ‘top service for a premium price’. In each profession that we research there are firms that over many years consistently occupy the top right position, and, assuming smartly resourced, generate top profits. Clients commenting on the value delivered by these firms typically say “They are expensive but worth it”.
Firm C (bottom right) has the highest client service rating but one of the lowest price positions i.e. they are delivering exceptional value. Our research shows that firms in this position have price-setting discretion i.e. they can increase price without losing share; or they can use their service + value price advantage to win share from competitors. We have several case studies where we have worked with firms in this position to successfully increase fees whilst communicating their excellent service and value.
Firm D (top left) has one of the 2nd lowest client service rating and 3rd highest price positions i.e. they are delivering very poor value, which our research shows a real risk losing share of future work.
Three ways to deliver excellent CX
There are three ways to deliver excellent CX, based on beatonbenchmarks data:
Consistent excellence – the top right firms are able to deliver the most consistently excellent CX across clients. Good is not good enough.
Know the top three drivers of client satisfaction for your clients and focus continuously on improving excellence, e.g. Ease of doing business.
Run real-time feedback during engagements to identify issues, action them immediately and track progress towards consistent excellence, superior value. And, for the firm, if smartly resourced, top profits.
Read Knowing your clients is a very g$$d idea published on Research. Reveal. early this month.
Paul Hugh-Jones is a partner of beaton. You can also connect with Paul on LinkedIn and contact him at firstname.lastname@example.org