Great Expectations: How to Close Gaps and Grow Customer Loyalty

Minimizing the gap between customer expectations and experiences is the most valuable activity growth brands use to retain and grow their customer base.

When Maria left the restaurant after treating her husband to their first date night in months, she couldn’t help but feel cheated. It was supposed to be a special night for them, and while nothing went terribly wrong, there were a few things that took the shine off their evening: the air condition was on too high, the server left them too long between ordering drinks and food, and the presentation of their main course was a bit mediocre. She had high hopes for the restaurant and financially splurged for a date night to remember, but left feeling a bit ‘meh’ about it all.

“Would you go back there?” her husband asked. “I don’t think so, we should try somewhere else next time,” she replied.

Whether she knew it at the time or not, Maria felt the expectation-experience gap and it drove her future spending decisions. With the vast amount of restaurants available to us, we often conclude that we should explore somewhere new next time.

A gap between an expectation and experience creates negative sentiment. When we experience “the gap,” we feel a bit cheated because our expectations weren’t met. And this gap doesn’t have to be large – it just needs to exist. We might feel that an experience wasn’t bad enough to complain about but the result is the same: a lost customer for the restaurant.

How The Expectation-Experience Gap Relates to Customer Loyalty

On the flip side, when a restaurant or delivery experience matches or exceeds our expectations, we have no reservations about returning. In fact, we’d likely choose to return with new customers in the form of family and friends. Attaining this level of loyalty from customers pays dividends as studies have shown that up to 70% of restaurant revenue comes from repeat customers.

So what builds true customer loyalty to a brand?
1. Meet customer expectations
2. Delivering an experience in which the customer feels as if they got what they paid for (value perception)

Indeed, a Deloitte study of restaurant consumers found that eight out of the top ten factors that induce repeat visits are related to fulfilling the brand promise on their menu and service offering, including food taste, prior experience, food quality, service speed, and friendliness of the staff.

Striving to eliminate the number of customers who experience gaps in these areas is critical in generating genuine loyalty to a brand. And the resulting financial impact is enormous: just a 2% increase in customer retention is the same as cutting costs by 10%! (Forrester)

The tricky part? Operationally delivering on a brand promise is incredibly complex. With rapid changes to the labor market, brands must rapidly train a new generation of workers who are new to the industry, which increases the challenge further.

How Brands Close Gaps

Growth brands understand that each time a gap in the experience is solved, it removes the potential for the issue to impact other customers.

While recovering unhappy customers who complain can help reduce churn in the short term, if the root cause isn’t addressed, the problem will persist, impacting more and more customers.

So, identifying and fixing the root causes of experience gaps has a multiplier effect: solving one particular issue can save you many, many customers.

The question is: how do you find these breaks in the journey? You need to ask the only people who know: your customers. The more you ask, the more data points you have to pinpoint the root cause of issues, and the more confidence you have that you’re fixing the most important ones.

With a small, unstructured data set, it’s easy for improvement efforts to be swayed by a small number of loud voices. Instead, gaining feedback from a broad range of guests in a structured manner is the new experience data that is most in demand. It’s that data set in which growth brands are leaning on to take the delivery of their food and service to previously unattainable levels of quality and consistency.

And it’s easy to see why this trend is emerging when you look at other verticals. Take sports for an example. To improve their team, coaches don’t base their strategies and player development plans by relying on the opinions of their coaches watching on the sideline. Instead, they leverage video footage so they can track and analyze every movement of each player. They then crunch the data and give each player bite-size insights on how they can best contribute and improve.

Restaurant brands are increasingly giving insights to their restaurant managers. Given the right insights, at the right time, in the right format, the general manager is best positioned to fix gaps in the customer experience. By giving them the tools to act on the data, not only are more experience issues addressed faster, but doing so is far more efficient because retraining efforts are only delivered to the teams who actually need it.

The Loyal Customer

Back to Maria. On their next date night, they went to a different restaurant across the street. Everything was perfect. Her expectations were met and, in fact, the restaurant added some extra touches which took it above and beyond what she’d hoped for.

That was 4 years ago, and Maria and her husband have re-visited four times a year since.

Focusing on minimizing the number of customers who are impacted by the expectation-experience gap is a critical component that drives brand loyalty over time. The financial impact of taking a data-driven approach to identifying and solving problems is the killer multiplier activity that the most successful brands are taking to avoid churn, drive repeat visits with larger check amounts, and ultimately, increase revenue over time.

Learn more about why the driving force behind sustainable growth is consistently delivering on the heightened expectations of service, value, and quality with our whitepaper, ROI of Experience Management Technology.