Build Your Customer Empathy Engine. Watch Your Business Grow.

BusinessWeek names 25 companies every year to their list of service champions. They start with a list based largely on brands in J.D. Power & Associates database, and then they poll 3,000+ readers to generate a pool of names most associated with treating customers well. They look at the techniques, strategies and tools used to care for the customer, and I’m honored to say I help them in this process. The resulting list has its share of service legends, but new ones pop up each year. Despite their differences, most of the names on the list share one thing in common: they empathize with customers.

This year, in the 2010 Customer Service Champs, BusinessWeek took an in depth look at the company USAA. They are a private company that offers auto and home insurance to a customer base of military members and their families. With $68.3 billion in assets, USAA has unrivaled staying power atop Bloomberg BusinessWeek’s annual Customer Service Champs ranking. Since the first list in 2007, no other company has come close to achieving USAA’s feat: a No. 1 or No. 2 spot for four years running.

Beloved and Prosperous Companies Deliver Service with Care and Empathy

Customer empathy means understanding a customer’s needs and having the ability to interact with that customer in a personalized way. It’s the ability to imagine what it might be like to experience the life of a customer. It’s the ability to put one’s self in another’s shoes and walk a mile. And it’s an essential skill that should be at the heart of everyone’s service plan in the company, especially the frontline.

The companies that have made “the list” and companies that are thriving in this economy are there for good reason. Even in a sluggish economy, these companies continue to care for the customer, continue to empathize, and for that reason grow their business. As I discuss in my BusinessWeek article (from the Customer Service Champs issue), Customer Service: Marketer vs. Merchant, “They have made deliberate decisions about how they would run their business, and they live out those decisions every day. The most important of those decisions is the one that determines that taking great care of their customers is the highest priority.”

At USAA, New Hires Eat Like Soldiers

While new hires are not required to be from the military, they must understand the military.  So new USAA employees wear the military helmet and feel the weight of the backpack and flak vest strapped to their backs. USAA serves new employees MREs (meals ready to eat) during orientation so they can better identify with military life. They get to know the people behind the uniform by reading letters from soldiers and their families.

USAA was the first bank to allow iPhone deposits and among the first to let customers initiate an insurance claim using their phones from the scene of an accident. In 2008, they rolled out a service allowing customers to get text messages about their account balances. Later this year, they are planning mobile peer-to-peer payments, allowing customers to e-mail or text-message money to friends or family for immediate deposit. Also coming this year—a mobile car-buying service that lets customers snap an iPhone picture of a vehicle’s VIN number and instantly get back insurance quotes, loan terms and pre-negotiated loan rates. “They do all this really creative stuff that applies to guys and gals who are in Afghanistan,” says Karen Pauli, a research director at consulting firm TowerGroup. “There is nobody on this earth who understands their customer better than USAA.”

While nimble technology may be part of the formula for meeting its customer’s needs, USAA knows that an empathetic and caring workforce that understands the unique lives of their customer base is fundamental to their ongoing success. That means walking in their customers shoes.

In almost everything it does, USAA puts itself in the spit-shined shoes or combat boots of its highly mobile customers. Elizabeth D. Conklyn, EVP of People Services, says, “We want to cover the light moments, the heart-wrenching moments, what it’s like to be bored in the field. (Excerpt from Jeanne Bliss’s “I Love You More than My Dog: Five Decisions for Extreme Customer Loyalty in Good Times and Bad.”) By walking in the shoes of its customers, USAA breaks down the barrier that often exists between companies and customers.  As a result, USAA customers love and reward them with growth and validation. “No fewer than 87% of respondents to J.D. Power’s syndicated surveys say they will definitely buy from the company again, far higher than the average, which is just 36%. Its client retention rate? A near-perfect 97.8%.”

Decide to “Be Real”

Companies that customers love work hard to make personal connections. They strive to ensure their “real” personality shines through in each interaction with the customer.

In the beloved and prosperous companies:

• Leaders blend who they are as people with how they lead.
• Business decisions combine purpose and passion.
• Leaders give employees behaviors to model and permission to be “real.”
• Relationships are between people who share the same values.

These attitudes and actions embody what is behind beloved and prosperous companies. The action of empathy, walking a mile in the shoes of your customers, allows you to connect, establish rapport and create a trusting relationship. Once the customer realizes that you are on their side, they are more willing to work with you to fix the problem, or will allow you the time to resolve the issue.  And they will stay with you and tell their friends about you.  They will grow your business.

Go Try This

Have you trained your staff to understand the unique perspective of the customers they will be working with? Do they understand the value you place on getting to know the customer’s lives and special circumstances?

On a big sheet of paper, trace the bottom of your shoe and label it, “My Customers’ Shoe: Five Things We Should Know about Our Customers.”

In teams of 2 to 4, write down the things you understand about your customers. What keeps them up at night?  What is a day in a life for them?  What do you know about their needs that help you serve them?

This activity will help your team identify the unique characteristics of the people they serve. It may also be an eye-opener if the teams are not able to identify 5 things about the customers. Taking the time to review the lists and develop training to allow employees to gain a deeper understanding of the customer perspective will ultimately grow the value of your business and grow the bottom line.

Here’s your challenge question from my book, “I Love You More than My Dog: Five Decisions for Extreme Customer Loyalty in Good Times and Bad.”

Want to learn about other tools to help you earn customers who drive the success and growth of your business? Pick up a copy of: “I Love You More Than My Dog: Five Decisions That Drive Extreme Customer Loyalty in Good Times and Bad.”