Sitting an important exam. Attending a big job interview. Launching a new business.
These are the type of make-or-break events in our lives that we commonly call ‘moments of truth’. They’re situations where people are put to the test or have to make a key decision that could change the course of their future. Heavy stuff.
In marketing and customer service, the phrase ‘moment of truth’ has a similar meaning. It represents occasions where a customer’s interaction is so impactful that it alters their perception of the brand.
Moments of truth can forever change the relationship between a brand and its customer, for better or worse. That’s why it’s as exciting as it is important to recognise and spend some time to hone in on these pivotal interactions. Focusing on the “moments of truth” means spending your time (and budget) on the most valuable parts of your customer journey. You can focus more on the moments that truly matter.
So how do you spot a moment of truth? We’ll come to that. First, let’s dig a little deeper into when moments of truth occur.
What is a moment of truth in customer service and marketing
The term ‘moment of truth’ was first coined in marketing by AG Lafley, former Chairman, President and CEO of Procter & Gamble (P&G).
In 2005, he claimed there were two moments of truth (with a third being added later by Pete Blackshaw – another P&G alumni):
- First moment of truth: When a customer first encounters a product or service. This is when marketers have the opportunity to convince the customer to buy their goods instead of another brand’s.
- Second moment of truth: Once a purchase is made and the customer discovers whether a product or service meets their expectations.
- Third moment of truth: The tipping point where a loyal customer becomes an active brand advocate.
A moment of truth in customer experience (CX) and customer service can have a slightly different interpretation, however.
For McKinsey & Co, it refers to any time when a person invests a “high amount of emotional energy” in the outcome of a brand interaction. This is where moments of truth become really valuable – in emotionally impactful customer interactions.
When emotions are running high, so are the stakes for brands. And genuine emotional connections are key to whether companies will sink or swim during moments of truth.
The value of moments of truth
Handled well, a moment of truth can foster loyalty and brand advocacy. Handled poorly, and a customer could be lost forever.
We’ve quoted this statistic before, but it’s worth repeating: one-third of consumers will walk away from a brand they love after just a single bad customer experience.
McKinsey & Co research shows similar consumer behaviour. Within the banking industry, for example, 15% of customers who had negative experiences during a moment of truth switched banks shortly after.
A further 20% stopped using a particular product at their main bank. And 23% began buying services from another provider, even if they stayed with their current one. Around 14% decreased the value of the products they purchased.
That’s 72% of customers who actively changed their relationship with their bank (to the bank’s detriment).
Meanwhile, a ‘positive’ moment of truth has the opposite effect. Nearly a third of people (29%) purchase another product from their bank, and a whopping 58% increase the value of the purchases they made with their current provider.
Only 13% did nothing after a great moment of truth experience.
The upshot is that moments of truth inspire customers to take action. What action they take (and the effect on a brand’s bottom line) depends on how they’re treated at those crossroads.
Finding moments of truth – and getting them right!
Not every interaction with a customer can be described as emotionally impactful.
Reporting a lost credit card, getting in touch about a cancelled flight or asking for investment advice. All are classic moments of truth where emotions are likely to be running high. Buying some new toilet cleaner? Not so much…
According to McKinsey, companies often make the mistake of focusing too much energy on humdrum transactions that, frankly, most customers aren’t emotionally invested in.
And even if brands know what to look for, they don’t always get their responses right.
So, what do consumers want? First and foremost, they want good advice. A third of respondents to a McKinsey survey said this was the primary hallmark of a positive moment of truth.
Proactive communication that’s appropriate to their needs (13%) is also important. As is caring, responsive frontline staff who understand their history (11%). Flexible employees with a knack for troubleshooting also ranked highly (10%).
On the other hand, frontline staff who simply stick to the script and offer advice that is not appropriate to the customer’s needs are the top reasons why moments of truth go wrong for businesses. In general, customers also say they don’t like a ‘hard sell’ approach.
The bottom line is that people want a friendly, empathetic and personalized service. And if they don’t get it, they’ll talk with their feet and walk away from a brand – possibly forever.
How can conversational AI help brands with their moments of truth?
We know that emotionally charged interactions are usually when moments of truth occur in CX. Having capable, knowledgeable and emotionally intelligent staff at hand to steer those interactions in the right direction is undoubtedly to any brand’s benefit.
But we don’t have to explain that today’s customers are more often online and out of the direct hands of customer service reps. Even when they are, customer service teams can’t be everywhere at once, 24 hours a day.
And while automated technologies like chatbots and virtual assistants can provide immediate support, are they equipped to handle emotionally charged, make-or-break interactions? After all, customer service AI isn’t well known for building strong emotional connections.
We believe digital humans can, however, do better. With the face, voice and personality of your brand, they offer human-like conversations that go beyond simple customer transactions.
Body language, facial expressions, tone of voice, local dialects, engaging dialogue and accents – they’re all parts of human interaction that make up engaging, emotionally charged experiences. Digital humans use all of these, too, to form a lasting connection with customers.
As a type of conversational AI, digital humans can look after a brand’s moments of truth, instead of leaving emotional connection to the bots. By showing a little warmth and support at the right times, it’s possible to provide a human experience even online and when real people aren’t available.
To discover more, you can read our article on what CX looks like in the age of AI. Or download our free ‘what are digital humans’ eBook for a deeper dive.
So, what moments of truth matter most to your customers – and how can you make sure their experiences in these moments are positive?