Understanding and Managing Customer Perceptions

managing customer perception

Photo by Andrea Piacquadio

“As far as customers are concerned, you are the company. This is not a burden, but the core of your job. You hold in your hands the power to keep customers coming back – perhaps even to make or break the company.” – Unknown Author

We know that what customers believe today about a company/brand/product becomes their reality. Unless something significant changes their views, customers could either stick with a company or turn away for good. Since every customer would have her or his thought process, emotions, needs, and expectations, the way they perceive a single product would be different from every other customer. In fact, the perception in most cases could be opposite to what the company may have intended it to be. In today’s market, customer attention is hard to gain and sustain. Understanding and managing customer perceptions becomes even more critical. Companies can use surveys to learn more about their customers. Interactive decision trees help customer service teams create surveys based on previous answers.

Companies should create a positive impression

Customers now have access to a lot of information and data. Additionally, companies continue to push across information to customers, in a bid to gain their attention. With so much to deal with, customers are easily bored or overwhelmed. It leads them to ‘switch off’ until they see something that would be interesting and useful to them. Creating a positive impression in the first instance is a great method of managing customer perceptions. If customers see something they like, they are more inclined to seek out the company and its offerings consistently.

Company branding

Understanding and managing customer perceptions is critical to business success. With competition becoming increasingly fierce, companies are struggling to remain in the limelight. They consistently face the challenge of differentiating their products and services from others in the market. Products and services face stiff competition from existing and new companies. There’s hardly much left that differentiates one from the other.


Companies engage in price wars, and everything in the market seems to become commodities. With so many choices and offers, customers are becoming increasingly demanding and choosy. They are also becoming more sensitive to prices. They are in constant search for places to buy products at the lowest price and get better deals.


As opposed to this behavior, the customers increase attraction towards luxury and branded products. The opposing trends make it even more challenging for companies and brands to understand and manage customer expectations and perceptions. Making things tougher for companies is the reason customers are aware of the power they wield. They are not averse to using it to get what they want, how they want, and when they want. With this shift in the balance of power, companies have no choice but to get better at understanding and managing customer perceptions.

Create sustainable relationships

Given the situation, companies must actively look at creating and building robust and sustainable relationships with their customers. Such relationships would prove to be a significant competitive advantage. The relationships transcend the myopic approach of price and quality. They focus on building a mutually beneficial association, leading to the success of all those involved. Companies must focus on making the associations easy, convenient, reliable, efficient, and trustworthy for customers.

We know that even a single instance of mismanagement and service lapse can lead to a change in the customer’s perception of a company. It then remains negative. No company today can afford unhappy customers and customer churn. Unhappy and exiting customers are potential bombs for any company. They can cause serious damage to the reputation of a company with a single negative comment or review. Managing customer perceptions has become so hard for companies. An increasing number of prospective customers first read the reviews and comments of existing customers. With too many negative comments, it would almost be impossible for a company to change the perception of a larger audience, in its favor.

Build loyal customers

It is no longer only about understanding and managing customer perceptions. It is also about adapting their processes and operations to compete for the same set of customers. Traditionally companies would focus their efforts on marketing events, promotions, and other attention-grabbing activities. While these continue to be important, they are not enough. Companies need to move beyond trying to satisfy customers, to creating delighted loyal ones. It is loyal customers who contribute to a company’s growth.

They create more business by way of positive word of mouth. Loyal customers not only buy repeatedly but are also immune to outside influences. They would be less likely to change their company perception based on minor instances of service errors, or problems. On the other hand, a satisfied customer is not necessarily a long-term one. It would be easy for a competitor to ‘steal’ them by offering them even better products or pricing. Managing perceptions of loyal customers in the company’s favor is a lot easier.

They would have, over time, built an emotional connection and a bond with the company. They consistently prefer the company’s products to others and willingly recommend them to others. Their reasons for buying go beyond rational decisions and are rather more about how they ‘feel and perceive’ a company.

Customer perception revolves around values

Managing customer perceptions is important. They evaluate products and services based on the perceived value and benefits to themselves and their business. These benefits go beyond the scope of business, and the perceptions are more around emotional value. Companies must succeed in managing customer perceptions around these values – social standing, friendliness, trustworthiness, exclusivity, and other such values.

Customers measure companies and their products based on how well their expectations and preferences are met by them. In addition, when looking at the cost of a certain product, the perception extends beyond the purchasing cost. It includes costs such as usage, the duration for which the product is expected to last, loss when compared to other offerings, and other such cost-related considerations.

Customer feelings and emotion

Managing customer perceptions is critical since it’s based on feelings and emotions, and the apprehension of whether the product would live up to their expectation. Customers no longer buy to satisfy a particular logical need. For instance, buying a high-end product is more about social status, feeling good, and ‘bragging rights’. It’s less for the actual use of the product. A good quality handbag would serve the same purpose. Yet a social status-conscious person would buy a branded product for the feel-good value. In today’s competitive market, managing such feelings and emotions that lead to buying become increasingly important for a sustainable competitive edge.

Importance of managing customer perceptions

Companies must work consistently towards understanding and managing customer perceptions. By doing so, for a small group of customers, they are indirectly influencing a much larger audience. As mentioned, delighted customers speak highly of a brand. As a result, it encourages others to buy from the company. It increases the reach and awareness of the company without additional effort. A company’s efforts at managing customer perceptions must start with a monitoring and measuring system.

A company is able to know whether the processes and procedures it has put in place work in the current scenario. They also understand if they would need to change or improve with time. Getting into the mind of customers requires a significant mindset change for most companies and their employees. Managing customer perceptions must not be taken lightly, since how customers perceive a company determines its future and success. What customers think of a company is significant for any company today.

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