You may have noticed that many companies and brands are struggling to deliver the customer service and experience we've all enjoyed in the past. Perhaps you have experienced longer lines, unreasonably long wait times when calling customer support, shorter business hours, canceled flights, fewer employees in a store to help you — basically, lower levels of service than before.

The other day a friend of mine asked me, "Is mediocrity the new norm of customer service?" Isn't that a shame? He has noticed what most of us have noticed. Customer service and CX are heading in the wrong direction.

If you've experienced any of this (and more), you may be a victim of skimpflation.

The term skimpflation was first used on a recent episode of NPR's Planet Money podcast. It is the result of rising business costs and a labor shortage. "The Great Resignation" has been a big contributor to the labor shortage. Inflation and supply-chain issues have caused prices to go up. You put the two of them together and customers notice the poor service and higher prices, creating a bad experience that causes them to choose to do business elsewhere, if there even is an "elsewhere."

Learning Opportunities

Companies and brands don't choose to skimp on these services. Often, they have no choice. I've seen restaurants and retailers reduce the hours and days they are open because they can't find help. Some have been forced to shut down altogether.

So, how can you deal with skimpflation? How can you avoid losing customers because of a bad experience? While I can't address the inflation and supply-chain issues, I can address the employee side. And it doesn't matter the type of business you're in. It could be B2B, B2C, eCommerce/digital, consulting, etc. All businesses are being impacted by skimpflation. With that in mind, here are five ways to keep from giving your customers a skimpflation experience:

  1. Get employees to work for the company, not just the paycheck: Money is important. You may even have to pay more than what you've been paying in the past for good people to stay. Just know that isn't the main reason they stay. Even if you do pay them more, if you don't back it up with an employment experience that is fulfilling, they may leave if they know they will be treated better elsewhere.
  2. Managers and leaders must practice the three N's: My friend and leadership expert Tim Durkin knows what employees love. They want to be needed, noticed and known. (I know. The word known doesn't start with an N, but it sounds like it does.) As a leader or manager, let your employees know they are appreciated. Tell them they are doing a great job. Get to know each one as a person. You want them to have a relationship with the company that extends beyond trading time for money.
  3. Create destination employment: In my book The Amazement Revolution, I write about a concept that Brian Keeley of Baptist Health South Florida, a health care organization, refers to as destination employment. If you create a fulfilling employee experience and practice the three N's, you're on your way to creating destination employment. This is when your employees come to work for you and enjoy it so much that they never leave. That's a pretty lofty goal, but when people are properly compensated and treated the right way, they stick around. Keeley says, "We strongly believe that the health and well-being of our employees are critical to our ability to care for our patients." In other words, treat employees right, and they treat their customers right.
  4. Study what the best brands are doing: There are plenty of businesses out there that are doing it right. You can study big brands like Walmart, Amazon and Target. By the way, in spite of the Great Resignation, Target has been able to hold on to its employees, with the lowest churn rate it has had in five years. One publication writes, Target may just be the best place to work in retail. Yes, these companies are paying higher wages than in the past, but they are doing much more. Learn from the best and adapt what makes the most sense to your organization.
  5. Transparency: This last one is focused on the customer. I interviewed the CEO of a manufacturing company. He's been forced to raise his prices, primarily because his costs are rising. (He's already taking great care of his people.) He was so uncomfortable with the increase that he decided to send a very detailed letter to his customers explaining the reason why. He hoped they would understand. He assured them that he wasn't making more money because of the higher prices. And understand they did. Not only that, but he also received empathy letters from some of his customers. Most importantly, he didn't lose business. Keep in mind that rising costs don't have to come from products. It can come from paying employees more to stay. If there is a way to clearly explain the situation to your customers, in such a way that makes sense to them, you may come out ahead in the end.

Final Thoughts

Don't let skimpflation ruin the customer experience that you work hard to create. You might need to up your game, and these five ideas can help guide you to keep your employees on board and happy and inspire them to keep the customer happy, too.