Jackie Zach
September 8, 2024
The Peak-end Effect episode of the Tough Love for Business podcast delves into the “peak-end effect,” where the end of an interaction leaves a more vivid memory than the middle. Mike shares a personal story about a car service experience that started negatively but ended on a positive note, highlighting how a strong conclusion can reshape a customer’s overall perception. They stress that the end of any transaction is crucial for customer satisfaction and can be systematized through small but meaningful gestures like using customers’ names, smiling, and saying goodbye.
The discussion emphasizes that businesses can greatly improve customer loyalty by focusing on creating positive endings in their interactions. Personalizing interactions, acknowledging customers, and making them feel valued are key strategies the hosts suggest for business owners. They also provide practical examples, such as how a simple change in greetings and farewells improved the environment in a warehouse setting, demonstrating the broad applicability of the peak-end effect in various business contexts.
What is the end of the transaction your customer is experiencing? Need some help creating an extraordinary experience? Take advantage of a complimentary business strategy session to discover the opportunities in your business! https://actioncoachwi.com/podcast-ask-a-question-complimentary-session/
Podcast Transcript:
Mike McKay: Welcome to the Tough Love for Business podcast. My name is Mike McKay, and I’m here with my co-host, Jackie Zach, who’s having a bit of trouble announcing the name of our podcast today. What’s up, Jackie?
Jackie Zach: Today’s topic is another great one from the Daily Dose archives. It’s really interesting and something that hadn’t occurred to me until I started reading about it. It’s about “the ending”—the end of a transaction or an interaction with someone, whether it’s a meeting, phone call, or any interaction. How are you leaving the person you’re talking to? How do they feel after being in your orbit?
Mike: There’s a psychological concept called the “peak-end effect.” A lot of people believe first impressions are everything, but research shows that they’re not as important as we think. What matters most are the peaks and the ending of an interaction. These are the moments that people remember. For example, if a service experience starts poorly but ends on a high note, it can change how you feel about the entire interaction.
My wife had an experience with a car service person who was super condescending to her, blaming the car problem on her keyring. She left frustrated and didn’t want to deal with the guy again. After I called the manager to complain, they assigned a different person to help us. When we went back, they not only fixed the issue but also went above and beyond by discovering another problem and replacing the transmission under warranty. That experience, that peak-end effect, made me feel positive about the company, even though my wife still refuses to go back.
Jackie: The bottom line is, what’s the end of the interaction like for your customers? People will remember that. No matter what happens in between, they’ll remember how you made them feel at the end. Are you doing something to make that ending not just pleasant, but extraordinary?
Mike: And just to be clear, we’re not saying you should only focus on the ending and neglect the rest of the interaction.
Jackie: Yes. But the last few moments are crucial. They can be as simple as a genuine “thank you” or “it was a pleasure working with you,” rather than something mechanical or insincere.
Mike: Recently, I’ve noticed that some places we’ve been to, like restaurants, don’t even acknowledge you when you leave. At a restaurant, it doesn’t take much effort for the host to say, “Thanks for coming in!” It’s these small things that matter.
Jackie: I go to get my nails done regularly, and when I leave, anyone paying attention—usually the owner or one of the staff—always says goodbye, often using my name. It’s a small gesture, but it makes a big impact.
Mike: We once did a culture turnaround in a Napa warehouse, and the only change we made was requiring everyone to greet others by name in the morning and say goodbye at the end of the day. Most people didn’t even know each other’s names initially, which speaks volumes about how disconnected the work environment was. But simply using names made a huge difference. It’s not a big ask to take care of your people.
In coaching, no matter how tough a session might be, we always aim to leave clients on a positive note, reminding them of their strengths and what they can achieve. The peak-end effect can be built into your processes, whether it’s customer interactions or managing your team.
Jackie: Pay attention to your own interactions. Are people acknowledging you? Are they smiling? Small things like a smile can make a huge difference. If you start changing the ending of your interactions, you’ll see things begin to change for you. So remember, you’re professional business owners.