2016: CX Leaders Will Adopt Agile, Insight-Led Innovation To Fuel Customer Obsession

Deanna Laufer

In 2015, customer experience (CX) rose to the No. 1 priority for business and technology leaders. In 2016, it will be among the top 10 critical success factors determining who will win and who will fail in the age of the customer. And for good reason: Better customer experience correlates with stronger revenue growth. But this is only true when competitors provide meaningful differences in the experiences they offer and unsatisfied customers have the freedom to jump ship when treated poorly. So in order to reap the benefits that better CX can provide, in 2016, companies will need to get down to the real business of not only providing good experiences but also breaking away from the pack with meaningful internal operational changes.

This won’t be easy, because success in the age of the customer requires shifting to a customer-obsessed operating model that puts customers at the center of all strategic decision-making. In 2016, leaders will tackle the challenge of making this shift; laggards will underestimate the magnitude and speed of change required and will instead push forward with uncoordinated digital efforts and flawed business priorities.

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Communication Is Key For Any Relationship

Tom McCann

This is a guest post by Erna Esa, a Research Associate on the Customer Experience team based in Sydney.

In the movie Love Actually, the chemistry between an Englishman (played by the very dashing Colin Firth) and a Portuguese housekeeper (Lúcia Moniz) was evident — but not having the tools to communicate in each other’s language left the pair feeling frustrated and annoyed.

Employees experience a similar type of frustration when they are not offered the opportunity to contribute to the conversations companies have about their customers. How do we know this? Well, we have found that 70% of information workers say that their job requires them to engage with or understand their customers but fewer than 40% of organizations in Australia and New Zealand systematically capture input from their employees about those interactions. That leaves a lot of employees who interact with customers and have knowledge of their company’s customer experience ecosystem without a structured, systematic way of telling their organization what they are seeing and hearing — and that’s frustrating.

Successful voice of the employee (VoE) programs have the potential to transform your organization into one in which talented, dedicated individuals strive to build a career. In many cases, these programs are inexpensive to set up and maintain, yet deliver considerable benefits when implemented across the entire organization. Forrester clients can read about these benefits in our latest report, Engage Employees To Nail The Customer Experience.

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Differentiate Your Customer Experience with "Signature Moments"

Ryan Hart

Every March, children run around, eagerly filling baskets with Easter eggs. The eggs come in all sorts of colors and sizes, some hard to find, some more easily discovered.  The ritual continues every year with the Easter Bunny (or parents in rarer cases) hiding eggs to impart joy and wonder in innocent children.

One can analogize that smart companies have taken over the role of the Easter bunny, trying to bring joy and delight to customers, not children.

While the holistic brand experience, or Easter egg hunt, looks at the sum of these interactions – each interaction can be broken down further into a series of microinteractions.  These small-scale opportunities, when carefully tied back to the brand, give birth to what Forrester calls ‘Signature Moments’ - which we define as: 

Memorably crafted and branded microinteractions that deliver delight and value to customers in an often subtle yet, recognizable way.

In my report, Differentiate your Customer Experiences with Signature Moments, I describe the ‘what, how, and where’ of Signature Moments, provide examples, and look at how they can be carefully designed and infused into broader customer journeys to delight, differentiate and ultimately resonate with local customers.

During ideation of these moments, take stock of the following:

■   Is it sufficiently differentiating?Assess whether the proposed microinteraction is like a literal signature, unique only to your company and not easily replicated by others in the market.

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Is Your Business Social Enough To Create Great Customer Experiences?

TJ Keitt

Your customer experience (CX) is the product of the interactions between your employees, partners, and customers within your operating environment. Forrester has labeled this as a customer experience ecosystem. It's important to understand CX ecosystems' two components — the people and the operating environment — for two reasons: 

  1. People participate in the ecosystem if they get value from it. Each actor in the CX ecosystem is asking, "What's in it for me?" Employees want things like professional development, recognition, and advancement. Business partners want access to customers, sales support, and strong revenue growth. And the customers expect quality products and services that meet their needs.
  2. The operating environment affects people's definition of value. Every ripple in the operating environment changes what employees, partners, and customers value and how they expect that value to be delivered. The economic downturn, for example, meant that many workers valued stable work over things like personal fulfillment — which is reflected in Gallup's report that just 32% of US workers are engaged. Many software companies transitioning from delivering server-deployed software to cloud services has changed how those vendors' traditional channel partners are compensated, going from large payouts on perpetual licenses to annuities from subscriptions. And disruptive sharing-economy upstarts, like Uber, have reset consumers' expectations of how they find and use services as diverse as car services, hotels, and office rentals.
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B2B Customer Experience Professionals: Do You Know Who Your Customers Are?

TJ Keitt

In April 2015, we started a conversation about what is different between business-to-consumer (B2C) and business-to-business (B2B) customer experience (CX). That early discussion focused on the fact that in B2B scenarios, there isn't one customer; there are multiple stakeholders within a client account whose work depends on interactions with the vendor. Now we're ready to elevate this conversation to its next level: How do B2B CX pros help their businesses find the stakeholders who matter?

I know what you're saying: "Don't all client stakeholders matter?" Yes — you want to make sure that each individual in an account who interacts with your firm has an experience that helps them achieve their goals. But when business leaders assess the value of customer experience, they want to know that it contributes to revenue growth, a business success indicator. So when B2B CX pros examine customer experience, they must understand the perceptions of stakeholders who influence:

  • Retention. Who are the stakeholders who must see value in the vendor's products and services before the buyer(s) renews the contract?
  • Upsell and cross-sell. Who are the stakeholders whose perceptions of value influence their colleagues' decision to acquire more products and services from the vendor?
  • Advocacy. Who are the stakeholders whose opinion of the vendor can sway their colleagues' or industry counterparts' decision to do business with the vendor?
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Forrester’s Customer Experience Index, Q3 2015: It’s Hard Being An Optimist

Michael Gazala

I am an eternal optimist. My take on the Dow’s spiraling downward in Q3? Buying opportunity! That “exercise pill” scientists are working on that promises the benefits of exercise without any of the effort? I’m thinking my six-pack abs are now a sure thing. And I’m even holding out hope that the next season of Homeland will be as good as the first. But the Q3 2015 data from our Customer Experience Index (CX Index™) is making it hard for an optimist like me to find a lot of bright spots.

We’re in a world fraught with persistent economic imbalances where customers with copious options are flexing their market muscles more than ever before. If this is still news to you, I suggest reading up on our research about the age of the customer. But I think most of you know that an obsession with winning, serving, and retaining customers is a must and that you should transform your company to be more customer-focused.

Given that, I expected our latest US CX Index report would reveal that brands are delivering customer experiences that are getting better at strengthening the loyalty of their customers. But while much remained the same in the second round of Forrester’s 2015 US CX Index study (scores didn’t change for 69% of brands), when scores did change, they got worse instead of better. So of 92 scores that changed significantly from round one to round two, only seven improved; 85 got significantly worse. It’s hard being an optimist when:

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Federal CX Pros Must Start Preparing For The Presidential Transition Right Now

Rick Parrish

It's been eight years since the last presidential transition. Since then, we've seen real progress on the federal customer experience (CX) front, including the creation of the "customer service" cross-agency priority goal; the launch of 18F, the US Digital Service, and similar digital services shops; and the appointment of chief customer officers at four agencies.

Unfortunately, the next presidential transition could derail it all. The new administration might have different management priorities, misunderstand CX and its value, or simply want to undercut the current administration’s achievements. Improving federal CX may be good politics for nearly every conceivable incoming president, but that may not be enough. Some presidential transition experts bemoan times when neither good politics nor effectiveness were enough to save existing initiatives from a new administration's desire to appear different. As one expert put it, "Never underestimate the power of crazy."

Formally, the transition won't begin until the next president is chosen. In reality, work on the transition has already begun. The current administration has already refocused from rolling out new initiatives to securing its legacy; many senior executives are already planning their retirements or looking for work in the private sector.

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A New Era For Customer Experience In Australia? We Think So.

Tom McCann

A new era for customer experience (CX) measurement has just been launched in Australia — are you ready for it?

Forrester’s Customer Experience Index (CX Index™) report for Australian brands is now available for clients here. With the introduction of this research methodology you now have a tool that:

  • Reflects how well your brand’s customer interactions fuel the types of customer loyalty that drive revenue — retention loyalty, enrichment loyalty, and advocacy loyalty.
  • Measures how well your brand delivers on 25 industry specific drivers of CX quality, like how quickly your company resolves customers’ problems.
  • Provides a competitive benchmark of the quality of your brand’s CX compared to other brands within and across industry sectors, on a national or international level.
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Brands In China Have High CX Aspirations But Most Fail To Deliver

Ryan Hart

With recent drops in global stock markets and all eyes on China’s economy, the timing of the China CX Index report couldn’t be more serendipitous. While customer experience (CX) most likely doesn't have a direct impact on all this sudden share volatility, our research shows that there is a strong correlation between CX and revenue growth.

Forrester’s Business Technographics™ data shows that CX improvement is a growing priority for companies in China: 70% of tech and business decision-makers indicated that improving the experience of their customers was a high or critical priority for 2015 and 2016. However, CX Index scores reveal that these aspirations have yet to manifest themselves in actions and — more importantly — results.

Evolved from the inaugural assessment we completed last year, The China Customer Experience Index, 2015 now includes loyalty elements to the mix to gauge how well brands in China are at delivering quality customer experiences that create and sustain customer loyalty. This year, we examined 60 brands across five industries in China: banking, insurance, retail, eCommerce, and mobile device manufacturing.

At a high level, the results of 9,000 customer surveys in China revealed that:

  • No brands stand out as especially good or bad. The good news: No brands ended up in the very poor category. The bad news: none achieved excellent scores either. The vast majority of brands (80%) rated as just OK; 5% landed in the poor category, and 15% qualified as good.
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Australian And New Zealand Firms Say CX Is A Top Priority — But Do They Really Mean It?

Tom McCann

Lots of things are critical to delivering a great customer experience (CX). For instance, do you really understand your customers or simply do a great job of segmenting them? Do you actively encourage employees to provide feedback and recommendations on CX issues? And do you consistently get back to them on actions taken as a result of their feedback?

The truth is, you need to excel at all these practices to deliver exceptional customer experience. But even if you do, it may still not be enough. Ultimately, you’ll only excel at CX if you’ve properly aligned your CX strategy with your overall company strategy.

Forrester recently surveyed 52 Australian and New Zealand businesses, and of those surveyed, 98% believe that their companies are committed to improving CX. But only one-third have a CX strategy that’s actually aligned with the overall company strategy. Forrester's clients can access the full report here. That gap, the one between the priorities of the company strategy and the priorities of the CX strategy, is the business equivalent of the Bermuda Triangle; not all ships that enter will find their way out.

Whether you call them consumers, businesses, patients, citizens, or something else entirely, winning, serving, and retaining those customers must be a primary goal. And how can you achieve that goal? Ensure your CX strategy is actually aligned with the organization’s strategy. If you are one of the almost 70% of companies that have not aligned their corporate and CX strategies, you are like that ship trying to navigate the Bermuda Triangle on a very dark night, without a compass or charts.

Don’t be that company.