During the first part of this series, I talked about how clients are constantly asking us what to do with their data and how they usually go right to “what technology do I need to solve this?” We learned in that post that technology is most likely not the issue (or solution). In this post, I will go to the core of the issue: your organization.
In order to break down silos and open up a dialogue across business units, you have to start by asking, “What do we want from the data?” This question will start a path that first leads to where the data needs to end up and which audience is digesting it. From there, dig into where it lives (possibly in a top drawer, behind the socks . . . ) and see if what you need is there. In order to have that conversation, marketing, technology management, and analysts need to get in a room together to discuss possibilities and limitation.
Does customer experience really matter to business success — or is CX just the latest flavor of hype? Recently, Forrester completed a six-month research effort aimed at answering that question by examining the relationship between superior customer experience and superior revenue growth.
Why did we pick revenue growth as the measure of business success? Because it’s the No. 1 priority of global business leaders recently surveyed by Forrester.
So with that in mind, here’s what we did: Aided by some long-suffering research associates, some of our top industry experts and I picked pairs of competitors where one of each pair had significantly higher customer experience quality than the other (as rated by their own customers). We did this for five very different industries: cable, airlines, investments, retail, and health insurance. Then we built models that compared the compound annual growth rate in revenue of the CX leaders to the CX laggards between 2010 and 2014.
The results were intriguing. There was a clear correlation between superior customer experience and superior revenue growth for cable companies, airlines, full-service investment firms, direct investment firms, and retailers. However, the magnitude of the difference varied widely by industry, with cable coming out on top: 35.4% for the CX leader versus 5.7% for the CX laggard. Even more interesting, the results were a virtual draw for health insurers — superior CX didn’t seem to matter much when it came to revenue growth.
Over the weekend, I read the manuscript for Don Peppers' upcoming book, Customer Experience: What, How, and Why Now.
Because Don is a talented writer, and because I love customer experience, it wasn’t hard for me to start reading it. It was, however, hard to stop reading it. If you’re also into customer experience, you’ll no doubt have a similar reaction when it comes out.
What I like most about the book is that Peppers consistently grounds customer experience in business fundamentals. For example, he points out that the decision to focus on customer experience should never be binary: You don’t have to be customer-centric or product-centric, nor does spending to deliver a better CX mean wasting money. The reality is that focusing on customer experience can lead to new and better products and help create an even more profitable business — provided that you understand it.
Of course, learning to understand the practical aspects of customer experience can be hard work — much like attending a particularly tough business class. But that’s not the case here. Peppers makes the nuts and bolts of customer experience engaging and even visceral. To see what I mean, check out two of my favorite quotes from the book:
"If you think about it, a customer is really just a bundle of future cash flows, with a memory. And these future cash flows will increase or decrease based on how the customer remembers being treated, today."
“Customers don’t necessarily stay because they’re satisfied, but they often leave because they’re not.”
Expectation Maps Are A Smart Way To Visualize Customer Journey Emotion
Talking to clients, it’s interesting to see and hear how the topic of “customer needs” still comes up as frequently as the sun comes out in Singapore. In a day and age when customer “needs” such as food, clothing, and human interaction are largely met, it makes sense for CX professionals to shift focus toward dynamically changing and ever-evolving expectations of what a quality experience should feel like.
When making a purchase online, for example, the “need” is for the item to get to the address provided in the time stated — that’s a given. It gets emotional when there’s a disconnect between the picture of the product purchased and the actual item received. Wildly exceeding or failing to meet expectations elicits emotional reactions that shape customer perceptions of the quality of a given experience.
Culture and language also have a very powerful influence on customer expectations, and companies need to be mindful of this when going after customers outside of their home markets and localize those experiences appropriately.
My latest report, part two in a three-part series on tools CX pros can use to customize customer experiences in markets they operate in overseas, explores expectation mapping as a tool to capture diverse emotional elements to augment your existing customer journey work.
Have you read the results of the Government Business Council’s new “Digital Disconnect” survey?
The results are fascinating, and I could go on for quite some time about them (just ask my dogs, who have been listening to me rant about the survey all morning). However, at the moment, I will focus on the result of just one question.
That question is: “Which of these pose a significant challenge to your agency’s ability to digitally optimize its public services?” The top selection was “budget constraints.” About 64% of respondents said budget is a challenge to improving digital public services.
No way am I going to say that budget isn’t a problem. It’s a huge problem. That’s why Congress needs to fund the digital services groups and other digital customer experience (CX) initiatives that the administration advocates. But too often I hear budget used as an excuse for not doing anything, despite the reality that feds can make real digital CX gains on a shoestring budget and that good digital CX is often actually cheaper than bad CX.
Last week, I stumbled across "The Behavioral Economics Guide, 2015" (which you can find here).
I’m kind of a Daniel Kahneman/Dan Ariely junkie so I immediately started scrolling through it looking for articles of interest. And there, on page 8 . . . big score! A graphic that plots the relative Google search frequency of the term “customer satisfaction” against the search frequency of the term “customer experience.”
Here’s why this chart floats my boat: For two years — from 2008 to 2010 — we see the terms coexisting as if people couldn’t quite make up their minds as to whether they were really different or not. Then in 2010 — pow! “Customer experience” starts shooting up like a rocket, while “customer satisfaction” takes a deep dive.
(Coincidentally, in 2011, the attendance at Forrester’s CXNYC shot up to more than 1,300 people on-site, from just more than 800 people on-site in 2010. That led us to add a CX Forum West — now CX San Francisco — and CX Europe starting in 2012.)
Forrester's CX team is running a study on the state of customer experience in companies and would love your help. You just have to take our short (15-minute) survey. The purpose of the survey is to gain insight into:
How companies staff and manage their customer experience efforts.
Their attitudes and behaviors in relation to customer experience innovation.
Their attitudes and efforts related to customer experience strategy/vision.
It's finally here. That time of year when seemingly half of the federal workforce flees Washington, D.C., for a well-deserved vacation. It's a magical time for those of us who stay behind: Less traffic shortens our commutes, the Starbuck's and food truck lines are shorter, and fewer people at meetings means more decisions get made.
But the feds heading out for vacation are happy, too. They hope to return refreshed and reenergized. This year, I hope they will also come back inspired with new ideas for improving the federal customer experience (CX). To help them find that inspiration, I've put together this list of travel tips:
Fly JetBlue. JetBlue was the highest-rated airline in Forrester's CX Index. It's a solid omnichannel experience across digital touchpoints on multiple devices, and the airline's employees are friendly, helpful, and empowered to fix customer problems as they occur. The company creates a chummy atmosphere, rather than the us-versus-you environment that some airlines exude. As you enjoy the great experience, remember that it has been created despite structural hurdles that include a large and partially unionized workforce, a highly-regulated market, and razor-thin profit margins. If an airline can overcome these barriers, why can't your federal agency?
Each Congress considers over 10,000 bills, and virtually none of them ever explicitly focus on customer experience (CX). However, some bills do have implications for federal CX. And although just 3% of bills ever become law, federal CX advocates should stay informed of proposals from the start. That way, we can suggest improvements, help good ideas become law, and plan for what happens when they do.
That’s why I’m starting this new weekly blog series. Every week while Congress is in session, I’ll take a look at a few new bills that could affect federal CX and offer my initial thoughts on each. I hope my views start a weekly conversation about which bills seem most promising for federal CX and the overall role Congress should play in improving the federal customer experience.
Let’s begin by taking a look at two bills that House leadership recently assigned to committee: