My colleague Megan Burns and I have just published our new report "Executive Q&A: Customer Experience Measurement" in response to all the great questions we’ve been getting about measuring customer experience. To measure customer experience (CX), firms need a framework that tells them not only how good their customers' experiences are but also how to improve them and what benefits to expect from doing so. Increasingly, companies are developing such a framework despite facing sometimes-major obstacles.
This report answers some of the most common questions customer experience professionals agonize over when it comes to CX measurement.
One of those questions we are often asked is, “What does it mean to measure customer experience?” Here is the answer. Forrester defines CX as: how customers perceive their interactions with an organization. Therefore, fundamentally, to measure customer experience is to measure customers' perceptions of their interactions with a firm.
Allow us to paint a vision of the future for you: After interactions with your favorite companies, no one asks you how you liked those interactions. Your email inbox contains no requests for a few minutes of your time. No one asks you to wait on the phone line to answer a few questions. The word "survey" has vanished from your vocabulary.
GPS-enabled smartphones have made location the cornerstone of the mobile experience. Location powers popular smartphone apps such as Foursquare, shopkick, and Yelp; overall, navigation and mapping apps are the third-most-used category of smartphone apps, ranking higher than gaming, news, and shopping. Yet, as important as location is, its dependence on satellite-based positioning systems prevents it from playing a significant role indoors -- where we spend up to 90% of our lives.
As I discuss in my new report, Next In Tech: Indoor Positioning, indoor positioning technologies are rapidly changing this situation by enabling users, venue owners, and app developers to determine a person's (or object's) position inside buildings. The impact of this change will be profound:
Make the physical world searchable down to the object level. By geotagging objects (through manual tagging or low cost tracking beacons), indoor positioning will make it possible to search for products and objects in the physical world as easily as we can on the Internet.
Provide a new platform for in-store shopper engagement and experiences. Indoor positioning will not only help shoppers with tasks such as locating products on shelves, calling for assistance, and accessing in-store services but will also enable retailers to engage shoppers in real time as they shop.
Digitize the call for help. Requesting help in venues will soon go digital, as indoor positioning will enable the help to come to you rather than you going to the help.
From now on, any brand that scores an 85 or above in our Customer Experience Index (CXi) will receive both a physical award and a badge for its website naming it a “Forrester Customer Experience Index Award Of Excellence” winner for that year. Here’s a sneak peak at what winners will get:
Mockup of the Forrester Customer Experience Index Award Of Excellence
Without further ado, please join me in congratulating the winners of the first annual CXi Award Of Excellence, 2013: Marshalls, USAA (bank), Amazon.com, Kohl’s, Target, Courtyard by Marriott, Sam’s Club, Rite Aid, Costco, Lowe’s, TJ Maxx, JCPenney, and Marriott Hotels & Resorts!
Special congratulations to four of these brands — USAA (bank), Amazon, Kohl’s, and Costco. They were on the list of “excellent” brands in our 2012 CXi, too. It’s not easy keeping up with changing customer demands, so kudos to them for maintaining their leadership positions.
Earlier this month, Avis announced that it will acquire Zipcar. On paper, the combination of a traditional car rental company with a car-sharing service sounds like a win-win deal. Unfortunately, many of Zipcar’s customers think they’ll end up as losers. Here’s just a sampling from the hundreds of comments that concerned Zipsters have posted on Facebook since the acquisition announcement.
“Avis is horrible. They ‘lost’ a car I returned not that long ago. It was in the parking lot the entire time but was recorded as being a different color. And they were insanely ignorant and seemed [to] revel in my panic . . . ”
“I've had the worst experiences with Avis, repeatedly :-(”
“I've had nothing but terrible experiences with Avis. I want to believe that Zipcar will not change, but I'm very skeptical that this will turn out good . . . ”
The 2013 CXi is based on research we did in Q4 2012. It reflects how consumers perceived their experiences with 154 brands across 14 industries. If you’re not familiar with the methodology, or just want a refresher, check out “Executive Q&A: Forrester’s Customer Experience Index, 2013.” We put all the nitty-gritty details in there.
But what about the big picture? Of course, there are winners and losers (we name them in the report.) There is a tale of two banks — one whose score jumped up by 11 points versus last year, and another whose score plummeted by 24 points.
Through it all, though, one common theme leapt out:
In 2013, it’s all about value.
Many of the top brands this year, including high-scorer Marshalls, deliver solid customer experience at a manageable price. We saw this dynamic in the hotel space, where Marriott’s Courtyard brand beat out all other hotel brands. And we saw it in the airline industry, where perennial favorites Southwest Airlines and JetBlue Airways once again swept the competition with their combination of great experience at a great price.
Over the past two years, consumer technology adoption and market forces have catapulted the field of customer experience into strategic stature. In 2012, this shift manifested itself privately through sweeping organizational changes at companies in nearly every industry — and shined publicly through professional organizations, the media, and even the courts.
However, it will be years before customer experience is embedded to the same degree as mature business disciplines like finance, human resources, and information technology. While many firms have been working diligently to improve their customer experience for years, still others remain woefully in the dark about the business value it can bring. The net result is that in 2013 — and for several years to come — the customer experience industry will be characterized by efforts that range wildly from systematic change initiatives to desperate shortcuts.
In our latest report, Ron Rogowski and I outline the changes that customer experience professionals can expect in 2013 and highlight the pitfalls that companies need to avoid during the upcoming year. For example:
A couple of months ago, I spoke at a conference in Las Vegas. Immediately before my talk, two advertising execs, one a professed quant geek and the other a “creative,” spoke about how their agencies rely less on hunches these days and more on quantitative data to drive emotional relevance between their clients and consumers. “We can identify human emotions in massive rivers of data,” the ad men said. When I pressed them for an example during the Q&A session, they described how they had recently mined millions of clickstreams, search queries, video views, website clicks, and the like for a major mortgage lender. All in, the technology investment behind their analysis must have stacked well into six figures. And their big emotional insight? When people start shopping around for a mortgage, that’s all they can focus on until they’ve gotten it all sorted out.
I could hardly believe my ears! Any skilled ethnographer could have discovered that same insight — and then some — through a day of in-home customer visits and $150 in taxi receipts.
Customer experience professionals can now glean customer insights from social media, financial systems, emails, surveys, call centers, and digital and analog sensors. It’s amazing and wonderful, yes. But here’s the danger: Companies that become mesmerized by big data put themselves at risk of spending enormous amounts of time and money amassing new data sources — and in the process, forgetting that research methods like observation and one-on-one interviews even exist. This has the potential to create a large, and exceedingly expensive, blind spot.
Don’t get me wrong. I’m not a big data hater. However, to create a complete picture of who your customers are and what they really need, you need a combination of quantitative and qualitative research methods.
Our book giveaway contest is over and our 10 randomly selected winners are:
Holly S. from Fannie Mae
Arshad F. from Mobrise
Thomas Z. from CIO2020.com
Juha-Pekka H. from P&C Insurance
Monika K. from HSBC
Francesco R. from Pasticceria Romeo
Kim P. — @retaincustomers
Christian B. — @CSinnovations4
Derek G. — @derekgardiner
Zsolt N. — @zsoltnagy4
Someone from Forrester will be in touch soon. Congratulations, and happy reading!
What simple innovation brought billions in new investments to Fidelity? What basic misunderstanding was preventing Office Depot from achieving its growth potential? What surprising insights helped the Mayo Clinic better serve both doctors and patients? The solution in each case was a focus on customer experience, the most powerful — and misunderstood — element of corporate strategy today. Your gut already tells you that customer experience is the key to business success. Now you can prove it. Based on fourteen years of research, Forrester’s new book Outside In offers a complete roadmap to attaining the experience advantage.
Want to win a copy of Outside In? We’re giving away 10 copies this Friday, December 14. You can enter to win two different ways:
Recently I was on a panel about the impact of cultural change on customer experience. My fellow panelists included Meltem Uysaler, a senior vice president of customer experience for Citi, and Patricia John, the customer experience director for Europcar UK (a car rental agency).
Right at the end of the session, Patricia responded to an audience question by saying that Europcar focused on creating a customer-centric culture because they can’t script every interaction. Therefore, employees need to be able to make the right judgment calls on their own when dealing with customers (or anything having to do with customers, which includes virtually everything a company does).
Patricia John is right. At Forrester, we see this dynamic time and again through our research. For example, every time I see USAA’s Wayne Peacock speak, he always uses the phrase, “We do the right thing because it’s the right thing to do.” That’s extremely credible coming from Wayne: He’s the EVP of Member Experience at USAA, which is the number one bank, the number one credit card provider, and the number one insurance provider in our Customer Experience Index.
You, too, probably see this dynamic because it plays out in the news every day. Just compare the decision made by a Southwest Airlines pilot to the decisions made by some United Airlines employees.