How should you measure customer experience? Is it even possible to measure something that feels as squishy as customer experience?
As it turns out, you can measure it, you should measure it, and you even have some decent options for measuring it. Your alternatives range from monitoring the real-world interactions your customers have with your firm (like clicks on a site or the length of a call) to asking your customers for their perceptions of those interactions (the real customer experience) to tracking what your customers do as a result of the experience (like making another purchase or recommending you).
At Forrester, we have our own direct measure of customer experience that we’ve been using since 2007: the Customer Experience Index (CxPi). Today we published the results for 2011, which are based on research conducted at the end of 2010.
To help understand those results, let me explain how the CxPi works. We ask more than 7,000 consumers to identify companies they do business with in 13 different industries. We then ask respondents to tell us how well each firm met their needs, how easy the firm was to work with, and how enjoyable it was to work with (questions that correspond to the three levels of the classic customer experience pyramid). Then for all three questions, we calculate each firm’s CxPi score by subtracting the percentage of its customers who reported a bad experience from the percentage who reported a good experience. The overall CxPi is an average of those three results.
Back in October, I traveled to Berlin and Cambridge, Mass., to attend the annual conferences of the Service Design Network, an international organization for professionals and academics working in the field of service design.
Um . . . What’s service design?
Great question! Service designers broadly define what they do as a collaborative process of researching, envisioning, and then orchestrating experiences that happen over time and across multiple touchpoints. Unlike traditional design disciplines, service designers typically examine — and often re-engineer — the strategy behind a service as well as the operational systems, processes, and resources that deliver it.
Um . . . Can you give me an example?
Sure! There are lots of examples in my latest report. But one story in particular stands out because it includes some very cool design solutions for a very unsexy industry: utilities. When the UK recently mandated that water billing switch from estimated to actual use, English utility company Southern Water faced a massive meter installation project. The company turned to service design agencies for help – and through several interrelated projects that spanned roughly 18 months, the Southern Water teamexplored how meter installation could be a positive experience and how consumer behavior toward saving water could be influenced.
In the end, they streamlined the rollout of 500,000 new water meters. (That’s about 400 new meters a day over a period of five years!) Here are some of the project highlights:
Two Finnish service designers recently unveiled a prototype for a social media toy that’s constructed out of a classic Brio shape-sorting box outfitted with magnets and LEDs. Called the IOBR (the first few letters of its Iobridge tech backbone and an anagram of Brio), a small child can use the toy to let her friends know what she’s up to. Yup, it’s a toddler-sized status update.
From the designers’ Web site: “The actual status update is done by placing the appropriate block in its designated place on the box. For example, an ‘eating’ update is sent by placing the square block with the ‘plate, spoon, fork’ icon in the square-shaped hole on top of the box. This results in the illumination of the corresponding status light on the friend’s device.”
The system has received press from major media outlets dubbing it “Twitter for toddlers.” CNN reported: “No word yet on . . . whether or not you're going to want your kid to learn about these status updates, so to speak, at such a young age.” But focusing just on the IOBR’s status update feature is really missing the point of this project.
I stopped by my local Whole Foods the day before Thanksgiving to pick up some appetizers. And as I deliberated at the cheese counter, I couldn’t help but overhear what one cheese monger said loudly to the other: “This lady came up to me complaining about the store. This store’s too small, you don’t carry the things I need. I told her she’d have to talk to customer service. I mean really, I just work here.”
I just work here??! Did I honestly hear someone say that? In Whole Foods? Not only did this guy undermine the Whole Foods brand with his interaction with the original customer, but he made a bad personal decision to relay his story in front of other customers!
As Steve Portigal mentioned in a comment on one of my previous posts, employee authenticity is key to great customer experiences. (To see just how bad an inauthentic customer experience can be, check out my last post, "Worst Online Chat Ever!") But employee authenticity is really only effective if it aligns with a company’s brand attributes. Being an authentic jerk isn’t going to cut it in customer experience land!
A lot of employee behavior comes down to corporate culture — and in his "How To Build A Customer-Centric Culture" report, Paul Hagen mentions two things in particular that I think directly influence employee authenticity. Companies need to:
In October, Ron Rogowski provided a couple of excerpts from one of our colleague's online chat with her cable and Internet provider. But this chat session was so bad that I couldn't resist the urge to share it in its entirity. (Read to the end for a fantastic Yoda moment.) By the way, I made no edits to the transcript other than to change the names and obscure identifying information.
* * *
User Elizabeth has entered room.
Elizabeth (Sat Oct 2 11:36:45 EDT 2010) > I don't know my [company] ID or my password, so I can't log in to my account. I tried to set up a new account, but the site says my account already has an online account. Can you please reset my information (so I can create a new account) or help me log in?
Analyst Carol has entered room.
Carol (Sat Oct 2 11:36:50 EDT 2010)> Hello Elizabeth, Thank you for contacting [company] Chat Support. My name is Carol. Please give me one moment to review your information.
Carol (Sat Oct 2 11:37:05 EDT 2010)> My pleasure to have you on this chat, Elizabeth! Remaining committed and focused on my goal which is to provide quality customer service at my fullest effort will always be at the pinnacle. It is with utmost sincerity that I want to extend apologies for any trouble, inconvenience and frustration the log in issue has brought along your way. I simply hope you are doing fine.
Carol (Sat Oct 2 11:37:26 EDT 2010)> No worries. As your [company] service representative, I want you to know that issue resolution and your satisfaction are my top priorities for today. Together, we can work this out, Elizabeth.
“How customers perceive their interactions with your company.”
The key word I want to focus on here is “perceive.” While business success is viewed by metrics like conversions or average order size, for customers, their level of satisfaction is tied to the sum total of all interactions they have with a company from the first time they click on a link from an online ad all the way to opening and experiencing a product. That satisfaction is based on some rational justifications such as price, but it’s also largely based on the overall feeling customers have about those interactions. It’s that emotional component that can be the X factor in how consumers report whether or not they are satisfied with a brand — and more importantly determine whether they’ll do business with you again.
Think about it, emotions drive needs, wants, and desires and are the triggers that are the basis for most interactions consumers have with a company. Think about something as seemingly mundane as cleaning products. Why do people care about cleaning products? Because maybe they want to have a clean house that smells nice because they’re going to entertain soon and, secretly, they want to leave their guests not with an image of their home, but of how they keep their home. Or, maybe there’s a concern over the ingredients that are in the cleaning supplies that people use because they have young children and want to keep them safe from harmful chemicals. The bottom line is that people bring all sorts of baggage to every experience and that baggage is emotional — even the things that cannot be explicitly stated.
Our team is pretty floored by everything that’s happening in the customer experience space right now. We’re seeing massive changes in technology, which are enabling personal and social experiences unlike any we’ve ever seen. In addition, customer experience is gaining unprecedented importance across the enterprise. We think the combination of these influences is going to make for a pretty spectacular 2011.
Ron Rogowski and I are collaborating on a report that will outline Forrester’s thoughts on what 2011 has in store for customer experience professionals. Among our predictions:
Customer experience will (finally) connect with marketing. If you read my last blog post, it’ll be no surprise that I think there’s a pretty strong connection between customer experience and marketing. For CCOs and CMOs, 2011 will come in like a lion (with tension between their two groups) and go out like a lamb (with true collaboration).
Brands will (wrongfully) rush to abandon their Web sites. With the skyrocketing market for mobile phones and tablets, firms will look to engage users through differentiated experiences on these devices. But in the process, many will neglect a critical touchpoint — the Web — in favor of apps that have less reach.
Quantifies the correlation between a rise in a company’s Customer Experience Index score and the corresponding increase in three loyalty metrics that every company cares about: purchase intent, likelihood to switch business to a competitor, and likelihood to recommend.
Makes conservative but realistic assumptions about the business fundamentals of companies in 13 different industries.
Produces eyepopping projections of increased annual revenue as a result of realistically attainable improvements in customer experience — by industry.
If you’re reading this post, you’re someone who cares about customer experience. You might even be one of the professionals who works in the field of customer experience full-time.
So I’m going to go out on a limb here and guess that you occasionally get the question, “What is ‘customer experience?’”
Now maybe when you’re asked that question, it isn’t phrased so directly (or politely). For example, I get asked, “Isn’t customer experience just marketing?” And, “How is customer experience different from customer service?” But the bottom line is that people are looking for a definition that’s crisp, useful, and distinct from the definitions of other things that companies do. They are right and reasonable to ask for this — but collectively those of us who work to improve customer experience have failed to answer them.
I mean no offense to the many people out there who have tried to define “customer experience.” I’ve read many of the attempts that are out there, and the ones I’ve seen tend to be longer and more convoluted than necessary.
Not that customer experience is an easy concept to define. The customer experience team at Forrester has been debating the definition of customer experience for a while now, and it took us until recently to reach consensus. We now define customer experience as:
“How customers perceive their interactions with your company.”