Customer Experience as an industry is at a crossroads. As I have written before, the results that we should be seeing are not there. It’s time to put up or shut up. If we as an industry do not turn it around, we might see our budgets and headcounts reassigned somewhere else.
Customer Experience ROI Podcast
In our recent podcast, we had a guest Bob Thompson, CEO of Customer Think Corp., an independent research and publishing firm focused on customer-centric business management and the founder and editor-in-chief of CustomerThink.com. Along with being a popular international speaker, blogger, and author of Hooked on Customers: The Five Habits of Legendary Customer-Centric Companies, Thompson and I go way back.
This discussion was predicated by two articles I read from Nunwood and Forrester late last year. Both firms agreed that the Customer Experience Industry as a whole was not showing any significant increases or ROI. Forrester said it hasn’t improved for the past three years.
Thompson and I talked about this state of Customer Experience as described. We decided that the problem comes down to a few things:
- Few organizations differentiate themselves based on Customer Experience.
- Insufficient data exist about how companies do at an individual level as a result of Customer Experience improvement efforts.
- Only a small number of companies can demonstrate in actual figures an ROI connected to Customer Experience efforts.
There is a massive opportunity for companies to do better. For me, the danger is that people are not going to invest in Customer Experience if they don’t get results. Rightly so, to be honest. If you can’t produce results, you shouldn’t get the resources.
Revealing the Real Problems with Customer Experience
People are too focused on small things. They aren’t taking their Customer Experience to the next level. When it comes to most Customer Experience, people tinker around the edges of the issue rather than tackling the significant problems that stand in the way of Customer Experience improvement. Few organizations are committed enough to Customer Experience improvement to attack the foundational elements that interfere with putting the customer at the center of everything they do.
For example, I was talking to people that were newly appointed Customer Experience representatives for their companies. I asked them how their job had changed, now that they were in Customer Experience from what they were before, “Insights” or “Customer Specialist” or whatever. They said their job hadn’t changed, just their title.
For Thompson and me the most significant issues are this:
- There is a lack of commitment from senior people in the organization. They don’t understand what it takes to improve the Customer Experience. When you tell them, the top brass does not want to commit because it’s difficult.
- There is a cultural issue. Companies look inside the organization to see what’s good for them. It’s rare to have a company put the customer first or even equal to themselves.
- There is a lack of focus on presenting the business case for your program. Loads of good work is already happening in the field of Customer Experience. However, too few companies are showing their results based on their efforts and selling the organization on taking it further.
- There is a scarcity of knowledge on how to do better work in Customer Experience. It requires more than surveys or changing how you answer the phone. We all need to redouble our efforts to acquire meaningful data.
Thompson released research of his own, which he undertook over the past twelve months. In his data, he estimates that 75 percent of companies, or three out of four, have yet to demonstrate any results because of their Customer Experience.
Making a Business Case for CX Must Be a Priority
However, the silver lining in the gloomy cloud, as Thompson puts it, is that these companies do see improvement in metrics like customer satisfaction ratings, increased revenue, lower costs, and more employee engagement than in the past. They just can’t quantify it, or at least three out of four companies can’t, per Thompson’s research.
The 75 percent that Thompson describes makes sense to me. There is excellent work being done in Customer Experience, but not enough measurement.
As Customer Experience consultants, we see this all the time. Many organizations either do not know how to tie their results to actual numbers or, worse, they have not made tracking their Customer Experience ROI a priority.
Measurement is essential to your program and must be a priority. You must be able to make a business case for your program. In other words, you need to show your organization that you are contributing to the bottom line for what you are already doing.
However, you need to measure the correct things. The metrics you choose should line up with your actions and the goals you are trying to meet.
Also, you need to be a detective about the costs of the program. It’s not unusual to have the situation as I described earlier where people have Customer Experience in their title but not in their job description. The problem is when their overhead is assigned to your resources it damages your ROI.
What Else Do We Need to Do?
Recommendation #1: Do more than fixing problems.
Many organizations try to fix problems in their Customer Experience, and that’s good. You should fix your problems. However, fixing problems is an example of small stuff. Once you resolve issues, you have only provided the experience that customers wanted in the first place. It’s after this point that the real work of Customer Experience begins. Once the experience meets expectations, then you can take it to a new level.
Recommendation #2: Make your business case.
If you don’t know what to do, get some help. Take courses, find software, and talk to other experts. Learning how to make a business case is essential to your success—and continued employment.
Recommendation #3: Improve your Customer Experience skills.
We need to enhance how we improve Customer Experiences, whether that is better listening or improving the way we analyze data, or any of the multitude of other things involved. We need to develop the tools people use to optimize the Customer Experience. For example, the companies with the best ROI and results to show in Thompson’s survey took a more comprehensive and thorough approach to journey mapping. This data helps them address the individual moments and processes throughout an experience and use these moments to target their improvements and measure their success.
Recommendation #4: Get feedback from sources other than surveys.
Surveys are excellent, but they are only part of what you need to take your game to the next level. You need also to monitor social media and implement new technologies like facial recognition to get a better idea of what is happening throughout your experience in real time.
Recommendation #5: Help people understand what Customer Experience ROI is.
Improve your knowledge and then share it with everyone you know. Senior management needs to understand and embrace the ideas behind Customer Experience. Share articles, podcasts, articulate it in reports and meetings the things you are doing that are getting results, and always think of little things you can do to educate those around you.
The experts agree. Customer Experience is at a crossroads. We can continue on our path of tinkering around and hoping for the best or we can dive into the real issues and make changes that are going to improve the Customer Experience. Whatever we do, we must be able to make a business case for what we have accomplished, or we could lose the support of senior management, and, frankly, we would deserve it.
What factors do you think contribute to the problems of the Customer Experience industry? We would love to hear what you think in the comments below.
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Colin Shaw is the founder and CEO of Beyond Philosophy, one of the world’s leading Customer experience consultancy & training organizations. Colin is an international author of six bestselling books and an engaging keynote speaker.
Follow Colin Shaw on Twitter @ColinShaw_CX