(This article was first published at G2 Learning Hub)
Businesses everywhere are waking up to the value of customer experience and recognizing outstanding customer experience (CX) as a key ingredient to rising above the competition.
From ideas and definitions to practical tips on roles and processes, here’s how to supercharge your brand, secure long-term revenue, and evolve your company culture.
Understanding customer experience management
Customer experience is the sum total of every interaction a customer has with your business, from seeing your logo on a billboard to humming along to the hold music when they use your contact center.
It’s a way of looking at customer relationships that’s rapidly gaining traction in the business world, because it offers some exciting benefits and a holistic, far-reaching framework for making positive changes.
What is customer experience management?
Customer experience management, sometimes abbreviated to CEM, is the practice of owning your customer experience and actively working to improve it. It involves research to discover who your customers are, what they need, and where their pain points lie.
CEM means making changes to the way you do things. And it means continually listening to your customers to find out how well you’re doing and what you can do to keep improving.
There are a few core principles to understand when you’re getting started with customer experience. The first is that customer service and customer experience are different things.
Customer experience includes every interaction your customer has with your brand, including those that happen outside of your channels.
Customer service is a subset of customer experience. It’s the way you treat customers when they are in direct contact with you, via text, phone, chat or other forms of communication.
The next is that customer experience is all about journeys. A customer’s experience isn’t bound by internal divisions like sales vs. service or retail vs. trade. It is a sum of many parts, and in most cases you can’t predict where the customer’s journey will begin or where it will lead.
Along that customer journey, any one point of failure (glitchy website, over-long wait for a chat response) can detract hugely from the customer’s experience as a whole. It doesn’t matter if the customer’s delighted by one part of your business if they’re later disappointed by something else.
That’s why it’s wise to optimize every part of the customer journey and create an integrated, consistent omnichannel experience that’s based around your customer rather than the internal anatomy of your business.
Research from McKinsey found that customer satisfaction is 73% more likely when entire journeys work well than when individual touchpoints do.
How to measure, optimize, and scale your customer experience capability
Customer experience management begins with understanding your customers and their needs. Your CRM system is a valuable tool here as it already contains a record of your interactions with each customer to date.
You can also bring in tools like customer surveys and UX research which can help you dig deeper and understand your customers’ priorities. Do your target customers care more about certain things than others? Which of the typical customer journeys for your business hold the most personal importance for customers? Where are they most likely to want support, reassurance, or a greater range of options?
Customer-based research, and the resulting customer experience insights, will help you to prioritize your CX improvements and work more intuitively on existing projects. It could also help point toward efficiencies and improvements you can make for your company’s own sake, especially where customer insights provide a birds-eye view across your internal silos.
It’s likely that CX improvements will start small within a company and then grow. Small, successful pilot projects will help generate interest in CX and make the case for wider-scale changes and more ambitious programs.
A company-wide approach
As we’ve suggested, there are major rewards to be reaped when companies think big. Make your whole business experience-led and the benefits are likely to multiply accordingly. As an experience-first business, you’re in line for positive results on big picture measures like your brand loyalty, plus immediate-return results in terms of sales.
According to US research from PwC:
Consumers will pay up to 16% more for products and services if the experience is great
1 in 3 will leave a brand they love after just one bad experience
Customers say they’re more likely to try additional services or products when brands provide superior customer experience
Meanwhile, according to Adobe’s Digital Trends 2020: “36% of companies on the forefront of customer experience said they exceeded their top business goal by a significant margin, compared with only 12% of mainstream companies,”
What does that look like in practice? It means that experience isn’t just the duty of a single team or department. While it’s important to appoint and support experience management leaders in your business, they should be setting goals and providing strategies for an entire company’s behavior, not working in isolation.
Changing culture
Making a commitment to customer-centric ways of doing business is likely to involve cultural change within your organization. This is likely to be a medium- to long-term endeavor, but there are some changes you can make straight away that will promote CX-friendly ways of working.
Lead by example
C-suite and leadership have an important role to play in making CX a company priority, not only because they’re empowered to make change but because staff at all levels naturally look to them to see how to behave. Leaders who walk the talk and put customer experience first can help turn the tide towards customer-first thinking.
Bake CX into your goals and KPIs
At team and individual levels you can promote customer-first thinking by explicitly making it a priority in performance management and target-setting. Note however that you should prioritize outcomes such as “make the customer feel heard” rather than behaviors like “chat to every customer” – authentic customer connections are more likely to flourish if staff are given some personal input into how they’re achieved.
Appoint CX champions
It can be helpful to think of CX as a horizontal function, a little like HR or IT, vitally connected with every department. Unlike HR or IT though, it can be improved by anyone who is willing and able to step into a customer’s shoes. Within each area of business, try appointing an enthusiastic CX champion who can make suggestions and provide support in making their own part of the company more customer-centric.
Setting up a customer experience management system
Your customer management system is a set of tools and processes you can use company wide to create a continuous cycle of improvement. It’s likely to include elements you’re already using, with a few new ideas and approaches added to the mix. Here’s a step-by-step guide to getting it up and running.
Goals
The first step is to decide what success will look like. Think about what you want CX to do for your business and what positive results you want to see.
Strategy
Based on what you’ve discovered about your current levels of customer loyalty and customer satisfaction, identify first priorities. Choose one or more customer journeys to act as your pilot program.
Tools
CX improvement is largely a matter of awareness and agility, and this is what your tools need to provide. You need to be able to collect customer feedback data at a number of touchpoints across your customer journey(s) and analyze it in a way that allows you to take meaningful, rapid action. You also need to be able to circulate those insights within your business in a clear, digestible format.
Process
Choose where in the customer journey you will collect feedback from your end-users and how you will use it. It’s a given that feedback data should be analyzed to reveal your current performance levels, but you may also want to feed it into parts of your business that can make immediate improvements to individual cases. For example, feedback from a dissatisfied customer could be routed directly to the person responsible for the relevant touchpoint.
While having a structured customer experience management model is important, it’s worth noting that CX is an exploratory process and you will also need to allow room for flexibility. You should expect your program to change and grow along with your business and what you learn over time.
Measure, check and iterate
While setting up a CX program, and throughout its duration, measurement is critical. Early in your planning phase, define the metrics that indicate success and that you’ll continually measure and track.
CSat and NPS are likely candidates for many businesses, along with CES (Customer Effort Score). You may also want to pull in quantitative measures linked to CX, such as waiting times on phone and chat channels, customer review scores, and website loading speeds.
Even more important than defining your metrics is being able to monitor them on a continual basis. While it’s true that using multiple metrics will help you get a clearer and more multifaceted picture of how you’re doing, make sure your analytical capacity and your collection capacity are in line with one another. Collecting data is only valuable if you’re able to turn it into improvements and predictions.
Software that supports your goals
In order to be useful, cost-effective and scalable, a CX program typically relies on software to store data, route information to the right people and analyze results. Here’s what to look for in CX management software.
Accessible everywhere
Cloud-based is becoming the gold standard in enterprise software, and with good reason. A cloud-based platform means projects are easy to scale up to large numbers of users, and that they can access data and analyses on a range of devices according to need.
User-friendly
Because CX is a cross-departmental discipline, it’s important that your software is as accessible as possible. It should be able to provide on-demand data and insights in a format that anyone can understand.
Analytically powerful
Ideally, CX software should be able to not only collect data and analyze it, but use statistical tools to extrapolate and make predictions about the drivers behind positive CX outcomes. It’s a plus if your software can perform analysis on natural language, such as the contents of online reviews and free-text fields in surveys.
Integrated
CX touches almost every part of your business, so it’s important to be able to connect your CX software with the platforms you already use, such as CRM and HR systems, marketing software, social media analytics, SEO and marketing tools.
Building your dream team
CX is a company wide mission, and your CX team is the beating heart of the operation. But how do you bring that team together? To decide who you should hire or nurture, you need to know what makes a great CX professional.
Given that CX is a relatively new concept, it’s unsurprising that most CX professionals have arrived from careers in other areas. HR is a common background, as is customer service. CX leaders may also cross over from user experience and service design, psychology, marketing or sales.
Wherever they come from, they’re united by personal qualities like empathy and excellent listening skills. They’re likely to be articulate and persuasive, good at forming professional relationships and making the case for change.
Above all, they are passionate about what they do. They see CX transformation as a mission, not just a role, and they’re committed to making the customer central to everything a business does.
A long-term view
As you embark on a CX program, it’s important to set realistic expectations about the timeframe of your work. CX management should be viewed as a long-term program which will deliver long-term results, and it’s likely that these will grow steadily over time rather than offering immediate ROI.
The time it takes to see results varies by industry. As Colin Shaw of Beyond Philosophy notes, if your typical customer contact cycle happens across months or years rather than weeks – (e.g. if you provide infrequent services like optical prescriptions or car servicing) – it will take longer for customers to encounter and react to the improvements you’ve made.
It’s also likely that it will take time for your internal CX process to reach its full potential in terms of speed and efficiency. Changing minds, behaviors, culture, and protocols is by nature a long-term process, and without the right tools and plans in place, it will inevitably take longer.
Is it worth the effort? Absolutely. And businesses willing to make the investment now will find themselves benefiting in the future as great CX becomes more essential and expected.
Historical data bears this out, too. Across a 10-year span, businesses who maintained above-average customer satisfaction (using ACSI scores) delivered a 400% increase in shareholder returns. Those with below-average scores achieved little or no growth in their returns.
Conclusion
Customer experience touches every part of a business, and it makes significant demands for change and reevaluation within a company. But it offers enormous potential too.
CX isn’t just a nice-to-have or an ephemeral buzzword. It’s nothing less than a more evolved way of doing business, and in an increasingly connected world where customer expectations have never been higher, it may well be the deciding factor between businesses that fall by the wayside and those that go on to bigger and better things.
This article is written by Garret Stembridge:
Garret is the Head of SEO and Content Optimization at Qualtrics. Qualtrics is the leader in Experience Management (XM), helping the world's best brands close experience gaps and deliver breakthrough results. Prior to Qualtrics, he spent his career managing content and SEO for companies with 1,000+ locations in the storage and wireless industries. Outside of work, he enjoys hanging with his family and spending as much time as possible in the beautiful Utah mountains.