After years of conversations around the importance of Customer Experience (CX), it seems that finally it is becoming an operational priority for companies.
This shift has never been timelier, as CX becomes an important competitive differentiator. According to Gartner research, 89% of organisations will be competing mostly on the basis of customer experience in 2016. This is leading organisations to invest a great deal of time, energy and money putting in place innovations, strategies and practices to improve CX. Markets and Markets predicts that global investment in CX programmes and initiatives will rise to £5.8 billion ($8.3 billion) in 2019.
But there appears to be a long way to go. In its 2015 CXEvolution™ Benchmarking study, MaritzCX reports that based on a sample of 4,000 CX professionals, 56% have a formal CX programme, with airlines, consumer packaged goods, breweries, apparel, and supermarkets leading the pack.
However for the remaining 44% of companies, what are the obstacles preventing them from realising business outcomes from their efforts? And how are they overcome, before the predicted extensive CX investment is put at risk?
The obstacles
56% of the 500+ UK CX professionals surveyed believe their Voice of Customer (VOC) programmes fail to meet management’s expectations, such as increasing revenue, reducing cost and driving customer retention. In addition, the research uncovered that fewer than half (42%) believe their VOC programme is very successful at improving business results.
This disappointment in the performance of CX programmes is echoed by 78% of UK CX professionals confirming their company’s current Customer Satisfaction score, Net Promoter Score or CX performance was not significantly better compared to a year ago. This is despite 36% believing their organisation to be more concerned with improving scores than actually delivering a great customer experience.
Linked to the disappointing performance of CX programmes is the confusion amongst CX professionals. Only 23% strongly agreed that they have a clear understanding of their customers’ needs, whilst only 12% felt that it was always clear what actions they should take based on feedback received from their customers.
Focusing on the wrong areas
In a sense, some of these results are unsurprising. If a company is failing to understand its customers’ needs or expectations, it’s impossible for VOC and CX programmes to make a practical difference to the business. The truth is, most programs are focused on chasing scores rather than examining how to achieve those scores. These companies should stop chasing scores and start chasing outcomes.
Clear understanding of the customer’s expectations, plus a well-understood action plan for how to analyse and respond to feedback are essential for making tangible impacts on customer experience. Without these, genuine customer dialogue can never be achieved and the VOC programme will remain misaligned with the business – and undervalued as a result.
The importance of assessment
The UK CX industry needs a rethink on how to align CX efforts with genuine business expectations. Most CX professionals probably think they know how their organisation is doing in terms of CX maturity. But they may not know what specific competencies are holding them back—and what specific actions they can take to realise better business outcomes.
Organisations should take the time to use a comprehensive framework for assessing, measuring and prescribing specific actions that links customer experience maturity with financial outcomes. This can allow companies to redefine their approach to CX management, identifying the specific issues that prevent them from realising the full potential through improved CX.
In order for companies to understand what they do next, they must understand their current position, and what makes the most sense for them to focus on. It takes more than a sound customer feedback programme to move the needle on business results: companies must take steps to break down the silos and embed consistent CX practices right across their business.
Assessment works
Companies may think that pursuing revenue goals, innovating products, or achieving greater operational efficiencies are the most fruitful areas for investment. But the truth is that CX underpins and drives success in each of these areas. In other words, get the customer experience right and mature CX programmes and efforts, and all else follows.
This is further evidenced by the CXEvolution study, which shows that those with the highest levels of customer experience maturity (where a focus on the customer is ingrained into the fabric of the business) consistently enjoy large payoffs in revenue, margin growth, customer retention and profitability – up to three times more than firms with lower organisational CX maturity.
Despite all the recent rhetoric, most companies are still immature when it comes to managing their customer experience. Making the right small improvements can create a significant opportunity for organisations to leapfrog the competition and catapult their CX programmes far ahead of industry averages.
To take the complimentary CXEvolution assessment and find out your companies CX maturity level, please visit www.maritzcx.com/assessment
