Achieving best practices in customer value delivery, and reaping the rewards of positive customer marketplace behavior, means that everything organizations do with respect to managing customer relationships must be planned, coordinated, and executed in a consistent and proactive manner. This includes, but is not limited to, having a single, integrated view of customers across the entire enterprise, and making certain that all information, processes, and employees are focused on this objective.
The Differentiators and Commonalities of Customer Experience Management Success
So, how do companies that are world-class customer experience managers get that way and sustain the highest levels of value delivery? What are they doing – and, as importantly, what are they doing differently – that other organizations can learn from and apply to achieve their own levels of success?
Let’s begin with a quick overview that ties together how the world’s best organizations perform for the benefit of all stakeholders, how they manage customers and customer experiences, and employees and employee experiences, and what they get as a result when these two stakeholder groups are behaviorally and financially linked.
First, these companies are relentlessly and passionately focused on the ‘line of sight’, in other words the essential connections between what they do, what the customer sees in terms of value and benefit, and how the customer behaves as a result. They have a firm grasp on the importance of linkages between strategy, processes and core capabilities, employees, customer-perceived value, and what they want customers to do.
Also, these companies are aligned. This means that all competencies, processes, functions, people, messaging, and data are directed at providing the highest value, and as the customer perceives value.
Next, and perhaps most importantly, these companies understand what effective customer management can mean in terms of stakeholder reward – all stakeholders, including the public, customers, employees, suppliers, and the financial community. Specifically with regard to the financial community, they have made the effort to communicate that return on customer investment, or ROCI, is as important as any other gauge of financial success.
These companies have a holistic view of customers and the customer life cycle. In addition, they have a holistic view of employees and the employee journey. They understand that they must seek and win the right kinds of customers and employees, build value for them, prevent risk and churn, and, overall, embrace both customers and employees as strategic assets. This includes making certain that every functional and emotional message, touchpoint, and experience reinforces the customer’s, and the employee’s, desire for sustained value in a long-term relationship, one which features commitment and advocacy behavior on behalf of the supplier.
As a significant sea change, many organizations are recognizing that employees are not just the people who sell to and support customers. Their creativity, proaction, loyalty and commitment has a direct link to customer loyalty behavior, and must be viewed on that basis. Companies that invest in building leadership and capability among employees are also seeing returns in the currency of staff loyalty behavior and longevity, another real, bottom line consideration.
Finally, these companies understand that managing the entire customer journey, from initial contact, first sale, building loyalty and advocacy through positive experiences, service, communication, and even esoteric areas such as billing, are all important to customers and have to be executed with quality, seamlessness and consistency.
Linkages to the Customer Value Proposition
It’s clear that there’s a direct continuity and linkage between what companies plan to do with customers, what customers actually see and feel in terms of perceived value, how the customers act in the marketplace, and what suppliers are able to learn about customer touch experiences, customer mindsets and levels of emotional kinship, and their behaviors with respect to suppliers. This insight then feeds back into enhancing and improving customer processes and the value propositions that organizations offer. In summary, what companies do – in large part, indirectly and directly through employees – creates the way customers think, feel, and act; and the result of customer relationships, emotions, and actions is what companies get in terms of business performance. It is, in fact, a “line of sight” between the supplier and customer.
The customer value proposition is at the core of everything a company can represent to a customer. To optimize long-term loyalty behavior, there’s nothing more necessary than making certain that the customer understands the company or brand’s unique value proposition. In other words, what benefits and solutions will the supplier’s brands provide?
Studies by academics in both the United States and United Kingdom have found that very few companies succeed in effectively conveying their value proposition message to prospects or customers. And, if the company is going to attract and convert the kind of prospects they target, build perceived benefit for their active customers, reduce or eliminate customer churn, and even recover attractive former customers, then communication of the value proposition has to be a top priority.
So, what is this elusive ‘value proposition’ and why is it so pivotal that customers understand it? Simply, delivery of the value proposition is why a customer buys from one supplier and not another. If customers don’t understand a supplier’s articulation of personal benefit, that supplier can never be on a at least a level playing field with other companies a customer may consider. Here, precisely, is how our perspective on the total value proposition was defined in responding to a recent client inquiry:
“Total proposition value is actually the aggregate of the way customers make brand and supplier selection decisions, that is the individual weight each customer puts on the tangible and functional (cognitive) elements such as timing, completeness, accuracy, performance, and costs, and relationship and emotional (affective) aspects of benefit and perceived value with the product or service, such as personalization, information, trust, and brand reputation and integrity. In the vast majority of businesses, even b2b, emotion and relationship will play a dominant role in customers’ brand or supplier selection”
Each to a different degree, customers consider both the intangible elements of the proposition, and the tangible elements, including price, in the mix, as they make their supplier selection and purchase decisions. As we’ve said, how effective the company is in creating a true kinship or bond with its customers, and encouraging them to be involved, dominates customer decision-making. When companies can do this, transaction after transaction, and through experiences over time, they will be well on the road to creating customer advocates.
Role(s) of The Committed Employee
Companies must weigh the role and impact of employees, especially in creating benefit for customers and making sure that it stays at a high level. When examining the leverage employees can exert on customer states of mind, a few companies have learned, as exhibited in research by two U.S. marketing professors, that employees committed to the company, its products, and its customers are also loyal to its brands, and are more likely to act as advocates in creating customer commitment.
Companies with employees who are highly loyal to its brands are more positive about their employment with the company itself, more likely to believe the company is customer focused, and they are more likely to have pride in the company and believe that it is well-managed. The dual message here is that companies should focus attention both on creating brand ‘champions’ and advocates among customers and also on building the capabilities and careers of employees to meet that objective.
How customers think and feel as a result of their touch and transactional experiences with suppliers links directly to both customer mindsets and customer behavior. These are the ‘moments that matter’, or points of interaction, that drive what customers do.
Today, customers have more ways to engage with suppliers of goods and services than at any time in the past. So, companies have more ways to succeed in creating a relationship, and also more ways to fail. Whether the ‘touch’ is by paper, by a human being, or by electronic means, organizations must offer consistent, seamless, and positive experiences for customers. Service, especially, is often a major differentiator and lever for either customer advocacy, or, if done grudgingly or poorly, for customer annoyance, negativity, and defection.
It’s essential that companies understand both where they please and delight customers and also where they disappoint and anger them at the points of contact. The results of these experiences directly influence customer advocacy levels.
Research into the impact of delightful and disappointing experiences has shown that disappointing experiences will lead directly to indifference in their relationship and engagement with a supplier. As customers become increasingly positive with their supplier experiences, this also has a direct correlation with purchase and communication. In fact, it’s impressive that the rate of correlation between type of experience and degree of customer commitment and advocacy behavior is almost 100%.
Increasingly, we are coming to understand the business outcome value, and even predict the effect on customer advocacy behavior, of employees as proactive, committed company ambassadors and positive agents (or also agents of supplier distrust and customer turnover, if the individual or longitudinal experiences have been poor). This is a ‘holy grail’ for many organizations as they strive to direct and leverage human capital to best effect. As we see it, this is most productive and profitable goal for any company.
As addressed so frequently in CustomerThink posts – https://customerthink.com/how-stakeholder-centric-and-value-delivery-focused-is-your-company/ – the path to EX and CX success, or commoditization, is based on the level of disciplined enterprise stakeholder-centricity.