Qualtrics CX Live Auckland
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Qualtrics, Kantar TNS and Vodafone NZ share insights on how to fill the experience gap within organisations.
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Qualtrics CX Live Auckland
- 2. Agenda 8.20am Introduction 8.30am HowtobecomeaCXleader:5Corecompetencies 8.50am ThecriticalsuccessfactorsinbuildingyourCXprogram 9.10am TheFutureofCX 9.30am Howtocreateadata-drivencustomerexperience 10.00am Close
- 4. 80% 2/3 of customers have chosen to switch brands due to a poor customer experience of the workforce is disengaged
- 8. DATA
- 9. DATADATA
- 10. there’s anewbusiness discipline emerging called EXPERIENCE MANAGEMENT
- 12. PRODUCT experience manage the FOUR CORE experiences of your business CUSTOMER experience EMPLOYEE experience BRAND experience XM isa STRATEGY
- 13. repeatable process to CONTINUALLY IMPROVE the experiences you provide Measure & Baseline 01 XM isa SYSTEM
- 14. repeatable process to CONTINUALLY IMPROVE the experiences you provide Predict & Prioritise 02 XM isa SYSTEM
- 15. repeatable process to CONTINUALLY IMPROVE the experiences you provide Act & Optimise 03 XM isa SYSTEM
- 16. XM is a TECHNOLOGY
- 17. Customer Experience Management (CXM) is the discipline of embedding customer insight into every critical decision, improving how you perform at every level of your organisation e CUSTOMER experience EMPLOYEE experience BRAND experience
- 19. + HOW TO BECOME A CX LEADER: 5 CORE COMPETENCIES PRESENTED BY VICKY KATSABARIS, QUALTRICS
- 20. “We’re creating a culture of customer centricity within our organisation. True customer centricity is not a project. It’s not a program. It’s a culture and a way of doing business that will help us grow and be successful for decades.” CHRIS FISHER, CEO Allianz AGCS
- 21. U.S. brands lose approximately $41 billion in revenue each year due to poor customer experience. NEW VOICE MEDIA Promoters are 81% more likely to repurchase compared with passives (44%) and detractors (16%). FORBES.COM CEI 66% of consumers who switch brands do so because of poor customer experience. KOLSKY 95% of dissatisfied customers tell others about their bad experience DIMENSIONAL RESEARCH 66% 95% 81% 86% of consumers will pay more for a better customer experience.86% 41B$ INDUSTRY STATISTICS
- 23. The 5 competencies of CX success
- 24. Culture and leadership o Gain executive sponsorship o Publish CX values o Align departments o Benchmark against competitors
- 25. CX management system o Capture feedback at every key touchpoint o Close the loop at scale o Manage with role-based views o Integrate with CRM and ops systems
- 26. Customer intelligence o Conduct customer research o Measure key relationships o Segment customers and understand drivers o Drive cross-functional change
- 27. Connected employees o Collect employee feedback across lifecycle o Understand drivers of employee engagement o Drive improvement at every level o Regularly communicate progress
- 28. Continuous innovation o Maintain singular focus on data quality o Routinely adjust management views o Encourage testing and research best practice o Support a culture of innovation
- 31. visible LEADERSHIP SYMBOLS enable a customer culture
- 33. Embed customer focussed values into the way you operate
- 34. WE PURSUE EXCELLENCE Our dedication to the customer shows in everything we do. QUIETLUXURY CRAFTEDEXPERIENCES INTUITIVESERVICE How does that sound? Instead of excess formality, JW Marriott luxury hotels and luxury resorts provide simple elegance. Instead of pretense there's a sense of purpose for every detail and decoration. The result is an inviting atmosphere where you can be yourself, and we're sure you'll like the sound of that. All hand delivered. Everything is done with care and precision at JW Marriott. That includes little touches that add up to exceptional experiences – even though they may go unnoticed. And that's the whole point. When you know, you know. There's a fine line between serving and crowding. We know the difference at JW Marriott and we've mastered the art of giving guests the assistance they need without getting in the way of the experiences they want.
- 35. CUSTOMER EXPERIENCE VALUES Internal External Principles “how” “How to frameworks” Proof Points “what” “We will do this in this manner for this customer experience” Commitment “why” “As a company, we will...” Specific Link to purpose Design
- 36. have you EARNED THE RIGHT for customers to advocate for your brand? Do the proof points… o Reflect your purpose, values & brand principles? o Consider the people who use your products & solutions and serve your customers? o Focus on what matters most to customers across the customer journey? o Value your customers time & effort? o Build trust in your brand? o Make it simple for customers to understand? o Hold yourself to account by being measurable?
- 39. * ADKAR model acknowledged Stakeholder Landscape Supporters High Interest & High Power: Engage frequently and consistently; seek input, listen and build shared consensus; mutual benefits. Supports change and has demonstrated a high level of change leadership Champions High Interest & Low Influence: Engage regularly; maintain two-way conversations to ensure that no major issues are arising and leverage as advocate for change Gatekeepers: Major Risk Low Interest & High Power: Share timely information at regular intervals to mitigate any potential major risks Bystanders Low Interest & Low Power: Share information when required using mainstream existing communication channels Low - Changes will have minimal affect on stakeholders' role High - Changes will directly affect stakeholders' role and the way they do their job. Level of Impact Stakeholder Strategy Gatekeepers Engage directly & regularly Major Risk Supporters Manage closely & empower Bystanders Share information Champions Leverage as advocate for change Level of Support (Interest) LevelofInfluence(Power) L H H Stakeholder planning helps to identify; o Stakeholders’ needs and interests o Mechanisms to influence stakeholders o Potential risks o Key people to keep informed about changes o Negative stakeholders & their adverse effects PREPARE YOUR PEOPLE FOR CHANGE
- 40. “Before you launch off after the next big goal, stop and ask yourself why it deserves your energy and scarce resources. If you don’t feel a fire in your belly ... chances are you won’t get it done”. Dr Peter Fuda
- 41. use storytelling to CAPTURE hearts & minds principles of an inspiring story: include FACTS and data include EMOTION and empathy be PERSONAL and authentic
- 42. your CUSTOMER CAPABILITY is as important as your financial capability
- 43. turn your employees into AMBASSADORS
- 44. Identify areas of opportunity with our CX diagnostic Step 2: Receive a personalised report and free consultation on next steps for your program Step 1: Assess your program against best-in-class CX program criteria (5 Core Competencies)
- 45. + THE CRITICAL SUCCESS FACTORS IN BUILDING A CX PROGRAM PRESENTED BY JIN WAN, VODAFONE NEW ZEALAND VODAFONE NEW ZEALAND
- 47. Vodafone NZ’s CX journey 2009 20162011 2014 2015 ● TOUCHPOINT NPS (Consumer) ● RELATIONSHIP NPS (Enterprise) ● TOUCHPOINT NPS (Enterprise) ● BENCHMARK NPS (Enterprise) ● BENCHMARK NPS (Consumer) BNPS TNPS TNPS RNPS TNPS
- 48. Source: Satmetrix U.S. Consumer 2016 Net Promoter Benchmarks at a glance A humbling experience…
- 50. The ONE thing that matters most, right from the start. Visible leadership endorsement
- 51. Start with the day-in- a-life of your people. End-to-end CX integration
- 52. Over-compensate on support for your people People support
- 53. Keep it simple to gain insights based on what truly matters to customers. Ongoing cycles of Insights & Initiatives
- 54. Finally, put CX into EVERYONE’s KPIs and commissions KPIs & Commissions
- 55. In the end, it’s all about people
- 56. + THE FUTURE OF CX: THE RESEARCH AND WHAT YOUR CUSTOMERS ARE TELLING US PRESENTED BY JASON SHOEBRIDGE, KANTAR TNS KANTAR TNS
- 57. Traditional value drivers no longer provide competitive advantage 1900 - 1960 1960 - 1990 1990 - 2010 2010 - PRESENT Age of manufacturing Age of Distribution Age of Information Technology Age of the Connected Customer
- 58. Technology will push what is achievable within CX
- 60. Technology will push what is achievable within CX
- 62. To have an impact, experiences must be memorable
- 63. Daniel Kahnemann The riddle of experiences versus memory. TEDtalk February 2010
- 64. Memories are the missing link Relationships drive business outcomes Experiences become memories Customers have a myriad of experiences Memories shape relationships
- 65. But most experiences aren’t memorable… 75% leave no lasting impression 25% may become memories
- 66. Whether positive or negative, the key to making an experience memorable is the emotional hook Making memorable experiences
- 67. Which experiences cause strong positive emotions? 1. Going beyond fulfilling service standards 2. The human touch makes the difference: staff attitude, making customers feel valued and important 3. Especially in instances where customers invest a lot of emotional energy themselves “Usual standard of great customer service” “Attitude of the staff; cleanliness of vehicle; advice re: items that were not yet at the end of their life but nearing it” “Lovely receptionist who made me feel important” “Wonderful polite customer service; all questions answered; work carried out at very competitive price and on time” Enchanted
- 68. Not all journeys need to delight customers “You can’t be good at everything. You must be bad in the service of good. Excellence requires under-performing on the dimensions your customers value least so that you can over perform on the dimensions your customers value most.” Frei/Morris 2012: Uncommon service; Pos, 127
- 69. Case study: Retail banking experience 52% Excellent Enchanted Unaffected 28% 24% 4% Fair/poor Disenchanted4% Case Study Retail Banking US 2016 Customer Experience Performance Emotion
- 70. When looking at the overall customer relationship, preference is the emotional link Performance Emotional Rational Preference
- 71. Customer preference is key to “customer’s mouth and wallets” 15 times more likely to spend more 20 times more likely to recommend 7 times more likely to stay Customers with high preference are…
- 72. Case Study: US mobile operators Understanding how relationship strength links to churn Global R&D Programme Actual churn from mobile network operators in the US 2013 first round of interviews with customers from all relevant operators 2014 follow-up interviews with the same customers about their actual behaviour Strong & Differentiated Relationships Weak & Undifferentiated Relationships Actual churn 2014 4% Actual churn 2014 36% *9 SOURCE : TRI*M validation survey 2014
- 73. Integrated Customer Experience Insights Customer Relationship Impact Customer Mission Journeys Daily Voice-of-Customer Holistic relationship assessments Customer value segments Customer Lifecycle Stages Predictive Behaviour Impact Potentials Extend CLTV End-to-End mission based journeys Identify critical customer journey interactions Address abandonment behaviour Design for emotion impact Continuous routine transaction feedback In the moment assessments (performance & emotion) Dynamic customer care & rescue Active front-line customer alignment Identify Customer Priorities Co-creating the Moments that Matter Most Channel based KPI Assessment & Learning STRATEGIC OPERATIONAL
- 74. How do your customers feel after their most recent interaction with your company?
- 75. + HOW TO CREATE DATA-DRIVEN CUSTOMER EXPERIENCES PRESENTED BY SAM RAMJAHN, QUALTRICS
Notas del editor
- Good morning! It’s great to be here for our very first event in New Zealand. We’re really excited to have everyone here today. This will be the beginning of many events we host with you in New Zealand.
- Today we’ll hear from a lot of great speakers Vodafone NZ and Kantar TNS about best practice CX programs experience.
- We live in an experience economy. Today, the winners and losers in business are determined by the experience they provide. Companies that make delivering experiences core to their offering are disproportionately rewarded and/or punished by a new generation of customers. The power is shifting to consumers and, by extension, to the firms that earn their love. The experience economy means “that businesses must orchestrate memorable events for their customers, and that memory itself becomes the product — the "experience" and that advanced experience businesses can begin charging for the value of the "transformation" that an experience offers…." (https://en.wikipedia.org/wiki/The_Experience_Economy) Examples: This shift is driven by the millennials, the first generation in history that prefer to spend money on experiences, instead of on “things”. Subscription based business (cancel anytime, need to consistently earn loyalty) General trend in car ownership Amazon Prime Uber - car sharing Advances in technology basically eliminates switching costs :: switching for phones (contacts / data / etc…) Cable networks and content
- These statistics help illustrate the macro trends in the experience economy. It’s critical to get experiences right in the economy today, but so many companies are struggling. 80% of customers have chosen to switch brands due to a poor customer experience. (http://www.bain.com/bainweb/pdfs/cms/hotTopics/closingdeliverygap.pdf) 2/3 of the workforce are disengaged and 2 million employees turn over every month because of negative experiences in the workplace. (http://www.gallup.com/poll/188144/employee-engagement-stagnant-2015.aspx)
- In a Bain and Co study, 80% of CEO’s surveyed expressed a belief that their organizations deliver superior experience to their customers. However, among their customers, only 8% agreed that these organizations were actually delivering superior experience. Essentially executives think they are delivering a great experience, but their end customers disagree.
- In a Bain and Co study, 80% of CEO’s surveyed expressed a belief that their organizations deliver superior experience to their customers. However, among their customers, only 8% agreed that these organizations were actually delivering superior experience. Essentially executives think they are delivering a great experience, but their end customers disagree.
- There is a huge, grand canyon sized gap between what you believe is happening and what is really happening. This gap stems from most companies' inability to know what’s happening, why it’s happening, and how to adapt. We call this the Experience Gap. REAL WORLD EXAMPLES: -Allianz Customer Experience Gap: Allianz believed that the claims department was only a back office function that had no customer experience impact. In fact, after Qualtrics, they discovered that the claims department was a major customer experience driver and became a strategic front office function: -Tesla Employee Experience Gap: Tesla was losing key engineering talent to all bay area companies. They were literally in crisis mode. They perceived that the main attrition driver was compensation and put together huge comp packages to retain key talent. It only worked temporarily. After Qualtrics, they realized the true driver of attrition of their highest performers was that they no longer believed they were working on cutting edge projects. The Chief People Officer created special "cutting edge" projects division for highest performers. WHY DOES THIS GAP EXIST?
- Businesses have a lot of O data but what they don’t have is…
- X data, experience data that tells them about what their customers are experiencing.
- This gap has led to the emergence of a new business discipline called experience management.
- Experience Management is made up of three components. It’s a strategy, it’s a system, and it’s a technology.
- XM is a strategy... Every business has 4 key experiences. Their products. Their customers. Their Employees. And their Brand. And market leaders optimize all 4. Market leaders are maniacal about optimizing the four foundational experiences they provide as a business - product experience, customer experience, employee experience, and brand experience. They understand that the four foundational experiences aren’t independent - they are interdependent. They realize that experience is the 21st century competitive advantage. “Creating the right experiences and then integrating around them to solve a job, is critical for competitive advantage. That’s because while it may be easy for competitors to copy products, it’s difficult for them to copy experiences that are well integrated into your company’s processes.” (Clayton Christensen, “Competing Against Luck”) Example... Think about it. Anyone could pretty much copy Jetblue’s brand strategy. You could copy their logo, you could copy their customer bill of rights, but you aren’t going to get the same results. Even if you were to nail the brand piece, you still wouldn’t get smiling employees helping carry children down the aisle for traveling mothers. They are all related.
- XM is a system... At it’s core, XM is actually a pretty simple recipe. The system consists of three important steps - steps that are repeatable across all four of the foundational experiences of business we discussed. First, you Measure & Baseline. Begin gathering data and learn how you are performing today. Second, you Prioritize & Predict. Start to uncover root causes, prioritize action items, and uncover areas for improvement. And third, you Act & Optimize. This is where the rubber meets the road. Take action, fix bugs, solve issues, and make changes to optimize experience. This system or methodology is universal to improving each experience. You’ve got to measure it, prioritize areas for improvement, and act.
- XM is a system... At it’s core, XM is actually a pretty simple recipe. The system consists of three important steps - steps that are repeatable across all four of the foundational experiences of business we discussed. First, you Measure & Baseline. Begin gathering data and learn how you are performing today. Second, you Prioritize & Predict. Start to uncover root causes, prioritize action items, and uncover areas for improvement. And third, you Act & Optimize. This is where the rubber meets the road. Take action, fix bugs, solve issues, and make changes to optimize experience. This system or methodology is universal to improving each experience. You’ve got to measure it, prioritize areas for improvement, and act.
- XM is a system... At it’s core, XM is actually a pretty simple recipe. The system consists of three important steps - steps that are repeatable across all four of the foundational experiences of business we discussed. First, you Measure & Baseline. Begin gathering data and learn how you are performing today. Second, you Prioritize & Predict. Start to uncover root causes, prioritize action items, and uncover areas for improvement. And third, you Act & Optimize. This is where the rubber meets the road. Take action, fix bugs, solve issues, and make changes to optimize experience. This system or methodology is universal to improving each experience. You’ve got to measure it, prioritize areas for improvement, and act.
- But none of this matters if you don’t have the technology to enable that system. Qualtrics is the only technology capable of measuring, prioritizing, and optimizing all four foundational experiences of a business on a single platform with the ease and simplicity to drive widespread adoption inside of companies. Experience Management is about closing the gap between the experience you think you are delivering and what you actually deliver. The Qualtrics XM platform offers purpose-built applications to optimize these four foundational experiences - independently and interdependently. All solutions are built upon the same scalable technology platform that offers best-of-breed data collection, analysis, prediction and action engines. It’s modern, it’s continuously updated, and has an open architecture that allows for seamless integration with other systems and data in the enterprise. —————- With Qualtrics Experience Management, companies can answer critical questions about their four foundational experiences: Customer Experience This is much more than customer satisfaction. How should companies think about and manage their customers? Who is important, who is not? What matters to a given customer segment and how do you get them to spend more? What do they like and what do they dislike? How are they changing and what does that mean for your business? Who is going to leave you and who is most likely to recommend new customers? What new products can you sell them? How do we grow their lifetime value? Product Experience Product experience and customer experience are fundamentally different. For starters, product efforts are focused on the future—where customer satisfaction today may only give a few hints about what customers will want tomorrow. How do you know whether you have the right product? Where should you invest if you want to get more people to buy your product? How much should you charge for your product? What is the best way to position and describe your product? How big is your market and how will you make it bigger? What is the value prop your products offer today and what will it be tomorrow? Employee Experience If we’ve learned anything, leading an organization is complicated and employee engagement is vital for all clients: Do your employees believe in where you are going? Do your team members see something urgent that they're not sharing? Do you know who tomorrow’s leaders will be? What skills are your organization missing that will help them buck the status quo? What is getting in the way and how do you keep employees from turning inward instead of outward to their clients? What is the wisdom of the crowd, and how can that help you go faster? Brand Experience Sometimes brand is the product, or, as in the case of Qualtrics, it can be the result of your combined Customer, Product, and Employee Experiences. For many organizations, their brand is their biggest asset and they need help managing the brand experience. What are we doing that positively reinforces the brand and what are we doing that negatively impacts it? How does our aided and unaided brand awareness compare relative to our competition? Who do we appeal to and who do we alienate?
- Hand over to Vicky Katsabaris, CX Principal Consultant at Qualtrics
- We believe there are 5 core competencies organizations must possess to deliver CX success. Together, these competencies comprise world class customer experience management. They are as follows: Culture and Leadership CX Management System Customer Intelligence Connected Employees Culture of Innovation
- Customer experience management begins with culture and leadership. Programs must have leadership and sponsors at the executive level that provide a consistent vision for the program. Departments must be aligned on a common set of objectives, values, metrics, and systems. Planning must be based on an honest assessment of competitive performance and strategy.
- CX Management System is the systematic measurement of interactions at each critical touchpoint and moment. It is the infrastructure that ensures each team and function has the customer and operational metrics they need to optimize how they perform. In addition, it requires the case management to ensure customer feedback is responded to at scale. Qualtrics provides the most dynamic, end-to-end platform for customer experience measurement, from intuitive survey building capability to omnichannel distribution, flexible role-based dashboards and closed loop follow up. We have powered some of the best brands and sophisticated solutions across every geography.
- Customer Experience Management requires deep, actionable Customer Intelligence that extend beyond touchpoints. It requires the ability to conduct research to understand customer topics, the analytic engine to understand key satisfaction and behavioral drivers by segment, and the ability to understand key relationships. This competency relates to the ability to capture deep insight that combines both operational and customer data to support strategic, cross-functional change. Qualtrics provides the most sophisticated, intuitive research platform on the market. With the most advanced survey builder and a full analytics engine featuring statistical, data, and text analysis, we empower you to leverage customer intelligence to drive strategic improvement.
- Connected, engaged employees are critical to delivering customer experience. Organizations need to routinely capture employee feedback to understand the barriers to greater employee engagement and performance. This information must be visible to each stakeholder and the org in general, so that leadership can be held accountable and take action in ways that empower employees to deliver great customer experience. Qualtrics provides the only experience platform that allows for both customer and employee measurement, analysis, and action.
- Continuous innovation is a competency that is easier said than practiced. It pertains to the organizations focus on data quality and research methodology rigor. CX programs must constantly adjust to the needs of the business, focusing on the topics and visualization that enable them to stay a step ahead of the market. Organizations must support a culture of research testing and iteration, where the goal is continuous improvement. Programs that innovate enable the broader company to innovate. Qualtrics provides the only truly flexible, end-to-end platform for customer experience management. With the ability to easily design, test, and launch sophisticated research, modify dashboards, and expand to new channels, Qualtrics allows you to scale and evolve with the needs of your business.
- Today’s session focusses on the establishing a customer culture & leadership. Why? Because it makes good business sense. Customer-obsessed companies can grow their revenues faster and build a more loyal customer base. While this sounds like a great strategy, companies are left wondering how they can actually achieve a customer centric culture?
- As many business realise there can be no doubt that the world has & is changing. Yesterday’s precepts for competitive advantage are rapidly disappearing and technology developments are a pivotal force. In today’s Connected Consumer age the customer-empowerment shift that started in the ‘90’s is now pervasive. Empowered customers will continue to be enabled by technology developments and this will continue to fuel increased levels of disruptive propositions ~ one only needs to look at how shopping behaviours have changed, or the way people make travel work more easily for them. Not only is this fertile ground for the entry of disruptive plays by new types of competitors it also represents an era of new opportunities for engaging & delivering in a more personally beneficial way to your own customers. Technology will continue to be harnessed in ways to support the drive towards customer-centricity.
- Air New Zealand recently released this short video showing how customer experience might evolve. The video demonstrates some trends that are picking up steam. Firstly there is the augmented reality of the Hololens. Augmented Reality and Virtual Reality are tools that will almost certainly work their way into customer experience, whether it is Hololens or some other technology. The more important point is how it demonstrates that a focus on getting relevant information to front line staff. Multiple data sources are being pulled together here from customer data and in-flight information Artificial intelligence identified the customer and could possibly decide what appears in the crew suggestions – much as recommender systems on Amazon or Netflix work. The AI has also identified how he is feeling. Over and above the technology on display here, it is being able to understand and respond to customers feelings that I want to focus on.
- Duplicate in case video is dodgy. Air New Zealand recently released this short video showing how customer experience might evolve. The video demonstrates some trends that are picking up steam. Firstly there is the augmented reality of the Hololens. Augmented Reality and Virtual Reality are tools that will almost certainly work their way into customer experience, whether it is Hololens or some other technology. The more important point is how it demonstrates that a focus on getting relevant information to front line staff. Multiple data sources are being pulled together here from customer data and in-flight information Artificial intelligence identified the customer and could possibly decide what appears in the crew suggestions – much as recommender systems on Amazon or Netflix work. The AI has also identified how he is feeling. Over and above the technology on display here, it is being able to understand and respond to customers feelings that I want to focus on.
- Having decided that customer experiences matter, many companies have rushed to micro-analyze every interaction as the key to bolstering customer loyalty and driving profitable behavior. But we have an Amnesiac Customer. That is, people forget far more than they actually remember. We are bombarded with stimuli of all sorts. If we processed, reacted to and remembered everything, we would have total sensory overload. The majority – the LARGE majority – of stimulti, touches, and interactions we simply forget. We almost never remember the table setting at a restaurant – unless it is spectacularly ornate or, unfortunately, dirty.
- For experiences to stand out from the background noise they need to be memorable. The dessert, for example, almost always will be more memorable than the table setting. But when we do recall something, we often actually MIS-remember. That is, our memories are far-from-perfect re-creations of what actually happened. Our memories are cloudy and inexact, missing in details, rife with inaccuracies, easily influenced by our biases. Our memories are not especialy reliable representations of what really happened. Regardless of the accuracy of our memory, we are going to recall experiences that are more distinct and meaningful to us far more often than we will remember experiences that are bland and meaningless. So the pie invariably is more memorable than the table setting.
- While we focus on experiences, the reality is that it is the MEMORY of those experiences that really matter. This is a critical distinction, as experiences that we do not remember are, in effect, irrelevant to the ongoing customer relationship. Forgotten experiences can‘t have any impact on customer loyalty or influence consumer behavior. It is the experiences that create memories that stick with us that are important, as these memories endure and have an impact on customer relationships.
- So experiences don’t directly influence customer relationships. [BUILD] Those experiences customers forget dissipate to the wind. Those experiences that we remember are what matters, and it is those memories that then go on to influence the overall customer relationship. And it is the relationship or level of loyalty that motivates the customer behaviors that create value for your company.
- So experiences forge memories and memories of those experiences help shape the customer relationship; and that relationship or loyalty motivates customer behaviour. But most experiences simply aren’t memorable. Perhaps ¾ of the experiences we measure for clients aren’t memorable. And this almost certainly understates the issue, as we only are measuring those experiences that clients consider meaningful in the first place.
- What makes an experience memorable, what makes it distinct from the background clutter, is an emotional connection. Ideally, of course, that emotion is a positive one – happiness or joy, a pleasant surprise, a sense of trust – something that reinforces good feelings towards your brand, your value proposition and bolsters your relationship with customers. But the flip side also applies: a negative emotional reaction – say a sense of disappointment, anger, frustration or sadness – will work to undermine your image, value prop and customer loyalty. In fact, because we perceive, process, act on and recall negative information and negative emotions more quickly and thoroughly than positive information and emotions, negative emotional customer experiences often are more enduring than positive ones. In other words, BAD is stronger than GOOD.
- We ask customers WHY did you feel this way? And this gives us a wealth of information. And you can see some results here: lovely receptionist who made me feel important, wonderful polite service. In most cases the HUMAN TOUCH is what made the difference. Staff attitude makes a huge difference, making feel customers valued and important. So in today’s world with so many competitors, the fulfilment of service standards is not enough. It’s a first step and it definitely helps to avoid that things go wrong, but strong customer experiences go beyond that and need empowered employees with an outstanding attitude towards the customer. Especially in instances where customers invest a lot of emotional energy themselves. Bots are an interesting phenomen, as you might think that the human touch is by definition missing. We don’t have a lot of data about this yet. When we look at results of service evaluations via facebook or twitter, they are very often emotionally engaging, simply because the tone of voice is different, more conversational, more relaxed and simply different. People love to use youtube for service videos. So there is definitely potential for digital channels. By now you are probably thinking, well, I get the principal idea, but I have 30 or 40 touchpoints to manage – how can I go beyond standards, delight customers without my costs of customer service going through the roof?? And you are right to pose this question.
- A bit of a provocative quote from France Frei and Anne Morris, two professors from the Harvard Business School. “You can’t be good at everything. You must be bad in the service of good. Excellence requires under-performing on the dimensions your customers value least… I wouldn’t put it quite so definitively . We all know that we cannot seriously be really bad in a customer interaction, we have seen the effects of this! But I do like the basic thinking. If we really want to be truly excellent, we need to set priorities. Where do we invest our time and our money? And those are then the interaction where we need to get the emotions, the human touch right. For all others, “good” is good enough and we can allow neutral feelings.
- We have been measuring performance and emotional impact for customer experiences and verifying the impact on relationship strength. This example involves customer experiences with their bank. Poor or fair performance compounded by negative feelings regarding a retail banking experience yields weak performance scores and even weaker levels of preference for the bank. When customer give the bank top grades for performance during the experience, the outcomes again vary widely based on their emotional responses. In this instance, moreover, the emotional take-away by the customer had a significant impact on both performance and preference: performance scores for the banks involved rose almost 20%, while their preference jumped 33% when customers came away from an experience feeling delighted as opposed to simply neutral. So, again, memorable positive FEELINGS about the experience significantly boosted the strength of the overall customer relationship.
- Many of us see ourselves making all of these rational decisions based on the pros and cons. So this visual may not be the way we see ourselves. In reality, no matter how analytical we may be or think we are, our emotional selves – as expressed in our preference for a brand or company— outweighs our thinking selves who are striving working so hard to make the best decisions. Now let’s get into a bit more measurement. And let’s make it really mundane: car repairs. People may love their cars, but no one actively likes to take their car to be repaired. We looked at the experiences of people who took their cars to be fixed at a dealership to see the extent to which how customers FELT about the repair experience affected their loyalty to relationship with the brand of car they owned.
- And since our focus is on business outcomes, not just happy customers for the sake of happiness, we see that preference monetizes handsomely. Ultimately, this is what investing in and focusing on customer experience and loyalty is all about. Preference motivates those customer behaviors that create value for your firm. I like to call these LOYALTY BEHAVIORS, the tangible actions and behaviors of customers that create value for your firm.
- Here‘s an example from the US mobile phone sector – a notoriously competitive and commoditisation challenged market. This was a longitudinal analysis looking at behaviour shifts over a 12 month period. We found that those customers who with weak and undifferentiated relationships left to a factor of 9x those customers with strongly differentiated relationships. In other words where there was no strong preference established through their experiences more than a 3rd of these customers had taken their business elsewhere within 12 months! The importance of having a really strong customer insights capability can not be understated.
- And this customer experience insights engine needs to be fully integrated across identifying the strategic priorities for customers & identifying where customer value opportunities exists, and on a more operational level where technology driven VoC enabled programmes drive customer learning and responsiveness into the organisation. The link between these Strategic and Operational views is achieved through the customer journey lens --- and of specific importance, being able to frame these journeys around clearly defined missions that the customer is seeking to achieve. Building highly granular mission-based journey views allows us to focus on individual moments that really make a difference along the process of engagement & interactions the customer experiences. And at this level it is possible to extend into co-creative development iterations – internally as well as with customers. Maybe your business is a long way down this path. It wouldn’t be unusual if it sounds a long way from where your business currently is.
- Either way, we would encourage you to take a step closer by asking yourself this question . . . .