Relevance of customer experience management in the modern world
Should we measure satisfaction, effort or loyalty?
We live in the age of customer — customers who know what they want, who are not shy from trying new offerings, who tell about their experience to others and customers who love listening to other customers. The range of product and services offered are changing everyday. New, trendy and different is the name of the game and all the organizations are forced to play it. This raises multiple challenges for organizations; in understanding what are the primary needs or expectations of the customer? What is ideal mix of products and services we should offer ? How can customer be segmented or targeted when we are continuously changing ? Should we measure satisfaction, effort or loyalty ? Does loyalty even exist any more ? If yes, which form of it ?
Though most of these questions have not changed through the last decade or so, both the solution as well as approach to solution have changed. The primary drivers of this change are multiple: the disruptive changes in technology, emergence of mobile as primary interaction device, increased access to internet and percolation of rich information to customers. Most of these changes in themselves would have disrupted commerce in itself, but they all happening at the same time had complex effect on the way customers now interact with brand, product or services. Result — It has become much more important to understand, manage and monitor customer experience and its drivers.
Dictionary defines the word experience both as noun “an event or occurrence which leaves an impression on someone.” and as verb “encounter or undergo (an event or occurrence)”.
In the commerce context— primarily B2C, it’s an amalgamation of the two — transaction with company or brand leaving an impression on customers. In today’s world however, transactions can both be indirect(ads, reviews, other customers, reselling) and direct(orders, contact center, delivery) forcing companies go beyond the boundaries of their organization to manage experiences. This has made managing customer experience tougher than ever.
Should companies keep focusing on the established ways of customer management — customer relationship management(CRM), customer journey mapping(CJM), designing loyalty programs etc.?
Does this mean companies should stop focusing on the established ways of customer management — customer relationship management(CRM), customer journey mapping(CJM), designing loyalty programs etc. Not really. Infact, companies need to focus more on these programs — but should be able to connect insights and results from these programs to experience they are offering customers. For example, does your loyalty program gives you actionable insights into which experiences are leading to loyalty and which are not ? Does the CJM helps you in identifying the pain points customers have through the journey — and more importantly how much impact does it have on the overall experience ? Does relationship management helps you identify the existing and latent needs of the customer to provide them with better experience ?
Customer Experience Management(CXM) Programs are specifically designed to solve and answer these questions.
A well defined and designed CXM should be able to define, measure and analyze the customer experience and its drivers for the organization. A good Customer Experience Management program should also be able to guide business leaders and associates towards define, design and manage key initiative and business strategy. It should help management and analyst to seamlessly convert customer view to company view. The defined customer experience metrics, be it CX Index, NPS, CES or any other, should provide the holistic view of the current and past experiences customer had through the customer journey. CXM program should also help management in establishing the relationship between the CX metrics to critical business metrics like Revenue, Margin, Customer Retention and Repeat Purchases. This will help management in prioritizing the internal initiatives according to the impact on Customer Experience and strategic goals of the company. Lastly, CXM should be able to assimilate and provide 360 degree view of the customer across different channels — Reviews(Product Review, App Reviews), Social Media, External and Internal Surveys, Operational Metrics and other Voice of Customer sources.
Though it looks complex and expensive, designing and managing such CXM programs is process bound and affordable. The primary ingredients required for creating such programs is available within companies themselves. Even the small and medium size organizations are running such programs — fully or partly in some way or the other. The real secret lies in the bringing different functional pieces together and driving it under a common program group. This will help organizations in providing the single direction to all the initiatives to enhance customer experience and better execution of those initiatives. Moreover, such common program groups reduces the friction between different functions working on different priorities and timelines.
Moreover, complex or not, Customer Experience Management is coming to the fore as the key business focus areas for all the organizations — big or small, offline or online, product or services. The real design and execution of CXM program may change across companies, but the end goal will remain same —