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Continuous CX Improvement: Between Margins and Moonshots

Something has gone wrong in customer experience (CX). Advanced analytics was supposed to tell us how to delight customers with seamless, integrated experiences. But despite tripling down on analytics spending, companies are seeing only a modest impact. In fact, CX quality actually decreased last year. Margins and Moonshots The hallmark of CX leaders is their […]

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June 11, 2018

Something has gone wrong in customer experience (CX). Advanced analytics was supposed to tell us how to delight customers with seamless, integrated experiences. But despite tripling down on analytics spending, companies are seeing only a modest impact. In fact, CX quality actually decreased last year.

Margins and Moonshots

The hallmark of CX leaders is their ability to deliver on a very clear and distinct vision. When customers interact with a firm like Apple, they know exactly what to expect, how it differs from other companies, and why they value that experience.

Unfortunately, instead of defining and furthering a vision, many CX initiatives tinker on the margins: running performance reports, identifying UI improvements, A/B testing product changes, etc. These activities are important, and can incrementally improve customer satisfaction and conversion. But they’re not CX, and they won’t create differentiation or a long-term relationship.

The flip side of the coin is the moonshot. When operational analytics fail to produce the transformative change that was envisioned, firms often respond with aggressive bets on bleeding-edge technology. AI’s siren call is difficult to resist.

But these technologies are difficult to implement, requiring a level of data integration, data quality, and data science skills that many companies don’t have. Even when implemented well, it is easy to raise expectations so high that customers end up – counterintuitively – disappointed by the new features!

The fact is, an isolated moonshot rarely creates a truly differentiated experience.

KLM launched the airline industry’s first chatbot in 2016. It was at the forefront of machine learning – but no one became a loyal KLM customer because it had a chatbot. Within two years, practically every other airline had a chatbot anyway. A technological advantage that didn’t reinforce a larger CX vision led to a lot of press but few results.

A Practical Path to Compelling CX

KLM is hardly alone. Only 30% of firms think that CX has delivered “tangible benefits or differentiation” – let alone transforming them into market leaders.

When CX initiatives fail, it is tempting to think that CX is not a repeatable process and rationalize that only a few unique companies can capture lightning in a bottle.

But CX is not magic, nor is it limited to high-end firms like The Ritz-Carlton. In fact, Forrester’s top 15 CX leaders includes Homewood Suites, Cricket Wireless, and QVC. What these firms have in common is a clear understanding of their CX vision, consistent performance across the customer journey, and continuous identification and improvement of key touch points. By correctly utilizing customer analytics, this is within reach of any company.

Define a Clear CX Vision

It is essential to set a clear vision of the unique experience that you provide to your customers. This must be more than a generic goal of providing good customer service; to change your competitive position, you must clearly differentiate your company from its peers.

A small handful of companies already have that differentiation embedded in their corporate DNA. But for most, the vision itself needs to be defined.

Typically, we’re told to “stand in our customers’ shoes” and “listen to the voice of the customer.” While techniques like empathy mapping certainly have their place, they are also subjective. Your customers don’t speak with a single voice, and you risk hearing the wrong things in the cacophony.

Analytics can separate the signal from the noise. Sentiment analysis can identify where you have started to differentiate yourself, how customers view your competitors, and what factors drive overall opinions. When joined with data on spending patterns, particularly from your highest-value customers, you can determine what customer experience will deliver customer loyalty and increased revenue.

Meet Expectations in Every Touchpoint

CX doesn’t mean that every single interaction will be superlative. Frankly, it is impossible to delight the customer at every single step of the journey. And some interactions will simply never be delightful. When was the last time you felt joy at an account login screen?

Luckily, every touchpoint doesn’t have to be special. The Zappos.com check-out is very similar to the DSW.com check-out. Yet no one would say that Zappos has failed to establish its customer experience.

But you must meet customer expectations at every touchpoint. Breezing through the account login screen may not make someone a loyal customer. But if the login screen doesn’t work and the customer can’t access their order? That can create a very unhappy customer, and it can destroy loyalty.

How do you determine customer expectations for each touchpoint and whether you are meeting them?  Use industry comparative data to baseline against your peers, and use sentiment analysis and revenue attribution to establish clear performance parameters. That will enable you to give your employees clear directions, like this: “We must resolve a customer complaint within five minutes or we start to lose the customer. But resolving the complaint in four minutes doesn’t get us any additional benefit.”

Then, set up the data capture you need to track your performance at each touchpoint and identify deviations. Create dashboards that clearly and concisely convey actionable information, so that your staff can rapidly prioritize and address issues.

Identify Your Critical Touchpoints

Not every interaction needs to be delightful. But some touchpoints are genuinely critical. You need to know which touchpoints do the most to reinforce your CX vision, deepen the customer relationship, and differentiate your brand.

Some of these touchpoints stem naturally from your CX vision. A four-star restaurant wants its servers to speak to the ingredients, cooking style, and stories behind its dishes. A fast-food restaurant wants to speed ordering as much as possible.

Still, your customers may surprise you. McDonald’s knew that its customers wanted to get food quickly and then get moving – until it turned out that a lot of them wanted to spend the whole day in a community hub.

So, you must regularly evaluate your customer interactions. Most of the time, standard performance analytics will surface the key touchpoints by measuring your KPIs and tying them back to revenue and customer loyalty. But you should also make time for general data exploration. You might notice that a previously unimportant section of your website is starting to see more traffic, or see that certain key phrases are coming up in more and more customer reviews. A touchpoint that you weren’t even bothering to measure yet could be your next differentiator.

Exceed Expectations in Your Critical Touchpoints

These key touchpoints are where you need to deliver a superlative experience.

Great experiences feel so effortless and natural that we think they spring forth fully-formed. In reality, they are usually the end result of a long process, with a lot of work, course corrections, and refinements along the way.

Analytics is essential to this process of continuous improvement. In fact, analytics itself has its own continuous improvement process. Find relationships in the data to determine the drivers of customer satisfaction and behavior. Then, implement new data capture – much finer-grained than general tracking – to provide the needed detail to validate these relationships and tease out the “micro-steps” in the journey. Develop predictive models based on the data from these key touchpoints, and then continuously refine them and re-train them in order to create increasingly accurate views.

And, of course, test, test, and test again. No matter how good your models are, there is no substitute for actually testing your product refinements and your process changes. An agile development and testing process that is paired with complete data and rapid analytics is the real CX game-changer. It creates a virtuous cycle of CX improvement at your key interactions, continuously reinforcing your CX vision and differentiation with your customers.

Analytics Within a Strategy

Customer analytics is not hype. Companies that leverage their data to achieve real insights can create a compelling customer experience and establish a huge advantage over their competitors.

You can’t simply throw analytics at a problem and think that a strategy will result. Operational analytics won’t generate true differentiation, and stand-alone moonshots are likely to disappoint.

But establish a clear role for analytics within a well-defined process of continuous CX improvement, and you can join the small group of companies that achieve transformational results.

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