Analyst Perspectives

During this year talk has been widespread about the customer experience, which is good. What is not so good is that, according to my benchmark research into next-generation customer engagement, most companies still struggle to deliver satisfying experiences. However, the research and my discussions with users and vendors lead to some clear conclusions:

• Consumers have changed the way they communicate with each other, and this has changed how they expect to engage with businesses.
• Customer expectations have elevated. Many want engagements to be EPIC: that is, Easy (at the time of their choice, through channels of their choice and easy to use technology), Personalized, in context (recognizing the state of their relationship and previous interactions with a company) and Consistent (providing the same information regardless of channel).
• Organizations must support multiple channels of engagement or risk losing customers as found in our research ranging from telephone (94%) and email (92%) to mobile (29%).
• Multiple departments engage with customers, but their responses often differ because not everyone has the same objectives or customer information.
• Organizations strive to improve customer satisfaction but inefficient processes, inadequate people skills and cost constraints often get in the way.

These points and others were raised recently at the 2014 Customer Engagement Summit in London. Keynote speaker Louise Cooper, a noted financial analyst, columnist and broadcaster, related a personal experience that illustrated what can go wrong with the customer experience. In purchasing 10 new coats at a well-known retail outlet, apparently she upset the checkout assistant by “creating too much of a draft” as she placed the coats on the counter. The assistant, seemingly out of spite, dropped each coat on the floor as she bagged them. When Louise got home, she discovered that the coats were dirty, and hereafter the process broke down: She received no response to email complaints, and despite promises of action by customer service, none was taken. The situation was resolved to a degree only after Louise tweeted to her half-million followers; an executive picked up the issue and had 10 new, clean coats delivered. This led me at the time to tweet that it is so easy for people and process glitches to nullify the best-laid customer experience plans.

The theme of how people impact the customer experience continued during the sessions. Several speakers insisted that employee engagement is paramount to delivering superior customer experiences; this point was illustrated in my benchmark research into the smart agent desktop, which shows that very happy contact center agents twice as often meet their targets for customer satisfaction and net promoter scores as do less satisfied ones.

The challenge as I see it is to think in four dimensions:

• One is the customer business journey. Customers have different needs, wants and expectations as they move through the process of finding products or services, buying their selections, looking for help in using the product or service, and getting support if things don’t go as smoothly as they expected
• The customer engagement journey requires understanding of how customers engage with an organization at different points in the business journey, including the communication channels they use for each type of issue, how they move from one channel to another if they don’t get resolution in the first, times at which they engage and outcomes.
• There is also an internal journey. It requires understanding which lines of business engage with customers at different points in the business and engagement journeys.
• The product or service journey involves how customers engage with an organization for different products and services, and how that varies depending on the nature of each.

Ineffective technology also gets in the way. My next-generation customer experience research also yields insights into why systems hinder organizations in delivering superior experiences, particularly these:

• 49 percent struggle to integrate the systems required to support the customer experience.
• 47 percent have multiple channels of communication, but most are managed as individual systems.
• 33 percent said that responses differ depending on who the customer interacts with.

A further complication is that technology is changing at an unprecedented pace. We live in a digital world dominated by the use of smartphones and tablets. We live in a time deficient world so again everything seemingly needs to happen in real time and often while the customer and/or the employee is on the move. Consumers are becoming more social so companies need to take into account the impact any one tweet out of the billions might impact their business. Consumers are also becoming more trusting in self-service technologies so many more are happy to solve their issues using voice activated technologies, including virtual agents. And the recurring revenue business models is changing some one-off purchases into longer-term subscription services.

The issue for customer service organizations is how to keep up. Many recommend adopting a more customer-focused culture. My view is that organizations need to manifest a change of culture in the four interconnected dimensions Ventana Research tracks: people, process, information and technology. As the example above showed, under-motivated people can destroy the best-laid customer experience plans. Organizations have to get hiring processes, onboarding and quality monitoring right, and support employees with training, coaching and suitable technology so they can deliver superior customer experiences. As organizations rethink their engagement processes, I suggest starting with the four journeys described above. Map what is happening in each journey, decide how you want it to happen in the future, put in place programs to make it happen and then repeat the process. One of the major determinants of the success of any business activity, and customer experience is no different, is the metrics you use to assess and monitor success. My research into next-generation customer analytics shows that customer, interaction and customer journey analytics can help companies deliver on key objectives such as improving the customer experience (55%) and gaining better alignment across business units (51%). However, the research also finds a gap between what is important to most companies and what they measure. They care about customer-facing metrics such as customer satisfaction and net promoter scores, but mostly they measure operational metrics such as average handling times and hold times. Find a balance between the two and the impacts one might have on another; for example, sales conversion rates might increase call volumes and decrease satisfaction because customers weren’t fully informed at the time of the sale. These days making any serious change involves investing in new technologies, even if it is only to process the huge volumes of data now being generated. So take time to investigate new technologies such as mobility, cloud-based communications infrastructure, workforce optimization, smart desktop technologies and above all analytics; each of these can help support new customer experience strategies.

Harvard Business Review recently pronounced that “companies should stop trying to delight customers,” which caused a stir. Its research shows that little business benefit to be had from delighting customers, but there is a fundamental need to get the basics right. I couldn’t agree more. At a time when trying to compete on product, service or price has become increasingly difficult, what counts is the customer experience. Several consumer research studies show that customers who receive satisfying experiences will stay loyal and buy more products or services, but getting it wrong even once can lose a customer and damage a company’s brand via social media. To attract and retain customers, their experiences must be EPIC (see above for definition). To survive in today’s business world, seek convergence of the four journeys described above, and align your people, processes, information and technology with them.

Regards,

Richard J. Snow

VP & Research Director