Beyond the win: accessing the long-term benefits of CX
The profile of Customer Experience has risen rapidly over the past couple of years, it is now accepted business wisdom that good CX provides competitive advantage and with that has come widespread support for projects that target improved performance through a CX approach.
Marketeers and brand teams have generally been quickest to embrace the concept, leveraging positive customer feedback to win new business and improve the rate and efficiency of customer acquisition. But the real value of Customer Experience is in the ongoing relationship. It is the delivery of the promise, not the promise that should take precedence for businesses.
The major wins from CX are in the existing customer base, helping businesses increase life-time value of customers, reduce churn and drive customer advocacy through better relationships. These aren’t marketing KPI’s, these are the operational fundamentals for most businesses, underpinning the case for much wider ownership of CX, including at senior levels, within organisations.
Recognising the opportunity in CX is straightforward, delivering it can be more of a challenge. Moving from strategic goals to effective implementation throws up two major obstacles, co-ordination and, the nemesis of every company, budget.
Co-ordination is quite often seen as a facet of the budget challenge. Most businesses of significant size split responsibility for customer management over multiple departments. The end result often being that what sales and marketing propose and what product development, technical teams and customer support are able and/or willing to deliver can be at odds. As can the way that they communicate with and handle customers at different touchpoints throughout the relationship, the culture of each leaking into the customer experience.
The utopian vision of solving this problem, centralised responsibility for CX handing down specific and actionable direction from a board level CX authority (the CXO) who holds a budget fit to fund it all, is a pipe dream for most businesses. While it’s easy to identify the positives in such a set up, the reality is that funding and approval for establishing such significant change is difficult to achieve and the actual benefit for the company as a whole of passing responsibility in this way is questionable.
A more distributed model is achievable and doesn’t require sacrificing consistency, or excellence, in the pursuit of pragmatism. The foundation is a simple and easily applied set of CX principles, applicable across the business, signed off and signed up to by all departments.
This may seem as daunting a challenge as getting a CXO in place, but most CX improvements will have outcomes that directly align with department targets, priorities and requirements. Initial buy-in can meet resistance from those that perceive CX as a marketing fad, but achieving a company-wide approach is mostly about open dialogue, alignment and language. Advocates of a customer-centric approach can normally be found, or created, across functions once the benefits, and the reality, of better CX are described in language that resonates. As an added benefit, internal conversations that improve outcomes for customers often improve interaction between teams as well.
Budget can be a harder nut to crack, Customer Experience really is a durable competitive advantage, but to be successful the whole business has to support it. The best way to get that support is simple; prove that it works.
For businesses attempting to build enthusiasm for CX we believe the initial goal should always be a limited project, where benefits can be closely identified and therefore the beneficiary encouraged to find budget. Without a portfolio of projects that demonstrate success - getting a mandate for large scale CX projects, and structural change to support it, is generally an arduous process with no guarantee of success. In the time it takes to get board approval for a decent sized project half a dozen smaller projects could have been defined and executed.
So how could you approach this within a moving business, without necessitating a restructure or massive investment?
Start with knowledge
What is the current customer experience? You can’t improve what you don’t understand, even small scale qualitative research can drive significant insight. Map an existing journey, understand all the places where customers interact with you along that path.
Establish a multi-departmental team as your CX working group, start with understanding how CX impacts each team, establish principles of good CX for your business, agree what you are trying to achieve, meet regularly.
With a cross-functional team the customer journey map can be used to rapidly identify current areas where customers are frustrated, or opportunities for the business exist. It can be a long list, the goal isn’t to fix it all, but to find it all.
Where can you make the biggest impact for the least amount of internal disruption? What is driving customers away? Establish the priority opportunities and then establish a first project. Don’t go crazy, start small and measurable.
Identify a budget
Ideally the budget will come from the primary beneficiary. Often where budget is already allocated to tasks that can be ‘re-badged’ as customer experience, for example user guides or online resources, it’s easier to repurpose funds. This is especially true where the budget for these resources is held by operational rather than marketing teams.
Using your working group, get feedback across the business on the impact of changes, have sales increased? Have customer service calls decreased? Are technical teams seeing a difference in demands on them? Reinforce for the team and their departments that improving the CX helps everyone.
With each project a stronger case for prioritising CX is being built. Show the business it would benefit from a centralised CX lead and full time budget. This will be easier if the departments recognise the value to them and are willing to contribute, so it’s not new money.
When initiating a new CX function we encourage businesses to find the sweet spot between doing enough to generate valuable outcomes and overreaching with regard to budget and activity. With the right starting point it can be surprisingly cost effective to deliver significant impact and generate momentum and enthusiasm within the business as whole.