For decades now, companies have recognised that their customers are the most valuable asset and survival is dependent on acquiring and retaining these customers. Hence, in being customer centric, organisations focused their efforts in addressing customer needs. However, changing buyer behaviour and commoditisation have led companies to rethink how they can differentiate themselves. This shift has seen the emergence of Customer Experience Management (CEM). Even though many businesses see improving customer experience as a competitive differentiator, many struggle to formulate a strategic approach to deliver it.
Customer Experience Management (CEM) has been defined a number of ways. Gartner defines it as
“the practice of designing and reacting to customer interactions to meet or exceed customer expectations and, thus, increase customer satisfaction, loyalty and advocacy.” Bruce Temkin from the Temkin Group defines customer experience management as “the discipline of increasing loyalty by exceeding customers’ needs and expectations”.
At Resonate Solutions, we believe Customer Experience Management is a methodical approach used by companies to strategically manage all the interactions with its customer. Whilst systematically look to better those interactions by listening to the voice of the customer, acting on the customer feedback, discovering new insights and improving the customer’s experience. The outcome leads to increased loyalty and advocacy and ultimately top line growth.
Customer Satisfaction and Customer Experience
Delivering great customer experiences will create benefits for the company and contribute to its financial success. However, often organisations making the transition to deliver these experiences mistake being customer focused as customer experience management.
The notion of being customer focused normally is defined with the goal of satisfying the customer. To achieve this, the efforts are placed on market research to determine the needs and wants of the target market. Whilst neglecting the decision making process and the potential touchpoints between customer and the organisation.
As an added step, companies today are inclined to deploy complex customer relationship management (CRM) solutions to track and manage post sale interactions. While this is considered being customer centric, it is a reactive approach rather than proactive. The data captured is only through customer’s further engagement with the organisation.
As defined above, customer experience management is the process of strategically managing the touchpoints of a customer’s lifecycle with an organisation. Customer satisfaction is the outcome of a positive customer experience.
Customer Journey Maps
Creating Customer Journey Maps is the starting point to allow organisational leaders to visualise and storyboard the process a customer may undertake throughout its lifecycle. It is a fundamental step identifying each touchpoint between the customer and the organisation.
The process of Customer Journey Mapping allows organisations to fill in the gap between the customer’s desired experience and that which is currently being provided. Customer journeys can be complex, long and extended through multiple channels.
Net Promoter Score
The Net Promoter Score (NPS) has been a key measurement of a customer’s loyalty and advocacy. The simplest form of NPS measurement is by asking customers the ultimate question.
“What is the likelihood that you would recommend Company X to a friend or colleague?”
The answer is based on a zero-to-ten scale and then categorised as the following:
Promoters – 9 and 10
Neutral – 7 and 8
Detractors – 6 and below
To calculate the Net Promoter Score is simply the percentage of promoters minus the percentage of detractors.
NPS is a number that can be easily compiled, tracked and measured over time. The popularity of NPS is fostered by its simplicity and the correlation between potential organisational growth through word of mouth and advocacy. The NPS calculation is far beyond a percentage.