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Table of Contents
- Customer Experience and Consumer Experience
- Importance of Excellent Customer Experience Management
- Guide to Creating a Great Customer Experience Management Strategy
- Conclusion and Takeaways
Bain & Company asked companies to rate the quality of their customer experience, finding out that 80% of companies believed they are delivering a superior experience. In comparison, only 8% of customers believe that they were receiving great customer experience. It seems like companies, in reality, are blind to the actual results of their customer experience management strategies, and this can potentially result in long-term negative business consequences. The quality of customer service forms the face of the company, which is the first point of contact between customers and companies’ employees. Companies that implement a strong customer experience management have tended to reap very good rewards. That is, a company can potentially convert dissatisfaction and indifference to conviction or great satisfaction with the company’s customer service; this leads to, for example, potentially increased lifetime purchase value of clients, improved rates of referral from current clients, and growth in both sales revenue and market share.
Customer experience versus Customer Service
a. Difference between Customer Service and Customer Experience
To better understand the specific difference between customer experience and customer service, we can differentiate these two concepts by characterizing customer experience as an inward perspective of the customer, while customer service is the outward force that influences inward perspective of the customer. That is to say, customer service can contribute to the customer experience, but not vice versa. A company can make the customer experience excellent by not only providing great customer service, but can also provide other services such as user-friendliness of B2C interface (e.g. a software portal or a convenient online marketplace etc.). In simpler terms, customer service is the first moment in which they come into the contact with the company by interacting with an employee. This can happen either within a retail location, over a phone call, or through an online chat or calling platform or software. However, customer service is only one component of customer experience.
b. What is Customer Experience?
Customer experience covers not only customer service’s component of person-to-person interaction, it also covers the general experience of purchasing, selling, owning, or acquiring information about the product or service of the company.
c. Examples of Excellent Customer Experience
For example, the use of technology provides new and unique ways to communicate with and providing information to customers. An instant chat feature on the website, 24/7 hotline via both Skype or phone hotlines, and multiple payment methods which includes modern payment methods like AliPay and PayPal can improve the customer’s experience of purchasing the good or service. In addition, the user-friendliness of a website can provide ease for customers to search for product or service information – if presented effectively, even the user-friendliness to search for and readiness of information can lead to continuous successful sales.
Another example of providing effective customer experience is the use of both CRM software and predictive analytics. The use of CRM software can help to record customers’ purchase history by storing all relevant data points about the purchases. Predictive analytics software can then leverage the database of the CRM software to predict customers’ future purchases. Such predictive capabilities can help to project seasonal trends in general purchases, providing and suggesting related products based on the purchase history, and develop and implement target email marketing campaigns. More importantly, predictive analytics can provide an improved customer experience as customers can purchase what they want more easily and make faster decisions.
A company that has successfully re-invented the notion of an excellent customer experience management strategy is Google. With the release of the Google Pixel phone, the company understood that a majority of the mobile phone market share has been largely saturated by Apple and Samsung. In order to provide a smooth transition to their product, they provided Apple and Samsung cable adapters that allow the user to easily transfer data to their new Pixel phone. No external software for transferring of data is necessary as this is already installed into the Setting Up process the moment the Pixel phone is switched on. Google also understood that Apple reinvented Customer Experience by being arguably the first tech company to offer a retail location that sells its devices, and hire representatives that service and help individual customers rather than forcing them to queue and wait for their turn. However, Google also understood that not many people may have the time to drive or take transit to retail locations to get help. Hence, Google introduced a 24/7 help desk within the Pixel’s phone’s settings that allows the user to type in their problem, and a Google tech representative would call within the hour or so to troubleshoot the problem. This means that the user can get help from Google’s professional team from the comfort of their own home, office, or wherever the user may be.
Another company that has become a signature organization for implementing an excellent customer experience management strategy is Nordstrom. Nordstrom’s stores tend to be nicely lit and well-designed; salespeople solicit the retail space without being obsequious or interfering with the customer’s sense of space. This is because Nordstrom’s entire ethos is to make a present, enjoyable experience for the customers, which is felt both on Nordstrom’s website and online channels - not just the experience of shopping at the retail stores. There is a consistent customer experience strategy across all mediums. Nordstrom also closely monitors customer feedback. For example, in 1975, a man pulled up to a store with four snow tires in his truck. He bought the tires at this location a few weeks ago and needed to return them. Unbeknownst to him, the tire shop had closed, and Nordstrom replaced the tire shop. After explaining his situation to a sales clerk, Nordstrom allowed him to return the tires and refunded his money. Another example was when Kenneth J. Worzel, executive vice president of strategy and development at Nordstrom, told the authors about a woman who had tweeted about a blazer problem that came up as she made a return trip to her home in Seattle.
The tweet: “Good news is I bought this great blazer in Portland. The bad news is there is a sensor left in the jacket.” The social media team at Nordstrom found the tweet, contacted the customer, and actually sent a person to her office to remove the sensor tag. From these stories, we can tell that Nordstrom is not committed to financial markets, real estate markets, or profitability, but rather solely customer service. Nordstrom empowers employees and creates policies that encourage doing the right thing for the customer - going above and beyond to take care of customers is expected, encouraged and praised.
Importance of Excellent Customer Experience Management
One survey conducted by Bloomberg Businessweek determined that “delivering a great customer experience” has become a top strategic goal, and a recent Customer Management IQ survey showed that 75% of customer management executives and leaders rated customer experience a “5” on a scale of 1 to 5 (5 being the highest importance). Based on other research reports, of 860 corporate executives who increased their investment in customer experience reported higher customer referral rates and customer satisfaction (Strativity Group, 2009), and such a strategy eases customer acquisition, drives customer loyalty and improves customer retention (Beyond Philosophy, 2013).
Guide to Creating a Great Customer Experience Management Strategy
a. What is the Vision of Customer Experience?
The company must first develop a clear and implementable vision for its employees. That is, a set of statements must be established and written as guidelines for its employees. Such a vision should tangible enough to drive the behavior of the organization. The company must also never forget to put the objective of excellent customer experience to be the forefront of designing any vision statement(s). Nonetheless, the tangibility of the vision will depend on exactly what objectives must when implementing a great customer experience management strategy. Potential objectives can include a focus in either of:
- Loyalty of customers (renewals such for SAAS products, the redemption of loyalty points programs)
- Increased Social Media interaction (e.g. more likes on Facebook or more subscriptions and views on monetized YouTube videos)
- Providing added value by innovating new products or systems (e.g. the car industry wherein customers continually see demonstrated value that is different from its competitors such as Tesla)
- Emotional connection (e.g. heroic stories by representatives and employees of the firm such as Nordstrom)
b. Understand the Target Audience
The next step is to know and understand who your target customers are. Every vision can be interpreted quite broadly. Hence, a specific profile of the company’s target customers must be fully understood so that employees can empathize with their problem(s) and provide the company(s)’ solution effectively. In order to better the target customer, a few features can help:
- Social considerations. For example, customers can be analyzed by analyzing their demographic breakdown of the customer base (e.g. consider age groups, ethnic groups, geographic origins)
- Psychological and Character considerations. Understand the target customer’s mindset e.g. if they have a preference for traditional vs. disruptive products or services and their emotional or mental preferences
- Economic (and financial) considerations. We can also consider occupational-specific considerations (e.g. income level, management level of occupation, industry or sector commonality of job)
c. Create a Genuine Experience with Customers
At Nordstrom, many heroic stories have been told about how representatives at retail locations have helped to make personal urgent reservations of dresses for their customers’ wedding date or running to return a customer’s wallet despite the customer having just left the retail store. It is these moments of corporate heroism and personal sacrifice that become a story told by many loyal customers. Once the company has understood the profile of its customers, employees should dedicate their corporate life to serving customers to ensure an excellent experience. Building an emotional connection helps to bridge the psychological gap between a potential or current customer with the vision of the company. In order to ensure a genuine and positive experience with customers, the customer support team can follow these guidelines:
- Ensure a positive attitude. Always be eager and happy to support and help customers as this can build a long-term relationship with every customer. Goodwill from employees can help customers believe that they can always trust the company to have a positive experience, thus enhancing the psychological and emotional satisfaction of customers.
- Always actively listen to customers’ issues. When communicating with a customer, always verify and clarify what the customer is saying about an issue before providing a solution. A customer will become very frustrated if he or she has to repeat his/herself as a result of the employee not listening or due to time lags and elongated waiting time periods
- Remember that customers are not always happy. Many times, this is due to the customer’s own life events and has nothing to do with the customer support representative. Nonetheless, the employee must remain professional and keep their objectives in mind to resolve any issues brought up.
- Be honest when the company makes a mistake. When issues arise as a result of the company’s mishandling or misinformation, admit that the company has caused the problem and professionally provide a solution positively and directly. Responsibly acknowledge the customer’s frustrations without criticizing the company. The representative is responsible for creating a positive image of the company for the customer.
- Find solutions that yield a win-win strategy. Customers sometimes interpreted or acquired information mistakenly and that is natural for many people. Be careful to not blame them for this and treat them to a positive experience with the customer support team.
- Verify the validity of a solution. Ensure that the representative’s suggested solution is in line with upper management to ensure that the company as a whole sends a consistent message to all of its customers to ensure effective customer service.
- Resolve the issue. Ensure that the solution promised to the customer is executed completely. While doing so, always ensure that the customer is informed of the process and make sure to follow-up with the customer to confirm their satisfaction with the final solution.
- Outperform expectations. When representatives outperform their customer’s expectations, customers tend to be in awe in this creates a sense of admiration and loyalty to the brand.
- Always thank customers. Customers should be treated as valued partners in your company’s capacity to achieve its strategic goals.
- Provide basic customer service consistently. If the greeting is part of the business model, ensure that customers are always greeted warmly the moment they enter the business. This can be done either online with a welcome message, or at a retail store with a greeting representative at the front of the store. Maintain an upbeat and excited mood so that customers feel welcomed.
- A consistent message across the organization. Whether the employee is in a customer facing or non-customer facing role, every employee must understand the company’s objectives and values concerning customers.
d. Real-time Customer Experience Metrics
A 2011 Harris Interactive Survey found that a whopping 86% of consumers are willing to pay for “better” customer experience. This means that it pays to acquire real-time customer experience metrics, for the benefits of both customer
The collection of real-time customer experience metrics means that customer data is collected whilst communication is simultaneously happening in order to catch negative and positive trends as they arise. Data needs to be aggregated across customer touch points including chat logs, emails, call center recordings, social media comments/interaction, how they respond to promotions and more. For example, relatively insignificant things such as a shipping glitch from the head office can be identified and addressed quickly while significant issues such as the real-time assessment of inventory of an entire product line is being checked to ensure inventory does not enter dangerously low levels – which will then trigger alerts for the relevant personnel to quickly replenish the inventory. With this type of software in place, the company can make business decisions swiftly, which can improve and develop smarter sales cycles and, more importantly, enhance customer experience by ensuring the smooth and optimal customer experience. The power and effectiveness of such predictive analytics and real-time assessment software are only as good as the data it gathers. Hence, it is important to ensure that the software or provider which the company intends to work with has top-notch data centers, well-maintained data servers, and strong predictive and effective algorithms. Even with good data and effective predictive technology, the objective of real-time customer experience analysis must begin with the right questions been asked. This means good training of staff and effective feedback from employees – which shall be covered in the following sections. Customer support quality can be improved by analyzing individual representatives or a team of representatives’ activity. This way, the company can track on real-time and analyze individual representative’s performance and identify top and worst performers. The following are examples of methods to collect real-time customer experience metrics: Customer Satisfaction Surveys are the industry standard to collect data on customer satisfaction or without follow up questions. Samples of such surveys include:
- In-App Surveys. Companies can subtly request for feedback inside a website, with one or two questions. Because of this low number of questions, response rates are generally highest. Simple questions that use metrics like NPS or CES are preferred. Examples of in-app customer surveys include Floq and SurveyMonkey.
- Post Service Surveys. Companies can focus on the customer’s satisfaction with a specific service he or she has just received. while it remains fresh in the customer’s mind. This can be done in an email that contains a rating link, or during a live chat with a rating view that appears after the chat session. It can also be done via a phone call but might be problematic in terms of time spent by the customer and the customer’s belief that the answers are unfiltered.
- Email Surveys. In-app surveys and post-service surveys are inadequate for detailed insights about your customer satisfaction. Email surveys can provide in-depth information about the customer experience. Although they generally have low response rates (10% - 15%, according to SurveyGizmo), they nonetheless allow customers to take their own time in answering multiple questions. Google Forms is an excellent free tool.
Social Media Monitoring Social media in the modern world plays a very important role in the relationship between business and customer as it offers an outlet and reaches to potentially millions of people. Social media monitoring can help to track what customers say or think about the company. Relevant platforms include Facebook, Twitter, Quora, Yelp, TripAdvisor, etc. Some helpful tools:
- Google Alerts. This Google service has notifications when the company’s brand appears in a prominent position on its search engine.
- Mention. This freemium tool alerts the company whenever their brand is mentioned on the web. It is useful for social media tracking, in which Google Alerts cannot do.
- Socialmention. This free tool analyzes social mentions of the company’s brand on the web. It shows the likeliness of the brand being discussed on the web, the ratio of positive to negative mentions, the likelihood of people mentioning the brand repeatedly, and the range of influence.
e. Training of Customer Support Team
Once real-time customer experience metrics are captured, the company can analyze the data and understand what customers think about the quality of your service compared to the customer experience principles the company has defined. The next crucial step is to then design a structured trading program to identify and meet the needs of the customers by addressing the concerns and weaknesses of each individual member of the customer support team. Training requires a systematic methodology, process, and undying discipline. Many corporations assess the quality of phone and email communication. However, an excellent strategy goes beyond just an assessment using the feedback to schedule and track the teams’ development through coaching, eLearning and group training. The best corporations their value propositions by focusing the entire company’s employees on delivering them with an emphasis on cross-functional collaboration. For example, the marketing and supply chain departments cooperate closely to ensure a smooth alignment of the entire customer experience strategy. That is, together, they deliver a consistent value proposition to their customers. In summary, Adam Feigenbaum from iCIMS suggests these tips;
f. Support Team feedback
Gathering customer experience metrics on real-time and training the customer support team is only one side of creating an excellent customer experience management strategy. The other side includes gathering employee feedback about the training program, and their experiences with customers. Relying on annual feedback from employees may lead to forgotten information and unintentional curation of wrong or misleading information due to the potential human memory lags. This can lead to wrongly skewed information about customers and lead to the development and implementation of training programs that do not, in reality, cater to the specific demands and needs of customers. However, requiring employees to take daily or weekly feedback forms can be tedious and unnecessarily costly. Using modern technology, companies can instead use project management software or social media tools such that communication between employees and customers and within customers can be extracted as data and even automatically analyzed by predictive software to produce meaningful real-time analytics and feedback.
g. Measuring ROI
Net Promoter Score, or NPS, is a score rated by customers to determine to what extent they would recommend a customer support team member. NPS is a suitable benchmark for a customer experience metric because many companies use it as the standard customer experience measurement. This is also very easy to implement and measure makes the NPS a favorite with many companies and executive directors. Other software tools can too help measure ROI and they are as follows and Client Heart Beat compares this software: Companies should also collect the following information to determine the quality of their customer experience management strategy:
- Backlog. If the representative has too many open cases relative to closed cases consistently, based on historical records, then the representative is likely nor being proactive enough.
- A number of cases taken on. Are the cases allocated equally among representatives? Is one or a few representatives taking more than they should?
- A number of cases resolved. If the representative has resolved multiple cases, this tells the company that he or she is very efficient at providing resolutions.
- Resolution time. If a representative tends to take longer than average to resolve a case, then the company has identified a bad performer, and more training should be provided.
- First Contact Resolution. If a case is swiftly resolved in one response, this means that the representative is efficient in first knowing frequently asked questions, and implementing them effectively. Representatives should ideally have access to a database of FAQs to ensure long-term effectiveness.
- Frequency of submissions. If similar customers frequently submit cases that require resolution, a team may or may not have the resources to resolve them. Resources need to be deployed to ensure that customers do not frequently have problems. This can be done by providing customers Help manuals, change the platform to help customers navigate for information more easily, and perhaps even hire more members to the particular team.
- Submissions based on time period. Do certain kinds of submissions of cases tend to occur at a certain time of the year? Perhaps shift rotations are required by representatives. Also, if similar cases tend to always arise at a specific time or date, then the company should consider changing its product or service as this might be an overlooked systemic issue.
- Cases ranked by date, effort, and response time. This allows representatives to understand which kinds of cases tend to require higher priorities, and they can determine which is of higher ‘value’ in terms of those needing more attention that average.
- Account specific summary. By tracking the number of case submissions relative to their account’s value, the company can determine which accounts tend to be more active and which accounts are at higher risk of closing. That is, if an account that is active and has a higher than average number of case submissions, representatives show pay more attention to such accounts.
- Turnover rate. By tracking the number of customers that closed their accounts, we can determine the total quality of customer experience. The company can also determine if the turnover rate is sustainable or not – if not, systematic solutions must be brought to light and resolved soon.
- Customer Satisfaction Score. Whenever a case is marked as resolved, the customer should receive an automated reply to voluntarily provide a score to rate his or her satisfaction on the representative’s service. If a type of service frequently received a bad score, the company should determine if additional training is required for the particular type of issue of interest.
- Net Promoter Score. Collecting data on whether a customer would recommend the company to their friends or colleagues, expressed as a percentage, can provide information on the quality of customer service from the support team. Additional training may be required if the score tends to continuously decrease with time.
- Customer Effort Score. Collecting data as a measure of the number of effort customers used interacting with representatives can provide insight into whether the support team is putting effort into resolving cases, or are they overly relying partly on customers to pay effort.
Conclusion & Takeaways
Companies are often mistaken by their own customer experience management strategy as excellent, while customers often believe otherwise. If companies remain myopic about this discrepancy, long-term business effects may be in the likes of reduced growth or even sales revenue. Hence, it is very important to create a systematic and excellent customer experience management strategy. Companies must define clearly the difference between customer service versus customer experience. Once they understand that they are different, they need to also need to observe samples of excellent customer experience strategies at work in reality in order to get a sense of what an excellent strategy looks like and how they operate. Once the company understands the value in creating a systematic customer experience management strategy, the company must go about implementing such a strategy through a step by step process. The process first involves defining the vision and objectives of the customer experience management strategy. The company will then have to determine, analyze, and build a common profile of their target customers before determining how to create a genuine relationship with its customers. In doing so, the company can further analyze their strategy by tracking real-time customer experience metrics and use this database to construct specific training programs for their support team(s). Such training programs will then provide the company with the support team’s feedback, thereby creating a positive feedback system. Of course, to determine the true effectiveness of a customer experience management strategy, the company must define systematically measure ROI by using, for example, customer satisfaction scoring systems.
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