Forrester analyst Maxie Schmidt recently noted that for certain industries, “improving CX by one point can lead to more than $1 billion in additional revenue.” A Forbes article provided a more generic measure of customer experience impact that can be applied to all industries: "Companies with a customer experience mindset drive revenue 4%-8% higher than the rest of their industries." The author also noted companies known for leadership in customer experience tend to outperform competitors by almost 80%.
Building an effective customer experience practice is clearly important. But doing so isn't easy. It requires a holistic approach.
Balancing an External and Internal Holistic CX Approach
Companies looking to take a holistic approach to CX must consider the entire customer journey, across all channels and over time.
Imagine your company is a retailer with both an online presence and brick-and-mortar outlets. You broadcast an offer to your customers via email. A buyer is incentivized by your offer, and attempts to purchase items online using the offer's terms. But they run into a problem: the offer code isn't accepted online, and they have to call customer service to complete the order. Then, upon receiving the product, the customer decides to return it using the curbside return service offered at a brick-and-mortar store.
Throughout this process of purchasing and returning a single product, the customer interacts with your brand in a number of ways. Fixing the problems experienced throughout the journey is the responsibility of several different departments, each of which should be notified as necessary:
- Interactions with online systems (possibly both website and mobile app)
- Problems here should result in notification to web design and development teams
- The interactive voice response system
- Problems here should result in notification to the IVR team
- At least one customer service representative
- Problems here should result in notification to a customer care team
- Personnel involved with curbside return
- Problems here should result in notification to management of the physical store
Each touchpoint involves a different division and personnel team within the company. But the situation involves all of them. A problem with one can impact others. An issue with curbside returns, for example, may stem from some confusing online messaging.
And though there may not have been any internal touchpoints throughout this process, that’s not the way your customer experiences it. In fact, there should be an internal organization that focuses on the holistic customer experience, avoiding the siloed view that is typical of many organizations. Not only is a siloed approach traditional for many companies, it is often unintentionally incentivized by organizational standards. A team’s personal goals and related bonus structures, for example, can be organized in a way that tends to deflect efforts at collaboration.
3 Tips for a Successful Customer Experience Practice
Improving the customer’s experience depends on three key factors:
1. View the Entire Customer Journey and Experience
Analyze the experience from your customer’s point of view — when and how they interact with your brand — rather than viewing through the lens of your internal organization.
A great way to start with this step is by creating a separate customer experience practice, a team of associates who are as independent as possible from other teams. This team can then view the overall customer experience in a more unbiased manner.
2. Integrated Cross-Functional Programs
Members of the customer experience practice must foster relationships with other divisions and teams to roll out programs and processes that solidify a cross-functional collaboration. Ideally, each division and team designates someone to fulfill the role of a CX champion for the team. That individual then serves as a liaison and promoter of the collaboration within the customer experience team. The CX champion also promotes the processes and programs rolled out by the customer experience practice.
3. Engagement at all Levels of Your Organization
The collaboration described above requires engagement. And engagement must be an active pursuit at all levels. But, importantly, all levels must be involved in ways that are relevant for them (e.g. relay information relevant to them and their unique view of the holistic experience, and set goals that they can realistically achieve).
Though executive engagement can be promoted in a number of ways, an especially effective method is having execs experience “a day in the life” of a typical customer. This approach can shine a light on the actual customer experience, not just the ideal one. And ensuring that executives understand the link between good CX and positive revenue trends can be very helpful in securing executive buy-in.
May Not Quite Be Worth a Billion, But …
Depending on your industry, a revenue increase of more than a billion dollars per CX point may not be realistic. But, as the Gayle Kesten, managing editor of CMO by Adobe recently wrote, “Companies that prioritized and effectively managed customer experience were three times more likely than their peers to have significantly exceeded their top business goals in 2019.” So, by building a holistic customer service practice, perhaps your company will be one of those for 2020 and beyond. Or maybe you will bump that revenue up by a billion dollars.
That high number (or anywhere in between) would be worth the effort, wouldn’t you agree?