Kathy Gibson is at Gartner Symposium in Cape Town – Improving customer experience is all about delighting the customer with innovative new programmes based on careful research and metrics, right?
Wrong, says Ed Thompson, vice-president and distinguished analyst at Gartner. These three premises, which most companies accept as fundamental truths, are going to propel your company into the top ranks when it comes to customer experience.
“We are saying, no, you don’t want to do these things,” Thompson says.
His list of what not to do starts with the old chestnut: delight the customer.
Instead of delight, companies should aim to be effortless, he explains.
Studies have shown that the correlation of satisfaction to profit grows at a faster rate if a company is easy to do business with.
In fact, says Thompson, delighting the customer only has a 16% chance of any return on investment (ROI).
“You need to ask the question: how much effort did it take to achieve this? If it’s less effort, people tend to be more loyal.
“You get massive reward for meeting expectations; but you don’t get much more reward if you delight them – although it costs a ton of effort and resource to delight the customer.
“Rather focus on meeting expectations and you will have a better ROI.”
Thompson adds that many organisations are inconsistent in the delivery of their customer experience strategy.
“While they are aiming to delight in one part of the organisation, they still require effort from the customer in another part. We recommend that organisations don’t delight, but rather focus on being effortless.”
Innovation is the buzzword of the moment, but is not the best strategy to use in customer experience. Thompson’s advice to companies is: don’t innovate – imitate.
“When it comes to customer experience, innovation tends to be a copy of something that’s been done before in another country or another industry,” he says.
“Over and over again, we find companies that imitate are successful, and fast followers tend to do better than innovators.”
The time to innovate, he believes, is when you have reached the pinnacle of customer experience achievement. “If you are the best in the world and there is nothing else to imitate, then go for blue sky.”
Information overload is a reality in most aspects of our lives and this holds true in the customer experience field as well. “We see people gathering data, and correlating data, looking at patterns and making assumptions,” Thompson says. “We see that a lot of mundane things are getting done, but not really much to improve the customer experience.”
He advises them to stop correlating all the data and rather focus on helping jobs to be done.
“You need to know what it is that the customer wants done, what it is that they want to achieve. It’s about knowing causality, understanding not just the customer’s journey but the jobs that need to be done.”
Gartner research has shown that adding numerous channels and options to make things better for customers has the opposite effect — it makes the customer experience worse.
“Organisations are better served by understanding what customers are trying to achieve rather than monitoring demographics or psychographic information,” says Thompson.
“Rather than just looking at studying customer data, you need to examine the needs that arise during your customers’ lives.”
Despite busting these popular myths, Thompson stresses that customer experience is a goal worth striving for.
“Organisations with superior customer experiences tend to appoint a leader, their executives are committed to the initiative, and they have a small dedicated team with 12 direct reports on average,” he points out. “They also involve a broad range of departments from marketing and sales, to supply chain, IT, R&D and HR.”
Being in charge of customer experience isn’t a job for the faint-hearted, though. Thompson says customer experience leaders have a 40% chance of losing their jobs within 18 months.
“The main thing is to use facts. You need to have a holistic view of customer feedback to make sure you have a degree of clout. And you have about 18 months to get this right or you are toast.”
While most companies say customer experience is very important, when it comes to spending money, they prefer to invest in activities that show a demonstrable ROI.
“There is normally a lot of enthusiasm to start with, but finance wants to have a proven ROI,” Thompson points out. “You can measure this stuff, it is just hard.”
First prize for customer experience is for it to be central to the corporate culture.
“Culture is the big thing,” says Thompson. “Just tacking on compensation relating to customer experience doesn’t help. Compensation tied to culture is important, but its complex and quite subtle.”