Customer experience has qualitative and quantitative returns, as I will discuss next month at Forrester’s Business Process (BP) Forum. For a detailed discussion of customer experience optimization, also take a look at this recent Forrester report that I authored. You can measure the qualitative business return on customer experience in, dare I say it, love. Hopefully, your customers love the multichannel experience you provide, and, as a consequence, seek to deepen and extend the relationship. The concomitant of that is the quantitative return, summed up by a single word: money. If you’re making customers happy, hopefully that translates into sales, profits, renewals, referrals, and other bottom-line boosts.
That’s all well and good, but how can you directly translate love – i.e., quality of experience – into money, measure the impact, and calculate the return on your investment in experience-boosting technologies?
CRM next best action platforms are the key to realizing this promise. CRM next best action environments shape experience through embedded analytics that guide all interactions and offers across all customer-facing channels, processes, and roles. In addition to predictive analytics and business rules management systems, enterprises often incorporate into their next best action initiatives such experience-boosting investments in decision automation, sentiment analysis, conversation management, dynamic case management, knowledge management, and social networking.
The next best experience should be the one you deliver to a customer who is delighted by your apparently seamless ability to deliver continuous satisfaction within the context of their unique needs and preferences. In addition to targeting offers and improving customer loyalty, CRM professionals should be using next best action technologies for proactive satisfaction initiatives. For example, many companies use this technology to identify burning issues and automatically escalate them to customer service reps that can respond to issues and defuse them before they become showstoppers.
How do you measure quality of experience? Customers may articulate it crisply in words, but don’t count on it. Often, they express quality of experience through their actions. Here are some indicators, in terms of concrete words and deeds that that you can measure to gauge the bottom line impact of your CRM next best action initiative:
- Do customers find it satisfying enough to stay in the relationship?
- Are they renewing, extending, and deepening the relationship because you offer new ways for them to satisfy themselves?
- Are they enjoying the relationship enough to tell the world, or at least their friends and family, about the value they’re receiving?
- Do they respond and accept new offers rapidly?
- Do they visit one or more of your channels frequently?
- Are they able to find and purchase what they need rapidly through your channels?
- Are they recommending and influencing other people to become customers, stay with you, and/or extend and deepen their relationships with you?
Many of these indicators have a strong direct or indirect impact, aka “lift,” on customer lifetime value (CLV). But this isn’t cheap. To the extent that you attempt to achieve marginal gains in quality of experience through costly investments in new technologies, you may be adding to your overhead and thereby eating into your ROI. Your costs will also increase as you recruit and cultivate the requisite customer experience “domain experts” to maintain the data structures, statistical/predictive models, deterministic business rules, and other “decision logic” needed to power all of these components of a next best action initiative.
I look forward to hearing what you have to say about this. Please respond to this blog and come to my session in Boston on September 23.
This blog originally appeared at Forrester Research.
Unfortunately, companies too often anchor the customer experience in their customer relationship management (CRM) systems. Millions of dollars/euros are poured into technologies that organize, automate and synchronize business customer service processes. The goals are certainly noble - winning new customers, nurturing and retaining existing customers, enticing former customers back into the fold, and reducing the costs of marketing and customer service.
But what about the touchpoint?
In our experience what is overlooked is the actual customer service representative, the agent, the actual human being charged with solving customers' problems and making them happy.
Customer service agents are asked to do more and more with a phone call, email or chat because they have more technology than ever available to them. Unfortunately, what has not changed very much over the years is the nature of the training customer service agents receive.
Call center training is almost always administered in silos. For example, companies often begin training their agents in the systems silo - here's our CRM and how it works, this our pricing system, here's how to operate the billing system, etc. Then the company moves on to the product silo - here are our products and their features, here's how they work, etc. Once the systems and products pieces are finished, companies add a dash of customer service training from the soft skills silo and...Voila! The agent is placed on the floor with a headset and keyboard and expected to connect the dots.
Where technology and traditional methods of training fall short in the customer service world is a focus on the behavior of the agents during the customer touchpoint. The skill set required for customer service agents and other customer-facing employees to create sustainable customer loyalty and drive loyalty metrics (for example, NPS) has changed. Companies must train agents, and agents must learn, how to have a new and more value-driven conversation with the customer.
Technology can assist in making the new conversation effective but cannot serve as a substitute for loyalty-building agent behaviors.
So is it the car (technology) or the driver (behavior) that wins the race? I suggest to you that it's the right agent behaviors, together with the supporting technology, that will truly raise a company's ROI on customer service.
Jack Dempsey Principal, Pretium Solutions