NILF 2014: The Path to Customer Experience Maturity: Craig Menzies, Principal Analyst, Forrester

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Text of NILF 2014: The Path to Customer Experience Maturity: Craig Menzies, Principal Analyst, Forrester

  • The Path to Customer Experience MaturityinThe Age of the CustomerCraig Menzies, Principal AnalystServing Customer Experience Professionals

    Twitter: @craigmenzies, @forrester, #NASSCOM_ILFMy CX blog: http://blogs.forrester.com/craig_menzies12th February, 2014

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    Why should we care about customer experience?

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    How customers perceive their interactions with your company

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    EnjoyableEasyMeets Needs

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    Willingness to consider for another purchaseLikelihood to recommend to a friendLikelihood to switch business to a competitorCustomer experience correlates to loyalty

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  • 1960 - 19901990 - 20102010 +Sources of competitive advantage change over time

  • 1960 - 19901990 - 20102010 +Age of ManufacturingAge of DistributionAge of InformationSources of competitive advantage change over timeSources of Dominance

  • 1960 - 19901990 - 20102010 +Ford, RCA, GE, Boeing, P&G, SonyAge of ManufacturingAge of DistributionAge of InformationMicrosoft, Dell, Google, Capital OneWal-Mart, Toyota, UPS, CSXDominant CompaniesSources of competitive advantage change over timeSources of Dominance

  • 1960 - 19901990 - 20102010 +Ford, RCA, GE, Boeing, P&G, SonyAge of ManufacturingAge of DistributionAge of InformationMicrosoft, Dell, Google, Capital OneWal-Mart, Toyota, UPS, CSXDominant CompaniesSources of competitive advantage change over timeSources of Dominance?Age of the CustomerContenders include Southwest Airlines, USAA, Amazon,

  • A 20 year business cycle in which the most successful enterprises will reinvent themselves to systematically understand and serve increasingly powerful customers.The Age of the Customer

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    My Buying Criteria:

    My friend was selling it (proximity)I could afford it (price)I hadnt heard anything bad about it (information)It was on the cover of a magazine (media)

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    Detailed specsModel comparisonsTrusted reviewsBest place to buyBest price to paySpecial offersBest insurance dealsOwner opinionsMaintenance historyAccessoriesUpgradesSocial eventsWhere to rideEtc, etc, etc, etc

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    So how does one do customer experience?

    Khumbu Icefall

    Lhotse Face

    47%Differentiate the company from leaders in their industry13%Differentiate the company from leaders in ANY industryBase: 100 customer experience professionals (percentages may not total 100 because of rounding) Source: Q4 2012 Global Customer Experience Peer Research Panel Online Survey

    47%dont measure customer experience quality

    79% dont train employees on how to deliver the target customer experience

    Low customer experience maturity

    Customer Experience MaturityThe extent to which an organization routinely performs the practices

    The extent to which an organization routinely performs the practices required to design, implement, and manage customer experienceCustomer Experience Maturity

    The extent to which an organization routinely performs the practices required to design, implement, and manage customer experience in a disciplined way. Customer Experience Maturity

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    RepairElevateOptimizeDifferentiate

    RepairElevateOptimizeDifferentiate

    Repair Phase Key ActivitiesIdentify bad experiencesPrioritize fixesCoordinate implementationMeasure results

    2008 CXi Wireless Carriers

    RepairElevateOptimizeDifferentiate

    Elevate Phase Key ActivitiesDefine a customer experience strategyShare customer insights with all employeesCreate a consistent, companywide customer experience measurement frameworkStart following a human-centered design process

    Edward Jones CXi Score 2011 2013

    RepairElevateOptimizeDifferentiate

    Optimize Phase Key ActivitiesModel the relationship between CX quality and business resultsBuild strong experience design practicesSharpen employees CX related skills through targeted trainingEvaluate employee performance against role-specific CX metrics

    Let personality shineProvide optionsHelp guests feel comfortable in public spaces

    Systematic customer experience training

    Six months beforePre-reno11 days before3 months after re-opening

    Courtyard by Marriott CXi Score 10 13

    Courtyard by Marriott CXi Score 10 13

    RepairElevateOptimizeDifferentiate

    Differentiate Phase Key ActivitiesRe-frame customer problemsReveal unmet customer needsRe-think the entire CX ecosystem

    Car loansMortgagesInsurance

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    USAALead over next highest brandBanks85+7Credit Card Providers82+7Insurance Providers83+9

    How do you get started on the path to CX maturity?

    The Experience-Driven Organization PlaybookMay 2012 Transform To An Experience-Driven Organization Assessment:Where Are You On The Path To Customer Experience Maturity?October 11, 2013 |Megan BurnsOverview:Transform To An Experience-Driven OrganizationMay 7, 2012 |Harley Manning

    Thank you

    Craig MenziesPrincipal Analyst, Forrester Research (Sydney, Australia)

    cmenzies@forrester.com+61 02 9006 3352, +61 43 555 1412Twitter: @craigmenzies, @forrester, #NASSCOM_ILFMy CX blog: http://blogs.forrester.com/craig_menzies

  • We Need You!Please join our Asia Pacific Customer Experience Peer Research Panel and take the 2014 CX Survey!Contribute your views and insights to leading edge industry research (confidential/anonymous)Receive free research reports and read the views of other people working with the same challenges day in day outGet in touch: cmenzies@forrester.com

    Now I dont care whether you call them shoppers, clients, members, subscribers, or patients, or whatever...the fact is that if you provide products or services in return for money, then you have customers.

    And all those different kinds of customers go through the same archetypal steps, which start when they Discover that you offer something which can meet their needs. (Follow the circle.)

    But then theres this critical juncture: the point where customers either decide to do business with you again, or they leave.

    What influences that decision? Many things but the biggest is customer experience.

    What exactly is customer experience, that I can make this claim? Its no less than*(Read) Those interactions occur at each of the steps of the journey I just described.

    And those perceptions occur at three levels which we collectively call the customer experience pyramid.

    Now, just like a real pyramid

    http://www.autonettv.com/2012/why-people-don%E2%80%99t-like-you-%E2%80%93-part-2.html *the CX pyramid has a hierarchy. At its base, a successful experience must first be something that

    Meet needs. For example, most of us fly on business. Any airline that flies from where we are to where we want to be could meet our basic need to get from A to B. And yet, each of us pick one airline out of our many possible choices every time we fly. Why? For many of us it was because one option was particularly

    Easy. Maybe one of those airlines has more convenient flight time. Or maybe you have elite status on one of them so you get to board sooner and dont have to fight for overhead bin space. Any or all of those factors could have determined who got your business and who did not.

    And at the top of the pyramid, the best experiences are Enjoyable. This is the one that surprises a lot of businesses but it shouldnt because we all know that customers have emotions that influence their choices. Take the example of JetBlue. Their mission statement says that they seek to bring humanity back to travel. And if you fly them, as I do, you know that their flight attendants have a sense of humor and dont sound like robots. For me, that matters.

    Easy, Enjoyable. That is customer experience. And the reason we know that you should care is that for years weve been running a large scale consumer study called the Customer Experience Index, which proves that ...

    *Specifically, it correlates strongly to three metrics. (READ)

    When we look at companies that understand this dynamic, we see some compelling results.

    For example*The arrow and text boxes are from illustrator but independent pieces that you can build individually. The dates are powerpoint, as are the dotted lines, so you can build by decade and text.*The arrow and text boxes are from illustrator but independent pieces that you can build individually. The dates are