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

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  • Now I don’t 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 there’s 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? It’s 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 don’t 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 shouldn’t 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 don’t 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 we’ve 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 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 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 powerpoint, as are the dotted lines, so you can build by decade and text.
  • <READ>
    So if you’re in an organization that suffers from low customer experience maturity it means that…
  • In 1993 I bought a used motorcycle from a co-worker. It was a 1984 Honda CBX550. I paid $1000 for it.
    Fast forward 25 years.
  • Fast forward 25 years.
  • In 1993 I bought a used motorcycle from a co-worker. It was a 1984 Honda CBX550. I paid $1000 for it.
    Fast forward 25 years.
  • In 1993 I bought a used motorcycle from a co-worker. It was a 1984 Honda CBX550. I paid $1000 for it.
    Fast forward 25 years.
  • In 1993 I bought a used motorcycle from a co-worker. It was a 1984 Honda CBX550. I paid $1000 for it.
    Fast forward 25 years.
  • In 1993 I bought a used motorcycle from a co-worker. It was a 1984 Honda CBX550. I paid $1000 for it.
    Fast forward 25 years.
  • In 1993 I bought a used motorcycle from a co-worker. It was a 1984 Honda CBX550. I paid $1000 for it.
    Fast forward 25 years.
  • In 1993 I bought a used motorcycle from a co-worker. It was a 1984 Honda CBX550. I paid $1000 for it.
    Fast forward 25 years.
  • In 1993 I bought a used motorcycle from a co-worker. It was a 1984 Honda CBX550. I paid $1000 for it.
    Fast forward 25 years.
  • In honour of the Winter Olympics!
    …Mount Everest. It’s the world’s tallest mountain at 29,029 feet. And it’s become a metaphor for our biggest, hairiest, most audacious goals.
    That’s because until not that long ago, climbing Mount Everest seemed impossible. It wasn’t until 1953 that…
    Image source: https://en.wikipedia.org/wiki/File:Everest_North_Face_toward_Base_Camp_Tibet_Luca_Galuzzi_2006.jpg
  • Sir Edmund Hilary and Tenzing Norgay became the first people ever to reach it’s summit.
    These are the guys who get all of the attention, but in reality it took many, many more people to reach the top of Mount Everest.
    In fact, it took…
    Image source: http://www.britannica.com/EBchecked/media/11603/Sir-Edmund-Hillary-1956
  • …20 Sherpa guides from Nepal
    And 362 porters
    Carrying TEN THOUSAND lbs of baggage
    And those were just the people on the expedition itself. There were countless other who helped in the pre-climb preparations.
    Hillary worked for months with a team to figure out what path to take to get through treacherous terrain like…
    Image source: http://www.flickr.com/photos/auldhippo/3555595201
  • the Khumbu Icefall…
    Still another group had to go to the mountain and prepare part of the steep slope known as the…
  • Lhotse Face so that the climbers could scale it on their way to the top.
    These days it can be easy to forget just how much of an accomplishment it is to climb Mount Everest, especially when we see headlines like this…
  • “Mount Everest Is Too Crowded” This headline showed up earlier this year and we wondered, “Is this a joke?” But it’s not.
    About 520 people make it to the top of Mt. Everest every year now. And that’s enough to make some people think that it’s easy to climb Mt. Everest.
    In the fact, the Sherpa guides who help people make it up the mountain now contend with people who are…
    Image source: http://www.theatlanticwire.com/technology/2013/05/mount-everest-too-crowded/65712/
  • …clearly unused to even basic mountaineering equipment.
    These folks may think its easy, but the truth is it still takes years of training and months of planning to get to the top of Mount Everest, and there are no shortcuts.
    The same is true for customer experience. For many companies…
    Possible resource: http://business.time.com/2012/01/23/the-economics-of-everest/
    Image source: http://www.flickr.com/photos/detlef-rook/4338479840/
  • …customer experience has become their big, hairy, Everest-like goal.
    In fact, in a recent survey of customer experience professionals we found that executives don’t just want to get good at customer experience.
    Image source: https://en.wikipedia.org/wiki/File:Everest_North_Face_toward_Base_Camp_Tibet_Luca_Galuzzi_2006.jpg
  • 47% want to use it to (CLICK) differentiate the company from leaders in their industry.
    Another 13% have even more aggressive goals. They want to use customer experience to (CLICK) differentiate the company from leaders in ANY industry.
    But like those climbers who show up unprepared, these…
  • …firms are not doing what it takes to accomplish their aggressive goals.
    In the same survey we asked people to tell us a little bit about their customer experience programs.
    And we found that…
  • …47% don’t measure customer experience quality consistently across the organization. So they don’t even know how far they have left to go.
    And…
    Source: Forrester is regularly collecting data on the current state of CEM from our Customer Experience Peer Research Panel. This study was fielded in Q4 2012
  • 79% don’t train employees on how to deliver the target customer experience.
    And when you don’t have the right training, you end up with results….
  • …like this. This is the distribution of scores on our Customer Experience Index this year. And you can see that most companies deliver experiences that are Okay, Poor, or Very Poor.
    And I think it’s pretty safe to say that if your customer experience is ok, poor, or very poor it is NOT differentiating. At least not in the way you want it to be.
    All of this weak performance is really just a symptom of a bigger problem…
  • …LOW CUSTOMER EXPERIENCE MATURITY.
    At Forrester we define…
  • Customer experience maturity as…<read>.
    <CLICK>
  • <READ>
    <CLICK>
  • <READ>
    So if you’re in an organization that suffers from low customer experience maturity it means that…
  • …key practices are either missing – they don’t happen at all -- or performed in an ad hoc way, where you do them differently across different part of the organization.
    Contrast that with companies that have high customer experience maturity. They perform those practices systematically. People do them all the time, the same way every time.
    So if you’re in one of those companies that has lofty goals but low customer experience maturity, I hope you brought your climbing gear. Because THIS is the slope you need to get up. You need to…
  • …get on the path to high customer experience maturity.
    Now if you’re like a lot of people we talk to you’re struggling a bit with how to get in that path. Because…
    Image source: http://www.flickr.com/photos/mckaysavage/6441642787/
  • …there seem to be so many different paths that you could take, you aren’t sure which one to follow. In fact there are six distinct customer experience disciplines to master, and they encompass 40 different practices. How do you know where to begin or what to do next?
    Well, Forrester is a research company so we set out to try to find the answer. And we found something that we weren’t expecting. It turns out that there aren’t actually multiple paths to customer experience maturity – at least not multiple paths that work. All of the companies that have made their way up this trek have followed the same path. (CLICK)
    Image source: http://www.flickr.com/photos/nasamarshall/5370808050/
  • And it’s a path that has four phases: Repair, Elevate, Optimize, and Differentiate.
    So what we’re going to do this morning is to walk through these four phases so you’ll have a better chance of determining where you are today and what you need to do next. And we’re going to start with this first phase…
    Image source: https://en.wikipedia.org/wiki/File:Everest_North_Face_toward_Base_Camp_Tibet_Luca_Galuzzi_2006.jpg
  • Repair.
    Here your goal is pretty simple…
    Image source: https://en.wikipedia.org/wiki/File:Everest_North_Face_toward_Base_Camp_Tibet_Luca_Galuzzi_2006.jpg
  • …Stop the avalanche of bad customer experiences.
    To do that you perform a set of key activities…
    Image source: http://www.sassglobaltravel.com/lost-life-on-loveland-pass/
  • …that help you…(READ)
    If that sounds familiar, it’s because that’s what you do in a classic…
  • …closed loop process. Companies have used that kind of process for years to improve all different areas of their business. And all they’re doing now is applying the same process to customer experience.
    Without a doubt, the repair phase has the most examples and case studies of any phase in this journey. I’m going to tell you one now that you may have heard of before but bear with me, this time it will be a little different.
    It’s a story about…
  • …Sprint. Starting at the end of 2007 they found themselves in need of some serious repair. The wireless industry isn’t known for great customer experience to begin with and at the time Sprint ranked…
    Image source: http://www.syracuse.com/news/index.ssf/2011/10/sprint_no_more_clearwire_devic.html
  • …last out of all of the wireless carriers in many different studies including both JD Power and our Customer Experience Index, which you see here..
    These bad experiences were causing the company to spend millions of dollars handling…
  • …calls to customer service, and doling out credits to compensate unhappy customers. As I, “Sorry for the inconvenience, here’s $50 worth of free wireless minutes.” And that adds up when you multiply it by literally millions of unhappy customers.
    To fix customer experience and eliminate that unnecessary cost, the team at Sprint decided to treat every call to the call center as a defect to their customer experience. Which makes sense. If your phone is working the way it should there’s not much reason to call.
    And they started doing root cause analysis to figure out what they were doing wrong, why people had to pick up the phone to call them. They figured it out, they started implementing fixes, and they measured the results. Ultimately they estimated that as a result of these fixes they save (CLICK) $1.7 billion per year.
    And those are some pretty impressive results from simply having call center agents write down why people called to complain, and then using those customer insights as a way of finding systemic problems with the business.
    But that doesn’t tell the whole story. Because sure, Sprint managed to greatly improve their customer experience. But that only took them…
  • …from Very Poor to OK, as measured by our Customer Experience Index. A good start, but a far cry from where the company hopes to be.
    Their goal is to differentiate on the basis of customer experience. But if we…
  • …overlay scores of their two biggest competitors – AT&T and Verizon - on this graph…
    …you’ll see that all three are in a dead heat – they got the exact same score, a 66.
    So the Repair phase, while it’s critically important, is the equivalent of…
  • …making it to Base Camp.
    Not easy, but there’s still a lot of climbing to do to reach the top. Now let’s move on and talk about the…
    Image source: http://images.summitpost.org/original/572324.JPG
  • Elevate phase.
    In the elevate phase you begin to perform key activities that…
    Image source: https://en.wikipedia.org/wiki/File:Everest_North_Face_toward_Base_Camp_Tibet_Luca_Galuzzi_2006.jpg
  • Make good CX behavior the norm.
    And to do that you need to start changing the way that you do business, at a fundamental level. And that’s why so many companies get to this point and then grind to a halt. If you don’t want to grind to a halt, you need to…
    Image source: http://www.sassglobaltravel.com/lost-life-on-loveland-pass/
  • (READ>
    And back in 2011, this is just what investment firm…
    Image source: http://www.cxpa.org/resource/resmgr/2013mie/blue_cross_blue_shield_of_mi.pdf
  • …Edward Jones started doing.
    Like a lot of companies they had a Voice of the Customer program to gather customer insights. And what they realized is that they could use this information to go beyond just learning how NOT to be bad, as companies do in the repair phase.
    So they used their VoC data to conduct what we call a…
    Image source: https://www.edwardjones.com/groups/ejw_content/@ejw/@us/@graphics/documents/web_content/web_028645.jpg
  • …bright spot analysis.
    Most of their client interactions happen face to face with a financial advisor so they looked to see which advisors were earning the highest scores from clients and brought them in to see what they did differently.
    To make those best practices more systematic across the organization they integrated what they learned into…
    Image source: http://www.flickr.com/photos/ggladman/455756326/
  • …the standard curriculum for financial advisor training.
    Part of that training was a grounding in what the company calls…
  • …The Ideal Edward Jones Experience. So yes, they have an explicit vision of the experience they want to deliver – their CX strategy.
    Then they created specific metrics for every job function in the company that measures employees on the part that they play in delivering the ideal customer experience.
    Image source: https://www.edwardjones.com/groups/ejw_content/@ejw/@us/@graphics/documents/web_content/web228340.jpg
  • Now of course the people on the front lines have some of those metrics. Because they need to know what to do when they are face to face with clients.
    But even people behind the scenes back at…
  • …Corporate headquarters have those same kinds of metrics. And when people do really well on those metrics, they get rewarded.
    The company now has a …
    Image source: Edward Jones web site (media kit image)
  • …national conference that recognizes people who earn the highest CLIENT scores.
    And to come full circle, they not only reward these folks, they ask what’s working and feed new lessons into their bright spot analysis and their ongoing training. They have a SYSTEMATIC process for making good behavior the norm.
    And clearly, this approach is working. If we look at the company’s scores on our CXI from…
  • 2011 when they started this program to 2013, they have in fact elevated from 67 – which falls in our ok category, to 75, which is the first rung of Good.
    Most companies would be pretty happy with that. But personaly, I wouldn’t want to stop there. And I suspect the folks at Edward Jones don’t either. They want to keep going. And to do that, you need to…
  • …optimize.
    At this phase, companies are now ready to adopt practices that give them…
    Image source: https://en.wikipedia.org/wiki/File:Everest_North_Face_toward_Base_Camp_Tibet_Luca_Galuzzi_2006.jpg
  • …a more sophisticated Customer experience toolkit to help employees pick the best ways to move the needle further.
    This is where you need to…
    Image source: http://adventure.nationalgeographic.com/adventure/everest/gear-edmund-hillary-hilaree-oneill/#/sir-edmund-hillary-wireless-radio_49925_600x450.jpg
  • (READ)
    And one of the companies we’ve watched doing this for a number of years is…
  • Courtyard by Marriott.
    In 2008, the company had pretty good customer experience scores, but was facing increased competition from a host of new competitors like
    Image source: http://www.crosslandconstruction.com/projects/courtyard-by-marriot-hotel/
  • Aloft, and…
    Image source: http://artandentertainme.blogspot.com/2012/09/aloft-sfo-opens-in-style-at-steal.html
  • Hyatt Place.
    Leaders at Courtyard knew they needed to do something to step up the experience they were delivering to business travelers
    So they said “What can we do to optimize our experience so we stay ahead of the game?” Then they went out and started observing guests in their hotels, and talking to them, to develop a deeper level of insight into what those guests wanted. And they combined those qualitative insights with quantitative data from research studies.
    And that allowed them to zero in on five particular principles of customer experience that they knew would be most important. And those principles included…
  • …the need to let personality… (CONTINUE READING)
    These things make a tremendous amount of sense. But there are a lot of companies that have principles like this, and if you do business with them you’d never know it. And that’s often because companies struggle to take these concepts, and design specific experiences that make them real for people.
    But Courtyard by Marriott didn’t fall into that trap. They hired the experience design agency IDEO and together they designed things like this…
    Image source: http://www.flickr.com/photos/kathika/3350380456/
  • …”Go board.” It’s a 52 inch touch screen that’s now in the lobby of a lot of Courtyards. It helps guests learn more about the city they are in, get local weather, traffic, and even flight information -- just like you’d find at an airport. It will even help you find local area attractions, and local restaurants complete with restaurant reviews.
    Of course, Courtyard would love to have you stay and dine with them. So they totally redesigned the dining experience, as well. They recognized that a lot of people when they’re traveling don’t want to go have a formal sit down dinner. So instead of a formal restaurant they created a…
    Image source: Marriott Web Site
  • …a much more casual dining experience that gives them a whole host of options including some things that are healthy, and some things that are not so healthy but very tasty!
    And they made sure that the space in the lobby around the dining area was…
    Image source: http://www.floridaattractions.org/en/rel/1679
  • …comfortable. It includes things like these booths. If you want to work like this guy was doing with his laptop in front of him, you can do that. If you decide you want to take a break and you want to watch TV for a while you have your own TV <CLICK> right there. And you’re not stuck watching what the hotel puts up on the big TV in the lobby because you have your own <CLICK> remote control right there.
    So Courtyard’s goal of making these lobby spaces comfortable is clearly working. We pulled this picture down from Flickr and here is what the caption said: <CLICK> “Matt is chiilin”
    But Courtyard knew that it was more than the physical space they had to focus on. Because so much of the experience in the hotel is about interaction with people who work in the hotel. So they took a systematic approach to designing training.
    Image source: http://www.flickr.com/photos/netgeek/3007407231/
  • When a new hotel is getting ready to roll out this new experience they actually start out 6 months before the renovation. The hotel’s general manager gets a <CLICK> walkthrough of the entire renovation process so they can start to prepare themselves and their team.
    That same GM then goes through an <CLICK> immersion experience, actually staying in one of the renovated hotels so he or she can see and feel what it’s like, and talk to staff who have some experience delivering this new concept.
    During construction the training continues with a series of <CLICK> 6 webinars, and then 11 days before the property is set to re-open after the renovation 2 or 3 trainers come on site and walk <CLICK> associates through the nuts and bolts of how all of this works.
    They follow up 3 months after the re-opening with a <CLICK> two to three day post visit to make sure things are going well, and fine tune anything that associates may have questions on.
    And this training around the renovation isn’t the only training that the hotel’s…
  • …Associates receive. There is another systematic training program in place that includes what the company calls service essentials and service experience. All new associates and current associates are required to go through it for yearly recertification to either reinforce what they already know or update it if the company finds that guests needs or expectations are changing.
    Once again, we have proof that this is paying off. We looked at our Customer Experience Index data starting back in…
    Image source: http://hpcourtyard.wordpress.com/tag/employee-spotlight/
  • …in 2010 when they started rolling this program out. At the beginning their score actually started out in the Good category – it was a 75. Here’s what’s happened since then.
  • Their score is now in the Excellent category – 88, which many companies are never going to see. In fact, they’re the highest scoring brand of any hotel in our Customer Experience Index. Now here’s some trivia: There are only two hotel brands that made it into the Excellent category this year, and the other one was Courtyard’s sister brand, Marriott hotels and resorts. And that’s not a coincidence. It’s a result of their systematic approach to customer experience.
    Now for a health insurance company, getting to this level – where you deliver an excellent customer experience consistently -- would be spectacularly differentiating because the bar is not set very high in your industry right now. But that’s not going to be the case forever: You can bet that many of your competitors are also thinking about customer experience right now. In fact, I know they are because we work with many if not most of them.
    So to start you thinking about the future, let’s look at our fourth phase…
  • …Differentiate. That’s when companies start performing activities that…
    Image source: https://en.wikipedia.org/wiki/File:Everest_North_Face_toward_Base_Camp_Tibet_Luca_Galuzzi_2006.jpg
  • …catapult you to the top. Organizations that succeed at differentiating through CX do so because they are willing and able to think differently. They’re not just trying to perfect the same old thing. Because that’s what differentiation is about – doing things differently from your competitors. How do they do that? they…
    Image source: http://www.flickr.com/photos/radson/4655817722/sizes/o/in/photostream/
  • …re-frame customer problems to suggest better solutions.
    And they reveal unmet customer needs through customer insights – needs that no one else in the market has thought of yet.
    And they’re willing to rethink the entire customer experience ecosystem because they realize if you want to do something that’s really different, you have to practice your business differently. Business as usual is not going to be enough.
    It’s this kind of thinking that powers companies like…
  • USAA. USAA is not like most other financial services firms in that they don’t go to market on the basis of products. It’s not about…
    Image source: http://afrotcfieldtraining.blogspot.com/2012/08/usaa-pizza-party.html
  • Car loans, or mortgages, or insurance.
    Instead, they think about their business the way that customers do, in terms of goals or journeys like…
  • …buying a new car or…
    Image source: http://www.flickr.com/photos/annstheclaf/2188335168/
  • …a new house. And they understand that that is a process that is about more than just money. And it’s helped them create offerings like…
    Image source: http://www.flickr.com/photos/davidpb145/231821377/
  • …home circle, which helps you find a real estate agent, and connects you to people who are in the same part of the process to get ideas and advice and recommendations. And sure they help you get a mortgage and they help you get home owners insurance but they don’t leave after the closing papers are signed. They help you…
  • …through the next phase of the journey…
    Moving
    And renovating
    Because they understand that this isn’t about buying a house, it’s about making a home. And all of these activities are part of that single end-to-end customer journey.
    Understanding that about a customer’s experience – and then doing business accordingly – is what helps make USAA the leader in three industries in our customer experience Index.
  • 78 Sun Trust
    75 AmEx
    74 State Farm
    They’ve got to continue to innovate, just like you will, and you’ll learn more about how to do that from Kerry tomorrow.
  • …is where you’d start. This arch marks the entrance to the trek to the base camp.
    Unfortunately, the entrance to the path to customer experience maturity is not so clearly marked.
    So here are Forrester’s recommendations on how to get started.
    Image source: http://blog.thecheaproute.com/img/start-everest-trek-640x426.jpg
  • …which practices you need to become systematic at before moving onto the next phase. If you’re like the vast majority of companies that have started on this journey, you are probably in the Repair phase. In other words, you haven’t gotten systematic at all the practices in the phase so you can move on with a solid foundation. And that’s okay for a while, you will see a lot of benefit there.
    But wherever you find yourself, before you start moving on we recommend that you…
  • “I need my customers more than they need me.” And I want you to look at it every day, because it is so easy to forget. Next…

Transcript

  • 1. The Path to Customer Experience Maturity in The Age of the Customer Craig Menzies, Principal Analyst Serving Customer Experience Professionals Twitter: @craigmenzies, @forrester, #NASSCOM_ILF My CX blog: http://blogs.forrester.com/craig_menzies 12th February, 2014
  • 2. Why should we care about customer experience? © 2012 Forrester Research, Inc. Reproduction Prohibited
  • 3. © 2012 Forrester Research, Inc. Reproduction Prohibited
  • 4. How customers perceive their interactions with your company © 2012 Forrester Research, Inc. Reproduction Prohibited
  • 5. Enjoyabl e Easy Meets Needs © 2012 Forrester Research, Inc. Reproduction Prohibited
  • 6. Customer experience correlates to loyalty  Willingness to consider for another purchase  Likelihood to recommend to a friend  Likelihood to switch business to a competitor © 2012 Forrester Research, Inc. Reproduction Prohibited
  • 7. The playing field for businesses is changing before your eyes © 2012 Forrester Research, Inc. Reproduction Prohibited
  • 8. Sources of competitive advantage change over time 0+ 01 2 9 19 0 99 -1 60 19 0 96 0-1 0 19 2 0- 0 01
  • 9. Sources of competitive advantage change over time Sources of Dominance Age of Information Age of Distribution Age of Manufacturing 0 96 0-1 0 19 0 99 -1 60 19 9 19 2 0- 0+ 01 2 0 01
  • 10. Sources of competitive advantage change over time Sources of Dominance Age of Information Age of Distribution Age of Manufacturing 0 96 0-1 0 19 Ford, RCA, GE, Boeing, P&G, Sony 60 19 0 99 -1 9 19 2 0- 0+ 01 2 0 01 Microsoft, Dell, Google, Capital One Wal-Mart, Toyota, UPS, CSX Dominant Companies
  • 11. Sources of competitive advantage change over time Age of the Customer Sources of Dominance Age of Information Age of Distribution Age of Manufacturing 0 96 0-1 0 19 Ford, RCA, GE, Boeing, P&G, Sony 60 19 0 99 -1 9 19 2 0- 0+ 01 2 0 01 Microsoft, Dell, Google, Capital One ? Contenders include Southwest Airlines, USAA, Amazon, … Wal-Mart, Toyota, UPS, CSX Dominant Companies
  • 12. The Age of the Customer A 20 year business cycle in which the most successful enterprises will reinvent themselves to systematically understand and serve increasingly powerful customers.
  • 13. My Buying Criteria: •My friend was selling it (proximity) •I could afford it (price) •I hadn’t heard anything bad about it (information) •It was on the cover of a magazine (media) © 2013 Forrester Research, Inc. Reproduction Prohibited
  • 14. Fast forward 25 years! Word of Mouth, Price, Expert opinion, Proximity AND… © 2013 Forrester Research, Inc. Reproduction Prohibited
  • 15. Highly detailed specifications © 2013 Forrester Research, Inc. Reproduction Prohibited
  • 16. Competitive comparisons © 2013 Forrester Research, Inc. Reproduction Prohibited
  • 17. With even more detailed specs © 2013 Forrester Research, Inc. Reproduction Prohibited
  • 18. Reviews from other buyers © 2013 Forrester Research, Inc. Reproduction Prohibited
  • 19. Forums of opinionated owners © 2013 Forrester Research, Inc. Reproduction Prohibited
  • 20. • • • • • • • • • • • • • • © 2013 Forrester Research, Inc. Reproduction Prohibited Detailed specs Model comparisons Trusted reviews Best place to buy Best price to pay Special offers Best insurance deals Owner opinions Maintenance history Accessories Upgrades Social events Where to ride Etc, etc, etc, etc…
  • 21. In short… The Customer has all the power © 2013 Forrester Research, Inc. Reproduction Prohibited
  • 22. n Informatio Tech © 2013 Forrester Research, Inc. Reproduction Prohibited © 2014 Forrester Research, Inc. Reproduction Prohibited Price Location 22
  • 23. Information Tech © 2013 Forrester Research, Inc. Reproduction Prohibited © 2014 Forrester Research, Inc. Reproduction Prohibited Price Location 23
  • 24. Information Tech © 2013 Forrester Research, Inc. Reproduction Prohibited © 2014 Forrester Research, Inc. Reproduction Prohibited Price Location 24
  • 25. Informa tion Tech © 2013 Forrester Research, Inc. Reproduction Prohibited © 2014 Forrester Research, Inc. Reproduction Prohibited Price Locatio n 25
  • 26. So how does one “do” customer experience? © 2013 Forrester Research, Inc. Reproduction Prohibited
  • 27. 20 362 10,000
  • 28. Khumbu Icefall
  • 29. Lhotse Face
  • 30. “clearly unused to even basic mountaineering equipment”
  • 31. Customer Experience
  • 32. 47% Differentiate the company from leaders in their industry 13% Differentiate the company from leaders in ANY industry : 100 customer experience professionals (percentages may not total 100 because of rounding) ce: Q4 2012 Global Customer Experience Peer Research Panel Online Survey
  • 33. Firms are not doing what it takes
  • 34. 47% don’t measure customer experience quality
  • 35. 79% don’t train employees on how to deliver the target customer experience
  • 36. Not differentiating
  • 37. Low customer experience maturity
  • 38. Customer Experience Maturity The extent to which an organization routinely performs the practices
  • 39. Customer Experience Maturity The extent to which an organization routinely performs the practices required to design, implement, and manage customer experience
  • 40. Customer Experience Maturity The extent to which an organization routinely performs the practices required to design, implement, and manage customer experience in a disciplined way.
  • 41. High CX maturity Practices are performed systematically Low CX maturity Practices are missing or performed in an ad hoc way
  • 42. Get on the path to high customer experience maturity. © 2013 Forrester Research, Inc. Reproduction Prohibited
  • 43. Differentiate Optimize Repair Elevate
  • 44. Differentiate Optimize Repair Elevate
  • 45. STOP the avalanche of bad customer experiences
  • 46. Repair Phase Key Activities › › › › Identify bad experiences Prioritize fixes Coordinate implementation Measure results
  • 47. 2008 CXi – Wireless Carriers
  • 48. $1.7 billion
  • 49. OK Very Poor Base: US online consumers who have interacted with each firm Source: North American Technographics Customer Experience Online Survey, Q4 2008 (US), Q4 2009 (US), Q4 2010 (US), Q4 2011 (US), Q4 2012 (US)
  • 50. Base: US online consumers who have interacted with each firm Source: North American Technographics Customer Experience Online Survey, Q4 2008 (US), Q4 2009 (US), Q4 2010 (US), Q4 2011 (US), Q4 2012 (US)
  • 51. Differentiate Optimize Repair Elevate
  • 52. Make good CX behaviour the norm
  • 53. Elevate Phase Key Activities › › › Define a customer experience strategy › Start following a human-centered design process Share customer insights with all employees Create a consistent, companywide customer experience measurement framework
  • 54. Edward Jones CXi Score 2011 – 2013 Good OK Base: US online consumers who have interacted with Edward Jones Source: North American Technographics Customer Experience Online Survey, Q4 2009 (US), Q4 2010 (US), Q4 2011 (US), Q4 2012 (US)
  • 55. Differentiate Optimize Repair Elevate
  • 56. A more sophisticated customer experience toolkit
  • 57. Optimize Phase Key Activities › Model the relationship between CX quality and business results › › Build strong experience design practices › Evaluate employee performance against rolespecific CX metrics Sharpen employees’ CX related skills through targeted training
  • 58. • Let personality shine • Provide options • Help guests feel comfortable in public spaces
  • 59. “Matt is chillin”
  • 60. Systematic customer experience training Full Associate Training Walk-through Immersion Six months before Pre-reno 6 Webinars 11 days before 3 months after reopening 2 – 3 Day Post-Visit
  • 61. Courtyard by Marriott CXi Score ‘10 – ‘13 Good Base: US online consumers who have interacted with Courtyard by Marriott Source: North American Technographics Customer Experience Online Survey, Q4 2009 (US), Q4 2010 (US), Q4 2011 (US), Q4 2012 (US)
  • 62. Courtyard by Marriott CXi Score ‘10 – ‘13 Excellent Good Base: US online consumers who have interacted with Courtyard by Marriott Source: North American Technographics Customer Experience Online Survey, Q4 2009 (US), Q4 2010 (US), Q4 2011 (US), Q4 2012 (US)
  • 63. Differentiate Optimize Repair Elevate
  • 64. Catapult you to the top
  • 65. Differentiate Phase Key Activities › › › Re-frame customer problems Reveal unmet customer needs Re-think the entire CX ecosystem
  • 66. Car loans Mortgages Insurance
  • 67. USAA Lead over next highest brand Banks 85 +7 Credit Card Providers 82 +7 Insurance Providers 83 +9 © 2013 Forrester Research, Inc. Reproduction Prohibited
  • 68. How do you get started on the path to CX maturity?
  • 69. The Experience-Driven Organization Playbook May 2012 “Transform To An Experience-Driven Organization” Assessment: Where Are You On The Path To Customer Experience Maturity? October 11, 2013 | Megan Burns Gather best practices Overview: Transform To An Experience-Driven Organization May 7, 2012 | Harley Manning
  • 70. Assess your maturity
  • 71. Understand your customer’s journey(s)
  • 72. Does your digital channel meet your customer’s needs?
  • 73. Thank you Craig Menzies Principal Analyst, Forrester Research (Sydney, Australia) cmenzies@forrester.com +61 02 9006 3352, +61 43 555 1412 Twitter: @craigmenzies, @forrester, #NASSCOM_ILF My CX blog: http://blogs.forrester.com/craig_menzies
  • 74. 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 out Get in touch: cmenzies@forrester.com