The document discusses 7 steps for improving customer experience management: 1. Understand customer needs, wants, and preferences through research. 2. Establish economic frameworks to understand the impact of marketing, sales, and service decisions. 3. Track customer behavior patterns over time and adapt strategies accordingly. 4. Develop lead nurturing and customer management plans tailored for different customer segments. 5. Develop a customer-centric information architecture to gain a single view of each customer. 6. Optimize customer touchpoints to deliver consistent, positive experiences. 7. Measure program effectiveness and return on investment of customer experience initiatives.

1. COMMUNICATIONS & MEDIA
Seven steps to
better customer
experience
management
Improving customer management
to drive profitable growth
kpmg.com

2. © 2011 KPMG LLP a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated
Introduction
with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in the U.S.A. The KPMG name, logo and
“cutting through complexity” are registered trademarks or trademarks of KPMG International. 23183NSS
It costs many times more to acquire a new customer than retain
an existing one. However, not all customers are created equal.
Some require more attention than others, some need guidance
from time to time, and some simply do not wish to be disturbed.
By gaining insights on needs, preferences, and behavior,
customer journeys can be optimized at critical touch points.
Consistently delivering positive experiences establishes relationships.
Strong relationships help build loyalty and drive growth.
Customer experience management They also help generate incremental
(CEM) focuses on creating differentiated sales through recommendations on
experiences at touch points that social and professional networks.
,
customers choose to interact with
In today’s business climate,
the company. Focusing on CEM as
rapid innovation and fierce competition
a strategy helps service delivery
makes it harder for telecommunications
capabilities align and adapt to behavioral
companies to outpace rivals on a
shifts of the target audience. Benefits
product basis alone. With new features
realized go well beyond improvements
quickly copied and introduced to
in customer satisfaction and churn.
market, the quality of the customer
Loyal customers buy more and share
experience becomes paramount as it
experiences with friends and family.

3. Seven steps to better customer experience management | 3
© 2011 KPMG LLP a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated
with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in the U.S.A. The KPMG name, logo and
“cutting through complexity” are registered trademarks or trademarks of KPMG International. 23183NSS
is an intangible that can be imitated but statisticians. Responsibility for the “Positive customer
not commoditized. In some instances, end-to-end customer journey is
the quality of experience can even help distributed across multiple business experience can build its
justify premium pricing. functions, often times causing messaging own momentum, creating
and service delivery consistency to be
Managing customer experience can
a challenge. an ‘ecosystem of goodwill’
be a tall order. Every touch point,
from advertising campaigns to post- The issue is becoming more acute as data that costs relatively little to
purchase support, can affect customer about customers accumulates throughout maintain, but can deliver a
perception and loyalty. To influence those the customer life cycle. In addition,
interactions, organizations often need to as companies grow, whether organically loyal fan base and tangible
go through a significant transformation or through acquisition, new systems, bottom-line returns. ”
of their own, adapting their systems, applications, and processes are
processes, and infrastructure to put often only partially integrated with
the customer at the center. The effort is legacy infrastructure, leading to data
worth the investment. Positive customer fragmentation, inconsistent taxonomies,
,
experience can build its own momentum, and inaccurate reporting. Ownership
creating an ‘ecosystem of goodwill’ that for the customer experience tends to
costs relatively little to maintain, but can be fragmented, nestled within product
deliver a loyal fan base that generates organizations, marketing departments,
tangible bottom-line returns. and sales groups, often with little
cohesion among them.
This paper offers seven ideas to help
companies in the communications Until now, the solution has been to
and media industry drive growth and spend heavily on sales and customer
profitability using customer experience analytics. But this, too, can cause
as a service differentiator. problems. Many marketing initiatives
are evaluated on a one-off basis.
Why managing customer experience is
The net impact is multiple teams
hard to do
reporting results on the same
Although many departments and
campaign, or worse, perceived
functions have systems to track
improvements are artificial, driven by
customer data, and measure customer
changes in metric calculations.
satisfaction, few organizations have a
holistic, enterprise-wide view of Given its importance, communications
customer experience. Voice of the and media companies are keen to rethink
Customer programs can determine strategy, assign leadership, and define
Net Promoter scores but are typically governance for customer experience
not action oriented. Business intelligence management, not only to gain a better
tools provide insights on the dynamic understanding of customer needs and
nature of customer behavior but not buying behaviors but to translate the
without IT support and interpretation from insights into better, more tailored, service.

4. 4 | Seven steps to better customer experience management
Seven steps to better customer
© 2011 KPMG LLP a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated
with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in the U.S.A. The KPMG name, logo and
experience management
Based on our experience with clients in the communications and media sector, there are
seven key steps that organizations can take to improve their ability to capture, analyze,
and respond to customer data and improve the customer experience.
“cutting through complexity” are registered trademarks or trademarks of KPMG International. 23183NSS
Step 1:
Understand the needs, wants, and preferences of your target audience
Preference research, consisting of both Key points to consider
qualitative and quantitative studies,
• Has the needs and preferences of your
can help organizations gain insights on
target audience changed over time?
customer shopping, pricing, product
usage, and service support preferences. • What are the growth categories in your
This critical first step is not about creating industry? What share of growth does
a new segmentation scheme. your company capture?
Instead, the focus is on gaining insights
• Other than price, how do you
on (1) how prospects hear about new
differentiate your products and
,
products; (2) the factors that influence
services?
who, what, and where they shop;
(3) onboarding needs and expectations; • How well aligned is your product and
(4) how they like to get help when issues service road map with market trends?
arise; and (5) perceived value at specific
• How successful are your renewal,
price points given new technologies and
up-sell, and cross-sell campaigns?
market trends.
The last point suggests that while a
customer may pay premium prices for
certain service features, they bargain
shop for others. So knowing where
key customers place their priorities is
essential to positioning in a meaningful
way. For example, while the convenience
of one bill and savings related to
consolidating voice, video, and Internet
service still drive purchase decisions,
the value of the bundle is fast diminishing
as more households switch to wireless or
third-party VoIP providers for voice.

5. Seven steps to better customer experience management | 5
© 2011 KPMG LLP a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated
with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in the U.S.A. The KPMG name, logo and
“cutting through complexity” are registered trademarks or trademarks of KPMG International. 23183NSS
Step 2:
Establish economic frameworks to understand and prioritize impact of
marketing, sales, and service decisions
Comprehensive economic frameworks New product focus shifted to growth Key points to consider
drive everything from market opportunity categories only. Highly targeted
• How do you decide which markets to
assessments, product pricing/cost acquisition and up-sell/cross-sell
enter, grow, harvest, and exit?
analysis, marketing spend, channel mix, campaigns followed.
support strategy, and customer policies, • How well do you understand
Over the next 12 months, the company
among others. With focus on customer performance within your distributed
not only cut marketing expenditures by
experience management, tradeoffs are sale model?
more than 40 percent, but also, churn
required at each touch point. The challenge
improved, average revenue per customer • How do you determine which
is to balance cost to acquire and cost
increased, and it actually boosted sales by products and services represent
,
to serve against customer tenure and
10 percent, thanks to greater performance growth categories?
profitability.
discipline.
• How much pricing volatility is there
In mature markets, companies are
in the current product and service
constantly implementing differentiated
portfolio?
strategies and tactics. At one
telecommunications firm, the marketing • What is the cost to serve customers
budget was cut by about 40 percent. using current online and offline support
However, there was no relief on the target tactics?
sales numbers. Rather than betting big
on a new marketing campaign to increase
yield on existing tactics, big-ticket
expenditures, such as golf sponsorships
and TV advertising, were cut. But the
team realized that much deeper changes
were needed to hit their numbers at the
reduced budget level. After much debate
between Marketing, Sales, and Product,
the company dramatically reshaped
its marketing footprint, pulling out of
underperforming areas and going from
a nationwide presence to locations in
just 10 key markets. They then allocated
budget based on market size,
sales momentum, supplier strength,
and other criteria. At the same time,
they revamped their indirect channel
programs and moved from a residual
payout to pay-for-performance model.

6. 6 | Seven steps to better customer experience management
© 2011 KPMG LLP a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated
with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in the U.S.A. The KPMG name, logo and
“cutting through complexity” are registered trademarks or trademarks of KPMG International. 23183NSS
Step 3:
Track customer behavior, distill patterns, and adapt to accommodate shifts
International Data Corporation (IDC) an outcome, behavior analytics allows • What are your most and least profitable
estimates that 5 gigabytes of data you to identify and start understanding campaigns? Should you spend your
exists for every person on the planet. key drivers behind emerging trends budget online or buy print ads or
The need to make sense of that sooner so you can anticipate, align, airtime? How quickly does campaign
information, and turn data into and adapt quicker to accommodate effectiveness erode over time?
actionable insights, is the business behavior shifts.
intelligence challenge.The traditional
Corporate decision makers can quickly
way of analyzing data involved pulling
uncover behavioral patterns across any
information using database query tools,
aspect of customer interaction and act
,
and then running regression analysis to
on these timely insights to increase
understand propensities. If someone
customer acquisition, retention, up-sells,
bought diapers every two weeks
cross-sells, and Web monetization.
for the last two years, the predictive
Specific applications include
model would suggest that he or she
market basket and loyalty analysis,
will likely do so again. The problem is
merchandising and marketing
that customer behavior is not linear.
optimization, and online analytics.
And although predictive analytics has
evolved significantly, many propensity Key points to consider
models are still largely developed by
• Are current propensity models able
reverse engineering outcomes like
to identify emerging trends that
purchase and churn events to identify
represent growth opportunities?
leading indicators. While useful,
predictive analysis lacks the ability to • Beyond seasonality and regional
identify emerging trends that are driven factors, what is driving changes in
by different leading indicators quickly. purchase patterns?
The task is limited by the time required How does in-store behavior
• How does in-store behavior affect
to run a new regression model focused
online purchase decisions?
affect online purchase
on tracing events that lead to the new decisions?
What is the connection between an
outcome.
abandoned online shopping basket and
Behavioral analysis has surfaced in subsequent purchases, either in-store
recent years as the approach that fills or online?
this void. It enables organizations to spot
• What are the best ways to target
and sort new patterns by association.
your most profitable customers?
Think of association as answers to
Are you reaching your most profitable
questions that may not have been asked
customer segments?
yet. So in contrast to reverse engineering

7. Seven steps to better customer experience management | 7
© 2011 KPMG LLP a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated
with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in the U.S.A. The KPMG name, logo and
“cutting through complexity” are registered trademarks or trademarks of KPMG International. 23183NSS
Step 4:
Develop lead nurturing and customer management plans for target audiences
Every interaction informs the next Similarly, customer management plans Key points to consider
interaction. Over time the information can be developed to address events that
• How are past customer and prospect
yields actionable insights for sales occur during the service and customer
lists managed and leveraged by sales
and service engagement. Strong lead life cycle. Event triggers and responses
acquisition programs? How effective
nurturing and customer management can be tiered by segment, risk, and value.
are your win-back campaigns?
programs are built around insights about A customer who spends $5 per month,
interests/needs and preferred contact for instance, will trigger certain • How many times a year does your
preferences. For instance, downloading a responses, such as sound bytes and company communicate with the
white paper or podcast on a new product e-mail notifications, while a customer customer? How many times a year
,
or service might indicate that a prospect who spends triple that amount may does your company market to a
is looking for preliminary insight, but is receive a dedicated customer service prospect?
not yet ready to buy. The company can number and a single point of contact for
• What is the optimal contact strategy
respond to those inputs by directing issue resolution. Knowing the average
for renewing and up/cross-selling
additional related material toward the lead time and the typical progression
customers?
consumer over the coming weeks and of trigger events can help product
months. A request for a free trial or and marketing managers gauge the • What are your customers, most
demo, on the other hand, might signal a effectiveness of current campaign preferred communications channels?
greater degree of interest, one that might strategy and refine accordingly.
• What are the most critical touch points
merit a sales call or other more personal
in your sales and service life cycle?
communication.
It’s important to define a structured plan
for different stages of lead generation.
If a prospect says “no” today, the lead
should not be disposed of. Information
picked up in that interaction can still form
the basis for subsequent contact.
Even cold leads need their respective
decision pathways. For instance,
the prospect may still be under contract
or may be waiting for prices to go down.
That information is then compiled into
the lead nurturing plan to be acted upon
later as the prospect’s needs change.

8. 8 | Seven steps to better customer experience management
© 2011 KPMG LLP a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated
with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in the U.S.A. The KPMG name, logo and
“cutting through complexity” are registered trademarks or trademarks of KPMG International. 23183NSS
Step 5:
Develop a customer-centric information architecture
Gaining a single view of the customer will be gradual. While the path generally Key points to consider
is critical, yet hard to obtain, particularly starts with call center and Web initiatives,
• How quickly can new information about
since many large organizations tend to the journey eventually touches customer
a customer disseminate through your
have information about the customer databases and data warehouses,
enterprise?
distributed across multiple systems. knowledge bases, search technologies,
The problem is complicated by the fact mobile applications, online portals, • Was your information architecture
that information captured about the online communities and social media, designed for products and systems,
customer typically only describes the marketing campaign management, or customers?
responsible party on the account. customer service systems, product
• How does your information architecture
,
The account may be a household where and service configurators, simulations and
account for relationship hierarchy?
there are multiple family members or visualizations, as well as manufacturing,
a business where there are multiple inventory, billing, shipping and delivery, • How do you categorize customer data?
employees. For some distributed and replenishment of the supply chain, By life cycle events, interactions,
businesses, headquarters may be even in-vehicle and handheld systems. or products?
the responsible party for the account. None of these areas remains untouched.
• Are your marketing and customer
Designing and deploying a customer-
Application design and development is databases integrated? If so, what is the
centric information architecture
not a sequential process. Neither is the unique identifier?
involves understanding the entity
shift to a customer-centric information
type, creating the entity relationship
architecture. The change process is
structure, linking events to the structure,
recursive and iterative. Many activities
and then populating the entity
can take place in parallel. Just about all of
structure with relevant data over time.
them will be done many times, over and
Another compelling reason to create a over again.
customer-centric information architecture
is because customer-facing applications
demand it. Design and development of
customer applications is not the same The problem is complicated
as design of applications that run the
business. In many ways, what we’re
by the fact that information
really talking about here is the shift of your captured about the customer
organization’s information systems from typically describes the
a product-centric focus to a customer-
centric focus. For most communications
responsible party on
and media companies, the move to a the account.
customer-centric information environment

9. Seven steps to better customer experience management | 9
© 2011 KPMG LLP a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated
with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in the U.S.A. The KPMG name, logo and
“cutting through complexity” are registered trademarks or trademarks of KPMG International. 23183NSS
Step 6:
Deploy workflow-based tools to marketing, sales, and service
stakeholder groups
Today’s multichannel environment creates Better connectivity and transparency Key points to consider
many more sources of potential customer can also create better reporting tools,
• How well coordinated are handoffs
interaction. Social and commercial such as dashboards, and easier
between marketing, sales, and service
networks, for instance, offer important monitoring, through enhanced
functions?
clues into the potential for up-selling, performance measurement capabilities.
switching providers, and increasing For companies wrestling with legacy • How well does your company manage
revenue. Eliciting this information requires architectures and fragmented databases, customer escalations? How long does
that companies develop the ability to SaaS and cloud computing can be a way it typically take to resolve? How many
monitor customer behavior by channel to leapfrog over to a more integrated data are not resolved?
,
and integrate that information across the and workflow management platform.
• How are lead nurturing and customer
organization.
management plans monitored?
Workflow tools provide a way for sales,
• What tools are in place to facilitate
marketing, and support functions to
workflow across business functions?
perform key tasks more collaboratively
and transparently. These technologies can • How much visibility and control do
ease bottlenecks, reduce paperwork, customers have on service issues
and improve communication between and through online portals?
among departments. The real-time nature
of these systems allows information,
such as a new lead, to be flagged and
qualified. Once vetted, that lead, and the
entire customer record, including notes,
can be fed to the sales team.
Similarly, negative customer satisfaction
feedback can trigger workflows.
Depending on the issue, response may be
an automated e-mail or an outbound call by
a service quality agent.
Social and commercial networks, for
instance, offer important clues into
the potential for up-selling, switching
providers, and increasing revenue.

10. 10 | Seven steps to better customer experience management
© 2011 KPMG LLP a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated
with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in the U.S.A. The KPMG name, logo and
“cutting through complexity” are registered trademarks or trademarks of KPMG International. 23183NSS
Step 7:
Create a customer experience map to optimize touch points
The customer experience map charts Organizations often develop multiple • What percentage of work flows ends
the journey from first contact with experience maps covering customer- up on jeopardy paths?
a product or company through the facing touch point categories, such as
• How do you measure the effectiveness
relationship life cycle. The goal is to shopping, onboarding, bill payment,
of customer experience delivery?
align process, policy, technology, and service support. A prospective
and organization with needs and customer might be in the market for a • Can your company drive growth
preferences of the target audience. new smartphone, for instance. To acquaint using customer experience as a
A map can help define functional herself with current offerings, she might differentiator?
requirements to support the launch start with Internet browsing, then head to
The quality of the customer experience
,
of a new product or service. It can a retail outlet to compare products and talk
has a direct bearing on sales, profit,
also help identify gaps in existing one-on-one with a sales representative.
and overall market position. For many
processes. With that information, the customer
companies, improving it will involve
might then return home, consult with a
It’s important to note that a customer changes in how data is captured,
few friends, and shop online for the best
experience map is not a workflow shared, and leveraged and will require
deal. Using customer experience maps,
diagram. Although process flows are structural improvements in how staff
organizations can design and coordinate
underlying components, they are used across functions work together.
experiences across each touch point to
primarily to assess strength of existing While defining and refining the
deliver consistent messaging and calls to
capabilities and to identify dependencies customer experience is an ongoing
action.
between business functions. process, there is growing urgency to
Strength is tested with customer use Key points to consider act. The communications and media
cases that represent jeopardy path companies that lead in this area can have
• Who owns customer experience within
scenarios. For instance, one use case a significant competitive advantage over
your company? If ownership is shared,
for a VoIP phone service provider tests slower-acting peers.
who drives customer experience
how well the current process addresses
tradeoff decisions?
prospects who do not have broadband
at home and/or a data plan on their • As business processes are defined,
mobile device. In this same example, what customer experience factors
a dependency on the VoIP provider’s are incorporated into the planning?
broadband service partner might be Are they included in go-to-market gate
weak if that partner’s broadband footprint requirements?
is limited. All this to address a simple
question:“Can I get your service?”

11. Seven steps to better customer experience management | 11
© 2011 KPMG LLP a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated
,
with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in the U.S.A. The KPMG name, logo and
“cutting through complexity” are registered trademarks or trademarks of KPMG International. 23183NSS

12. For more information on customer experience management
initiatives, please contact any of the following individuals:
Tony Castellanos
Partner
U.S. Communications & Media Sector Leader
KPMG LLP
212-954-6840
acastellanos@kpmg.com
Miriam Hernandez-Kakol
Principal
Communications & Media
KPMG LLP
973-912-6227
mhernandezkakol@kpmg.com
David Huang
Senior Manager
Communications & Media
KPMG LLP
973-912-6576
davidhuang@kpmg.com
The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or
entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate
as of the date it is received or that it will continue to be accurate in the future. No one should act upon such information without
appropriate professional advice after a thorough examination of the particular situation.
© 2011 KPMG LLP a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member
,
firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Printed in the U.S.A.
The KPMG name, logo and “cutting through complexity” are registered trademarks or trademarks of KPMG International. 23183NSS