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Tagged: customer experience research

Transforming your business’s perception of customer experience

August 15, 2017

If you’re a business executive, director or manager, you know customer experience should belong at the center of your daily activities. However, many organizations focus more on their operations, products and internal work environment than on their customers. How can businesses improve? Creating lasting structural change within an organization isn’t easy. However, executives can encourage their companies to transition toward customer-centricity by focusing on customer experience. Here are four major transitions in mindset and attitude executives can encourage:

As highlighted in this Forbes article, many companies are structured around products instead of customers. This is a symptom of a company being too self-involved to take a step back and understand its customers. When a business focuses too much on itself, it looks at the products it provides, how they can be improved and what new products they can bring to the table. Conversely, a customer-centric business understands who it serves, what their needs are and how the business can delight these individuals. Businesses must switch to customer-centric thinking by letting customers define their business, constantly soliciting feedback and putting their experiences at the forefront of the business.

Business helper to business differentiator

In financial services, most providers think they are relationship-focused above all else. However, according to the Bank Administration Institute, consumers rarely think of financial service providers as being relationship-focused. The reality is that the various responsibilities business face (marketing, sales, project administration, IT, etc.), while important, have the capacity to distract from the central goal of a business to make its customers happy. Businesses must move from a model that likes strong relationships with customers to a model that prioritizes strong customer relationships above all else.

Nice-to-have to must-have

Many businesses fail to regularly solicit feedback from customers. More commonly, businesses solicit feedback, but fail to analyze or act appropriately on their customers’ requests. Businesses tend to prioritize daily operations and revenue goals above trainings and meetings regarding customer experience because the day-to-day items feel more urgent. However, this designation of what is important is based on the perspective of the business professional, rather than the customer. Back-of-the-house work helps the business itself function, but does little to contribute to customer satisfaction. If a company’s priorities stay out-of-whack for too long, hundreds or thousands of customers are left with an underwhelming or mediocre perception of the company due to faltering customer experience. This underwhelming experience risks losing customers, and makes the brand’s/company’s value rely solely on the products it offers, which is a hugely risky strategy, as products are constantly changing and innovating among competitors. Making customers excited about the brands they do business with is a must-have.

General effort to specific behaviors

Almost all business care about customer experience, but they don’t know how to improve. Here is a typical, and poor, format for acting on customer feedback: Negative customer feedback comes in through dissatisfied customers reaching out to management, management calls together a meeting to highlight the issue and demand improvement, and employees make efforts to improve, masking over the underlying causes of poor customer experience for long enough that the issue slips from everyone’s mind. Sound familiar? This failed effort happens due to lack of ongoing coaching and training. The reality is that customer experience relies on a practiced set of behaviors and actions. CSP strives to utilize Voice of the Customer research to guide ongoing coaching sessions and training sessions with management. Meaningful change only comes when it is practiced regularly and when positive customer experience behaviors become engrained through repetition and training.

ROI of customer experience research



If you’re already reading this, there’s a good chance you see value in customer experience research. Understanding your customers – what delights them about your company, or what annoys them to the point where they

begin to explore your competitors – is essential in today’s competitive landscape. However, many businesses fail to dedicate the time and energy necessary to understanding their customers. Customer experience research isn’t an annual event that belongs in a PowerPoint slide – it’s the lifeblood of an organization, and should be treated as such.

In order to give customer experience research the attention it deserves, it’s important to remember the return on investment (ROI) customer experience research provides, and the different ways it pays off:

Customer Retention

The most obvious ROI for customer experience research is customer retention. Simply put, happy customers don’t leave. As brands become more sophisticated and competitive with the services/products they offer, customer experience becomes an increasingly important competitive advantage. In fact, many businesses and organizations continue to adopt the mentality that customer experience is their greatest differentiator among competitors. For a long time, businesses have found worth in customer retention due to the higher cost of acquiring a new customer, rather than maintaining an existing one. Now, that incentive has increased by placing customer experience as a form of customer retention, a focal model for competitive advantage and an expectation of Millennial customers.

Offering New Products and Services

Learning about customer experience helps businesses in a couple of important ways: They learn how their customers think, which in turn improves their customers’ satisfaction with them. These two customer experience improvements allow companies to offer new products or services in tactful ways. When they understand how their customers think, they can proactively address needs or desires with services/products they already have available. Likewise, when customers are increasingly happy with a business, they’re more open to enhancing their relationship. They know the company has their best interest in mind, so they trust new business opportunities and offers. Targeted customer feedback can guide businesses in enhancing relationships on a customer-to-customer basis, and provide a roadmap for future interactions with specific customers.

Development of New Services

Customer experience research gives businesses a new level of insight into their customers’ thought and needs, and opens the door to identify trends of unmet needs. These trends in feedback often lead to new products, new services or simply changes in the way they do business. In the same way, businesses avoid “flop” product/service rollouts when they listen closely to their customers. Through customer experience research, businesses tend to find a gap that their customers need, rather than creating a product that may or may not be desired. This gap directs their attention and guides the development of a new product or services, rather than taking a shot in the dark.

Customer Advocacy

Companies invest millions of dollars every year toward advertising expenses, offering incentives for new customers and hiring third party social media strategists to increase their brand awareness. However, customer advocacy remains one of the most effective ways to obtain new customers. When a client is so excited about a brand or service that they reach out to their friends and family, those potential customers know the perspective is coming from a source they trust. They place the highest value on trusted recommendations without an ulterior motive. Customer experience research ensures that businesses aren’t just satisfactory, but that they understand their customers enough to truly excite and engage them in a way that inspires this type of customer advocacy.

If your organization is ever in doubt about the ROI of customer experience research, take time to outline the ways it impacts customer retention, pitching new products, development of new services and creating customer advocacy.

Likewise, keep these different categories top-of-mind when conducting customer experience research, and use it as an opportunity to grow the most lucrative parts of your business.

Financial institutions: Are you leveraging benchmarking data?

July 12, 2017

An example of benchmarking categories

When a financial institution evaluates itself to identify opportunities for improvement, key performance standards, also known as benchmarks, are essential. Benchmarks paint a clear picture of a bank’s performance. More importantly, benchmarking sets up a long-term framework the bank can use to consistently measure its performance against key performance standards over time. This feedback, gained directly from customers, is invaluable for managers.

In 2017, benchmarking is a practice every financial institution should undertake. Key performance metrics are centered around impacting the bottom line, and improving benchmarking scores results in improved revenue. Things like overall customer satisfaction, customer evaluation of employee performance and wait times for help from call centers influence customer decisions. Happy customers are likely to open new accounts, develop more comprehensive relationships and vocally advocate for their financial institutions.

One of the most effective ways customer experience researchers and performance managers help their clients is by not only executing benchmarking programs, but by giving their financial service provider clients context around the benchmarking. Which metrics are being measured? How does customer experience vary across different channels? How does one financial institution’s performance compare to its closest competitors? The context of these answers brings benchmarking to life for managers.

Metrics

One of the ways managers learn about their overall customer experience is through a variety of metrics. Different metrics about specific performance indicators give managers perspective on their financial institution’s strengths and weaknesses. For example, a financial institution may have highly competent individuals in its call centers, but have a long wait time. As a result, customer satisfaction may be low with their call centers. Without standalone benchmarks for “call center employee performance” and “call center wait time,” managers wouldn’t have a clear understanding of why customers feel dissatisfied. A manager may falsely identify irritable employees as the issue, instead of the wait time. By having clear benchmarking obtained through feedback, financial institution managers can properly diagnose their underlying business issues.

Channel

Another source of context for managers of financial institutions to learn about their customer satisfaction is through various banking channels. Lending (consumer, mortgage, business/commercial), online, mobile, branches and call centers all offer unique challenges and opportunities. Mobile, self-service banking apps need to be optimized for a simplistic user experience. On the other hand, branch employees need wear many hats as trusted advisors, and need to be able to answer a multitude of diverse topics for customers. Benchmarking not only these different channels, but the most important elements within each channel, helps clarify financial institutions’ strengths and weaknesses. Then, leadership and financial officers can work together to decide where to best invest their time and resources to drive improvement.

Competition

One of the most valuable uses of banking for financial institutions is to reference against their competitors. This can be delineated in ways like portfolio makeup, asset size and geographic region. By gauging against competitors, financial institutions discover their own relative strengths and weaknesses. Strength areas can be promoted to customers as a competitive advantage, while weakness areas can be targets for resources and enhancement. Working with customer experience researchers and performance managers helps to assess the risks and benefits of each category strength and weakness to further specify a financial institution’s biggest opportunities.

Benchmarking offers a multitude of valuable insights financial institutions can’t afford to pass up. By developing key performance metrics and making consistent efforts to improve benchmarking scores, financial institutions can stand on firm ground knowing the resources they invest in today will enhance their revenue and business goals tomorrow.

Customer Segmentation Pitfalls and Potholes

March 9, 2017

Customer segmentation can be an immensely useful tool in getting actionable insights from your customer research. From those insights, you can devise strategies to improve the customer experience, because you have a more specific understanding of what customers want. But segmentation is far from simple.

To get the most out of it, you need to understand a few things about the art and science of conducting customer research. That’s just what CSP has been doing for more than thirty years, so we thought we’d share some of our pointers.

What Can Go Wrong with Customer Segmentation

customer segmentation

Methodology Mishaps

What does your business have in common with the Large Hadron Collider – the massive facility in Switzerland that smashes atoms together to better understand physics? You both rely on the Scientific Method. Or at least, you should (and they certainly should).

Any good research, whether studying customers or plants or animals or atoms, is based on these standards, which have been the guiding principles of science since the mid-1700s. To get good results out of your research, your methods must be scientifically sound, unbiased, and verifiable.

Research is not just conducted, but designed. That means knowing how to create a sound and testable hypothesis, conducting the right kind of ‘experiment’ to test it, and verifying your results with the proper vigor. Get any of these parts wrong, and the rest unravels from there.

Contaminated Sample

Sometimes research starts from scratch, but often, it relies on parsing data you already have on hand. That might include one or more customer databases or Customer Relationship Management (CRM) tools. These databases must be meticulously maintained so as to avoid contaminating the results. Examples of database disruptors include duplicate entries, incomplete entries, “dead” entries (meaning, invalid or out-of-date information, such as dead email addresses), and false categorization.

A slip-up here or there may seem like not a big deal, but it can lead to disasters in customer communication. For example, in 2011, the New York Times erroneously sent out a special discount offer to a small list of 300 recent ex-subscribers to entice them back – except that it was delivered to 8 million contacts, including many current subscribers who suddenly became aware of a discount they were not being offered. Things like this can happen when database entries are not correctly or clearly identified and grouped.

You Know What They Say About Assumptions…

Everyone has conscious and unconscious biases and makes assumptions based on those biases – it’s only human, and it’s rarely malicious. But such assumptions, no matter how logical or benign, can still affect the viability of research results and the value you get out of them.

A good example of where you see this happening is in discussions of the different generations – Boomers, Gen X, Millennials, and so forth. Many sweeping generalizations have been made about each group, some supported by sound research, and others just created by socialization. Eye-grabbing headlines and op-eds easily filter through to form your beliefs about these potential customer segments.

When that happens, you are more prone to leaping to the wrong conclusion. Don’t assume that seniors don’t use mobile banking because they’re technologically illiterate, or that lower-income customers don’t have smartphones. Any conclusions derived from research must be supported by that research.

It Pays to Have an Expert on Your Side

Done well, customer segmentation can lead you to valuable insights and an improved customer experience. Done poorly, it can just as easily lead you astray, or not lead you anywhere at all. If it were easy, businesses like CSP wouldn’t need to exist – but luckily, we do. To learn more about how we guide businesses in using their data to provide stellar customer service, contact us


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SOURCES

New York Times email mishap
Unsupported assumptions

What is Customer Experience Research?

March 6, 2015

Traditionally, Customer Experience Research falls into two main categories.

In the first category, there are market research firms that take an academic or scientific approach to collecting data and presenting the findings. These providers emphasize the purity of their data and the rigor of their methods and processes for collecting that information.

In the second category, there are data collection firms that specialize in gathering, storing, and organizing vast amounts of data from a variety of sources. Through their proprietary systems and tools, they make their findings accessible and digestible to the end user.

What does customer experience research capture?

The two metrics most important to customer experience management are customer satisfaction and customer engagement, which exist on a continuum and influence each other in both directions.

Customer satisfaction is an immediate measurement of an experience, from something as small as an interaction with a customer service representative to the overall feeling a customer has that his or her expectations and needs are being met. This is arguably the starting point for all customer research.

Customer engagement is what keeps customers coming back. It captures the long-term equity that is built on satisfying experiences by measuring things like loyalty and how likely a customer is to refer others to their preferred brands and businesses. In this way, it’s a more useful measurement than simple satisfaction: customers who are strongly engaged over time are more willing to overlook or tolerate the occasional less-than-satisfying experience.

A great example of this comes from the consumer technology industry. Brands like Apple and Google each have dedicated, loyal audiences that will continue to buy their products and tout their benefits to friends and family, even when the products themselves fall short of 100% satisfaction (think: buggy software releases or smartphones so thin they bend in your back pocket). This is the kind of engagement every brand dreams of.

The Journey From Data to Information to Knowledge

data information and knowledge

Both the academic and data-collection approaches to customer experience research have value. Market research can reveal trends, insights, and patterns across large populations and broader spans of time. Data collection, meanwhile, has grown so sophisticated as to merit its own industry, aimed at helping the everyday business manager access intelligence about their customer – because it’s unlikely they have the expertise or time to sift through it all themselves.

Both methods also have their limits. Statistical research may be useful in an ideal world where all customers have the same expectations and needs, and all businesses face the same challenges in meeting those expectations. But in a real-world setting, the insights garnered from this research often ends up “watered down” and are unlikely to apply to each unique business or brand the same way.

It’s not unlike the idea of the self-help book, which can be a useful way to talk about people in general, but won’t always apply on an individual level. You can do everything “by the book” and still fall short of your goals if the book you’re going by doesn’t account for the nuances of your business or your customers.

In turn, data collection is exactly what it sounds like: collecting data and presenting it as information. But turning that into knowledge that you can act on? That part is up to you. These firms often step out of the picture at that point, leaving you to figure out how that information factors into your strategies and tactics, what merits your attention and what doesn’t, and what steps come next.

Bridging the Gap Between Research and Reality

The shortfalls of traditional customer experience research are how businesses end up thinking they know their customers, without actually knowing them. There’s a break in the process that prevents them from getting to that next level of knowledge and using that knowledge to improve their customer experience.

In our 20+ years of customer experience research, CSP’s guiding principle has been to not only gather and present the information, but to then guide our clients in creating the roadmap to a better customer experience based on a thorough understanding of their unique customers.

Why should anyone have to figure this out from scratch? CSP has seen it all before, and we know what works and what doesn’t. Our experts are flexible enough to adapt to any given brand or business with a methodology that’s personalized every step of the way. Your specific questions about your customers, your market, and your competition are built right into the program, along with ongoing support, tools, and coaching to help you define and achieve your goals.

This level of customization and personal attention is hard to come by with traditional research models, but we believe it’s the key ingredient to successful customer experience management. We’re not passionate about data – we’re passionate about improving the customer experience, full stop.

For more information about CSP’s customer experience research methodologies and the programs we build to support them, contact us today by phone at (402) 399-8790 ext:101, via our website, or on Twitter @csprofiles