An excerpt from the 2013 Customer Experience Management Guide What Is Customer Experience and Why Is It Important? By: Brett Shockley, Senior Vice President and Chief Technology Officer, Avaya A vaya defines customer experience management (CEM) as “the discipline of managing and treating customer relationships as assets with the goal of transforming satisfied customers into loyal customers, and loyal customers into advocates of your brand.” Excellent Customer Experience Pays Research shows that customer service is second only to value for money in importance when building a brand. In order to deliver great personalized customer experiences, organizations must understand their customers: why they buy, what they buy, and why, when, and how they make contact. Customers that have a good customer experience are prepared to spend more with an organization—and the rewards can be significant. • Eighty-two percent of consumers will buy more from companies that make it easier to do business with them (Avaya and BT research, 2013). • Seventy percent of consumers are willing to spend more money with a company that provides good customer service (up from 58 percent in 2010) (Echo Research, 2012). • Fifteen percent of consumers said they would spend 20 percent more with companies with good service (up from 5 percent in 2010) (Echo Research, 2012). In contrast, if an organization doesn’t understand its customers—or delivers an unsatisfactory experience—why would customers buy more? • Twenty-six percent of consumers are not getting what they need the first time they contact a company’s customer service center (callcentres.net, 2011). • Thirty-six percent of consumers will consider defecting after only two or three attempts to resolve their query (callcentres.net, 2011). • Twenty-seven percent of consumers indicated that they were likely to or had already moved their business as a result of their interaction with a customer service center (callcentres.net, 2011). • Forty-four percent of consumers regard customer loyalty as a relic of the past (Avaya and BT research, 2013). Accenture’s latest annual Global Customer Satisfaction Survey also provides compelling evidence of how vital the service experience is when it comes to shaping consumer buying To manage the duality between customers and companies successfully, companies need to take a long-term approach. Together, the customer and the company embark on a journey. decisions, long-term loyalty, and the manner in which consumers recommend—or do not recommend— companies, products, and services. While understanding the importance of customer experience is a good start, it doesn’t happen by accident. Customer experience—the entire customer journey—must be cultivated and managed through a process. The Duality of Customers and Companies At times, customers and businesses have conflicting needs—yet these same needs link the two together. • Customers want to receive excellent service across all divisions of the company; they want to be treated consistently and feel as if they are known, regardless of which department they are dealing with at the time; they need problems resolved in a timely fashion; they want the best products and services; they want convenience; and they want to feel like they’re valued by the company. • Companies want growth and revenue; they want to be efficient and reduce costs; and they want to increase the overall amount the customer spends with them for as long as possible. While these needs may seem diametrically opposed, by managing the customer experience, companies can fulfill customers’ needs while at the same time satisfying their own. For example, improving internal efficiencies—such as bringing in back-office subject matter experts while engaging customers—can improve service and resolve problems, which in turn increases loyalty and lifetime wallet share. To manage this duality successfully, the organization needs to take a long-term approach to the customer experience. Together, the customer and the company embark on a journey. The journey may begin before the customer even connects with the business directly and continues long after the customer makes the first purchase. An excerpt from the Avaya 2013 CEM Guide Figure 1.1: The Customer Experience Journey OWN Renew Research Promote/ Detract PURCHASE Buy Use/ Seek Support Need/ Want Onboard Select Source: Avaya internal research. The Customer Experience Journey Customers go through several phases during their journey with an organization, and their objectives, actions, and expectations differ based upon which phase they are in. As outlined in Figure 1.1, the main phases of the customer experience journey are: • Research. In this phase the customer may be conducting broad Internet searches, reading online comparison guides and product reviews, consulting with friends, receiving information by word of mouth, soliciting feedback via social sites, browsing company websites, stopping by retail stores, and interacting with sales representatives either in person, on Facebook or Twitter, or over the telephone. While customerinitiated interactions open the door to a potential sale, organizations can proactively engage customers during this phase. For example, a company can respond to a tweet from a customer asking about an offer or leverage search engine optimization to provide brief but informative product information. • Select. Customers in this phase have made the decision to buy, though the purchase may not take place right away. • Buy. This phase includes all the steps a customer takes to make a purchase (online, in a retail store, or over the phone) and the actions required to express what they want, generate payment, and receive confirmation that their order has been processed. Even if the customer is making the purchase using a self-service channel such as Web chat, the organization can proactively engage them during this phase. For example, if it appears that a shopping cart is about to be abandoned, initiating a Web chat could engage the customer and move them to the final purchase phase. • Onboard. This phase typically refers to the first 90 to 120 days of ownership, when new customers are most likely to require help using a product or service. During this phase, they may reach out to customer service for help setting up, using, or installing the product; An excerpt from the Avaya 2013 CEM Guide they may look up troubleshooting instructions on the website; or they may call the support center for additional help. This step is absolutely critical in the customer-to-product/service acclimation process; it offers the opportunity to cement the emotional bond that occurs between a customer and the company and product/service that the customer has purchased. While customers often initiate service requests, organizations can again reach out proactively—for example, by sending tips via email explaining how to make the most of a purchase. • Use/Seek Support. This phase is defined as the physical motion of putting a product or service into action. Various levels of usage may occur as the customer becomes more familiar with the product or service and learns how to take advantage of its features. It also involves preserving and caring for the product or service, particularly if ongoing maintenance is required for its upkeep and continued good operating condition. • Promote/Detract. This phase of the customer journey occurs when a customer refers or advocates for the company (brand), product, or service that they have purchased and used to a friend or colleague, or many “friends” or “followers.” It can include a variety of actions such as posting positive reviews or promoting the company or product using social media. Negative experiences, obviously, can lead to customers publicly criticizing a company or its products. This phase directly impacts a company’s Net Promoter Score®. • Renew. This very critical step occurs when the customer makes a decision to leave or stay with the company, continue to use or discontinue use of the product or service that was purchased, or potentially make an additional purchase. Renewing an annual membership to a gym, continuing to buy health insurance, and closing a checking account are all actions that may occur during the Renew phase. Existing customers are often willing to interact with customer service representatives and may reach out with questions or concerns before making a decision. The Renew phase is directly related to customer lifetime value (CLV). DIFFERENTIATION IN ACTION The Jiangsu branch of the Bank of China has added video-enabled computers to its contact center, allowing customers to quickly access live agents from their own videoenabled devices. All these phases can be grouped into Purchase or Own categories, with about two-thirds of the customer journey (and the bulk of the interactions and opportunities) happening during the Own phase. The customer’s perceptions and experiences during every step of the journey—as well as how all these interactions are handled—become part of the overall experience. Customers should experience consistent treatment and messaging across all channels and when interacting with different parts of the organization, including sales, retail, marketing, customer service, etc. Aiming to optimize the customer experience should be embedded in the organization’s culture. In fact, the entire customer experience strategy should be practiced company-wide—it’s not just for An excerpt from the Avaya 2013 CEM Guide the contact center. For example, if a company’s message is “white glove treatment,” is this reflected when the customer interacts with accounts receivable or the warehouse? Or do those departments undermine that message? Managing the customer experience and understanding the customer journey are essential both in terms of customer service and for driving customer profitability. To this end, the new discipline of CEM has been developed. Improving the customer experience throughout a customer’s journey ultimately results in increased loyalty, retention, and advocacy— and an increased lifetime value. CEM strives to improve the value a customer represents to the organization over the lifetime of their relationship by optimizing each interaction and creating an engaged customer relationship. This drives repeat purchases, customer retention, customer referrals, price premiums, and reduced support costs. To deliver an excellent customer experience, it’s essential to align the company’s strategy, objectives, and operations with its customers’ dynamically changing needs and expectations. Organizations must plan to evolve and integrate communications, information, and processes in order to adapt and proactively manage customer experience expectations—in real time. The challenge is that every interaction point, communication channel, and service route added to increase differentiation and stimulate growth also increases the risk of dissatisfying the customer. Despite the risk, the opportunities and rewards are huge for organizations that realize that the customer experience is their brand and that this drives the lifetime value of a customer. Two-thirds of the customer’s journey with your company occurs AFTER they’ve purchased your product. Organizations that focus on CEM are focused on delivering positive customer experiences—and in doing so, they are also focused on driving sales through competitive differentiation, customer retention, and overall brand advocacy. Brett Shockley is Senior Vice President and Chief Technology Officer for Avaya. He is an industry veteran with more than 25 years of thought leadership in the telecommunications and contact center markets. An excerpt from the Avaya 2013 CEM Guide