How do calculate a link between CX and revenue?
“The link between customer experience and revenue is simple,” says Dan Roche, head of marketing, KPMG Small Business Accounting: “if a company can’t match the customer’s expectations, it won’t win and retain clients.”
In order to calculate a link between CX and revenue you have to clearly defined objectives. Designing a way of tracking experience that’s relevant to your customers is the critical part of the process.
For Mike Bainbridge, chief digital technologist, Rackspace, NPS is a great example, but understanding the difference between transactional engagements and a more general relationship with your customer is important. “Be prepared to measure different aspects of the interaction. It is important to recognise that your customer might have different roles or business functions,” he explains.
What’s constitutes a solid CX strategy?
Before we approach the fundamentals of a solid CX strategy, the first priority should be to ensure the entire service is agile and responsive. This enables you to work closely with customers to frequently review and iterate the approach to achieve better results.
"Offering both formal and informal incentives for employees who demonstrate commitment to CX is one way of embedding a CX-focused company culture"
At its core, the best CX strategy will ensure the brand promise is met at every stage of the customer journey. Mike stresses that this isn’t something that can be delivered in a silo: “CX management must be shared and delivered across the whole company.” From the initial interest following a campaign, subsequent enquiry, interaction with sales, on-boarding, and final service delivery, people and processes will overlap.
“If the experience is discordant between these touchpoints the chances the customer will invest are slashed,” warns Dan, “so it’s imperative to monitor the statistics particularly on journeys that have terminated before sale. Acting on these insights is what separates customer centric companies from the rest, some call it an outside-in approach.”
How do you decrease churn?
“The key to decreasing churn is proactivity,” says Mike. “If a marketer can identify when they’re at risk of losing a customer, they’ll be well-placed to secure the relationship and fix problems.” The best way to do this is simply having a constant dialogue open so that you can always determine the customer’s changing needs.
In turn, this will ensure the delivery of services matches the customer expectation. Internally, this involves working closely with service or delivery teams to align messaging. Other methods include hosting exclusive networking opportunities and training sessions.
Are there models that tie CX to business results?
Dan outlines a very simple model using the net promoter score (NPS). It works like this: an improved customer experience means an improved NPS. A higher NPS means clients are more likely to recommend the brand to others, so they gain more client referrals, which incur no discretionary marketing/client acquisition costs.
These referrals convert at a higher percentage than many other lead sources, as they’ve been introduced by a person they trust.
Many say that creating a great CX begins with employees. How does this work?
“In most situations, employees are directly engaging with customers, so if they’re not upholding the CX values the customers are unlikely to be happy,” explains Mike. So offering both formal and informal incentives for employees who demonstrate commitment to CX is one way of embedding a CX-focused company culture. “This doesn’t just mean paying the right salaries (although that is a factor), but also concerns the work environment, benefits and providing the right tools,” he adds.
Dan, on the other hand, runs customer reference programmes that aim to produce a given number of new client case studies or testimonials in a given time is also another way to engage employees. “The clients will be asked for feedback specific to their account manager; the results are then shared back to the account manager which helps create a virtuous circle, constantly improving customer experience.”
How do you measure CX improvements?
Identify your KPIs based on the objectives behind your CX initiative. Be clear about which customer behaviours and/or outcomes you’re looking to change; perhaps they were cancellation rates, repeat purchase rates, or pipeline conversion rates.
Another increasingly popular means of measuring CX is via customer satisfaction surveys, explains Dan. “These should be carried out over regular intervals and focus on specific points throughout the journey so you can identify the weak links, as well as understand what you are already doing well. Ask a series of questions to capture both qualitative and quantitative information.”
NPS is another widely adopted way of measuring an average satisfaction score without focusing on the granular elements of customer satisfaction on the customer journey. Instead, NPS focuses on just one single question: How likely is it that you would recommend our company/product/ service to a friend or colleague? The simple result is powerful as it gives the whole business something to work towards.
