The service sector powers 80% of the Canadian economy. No longer are the traditional focus areas of natural resource development and manufacturing so core to our economy. Most Canadians no longer “make a thing for customers,” rather, they “offer customer experience.” Professions in the service sector include high-touch, high-tech and knowledge-intensive jobs, tourism, healthcare, retail and transportation, among others.
This is why creating a better customer experience (CX) is so critical. As an affluent country, Canadians seek services to improve and augment their lives, both professionally and personally. And it’s this potential that has seen a renewed focus on CX recently, especially during COVID.
This article dives deeper into how CX has evolved, where it’s going and how it can help your business. To share more, In Partnership With reached out to the current Board Member and Past Chair of the Customer Experience Professionals Association (CXPA). Stephan Sigaud is the Executive Vice President of Phase 5, a market research and consulting firm that helps clients on their journey to customer centricity. They are experts in research, user and customer experience, innovation and design to help clients realize customer value.
Customer Experience Continues to Evolve
CX is the evolution of a theme in the corporate world that’s been around since the early 1900s. While product quality (“TQM” or Total Quality Management) was the focus of most organizations then, it evolved first into customer satisfaction management. Then, it delivered customer loyalty and more recently, customer experience.
CX is evolving again from today’s customer experience to tomorrow’s customer centricity.
Customer experience as a focus area has risen to the top of executive goals and concerns. Global consultancy studies highlight this regularly. However, there’s a concern that CX is evolving to be more like customer relationship management. We all saw how quickly CRM changed to be tech-led with less positive outcomes for customers.
Listening to the Voice of the Customer
As there is more and more CX automation, there is a stronger focus on metrics. This is generally a good thing but it can also get marketing and business leaders into trouble. Net Promoter Score (NPS) is a great example of this where there are infamous cases of companies “chasing the number” instead of focusing on the customer.
Some leaders look to improve their NPS at all costs while forgetting that behind an NPS score are customers with real issues and real stories.
A lot of people don’t realize that CX is simply a means to an end. Organizations should focus on CX because they want to generate sustainable growth. Whether you’re an entrepreneur or in the private or public sector, companies need to deliver optimal CX. In doing so, customers, donors or citizens continue to rely on your brand for the service or product you’re delivering. Therefore, the goal of customer experience is to generate the right level of loyalty.
Maximizing Customer Experience is a Mistake
Not every customer has the same value to an organization. Thanks to technology-enabled insights, the marketing profession is moving towards more and more personalization. Marketers used to talk about media channels. Today, personalized channels can deliver the right experience to each person at the right time. Variables – such as lifetime value – enables strategic and tactical decisions.
Organizations require the right staff training to ensure they are delivering the right experience to the right people. Perhaps high value customers receive additional perks or benefits. This could include shorter call centre wait times, easier returns or more personalized services. These could enable top customers to enjoy their experience faster, easier or smoother and become more loyal.
Personal interactions are much more impactful than technology-enabled touchpoints.
Regarding corporate culture, all levels of an organization have to understand the need to manage CX properly. All companies need a clear and well-understood strategy. Finally, governance must be in place to have the right metrics to deliver upon it optimally, not maximally for every customer.
The ROI of CX
It’s getting frustrating to have to keep defending the value of CX from an ROI standpoint. Some executives still ask to see a demonstrated, independent ROI from CX (isolated from all other variables). By asking that question, it’s clear they’re not getting it. It’s very difficult to specifically identify the ROI of CX since it is so integral to the entire marketing function and customer journey.
Organizations today are more and more financially driven, especially the publicly traded ones. Empowering employees to meet CX goals ensures happier team members and therefore happier and more loyal customers.
It’s the alignment internally to a core mission that matters to ensure customers are serviced effectively.
We know that happier customers spend more and talk up such companies to their friends and family (which amplifies sales further). Plus, when customers consider a repeat purchase, it’s not only the experience they had last time, but the cumulative memory of related experiences that matter. Creating memorable experiences generates loyalty for the long term. Regardless of how it’s measured, loyalty is the main goal.
Owning the CX Function Internally
This question raises a big red flag. It doesn’t matter who owns it, as long as there is an understanding among the executive team. That’s where it should start since CX is all about delivering against the brand promise. CX and marketing are linked. Marketing is in charge of defining the brand and communicating the brand promise. Delivery of the brand promise is where the rubber meets the road with effective CX.
The authenticity – or the need for congruence – between the brand promise and the customer experience is one of the key success factors.
Immediate results are not guaranteed. To start, typically an organization needs a CXO. This role is not necessarily forever, but a CXO must get the organization educated to organize a cross functional approach to delivering on the brand promise. You must align all teams: marketing, operations, finance and HR. In fact, a new CXO doesn’t have to be anybody’s boss. A team of CX ambassadors doesn’t need to be nested under marketing or vice versa. However, if there is going to be a CX conversation, marketing has to be at the table.
Customer Experience Changes During COVID
We’ve seen a lot of organizations pivot to get closer to their customers in the field of feedback management. We’ve also seen the best organizations change their approach from typical satisfaction surveys. Before COVID, surveys focused on “How are we doing in terms of meeting your needs?” Today, a better insight into a customer’s mindset demands new questions. “How are you doing, Mr. or Mrs. Customer? How can we help you?” That approach of empathy is core to delivering customer experience properly.
We’ve also seen some negative examples recently. Some companies have put their entire CX program on hold. That often means no more surveys since the team is too busy or that the organization no longer has the means to support the CX team. This is puzzling:
If you’re too busy now to care about your customers and their experience, what else could you possibly be more focused on?
Entire organizations with a strong CX focus have been able to adapt to better serve their customers during COVID and that is in the spirit of customer experience. Whenever we come out of this – and we will – those brands who have executed successful CX approaches will have lasting positive effects as a differentiator. Those organizations that have reached out proactively to their customers in these times of crisis are already showing much better results in terms of business continuance and loyalty from their customers.
If anything, COVID has exposed the need for CX and made it even more of a competitive differentiator than it was ever before. That’s what makes CX the next competitive battlefield. The winners – especially in our service-dominated economy – will be the ones still standing.
In Partnership With
Stephan Sigaud is a senior executive focused on helping organizations grow with customer-centric strategies. As the Executive Vice President of Phase 5, he is passionate about partnering with clients on their business challenges and opportunities around customer centricity. Stephan is a current Board Member and Past Chair of the Customer Experience Professionals Association (CXPA).
Tim Bishop, CM is a multi-disciplined executive with a proven record of optimizing strategic efforts to expand the influence of leading organizations, such as the Canadian Marketing Association, Cineplex Entertainment, Lavalife.com, IMI International and Northstar Research Partners. In Partnership With is his latest focus to curate Canadian marketing experts to celebrate the power of strategic partnerships in a perspective-based content series.