New Industry Standards for CX Could Make It Easier to Show ROI

In today’s competitive business landscape, customer experience (CX) has become a critical differentiator. Yet despite the intense focus on CX since 2020, this year saw a decline in average CX quality  across 10 U.S. industry categories.

Meanwhile, executives want to understand the value their organizations are getting for all this CX spending, and 66 percent of CX leaders say they’re feeling more pressure to demonstrate ROI. It’s not easy to do with the current tools, and 63 percent of CX leaders say some CX benefits go unmeasured at their organization.

One of the few tools available to quantify customer satisfaction is the Net Promoter Score (NPS), developed by Bain & Co. to rate how likely customers are to recommend a brand to others. However, the NPS illuminates a narrow portion of the customer experience, which is why Bain recently partnered with other CX groups to develop new industry standards “that will help companies link CX efforts to brand growth.”

The group recently released their initial draft of “Global Standards for Customer Experience Teams,” which focuses on company culture, employee experience, CX capabilities, and execution. The criteria used in these new standards can help CX leaders and teams prepare to benchmark their CX programs and create a plan for optimization and clearer ROI.

What’s in the New CX Standards?

As with any major initiative designed to drive business growth, there has to be a commitment and a clear path coming from the top of the organization. At the leadership level, the standards cover the customer-centricity of the culture, alignment of purpose and values with brand positioning, measurement against CX goals, and the creation of a centralized CX function.

The framework also spells out the importance of regular collection of employee feedback, ongoing employee coaching, and hiring and employee recognition processes that reflect a CX focus. The potential impact of these EX practices is to more closely connect employee’s day-to-day activities with the organization’s overall CX goals.

Clarity on Collecting and Using Customer Feedback

Customer feedback is useful data, but only to the extent that it’s fully leveraged. The framework proposes benchmarking customer feedback and tracking feedback on the customer relationship, journey, and interactions.

Sharing insights from that data across the organization is recommended, along with real-time visibility and access, so teams can strategize, follow up with customers, and evaluate the performance of their CX activities. Making the data available without silos and using it for follow-ups could correct a major issue that consumers have with companies: feeling like they aren’t seen or heard. In the most recent State of the Connected Customer survey, 66 percent of consumers agreed that “most companies treat them as a number.”

Using the customer feedback recommendations in the new framework, organizations can start now to clarify the kinds of customer feedback they gather, how they analyze it, who can access it, and what processes use that feedback.

Creating a Comprehensive Customer Data Map

Consumers perceive that they don’t receive a lot of value for the data they share with most organizations; 79 percent of consumer participants in the State of the Connected Customer survey agreed that “customer experiences should be better considering all the data companies collect.”

The new CX framework addresses this gap between data collection and results by recommending that organizations categorize their customer data and identify gaps they need to fill. There are also recommendations for linking specific types of data to specific goals, such as acquisition and retention, as well as to shape the creation of pilot programs for new CX elements.

Organizations can use the criteria to start classifying their data, filling in missing data categories, and analyzing their improved data to better understand and benchmark their customer journeys.

A Clear Focus on Value

The value management section of the framework outlines how organizations can make the most of their data to show the results of their CX investments. In addition to tracking customer growth rates, the guidelines recommend predicting the value of each customer, quantifying the value of customer referrals, and regularly sharing these customer value metrics with the C-suite.

This section also suggests using data to pinpoint “the key factors that drive customer value” for use in brand differentiation, and combining those insights with customer feedback to make data-informed CX decisions. These steps can help create value for customers in exchange for the data they share, which can help to build trust and loyalty.

These value measurement capabilities depend on the earlier elements of the framework, including executive buy-in and a comprehensive approach to collecting and analyzing customer data and feedback. They also mark a stage at which it becomes possible to make data-driven, granular decisions about customer journey and life cycle improvements, especially in regard to personalization. At this stage of maturity, the organization can track the profitability of individual customers, assign them to precise segments based on their needs, lean into hyper-personalization, and continue to make other data-driven CX refinements.

New Ways to Demonstrate CX ROI

Throughout the CX ROI recommendations, the common threads are leadership investment, a customer-centric culture, and methodical use of data and customer feedback to benchmark performance and track improvements in ways that can be clearly measured. This approach goes well beyond the NPS and voice-of-the-customer tools that most CX teams already use. It offers a way for CX leaders to clearly see what works and quantify the value of their efforts at a time when that’s a top priority.

Original article at: https://www.destinationcrm.com/Articles/ReadArticle.aspx?ArticleID=166107