Four predictions prescriptions for CEM clarity in 2015
[Note: This is a long one – but worth it! So get your beverage of choice and settle in.]
Admit it. You overindulged during the holidays. Oh, I don’t mean the liquor and libations, the decadent deserts, the game day gorging – after a long, strange 2014, you deserved all of that, and more.
I’m talking about your uncontrollable appetite for augury, your passion for prognostication, your sweet tooth for soothsaying. You’re addicted to prediction, and during the weeks around New Years, the succor you seek was more common than meth in Walter White’s motorhome.
Well, welcome to rehab. There’s a lot of hard work to be done in 2015 and in the cold, clear air of late January, what matters isn’t what some analyst or guru thinks might happen. What matters is what has to happen if your customer experience efforts are to end the year in better shape than when it began. (Which is far from a given. Accenture found that despite all of the attention and effort paid to customer experience, every one of the key CX metrics that they track declined in the latest survey compared to the previous year.)
[Note: As always, we use the term “customer” to refer to any person or thing with whom your organization wants or needs to have a meaningful relationship – thus customers, prospects, constituents, and donors as well as business partners, distributors, employees, and other stakeholders, etc.]
Customer experience management has (finally) moved from the realm of an opportunity that you might want to take advantage of. It is now firmly and inexorably situated in the realm of a fact of business that you have to deal with, or else.
In other words, the meaning of the CEM imperative (which is also the title of DCG’s most popular report of 2014) has shifted from realizing that CEM is an imperative to the imperative to make CEM a reality in and for your organization. And reality means that CEM is not just a feature of your marketing campaigns or your mobile apps but that it has become a deeply-rooted, company-wide, repeatable and fully operationalized competency.
But there’s the rub. At the beginning of 2015, what’s holding up CEM is no longer that firms don’t appreciate the need for it. Nor is it simply that they are unwilling or unable to commit the necessary time and resources.
The main problem is rather that CEM seems overwhelming – a massive undertaking that requires not only wholesale changes in just about everything you do but that also entails launching and mastering entirely new practices, such as wide-scale data collection and analysis.
Organizations are caught between the irresistible force of empowered consumers and the immovavable object of CEM – that is, the seemingly impossible task of getting started and building momentum with something as huge as managing (every) customer(‘s) experience.
Despite their best intentions, organizations feel like they are caught between the irresistible force of empowered consumers and the immovable object of CEM – that is, the seemingly impossible task of getting started and building momentum with something as huge as managing (every) customer(‘s) experience.
This perception of CEM is both understandable and unjustified. It’s understandable because vendors and pundits regularly depict CEM as something that:
- Encompasses every single interaction and touchpoint with a customer or prospect, over the entire lifetime of the relationship (aka “the customer lifecycle”).
- Rewards personalizing every interaction, based on what you know about the individual consumer (aka “personalization at scale”).
- Entails the collection, storage, and analysis of every possible bit of information and data about every customer or contact (aka “the 360-degree customer view”).
- Requires the use and mastery of powerful, sophisticated, and often complicated new tools (aka the rise of the “marketing technologist”).
And yet this totalizing (and often paralyzing) view of CEM is also unjustified, because in reality, the practices that can and will make a difference for CEM are smaller, more specific, and far more manageable.
In this context, we offer four prescriptions for CEM in 2015
In that spirit, I offer not predictions but rather four prescriptions for CEM clarity in 2015.
[Note: I’ll be writing in more depth and detail about each of these topics in the coming months. If you’d like to contribute to the research and discussion, please comment below or contact me to set up a call or meeting.]
1. Think of Customer Experience in Terms of Customer Journey(s).
Customer experience (CX) is commonly (and accurately) defined as something like “the customer’s perception based on the sum of their interactions with a company or brand.”
By extension, customer experience management (CEM) is obviously the management of these customer experiences, right? Well, no it isn’t. Or rather, it can’t possibly be, precisely because CX refers to the totality of all interactions.
That totality could extend over years or decades (there’s a reason it’s sometimes called a lifecycle) and encompass thousands of interactions and impressions, from website visits and app usage to call center and face to face conversations to mass advertising exposure, store visits, issue resolution, and even how your company appears in the news or the color and weight of the paper on which the bill is printed, etc., etc.
By definition, in other words, CX is life, the universe, and everything – and proposing to manage that is a fool’s errand. (Or a job for Prak, the character in Life, the Universe and Everything who is capable of (and condemned to) telling the truth about everything and everybody in the entire universe.)
The totalizing customer lifecycle view is useful as a heuristic but far too amorphous and intangible to serve as the basis of action. Instead, efforts to improve customer experience should focus on specific customer journeys.
Notice, that’s journeys, in the plural. Customer journey (singular) is sometimes used as a synonym for the cradle-to-grave customer experience or lifecycle. Rather, you should think of customer journeys as the relatively discrete, time-bound, outcome-oriented exchanges between a customer and a brand or provider.
Take the example of a cable provider. The key customer journeys might be: researching and selecting a new cable company; onboarding and service activation; issue resolution; billing; and service upgrades. Such journeys are small enough to be manageable yet comprehensive enough to have significant impact on the customer experience.
McKinsey estimates that over half of all customer interactions are part of such multi-channel customer journeys. In practice, this means that a limited number of journeys account for the lion’s share of revenue, as well as harboring most of the opportunities to influence customer satisfaction and build loyalty.
High-value customer journeys often involve multiple touchpoints and therefore numerous teams or departments within the organization. For example, the onboarding journey for a new cable customer might begin when the customer chooses the provider, extend through contracts, scheduling, installation (with a field rep at your home), and service activation, and end with the first billing.
By initially selecting one such journey for analysis and improvement, an organization can:
- Break up touchpoint-oriented structures and teams, which harbor silos of insight and data and are often driven by narrow incentives that don’t correspond to the customers’ interests.
- Gain knowledge of and experience with customer-centric structures and workflows via these combined teams.
- Begin to use and understand tools such as customer journey maps and experience design (aka service design), which can accelerate and improve CEM efforts.
- Identify and track outcome-oriented metrics and KPIs that clearly illustrate the business value of investments in customer experience, rather than “vanity metrics” such as customer satisfaction and net promoter score.
Bottom line: You can’t – and you don’t need to – control or manage the entire customer experience. Focus on the customer journeys that are the sources of value (for you and for your customers).
2. Forget Personalization and Embrace Relevance.
Focusing on task-oriented customer journeys also illuminates the primary limitation of the current obsession with personalization.
Make no mistake, personalization works. In a 2012 survey that I cite frequently in my presentations, 74% of UK consumers said they “respond positively” to firms that “understand” them – and this understanding was defined in the survey as “taking account of preferences, purchase history, and other provided information.” And an identical 74% of consumers in a 2013 US survey said they’re “frustrated” with website content that “has nothing to do with their interests.”
But . . .the key word here is “easier.” (And, “my interests.”) I would venture to argue that in almost every instance of “effective” personalization, the delivered benefit is relevance, and a reduction of effort. Google’s personalized search results get me to relevant content more quickly. (Assuming I’m interested in efficiency rather than expanding my mind.) Amazon recommendations lead to useful tag-along products. (As long as they’re not based on the purchases I made for my five year old niece’s birthday.)
We (vendors, analysts, and practitioners) tend to talk about personalization and relevance in the same breath. But they’re not the same thing. The first is primarily a benefit for the company, in terms of (so they believe) better attracting and maintaining the customer’s attention. The latter is primarily a benefit for the consumer, in terms of providing precisely (and perhaps only) the content (offers, services, functionality) that are useful and pertinent in the given context.
In practice, many so-called personalization initiatives actually aim at improving relevance – by, for example, sorting individual site visitors into segments or categories and then providing the (presumably) appropriate information. But since relevance is the aim, we ought to embrace it as such – and abandon the (useless) nirvana of fully personalized “Hello, Dave” digital experiences.
Bottom line: Personalization isn’t really about the customer, it’s about you. Focus on being personable, by offering timely, relevant, and discrete assistance.
3. Stop Binging on Big Data
Misunderstanding or misrepresenting personalization encourages firms to think they need to collect and understand every conceivable piece of information and data about virtually every one of their customers. As one firm advises, “Avoid sampling bias by capturing every data point found across multiple channels.” This insatiable appetite for all of the data about a consumer or user has a contemporary resonance – it’s what the NSA has called “the whole haystack” in order to justify their indiscriminate collection of data on many domestic communication networks.
This approach is however dangerous, unnecessary, and ultimately ineffective.
It is dangerous because consumers find it invasive. There is a growing gulf between the companies’ appetite for data in order to drive personalization and the consumers’ desire to avoid intrusive and “creepy” data collection. Too many vendor pitches about personalization simply ignore this consumer resistance.
Aiming to suck up and store every piece of consumer data is also unnecessary, because what ultimately matters is not the person, but the task or job they are trying to accomplish. As Clayton Christensen has noted people typically don’t buy products or services based on who they are, they “hire” products in order to get some kind of job done.
And wide scale data collection is likely to be ineffective, because, as the NSA has learned, the bigger the haystack, the harder it is to find the needle. The value of all of that collected data lies not in it’s volume or “bigness” – in fact, it’s not located in the data at all. The value is derived from the quality of the questions that data helps you answer – and queries about the customer’s task or job-to-be-done are more likely to be successful (i.e. lead to desired outcomes) than those designed to probe her demographic profile or segmentation.
Bottom line: You don’t need to know everything about your customers. (And they don’t want you to know.) Focus on recognizing and helping them accomplish the job they want to get done.
4. Demand That Vendors Provide Less Power and More Control.
2014 was the year of the hypercar (think supercar on steroids) McLaren introduced the 903hp, $1.3 million P1. Ferrari released the ridiculously named La Ferrari (47 more horsepower and costing a token $50,000 more than the McLaren.) And Lamborghini unveiled the absurd Veneno – at $3.9 million. These are vehicles with hybrid engines, adjustable suspensions, carbon fiber chassis, and millisecond clutchless gear shifts. Little of it makes much sense outside of a race track, but the manufacturers keep introducing more, faster, lighter, edgier, and insaner because . . . well, because they can, that’s why. Plus, they don’t have any trouble finding people willing to pay.
Something similar is happening among vendors marketing their products as CEM platforms. The leading players must have their developers on intravenous caffeine drip, given the pace with which they’re releasing new features and functionality. They’re locked in a furious race to create an ever-broader and more capable marketing-and-experience tool set and the sheer power of the combined content/marketing/social/analytics/campaign/kitchen sink solutions is breathtaking.
Like the hypercar companies, the CEM vendors find plenty of buyers. And like the hypercars themselves, most of the potential of the CEM platforms is never exploited by the owners. The dirty little (not so) secret of CEM technologies is that so-called end-users are becoming non-users – and ever more so, as the vendors aggressively innovate with new or extended features when the buyers haven’t figured out how to use the stuff from three versions ago.
It’s like giving a hypercar to someone who’s used to managing their transportation needs with a pair of reins, a buggy whip, and a 1hp wagon. It’s created a great market opportunity for service providers, who increasingly offer courses, boot camps, and quick start programs for befuddled marketers who are asking “Dude, where’s my horse?”
Bottom line: Tell vendors to stop the madness. When you select technology and/or service providers for CEM, favor those that pledge to help you master solutions you can and will actually use.
[Note: To repeat, each one of these prescriptions deserves and will receive deeper analysis from DCG in the coming months. What do you think? Can (and should) journeys and jobs rein in the grand illusion of cradle-to-grave experience management and boundless data collection — and define a sense of customer experience that real organizations have a real chance to master?]