13 Customer Experience Trends to Watch in 2013

Customer experience guru Bruce Temkin posted this prediction on Experience Matters. It is reflective of his knowledge, insights and research.

 

2012 was a very active year for customer experience management. I expect 2013 to be an even more robust year as we move deeper into the Era of CX Professionalism.

Here are 13 CX trends to keep an eye on this year as these efforts gain maturity:

1. Decline of surveys. As more companies thirst for customer feedback, the number of surveys has escalated. But there is a limit to customers’ willingness to complete surveys. As completion rates get more difficult to maintain, companies will become more efficient with the questions they ask, target questions at specific customers in specific situations, and stop relying as much on multiple-choice questions. Tidbit: When we asked large companies with VoC programs about the changing importance of eight listening posts, multiple choice survey questions were at the bottom of the list.                                                                                                     
2. Rise of text analytics.Companies are learning that some of the richest insights from customers come from unstructured content like comments on surveys, calls into the contact center, social media conversations, and chat sessions with agents. Companies will shift more of their focus towards collecting and analyzing these types of feedback. Tidbit: Nearly three-quarters of large companies with VoC programs are using or considering text analytics.
3. “Big data” predictive insights. It’s hard to talk about trends without discussing big data (in order to be fully buzz-word compliant). But what will this term mean for customer experience in 2013? Companies will blend together customer feedback data with troves of other data they have in CRM and other systems about customer transactions and value. Using this large dataset, they will predict customer satisfaction levels and Net Promoter Scores across their customer base. Since analytics requires more than just technology, we’ll see a surge of demand for data scientists. Tidbit: More than half of large companies with a VoC program are using or considering predictive analytics, but only one-third of large companies feel that they are effective at integrating CRM data in their VoC efforts.
4. Anticipatory service. As companies gain a deeper understanding of customers through research and analytics, they will use that information to develop more individualized customer experiences. Look for companies to route callers to phone agents most likely to help them based on anticipating why they are calling, train front line employees with different scripts based on anticipating a customers’ needs/interests/emotional styles, and proactively recover from service issues before customers even complain about them based on detecting potential changes to a customers’ loyalty. Tidbit: When companies responded very poorly after a bad experience, 47% of consumers stopped spending completely with the company. When they had a very good response, only 6% stopped spending and 37% increased their spending.
5. Experience-infused product development. We’ll see more companies create products with customer experience embedded throughout the entire development process. What will this look like? Product teams will define usability requirements, set minimum experience thresholds for product launch, and design the entire service lifecycle. Fidelity Investments evaluates all new product and experience efforts via a CX scorecard to determine the level of customer experience risk involved in a proposed project. Its “Customer Lens” process incorporates standards and checkpoints into business case and new product development methodologies to deliver more customer-centric experiences.
6. Design-based process improvement. As customer experience efforts highlight the need to redesign more operational processes, companies will combine customer experience efforts with other process improvement efforts such as lean sigma and design thinking. These combinations, such as GM’s bringing together of customer experience and product quality, will merge process-centric tools with the power of deep customer empathy. We’ll also see more companies follow firms such as Intuit that are embedding design thinking across their organizations (check out the Stanford d.school). Tidbit: 74% of CX professionals think that customer experience design is important for their company, but only 34% think that their firm is good at it.
7. Loyalty-focused contact centers. As companies more fully understand the link between customer experience and loyalty, especially with customer service, they will increasingly view contact centers as value-creators and not just cost centers. Some of the effects in 2013: less focus on average-handle-time and other productivity metrics, more focus on customer feedback and quality metrics, more on-shoring of previously off-shored interactions, and more investment in agent training and coaching. Tidbit: Consumers that are satisfied with customer service interactions are more than 4 times as likely to repurchase than those who are dissatisfied.
8. Appreciation of employee assets. Companies are beginning to see the deep connection between employee engagement and customer experience. So many firms will focus on their employees in 2013. We’ll see more CX programs develop internal ambassador programs and an initial wave of HR organizations leading employee engagement efforts across what we call Five I’s of Employee Engagement: Inform, Inspire, Instruct, Involve, and Incent. Tidbit: Highly engaged employees are 5.8 times more committed to helping their companies succeed and 3.5 times more likely to do something good for their employers that is not expected of them.
9. Mobile, mobile, mobile. Consumers will have more smart phones, more mobile apps, more tablets for them to do even more things wherever they go. Companies will increasingly integrate mobile into their product offerings and service experiences while integrating mobile with other channels, especially when it comes to combining desktop applications with mobile apps being used in physical stores. Tidbit: 31% of U.S. consumers use apps on their mobile phones on a daily basis.
10. Software as an Experience. The initial rise of cloud-based software (a.k.a. SaaS, or software-as-a-service) focused on renting access to software instead of the historical approach of selling licenses. As cloud-based software expands, we’ll see these offerings cater more explicitly to the needs of customers. How? More simple, highly-focused, specialized applications (like smartphone apps), more focus on quick initial usability, more sharing of best practices (usage, not technical), and customization based on behavioral analysis of users. Tidbit: Net Promoter Scores for tech vendors are more correlated to customer experience than product performance.
11. Resurgence of values. As more companies push forward on their CX journeys, they’ll find that there’s nothing holding their efforts together. The desire to improve customer experience will fall victim to other priorities if the effort is not tied to the core values of the company. But many organizations are so heavily focused on their operations that they’ve lost sight of their raisons d’être. I expect more companies to articulate and recommit to a core set of values like those of Zappos and Whole Foods, customer promises like that of TNT Express, and mission statements like that of the Dallas Cowboys.
12. Rethinking risk-experience trade-offs. Customer experience is often constrained by rigid requirements imposed by legal, compliance and risk management teams. As a result, companies are forced to collect additional information from customers, add additional steps in processes, and eliminate valuable self-service options. In 2013, given the increased emphasis on customer experience, we’ll see companies push back on and successfully eliminate many of the most egregious experience roadblocks.
13. Continuing CX education. Some customer experience practices are becoming standardized enough to create educational curriculum. In 2013, we’ll see more corporate training departments rolling out CX training, MBA programs incorporating more CX content into service and marketing courses, and the creation of standalone CX academic courses. Tidbit: The percentage of CX professionals that see training as an important professionals development goal increased from 52% in 2011 to 57% in 2012.

The bottom line: 2013 will be a busy year for CX professionals!

Customer-Focus: Why leaders of companies talk the talk but don't walk (or run) the walk?

Over the years I have written about many aspects of (not) Walking the Talk. I found that Chris Brown, CEO of MarketCulture Strategies, hit the nail on the head and effectively summarized (below) some key reasons why customers and employees don't believe what companies say.

Customer-focus is a term both overused and underdone. It sounds good in a mission or vision statement but many leaders don’t really know how to achieve a customer focused culture nor are they doing anything specific about improving it in a sustainable way. Many other leaders may know how to do it, but feel it may not be worth the effort and time required to achieve it.

There are many reasons the leadership of companies talk about it. They believe their customers and employees want to hear the “customer first” story. It sends the right message. Most leaders believe, at some level, focus on the customer is an important part of running a successful business. They understand that without customers there is no business.

So why do leaders of companies talk the talk but do not walk (or run) the walk?
The reality of being truly customer-focused – that is, having a customer culture – is somewhat different. It is challenging, particularly when companies have developed habits and structures that work against it.

Internal focus on operations, processes and working in silos create habits that can be hard to change. As companies grow they become more complex, communication becomes difficult and frequently confusing, processes are set-up to maintain quality and improve efficiency and eventually get in the way of doing the right thing for customers. Silos develop and internal politics result in people acting in their own best interests above the customer and the business. These conditions lead to at least 5 reasons why customers don’t believe you.

1. Misdirected compensation
Sometimes people are compensated in ways that work against the best interests of customers. There is no better example of this than the mortgage crisis in the US where mortgage salespeople were incented to sell mortgages to people that could not afford them. This leads to customers not having their real needs met.

2. Short-term focused behavior
Another reason for the lack of customer culture is the short-term behavior driven by an investor focus and reporting of quarterly results. This leads to a focus on profit and revenue to the detriment of customers. An underlying customer culture providing a sustainable business focus will lead to more integrated thinking and reporting based on medium term performance trends.

3. Focus on technical skills
Many of today’s professionals are specialists with highly developed technical skills in their areas of expertise. This leads to a narrow focus without a broader understanding of the business environment and how they affect the value received by customers. Some professions even view customers as inhibitors to getting their jobs done – an annoyance to minimize. For example the university academic that laments the fact that they have to teach students rather than focus 100% on research or the surgeon that dislikes having to communicate in person with patients. Others focus on profit to the exclusion of customer interests. When this attitude takes hold in organizations it becomes a significant roadblock to a customer culture regardless of what the mission states.

4. Operating in silos
Functional silos where there is lack of cross-function collaboration and unclear customer “ownership” creates problems for customers. We have all experienced being sent from one department to another by customer service representatives who are not empowered to take ownership of our problem. This leads to customer frustration and then your customer promise lacks credibility.

5. Lack of strategic alignment
When staff do not understand or care about the company’s strategy and how what they do contributes to delivering value to customers. This leads to the customer receiving mixed service and conflicting messages.

So, why should your customers believe them?

 

Moving Up from Customer Service to Customer-Focus

I have just published on SlideShare a deck.

Moving Up from Customer Service to Customer-Focus
10 Lessons Learned by a Seasoned Customer Service Consultant

10 Questions frequently asked about Customer Experience Management

                                                     
1) How long will it take to develop a Customer Experience Strategy?
That will be dependent on:
The quality and consistency of your current customer experience performance
How much time you can commit to working through the process
How well you have explained the what ,why and how and the importance of the commitment from all those involved in the business

2) Why don’t we just provide customer service training for our front-line people?
Answer - We launched Customer Experiences after our research found that when customer service training is carried out without a proper Customer Experience foundation, the training itself has very little impact on changing employee behaviour and ultimately little impact on improving the customer experience.
Customer service is a vital part of any quality customer experience. A customer experience strategy however covers far more than just customer service in fact it covers every aspect of a business because every aspect will have some impact on the quality and consistency of the experience a business delivers.

3) How do we gain total commitment from our people to ensure the success of a Customer Experience Strategy?
Answer - Commitment comes from engagement. The Customer Experience approach involves everyone. The fact is that everyone plays a role in your Customer Experience, not just those people directly interacting with your customers. Our customer experience development program is based on the fact that your people support what they create. A successful customer experience strategy is the result of total involvement from everyone associated with the business.

4) Why is a Customer Experience strategy difficult for your competitors to copy?
Answer - Leadership, culture and your people are vital parts of your Customer Experience strategy and the great news is, they are all difficult to copy. Everything else you do is relevantly easy to copy.
A customer experience strategy can be a businesses sustainable competitive advantage in a world where sustainable competitive advantages are rare. You can be sure that once you start gaining market share as a result of your customer experience your competitors’ will be looking closely at what you are doing.

5) Why is creativity such an important part of a Customer Experience strategy.
Answer - Creativity is today’s great competitive advantages. The reason there is not more creative thinking in business is its not encouraged in most organisations. The key to on-going customer loyalty is the ability to continually "add value" to what you provide your customers. This requires a steady flow of ideas from your people, the more creative the ideas the greater the impact on your Customer Experience.

6) How does a Customer Experience strategy help us to attract the right people?
Answer - Great people want to work with organisations that are totally focused on their people and customers. They know that these businesses take time to build real relationships with their customers and it’s these relationships that lead to loyalty and advocacy. The fact is that your working life is so much more enjoyable when your customers are smiling and coming back because your people have taken the time to build relationships.

7) Why is a vision so important to a Customer Experience Strategy?
Answer - A good vision keeps everyone focused, on track, inspired and motivated and that’s vital to a long-term strategic business approach. You must be able to clearly show how your customer experience strategy will move your business towards its vision.

8) Why is word of mouth so much more powerful today? 
Answer - Word of mouth has always been powerful in fact it’s today’s most powerful form of advertising. When you recommend a business to someone you are putting your reputation on the line and we don’t do that lightly. Today individuals have the ability via social media to reach many more people and share both great and not so great experiences. Business is only started to understand the power shift that has taken place.

9) How does a Customer Experience strategy take away the focus on price?
Answer - We do business today in a world we call "the world of sameness" the only way most businesses can come up with to get customers in the door is to reduce prices. The result is reduced margins and a struggling business. Customer focused businesses look for ways to add value, this is why it’s so important to understand your business from the customer’s perspective and foster creative thinking that will result in added value other than a price reduction. Research clearly shows as customers we will pay more for a consistent, quality customer experience.

10) Why does business have difficulty relating to customers emotions
Answer - emotions drive our lives however when we are on the other side of the counter we only see business as a logical process. A large part of how customers measure a businesses customer experience performance is by the way they feel and feelings are emotions. Thankfully understanding customer’s emotions is a major part of a Customer Experience strategy.

Source: Chris Bell, Customer Experience on Voxy.co.nz

Quick-Results method for improving your customer service

If you are looking for a pragmatic and quick-results method for improving customer service, you have come to the right place.

More specifically, your needs may include:

• Taking stock of your current customer service delivery;
• Looking for near- and longer-term opportunities for customer service improvement;
• Managing and measuring customer satisfaction;
• Mobilizing and hearing the voice of your front-line staff;
• Finding a seasoned, pragmatic and results focused customer service consultant.

I have launched a new website - the home of my widely proven and high-value Customer Experience Workshop. It provides context by means of the S-Curve and details of the methodology. Moments of Truth / customer touch point management moves you up the S-Curve, makes customers happier and thus bolsters profits. Making such customer service improvements is a profit strategy. strategy. A sharper customer focus leads to a sharper competitive edge.

Expert Witness for Customer Service

Defense attorneys in the U.S. and Canada can now avail themselves of my Expert Witness services in areas concerning customer service.

In today’s climate of robust consumer protection and burgeoning internet business, government bodies such as the Federal Trade Commission, Competition Bureau, and Auditors General are increasingly vigilant. 

If you are an attorney in the U.S. or Canada who is defending a case that involves the rights and treatment of consumers, you will find that often issues related to customer service come into play.

If your defense will benefit from the assistance of a pragmatic and seasoned expert witness for customer service, you should contact me. I am available for a no-obligation telephone consult, often on short notice.

What I can do for you as expert witness in the customer service arena

Considering my wide and deep customer service consulting expertise and experience you can expect me to assist you in matters related to topics such as:

• Customer service strategies and policies;

• Customer service processes and procedures;

• Customer satisfaction research evaluation;

• Customer service implementation issues, related to complaints, refunds and customer contact (center) practices;

• Customer service best practices and assessing your client’s practices against them.I will access the necessary research data and specific experts as required.

My qualifications as expert witness for customer service

• Specialized customer service consultant with wide and deep experience of 25 years, in a large variety of industries: Helping clients capture and act on the voice of the customer and make required alignments to close customer service/loyalty gaps.
  

• Clients in some twenty industries and six countries (predominantly U.S. and Canada);

• Eight years of working with a “Big Six” consulting firm (Coopers & Lybrand Consulting – Center for Excellence in Customer Satisfaction);

• Access to an extensive network of specific subject matter specialists;

• 27 Recommendations on my consulting LinkedIn profile.
  

For more information about my background and experience qualifying me as expert witness for customer service visit my consulting website.

“Eric brought a wealth of essential knowledge and practical experience to the table.

He was also easy to work with and prompt in his own customer service.”

“You Are Richer Than You Think.”

In my previous blog entries I have argued about the validity of the People > Service > Profit idea, the importance of Hiring Right and the fact that often good people are stopped by bad processes or bad management.  I am obviously of the view that the road to success for great customer service and experience excellence goes through People Management that is aligned with strategies that make customer service and customer experience into a sustainable strategic differentiator. 

Today’s business environment is constantly changing as companies work to stay competitive. But change only happens when people change their thinking, beliefs, and behaviours. This is hard and requires constant effort from employees and executives. Forrester analyst Claire Schooley reports that “Seven in ten - seventy percent - of change management initiatives fail. That is a dramatically high rate of failure.”  It could happen to you unless you take into account that any change in business process or strategic direction  is strongly related to personal change — that means your people — and this is often the component that gets shortchanged.

This blog entry pursues the line of thought that organizations often fail to realize the impact of change on the employees it will affect. This can be change due to process re-design or strategies and initiatives for sharpening Customer Focus.  They often do not plan and execute carefully enough to address the people issues through all phases of change management.

That means that frequently people are insufficiently informed and engaged and therefore not enabled or allowed to contribute what they could otherwise bring to the table, based on their experience, knowledge and creativity (that everybody has). Over the more than 25 years I have been involved in many types of organizations I have developed the cynical view that more often than not “the enemy is within” and that many organizations unwittingly go to great lengths to give the competition a leg up. I will be so bold as to estimate that thus many organizations are not getting one-third to one quarter of the payroll dollars (and benefits plus overheads) they spend.

My message to a great deal of organization is therefore what it says in the headline (a tagline of a ubiquitous Canadian bank campaign): You Are Richer Than You Think... but you are likely not getting what you pay for. Often organizations don’t know what they don’t know and what they could get from the people they are paying anyway.

Affecting change successfully is admittedly not an easy thing. There are many models, approaches and philosophies. In addition to a clear vision and capable leadership, among others, there is one critical element which I want to highlight here: Communication. Yes, how hard we try, there never appears to be enough of it. It shows up as an improvement opportunity in virtually every employee survey, doesn’t it.

One of my standard recommendations to my clients is to undertake making Communications a forethought rather than the afterthought it so often ends up being. That means they could benefit from appointing a member of a change steering group as Communications Advocate. At each and every turn, decision, new project etc. this person raises the question of What and How for Communication. Of course having a strategy to guide the process always helps...

To conclude, I would like to share with you how impressed I was by the use of an off-the-shelf technology that is cloud based (and does not interfere with or depend on IT infrastructure), to act as enabler and catalyst of customer-driven change. Four Seasons Hotels & Resorts is known for its exemplary service. Just like award other companies competing successfully on a sharp customer focus such as South West Airlines, Ritz-Carlton, Zappos, USAA and Costco, it understands the value of hiring the right people and enabling and empowering them to do right by the customer. Four Seasons decided to employ a Social Intranet (with very similar features to Facebook and LinkedIn) to carry and facilitate its customer service / experience strategy. This platform was simple and quick to deploy technically, but of course needed to be populated with thought and efforts. However, once Redwood eLearning’s BOOST was up and running it took very little effort to manage it. Who did manage it then?  Their people of course... A sure way to ensure that they get from their people what they paid for, and more...

What stops you from harvesting your richness? 

Six New Voice of the Customer Trends

Source: The Vovici blog "The Listening Post".

Andrew McInnes, Analyst with Forrester Research Inc., presented six new trends and framed them by discussing the value of customer experience and Voice of the Customer programs.

He is reminding us to evaluate these practices in light of their firm’s customer experience ecosystem. Not all companies will benefit by implementing every item on this list. Rather, when evaluating a new activity, make sure it links to an important customer interaction or moment of truth. Also consider how employees can be empowered and influenced with data and communication.

Why does customer experience matter?

Sam Walton, Founder of Wal-Mart, said “There is only one boss. The customer. And he can fire everybody in the company from the chairman on down, simply by spending his money somewhere else.” Clearly, a company cannot succeed without customers.

Why is the Voice of the Customer important?

If the customer is your boss, the voice of the customer is your performance review. Neglect what he or she says and you are likely to be replaced – by your competition.

Why are VoC Programs important?

Focused VoC programs improve the customer experience by acting on feedback and making systemic improvements across the company. These programs help change company culture via the sharing of customer stories, providing recognition, and offering rewards around customer-centric behavior. Finally, successful VoC programs deliver business results by increasing loyalty and retention, lowering service costs, and increasing sales.

Andrew observed that many trends first seen in 2010 continued throughout 2011. In addition, following are six (6) new trends demonstrated by the finalists and winners of Forrester’s 2011 VoC Awards:

1. Tailoring VoC activities for specific customer segments. In 2011, many programs included the powerful element of tailored customer communication and activities. Activities were customized for frequency, content, and level of personalization. For example, a B2B company may identify their customer segments as Executives, Managers, and End-users. Executives may require more one-to-one communication (phone calls, site visits) at a lower frequency. In contrast, the end-user may receive more frequent communication requiring less personalization (surveys, newsletters).
   
   Adobe Systems invites customers to share product ideas via an online portal; product suggestions are then demoted and promoted by the votes of other customers. Feedback from the Adobe product teams is provided through the portal so customers know the status of their idea submissions.
   
   
2. Measuring the value of an improved customer experience in general. Good VoC programs regularly measure the overall value of customer experience efforts, most often linking customer feedback scores to loyalty and revenue. This measurement proves that customer experience and VoC are important – and relevant.
   
   Adobe Systems brought together customer feedback with customer lifetime value data to statistically demonstrate that the most loyal customers were also at the higher end of customer lifetime value.
   
   
3. Proving the value of the VoC program specifically. By linking interventions with cost, retention, and/or revenue, a VoC program proves that it directly drives value. Value can also be driven indirectly by linking the outcomes of VoC-initiated projects to business results.
   
   
4. Bringing the VoC to life for back office employees. It takes an entire company to serve customers well. In addition to front-line employees, back office teams – such as billing, legal, finance, IT, and marketing – make decisions that directly impact customer experience. VoC leaders can align employee behavior around VoC through a number of ways, including variable compensation and performance evaluations.
   
   Programs must bring VoC to life for all employees by creating a motivational, emotional connection to the VoC program. Intel gives every employee in the company two days off if they reach their “customer delight” goals. Adobe Systems built a customer listening post room; employees can visit and immerse themselves in customer feedback. Twitter comments, survey feedback, and call center data displays – in real-time – on television screens in what is, essentially, a customer NOC. Talk about being dedicated to the customer cause!
   
   
5. Building networks of VoC champions. VoC programs need four levels of ownership: Executive Sponsors, VoC teams, VoC Champions, and everyone else! As an example, Forrester’s award winners were very active in building VoC Champion teams in 2011. While the role and definition of “VoC Champions” varies from one company to the next, they are typically delegates from each business area who understand the operations of their team—and know what the VoC team is doing. They are able to articulate the importance of customer-centric behavior to other team members while bringing the voice of the customer into all business process improvement activities.
   
   
6. Aligning key functions around VoC insight and action. In 2011, VoC leaders engaged other business functions in VoC activities. They aligned closely with Business process (for organizational and procedure improvements), Market Insights (for survey design and analysis), and Customer Intelligence (for mining customer databases combining operational and behavioral data with feedback). This alignment demonstrates increased sophistication of VoC programs as they drive strategic initiatives and increase value for the organization.

Moments of Truth for Customer Experience Management

Despite spending significant sums on studying and improving customer experience, many companies are simply not seeing the customer loyalty they want.

By Eleanor Bloxham, CEO of The Value Alliance and Corporate Governance Alliance. Published on the Fortune blog.

FORTUNE -- What company doesn't want customers to have a positive reaction when they think about doing business with it?

But despite spending significant sums on studying and improving customer experience, many companies are simply not seeing results, according to a recent survey of 8,000 customer experience professionals in 2,160 companies globally by consultancy Beyond Philosophy. The findings provide a road map any company can use to court new and repeat customers.

According to Steven Walden, research director at Beyond Philosophy, companies in retail, banking, technology, and telecommunications tend to spend the most on so-called customer experience initiatives. Yet of the top 10 spenders, only one made a top 10 list of successes, according to the survey.

What are companies doing right and, just as importantly, what are they doing wrong?

'Lipstick on a pig'

HP and Dell are two of the top 10 spenders on customer experience – and they do a fair job, but not what you would expect based on the cost and effort, Walden argues. What haven't they figured out?

Both companies provide a standard product that "does what it says on the tin," Walden says. They both have big organizations and spend dollars on thinking about the customer, but this is mainly from the perspective of usability, functionality, and fixing what's broken. From a customer perspective, "there's no wow there," Walden says, it's more about "putting lipstick on a pig."

A case of 'measurementitis'?

Other companies get it wrong by resorting to "measurementitis," says Walden. This often happens when a software vendor comes knocking and convinces a company that the way to improve customer experience is to measure every interaction with its customers. HSBC, another top 10 spender, is guilty of this, Walden says.

The problem with this approach is that companies will measure loyalty but then won't act on their findings. Why would they do this? Measurement instead of real action can be a draw for managers who want to create fiefdoms, Walden says. You can build a sizable team under you just by measuring things, but "you can't make a pig thin by weighing it," he says.

Customer surveys – or employee surveys, for that matter -- that result in no action are much worse than having no survey at all. It just fuels anger to ask people to state their complaints and take no action based on the results.

Turning a new leaf

By contrast, American Express (AXP), another top spender, is on its way up largely because they are concentrating their efforts on providing a "good feel" when customers call. The company has begun to stem its loss of customers, says Walden.

The Gap, another top spender, has even put the term "customer experience" into the titles of its in-store workers, but that has yet to improve the company's image.

Vodafone is the only top spender that also made the most admired ranking in Beyond Philosophy's survey. How did they do it? According to Walden, they maintain a great brand image through their sponsorship of the Formula 1 auto racing events.

"Customer experience is at the heart of everything they do; it's in the culture and DNA of the organization. It comes from the top down. Like HP, Vodafone may not be massively innovative, but they operate from this clear statement of intent -- in contrast to HP, where customer experience is a program," Walden says.

Using emotion well

Who does it really well without spending a ton? Tesco makes it because of "the strength of the relationship they create with the customer, as if you are part of their family," Walden says.

This contrasts with Wal-Mart , which is currently having trouble defining itself to customers and the marketplace. Even Family Dollar Stores, Walden says, recognizes that price alone won't draw all the customers a retailer needs. How customers feel about the company matters.

Which brings us to the top three most admired companies: Apple, Amazon, and Zappos. What do all three have in common? Charismatic leaders with a young feel to the product and delivery, Walden says. They have maverick, cutting edge approaches -- and don't just listen to customers, they lead them. They are creative and don't get bogged down in analytics, he says. Customers love these companies because of the personal feel and emotional connection they provide, Walden says, and emotions not only connect you to the company, it makes you want to buy from them as well.

For Apple, the most admired in the survey, the question will be whether they can replicate the explicit attention to detail the late CEO Steve Jobs instilled.

Clearly, it's easier to create personal feel and emotional connection in a small company rather than a large one but, Walden says, Apple in the 1990s would not have made the most admired list. Jobs set out to change that – and CEOs can. They just need to know how – and maintain that focus, gaining support for their vision and holding everyone associated with the company accountable.

Customer Service Through Social Media: The game has changed

States Harry Rollason of Useful Social Media: The rise of social media has changed customer service beyond recognition.

In today’s competitive landscape, customer service is more important than ever. A company’s reputation for satisfying their customers has never been so valuable.

It’s worth pointing out that it takes three times as much internal resources to acquire a new customer as it does to retain one. In these lean times it puts an awful lot of pressure on companies to ensure retention rates are as high as possible. And good customer service is a great tool to do this.

But are companies getting it? Does it look like big corporates are responding to this change in the landscape?

The short answer is no:

• Over 58% of tweeters who have tweeted about a bad experience have never received a response from the offending company
• 55% of consumers expect a response the same day to an online complaint – yet only 29% receive one
• 43% of consumers say that companies should use social media to solve customers’ problems

These statistics lay out clearly how the game has changed. Customers will no longer be happy with ‘old style’ customer service. To satisfy your customers, it’s essential to have a responsive social media presence.

To be fair, things are changing. By the end of the year, 75% of US-based companies expect to use social media for customer service. It’s a reaction to the changing game. Gone are the days when social media was all about marketing through Twitter and Facebook. It’s now an integral tool to ensure you are responsive not reactive, contactable not aloof and authentic not robotic. And increasingly, it’s about solving customer’s issues in real time through social channels, showing your dedication and transparency to your customers.

B2B Customer Experience Scores Are Low And Excuses Ring Hollow

Forrester's Paul Hagen posted this blog entry

The customer experience for companies doing business with other companies stinks. Three independent studies that Forrester Research has conducted over the past year indicate that the business-to-business (B2B) experience is perceived as worse than that in the bottom-of-the-barrel consumer industries such as TV service providers and health insurance plans in Forrester’s 2011 Customer Experience Index. This is not surprising for several reasons. Many B2B firms believe that customer experience is something that only consumer-focused firms like Disney, Zappos, and Ritz Carlton need to consider. Moreover, many B2B companies argue that purchasing decisions are made for a complex set of reasons other than customer experience. Finally, they often say that because of the relatively low number of accounts, they already provide a personalized experience through account management teams.

Firms making these rationalizations miss several important points. First, if word of mouth is important to sales, then so is customer experience. Forrester’s consumer research shows that only 23% of individuals trust radio and TV ads — and only 19% trust direct mail — while 73% trust recommendations of friends and family. There is little reason to believe that the numbers are much different for B2B. And while Facebook may not amplify opinions, social media tools used for professional networking in online communities certainly do. Second, firms that have poor experiences with other firms buy less. The experience design company, Walker Information, finds that firms whose customers are trapped spend significantly less, grow more slowly, and have lower gross margins than those that are truly loyal. Forrester’s research suggests similar outcomes, with strong correlations between customer experience ratings and likelihood to purchase again, recommend, and switch. Third, customer experience is not limited to the customer-facing employees, such as account managers and call center representatives, or the contract holders at the client’s company. Rather, the end-to-end experience often includes interactions driven by back-office employees that make life difficult and frustrating for important stakeholders who could drive future business at the client firm.

Improving the B2B customer experience from its dismal state is more than a marketing effort. After all, marketing only owns a small portion of all of the interactions with customers. Companies such as John Deere, Maersk Lines, Fidelity, Philips Electronics, and Intuit understand this and as a result have significant B2B customer experience efforts under way. While in some respects the B2B experience is more complex than the business-to-consumer (B2C) environment (e.g., diverse stakeholders within a client), other issues with partners, resellers, agents, and other intermediaries that impact or even deliver the experience are very similar. In fact, the best practices that the best B2C firms use apply to B2B firms. Best practices include:

• Defining the intended experience for the target customer. As experience design firm Beyond Philosophy puts it: “To improve customer experience implies you are somewhere today and you are heading somewhere else. The strategic question is ‘where?'” To get started, firms need to define who exactly they mean by the customer . . . something all the more important for B2B companies, which have many stakeholders inside of a client. One manufacturer found that it had 26 personas across departments just to describe those maintaining purchased equipment within client firms. Some were upward of 10 years old, and all were at varying stages of development. By rationalizing these down to just a handful of well-developed personas based on behavior rather than departmental role, those redesigning the experience — a cross-functional team that included employees as diverse as engineers, contact center staff, and account managers — created a common vocabulary and target to work on. Another B2B firm, in trying to decide for which stakeholder within its client base it should prioritize, realized that concentrating on improving the experience for lower-level logistics clerks would swing much more business its way than improving the customer experience for higher-level contract managers.

• Understanding the customer perspective. The most challenging aspect to improving the customer experience is for firms to shift to outside-in thinking in which employees put themselves in customers’ shoes, rather than today’s inside-out mindset that focuses primarily on narrowly defined internal metrics. Common experience design practices, such as behavioral personas, customer journey maps, and voice of the customer (VoC) programs, can help turn this around. Export Development Canada’s customer journey map for its insurance group found more than 35 internal handoffs between departments across 14 customer touchpoints with little consistency in total time to completion. The group used journey (value stream) maps to focus project teams and Lean methodologies for aligning internal business, processes, people, and systems. The result was a 60% reduction in processing time with improved predictability, a 24% increase in Net Promoter Score (NPS), and reduced waste.

• Aiming to change the culture. Firms serious about improving the experience realize that a cultural transformation needs to take place. Key practices such as recruitment and hiring, onboarding and training, internal communications and storytelling, performance metrics, and rewards and recognition systems aimed at changing the beliefs and behavioral norms of internal employees can similarly be applied to partners, resellers, agents, and other third parties that affect the B2B customer experience.

The widely divergent range of customer experience scores that B2B firms achieve in Forrester’s studies today suggest there is a lot of room to differentiate based on customer experience. And that could translate into big dollars. In the B2C space, Forrester estimates that a 10-point increase in its Customer Experience Index score can amount to up to $1.5 billion. But changing culture isn’t easy. Those that get the jump will create something that takes time and is hard to replicate.

Grow your Share of Wallet in multiple-supplier B2B accounts and boost profits

B2B Sales & Marketing Executives:

GROW YOUR SHARE OF WALLET IN MULTIPLE-SUPPLIER ACCOUNTS AND BOOST PROFITS

The case for growing Share of Wallet

In many of today’s stagnant or shrinking B2B markets growing through new customer acquisition may not be an option. It may at best be a
long-term option, with a high sales and marketing investment attached.

You need a profit growth option that is realistic, can be achieved at much lower cost than new customer acquisition, and in much shorter
time: Increasing Share of Wallet in existing multiple supplier accounts.

I have extensive experience in helping B2B companies systematically review key customer relationships in a multiple-supplier setting. Over the years I have been surprised by the frequently lacking knowledge of the Share of Wallet within an account, and if this share has
remained stable, increased or decreased.

While sales volumes might seem satisfactory, there is thus a real risk that a competitor is “eating the cheese off your sandwich”, without you knowing it.

Customer Satisfaction is a key driver of B2B Share of Wallet

The predictable myth that needs debunking is that Share of Wallet success in B2B is driven by price.

However, empirical research identifies four key drivers of Share of Wallet, with Customer Satisfaction at the top:

• Customer Satisfaction
• Trading Terms
• Length of Relationship
• Supplier Capability

The impact of Customer Satisfaction on Share of Wallet in B2B is three times as strong as the other drivers which have virtual equal impact.

Trading Terms is a strong driver of Customer Satisfaction and is undoubtedly also of high relevance.

How I can help you increase Share of Wallet in B2B accounts

As a seasoned customer service consultant with more than 25 years experience in some twenty industries I know my way around the critical issue to increasing Share of Wallet: Customer Satisfaction.

I developed and widely applied a process and methodology for reviewing key customer relationships with the purpose of turning them into High Value Relationships. In the process I conducted more than 400 executive interviews, mostly in person and also via telephone.

This is a “Fresh Eyes relationship X-ray process” that helps you see hidden flaws:

• Determine strengths and weaknesses and develop competitive benchmarks, with a focus on customer satisfaction.
• Bolster your relationship with key customers and increase Share of Wallet.
• Prevent unnecessarily losing a key customers (what would the cost be?).
• Demonstrate how you value this customer.
• Design a strategic account management plan.

Is this an expense or an investment?

If you consider this as an investment and you pilot this process, you are advised to ask yourself:

“What is the dollar value of this account? If I invest X amount of dollars (typically less than $10,000) in an in-depth review process, what are my chances that I will not be able to increase enough Share of Wallet to break even?”

My experience has been that without exception this process always provides a positive experience and my clients had no problems acting on the information and recouping their investment.

Most important is to know or discover how easy it is to pilot this process and if it works for you!

The upwards potential is significant, while the investment is low.

Visit my website for more information about me or contact me for a no-obligation phone conversation or request a service brochure with details.

Can you improve customer service and profitability by Exorcising Demon Customers?

During the many customer service improvement workshops I have conducted I have often heard participating front employees observe the difficulties and dilemmas of dealing with those difficult customers that always require extra attention and firefighting and who never seem to have their own act together. The squeeky wheels get the grease, but these customers take up time and resources that could much better be spent on building the relationships with "good" customers. The question is often asked: Can't we fire customers?
I think so!

You have to keep a special eye on those customers you want to wean from your business. Deal with the bottom-feeders first to immediately free up additional resources to help support your more profitable customers.

And then there are the customers that on the surface seem important customers. But are they???

I like this [abbreviated] blog posting by Bruce Hunter of Lighthouse 360 who puts a great perspective on this issue. He also introduces the notion that using Activity Based Costing to establish the Cost To Serve is an enlightening practice to help make those difficult decisions about exorcising customers.

An Evil Myth

The unfortunate reality is that most demon customers, on the surface, seem like everyone else. In fact, they may themselves be unaware of their true nature. But take it from me: demon customers exist, you've probably got 'em, and even as we speak they may be sucking the lifeblood out of your company. The sooner you are able identify and exorcise them, the sooner your business will benefit.

Easier said than done, right? A while back, I stared across a conference table at a group of radio executives and wondered how to tell them that the last national account they had scored was a loser. These were hard-knock sales folks who knew their industry and knew how to chase down leads and convert them into time blocks sold. For years, their philosophy had been "any customer is a good customer." It was my unenviable task to educate them that this old truism was not, in fact, true.

Their situation wasn't unique. Years before, I had assumed the leadership of another business organization that had developed along similar lines. Culturally, the group had bought into the notion that the bigger the customer, the better. Not only did they bring in money, they also provided a certain cache simply by being a customer - that would, reasoned the groupthink, surely bring in even more big customers.

That organization had succumbed to an evil myth. Not only is bigger not necessarily better, in most cases we discovered that these mega-customers were actually bad for business. (I know. It didn't make sense to them, either - at first.) To prove it, I conducted a customer profitability study that forced us to take an inventory of all of our customer-related costs and where they were being applied.

I have often had the occasion to cast my eyes upward and give thanks for the folks from the finance department. This was one of those times. They performed a bottom-up exercise called "activity-based costing" that aligned the right costs to the right customers. Before that, costs had been averaged out across the customer base in the belief that it provided a decent view of the costs associated with each customer. As it turns out, that was a fundamentally flawed belief.

What emerged from this financial exercise was a very different view of the customer base. To widespread surprise, we saw that some of our largest customers were actually our "worst" profit performers. They sucked vital resources in terms of the people dedicated to the business, they were the most demanding in terms of price concessions, and they were quite low on business sustainability. They regularly required us to bid on projects, which resulted in more time and resources spent preparing the bid as well as the inevitable price concessions. (Think about it: when was the last time you were able to increase price and build margin through an RFP process?)