Companies are starting to see the light. They are embracing the principles that Apple, Google, and Philips Electronics have been advocating for a long time – differentiate yourself based on the experience you deliver to customers; not on the products you sell.
According to a CEI Survey, 86% of buyers will pay more for a better customer experience. But only 1% of customers feel that vendors consistently meet their expectations. These statistics highlight the magnitude of the growth opportunity before us. What if you just increased the percentage of consistently happy customers by 5%? For any company, large or small, that would be a game-changer in terms of revenue and profit.
The rise of cloud computing and social media was the tipping point in the relationship between customers and vendors. Empowered with readily available information, rich analysis, and access to peers around the globe, buyers took full control of their purchase processes and vendor relationships.
Customers expect vendors to invest financially, intellectually and emotionally in understanding and consistently meeting their evolving expectations. The good news is that B2B vendors are starting to transform their entire organizations – people, process, technology – to align outward to customer experiences.
This new movement has spawned an interesting debate – does business strategy or customer experience come first?
One side claims business strategy comes first as it sets the framework of the business – what market problem is solves, for whom, with what products, through which distribution channel, etc. The other side claims that customer experience comes first and should drive business strategy.
Strategy buffs will recall the age old principle that Culture drives Strategy which drives Structure. It is still true today. Customer experience is a catalyst of transformation. It directly impacts culture, strategy, structure and all parts of a business.
In our client experiences the relationship between strategy and customer experience is symbiotic. Companies that embark on strategic growth planning inevitably come to the conclusion they do not intimately understand their target customers. The cathartic process of coming to grips with the fact that the organization does not have the insight around lifetime experience expectations for each market and persona is the trigger point for customer experience initiatives. They need that information in order to rationalize business strategy and, at the same time, evolve their culture.
Likewise, companies that embark on customer experience initiatives in the quest to accelerate revenue and/or improve customer loyalty quickly realize where their business strategy is lacking or counterproductive. Confronted with detailed customer journeys and where the gaps are in outcome/value, interaction, content, and trust, to name a few, compels management teams to revisit and revise their business strategy.
The idea that customer experience must be done before any strategy work can be initiated looks nice on paper but doesn't reflect real life. Customer experience expectations evolve rapidly in response to variables unrelated to and over which the vendor has no control or prescient knowledge.
Customer experience strategy, design and execution will become a companywide core competency as well as a core tenet of every organization's culture. The more interactions there are with customers, the deeper the relationships, the richer the data captured on experience expectations met, the more it will become a table stake in ever greening a company's strategy.
Customer Experience is a movement. In many ways it reminds me of the rise of the Quality movement in the 1950s spearheaded by Deming. I just wish people would stop attaching ‘management' to the end of ‘customer experience'.
It's not managed but rather aligned to and part of the strategy process.
Source: Forbes
