Businesses are finding that there is a tight correlation between loyalty and customer experience. Any company can improve sections of its customer experience, but it takes more than some superficial changes to create long-term results. Customer Experience Management (CEM) solutions are not just a luxury—soon, they will become a necessity. Customer experience programs reporting actionable intelligence give organizations a competitive advantage by enhancing their customer service and strengthening their customer base.
Research firm Ovum suggests that retail banks worldwide will see IT spending reach $118 billion in 2013 (3.4% growth) as CIOs emphasize customer satisfaction and revenue growth.
Forrester’s State of Retailing Survey reports that in 2013, online businesses will stress strategies and tactics designed to develop a better customer experience as well as increase web conversion and loyalty, especially on mobile platforms.
An organization looking to put a customer experience program into practice requires a quantifiable method of tracking its customers’ experiences. A good blend of metrics allows a corporation to effectively measure its performance over short and long-term periods, as well as compare across both geographies and channels. Selecting the right set of metrics also lets an organization monitor fluctuations in customer interactions and develop solutions for their improvement.
Important Factors when Choosing Metrics
Organizations can use numerous metrics to measure their customers’ interactions, but how do they decide which metrics are most applicable? The factors below can help organizations sort through several options to discover an optimal mix.
The first consideration in picking a metric is the nature of the industry itself: after all, certain metrics are more suited to different industries. Deciding how customers interact with a company’s products or services as well as how responses are collected helps in determining the correct metrics.
2. Survey Methodology
Industry regulations influence the degree of access to customers’ contact information, which will in turn decide which survey methods are appropriate. An email address is needed for a web-based survey, for example. Likewise, a mobile number is needed to send a survey via a text message.
While using too many metrics can dilute the impact of results, using only one may not provide enough information. In most cases it is best to use a combination of metrics. This combination of metrics can differ completely based on channels, or can be consistent across all service touch points.
4. Organizational Visibility
Considering which sections of staff utilize customer response results affects which metrics should be selected. For instance, if involving frontline employees to improve service is the goal, then tracking every service interaction will help. Instead, if corporate executives want to learn about their customers’ perceptions of their brand, a different metric will be more suited to this sort of high-level analysis.
5. Channel Evaluation
Establishing which specific business channels are involved in the program also helps with the choice of metrics. If a company is monitoring customer experience across multiple channels, deciding if each division aims for both a similar experience as well as the same goals is important. If experiences differ, metrics can then be custom-tailored to each channel in order to meet its specific needs.
6. Brand Promise
Brand promises generate great opportunities for an excellent customer experience. Every organization should identify their brand promises and then choose metrics to help fulfill them. Targeting the features that a company most heavily markets is an easy way to discover brand promises and their guarantees. Once found, the organization can find a metric to support their promises.
Some Common CEM Metrics
Finding the right mix of metrics from such a varied pool is a formidable task. Luckily, the best solution can come from some common, well-established metrics.
Customer Satisfaction (CSAT)
This classic metric gauges customer happiness with a company. It allows improvements to be made to increase customer conversion and frequency of purchasing as a result.
- Customer Effort Score (CES)
CES determines the amount of effort a customer must exert to solve a problem. The end goal is to reduce the amount of time customers must spend with each channel. Understanding the value in easing a customer’s total interactions with an organization has led to a recent increase in this metric’s popularity.
- Net Promoter Score (NPS)
By discovering how loyal customers are, an organization using NPS is able to find customers who bring in even more business through recommendations. It is also able to target those who are less happy and unearth ways of improving their experience.
- General Question Index & Customer Experience Index (CXI)
These two options utilize multiple questions to address different elements of an organization or service channel. They provide feedback into specific facets of customer experience.
- American Customer Satisfaction Index (ACSI)
The ACSI is an indicator of customer satisfaction across the entire United States. The ACSI is the most widely recognized national customer satisfaction index, with comparable versions available for other countries.
- Wallet Allocation Rule
The ultimate metric when determining satisfaction is how much a consumer spends. Computing the amount customers give to a certain organization, and then comparing that number against other companies within the same industry, provides a reliable consensus on customer loyalty.
The wide array of available metrics can make developing a customer experience program seem daunting—after all, it’s costly to choose the wrong metrics for the industry, organization and customer experience program. Valuable, applicable insights in terms of amount of data, what the data means and the intentions of the program are necessary to make improvements to CEM.
The key when choosing metrics is deciding on what is really actionable. To see improvements in satisfaction, organizations must evaluate their findings and make changes based on their results. The increase in loyalty, satisfaction and revenue that these decisions provide are the heart of great customer experience management programs.