Thursday, August 14, 2008

Customer Experience Value Management Perspectives

Customer experience value management (CEVM) our definition: A strategy to accelerate customer value, change customer behavior and build business value to support business growth needs.

Customer satisfaction has, over time, proved to be a poor indicator of customers’ true feelings or intentions. According to a report by Harvard Business Review1 between 60 and 80 percent of lost customers described themselves as “satisfied” or “very satisfied” in customer satisfaction surveys almost immediately before defecting.

Research carried out by UK insurer Norwich Union2 in2005 suggests that, while 84 percent of customers describe themselves as “satisfied,” only 41 percent remain loyal.

And yet we know beyond reasonable doubt that a positive contact centre experience will generate positive customer behavior – a propensity to remain loyal, spend more and provide advocacy.

In research published by the Henley Centre in 20063, 65 percent of consumers said they would be likely to stay with a company that provided good customer service, even if they could get a better financial deal somewhere else.

The urgency to measure and improve customer satisfaction has intensified in recent years as customers have begun to exercise, with greater confidence, their right to choose and switch suppliers according to how well or badly they feel they are treated by them. In a customer advocacy study conducted by Hitachi in 20064, 63 percent of respondents asserted that they would defect on the basis of a poor contact centre experience.

So, recognizing that a customer’s opinion of the service they receive will influence their behavior, organizations have slavishly persevered with customer satisfaction measurement, investing time, energy and resources in order to improve their scores. They have done so despite the fact that they can make no reliable correlation between those scores, their customers’ subsequent behavior and their own business performance.We see a new alternative emerging that focuses, not on what customers say about the service experiences they receive, but on those experiences themselves.

By capturing, analyzing and evaluating the interactions that take place between customers and organizations, and then mapping that analysis against subsequent customer behavior, it is possible to identify, with some accuracy, the characteristics of customer experiences that generate the most positive customer outcomes.

Once recognized, these characteristics can be replicated at scale through process redesign and training, and then reinforced by quality management.

Vitally, in today’s multi-channel world, this approach can be applied to customer experiences delivered not only via the contact centre, but across the Internet and other automated channels. And, perhaps most powerfully, the ability to identify the sources of customer delight or disaffection is not limited to the customer experience itself. By revealing why customers are calling, what they complain about and what they most frequently applaud, customer experience analysis highlights failings and virtues in an organization’s broader business processes, or even in their products themselves.

It is important to remember that the contact centre does not exist in isolation, but sits at the centre of a complex network of back-office departments whose activities impact the customer experience. If those departments operate poorly, customer experiences will suffer, and the cost to serve will rise.

But, it is to the contact centre – and its associated customer communication channels – that customers express their frustration with such failures. Customer experience analysis can be used to examine, not just the quality of the interaction, but what it tells us about the effectiveness of back office processes, allowing improvements to be made across the whole organization.

In simple terms, analysis of the customer experience can identify those processes – within the customer management operation and beyond it – that impede an organization’s ability to satisfy customers. Focus can then be applied to the improvement of that experience – the eradication of those behaviors that frustrate and the active encouragement of those that delight.

True customer experience management is being practiced only by an enlightened minority; a minority that, we predict, will reap significant competitive advantage as a result.

Effective customer experience management has the potential not only to make customers more satisfied, but to make them more profitable. It can encourage them to buy more and complain less, to remain loyal and provide advocacy. It can bring within reach the holy grail of the customer management industry – greater customer revenues achieved at lower operational cost.

Helix Commerce has a complete Customer Experience Value Management Methodology, with deep expertise proven in pre - sales to post service business problems to help its customers innovate its customer experiences more successfully.

Research Notes: recognition to Verint Consulting

2 comments:

katty said...

Thanks for sharing.:)Good customer relationship management entails thoughtful customer care and customer experience make. Customer satisfaction and loyalty are directly tied to the quality of your customer relationship management.
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angel andy said...

It's nice and Great idea.Thanks for sharing.:)CIO Collaboration Network

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