Who’s getting it right — and wrong — in CX?

By Paula Courtney,
CEO – The Verde Group

Companies have hailed customer experience (CX) as a strategic priority for years now and continue to spend massive amounts in the space. In fact, according to CX futurist Blake Morgan, global CX technology spending is expected to reach $641 billion in 2022, with 87% of business leaders tagging CX as their top growth engine.

Clearly organizations are striving to get CX right because they see the potential value, like reduction of churn, which our strategic partner Qualtrics reports can be reduced by 10 to 15 percent. However, Verde Group’s point of view is that many of these same organizations have some blind spots when it comes to tackling CX.

The way we see it there are three lanes where companies are stumbling with CX:

  1. Culturally — Too often, CX is trumpeted by decision-makers but key metrics, consistent data analysis and action plans are not driven throughout the organization, resulting in inconsistent application of insights, limited innovation or initiatives that lack substantive changes in employee action.
  2. Strategically — Many companies focus on the wrong metrics, like satisfaction and other attitudinal measures. But the reality is, you can’t really change a customer’s attitude. All you can do is try to improve the experiences that create the attitude in the first place. That’s because attitudes are an expression of experiences. Simply boosting satisfaction scores won’t guarantee a change in purchase or engagement behavior and, very often, it doesn’t.
  3. Operationally — Many companies get CX wrong because they don’t have the proper tools, like multi-modal listening, CRM integrations and closed-loop actioning interfaces, resulting in limited adoption and execution of CX responses guidelines. In addition, organizations do not explicitly link compensation incentives to improvements in CX performance.

The good news is, in spite of all the challenges that make it hard for companies to get CX right, there’s no shortage of those that do.

The CX standouts

In the world of B2C, few brands get CX right better than Zappos. Its 365-day return policy effectively addresses issues around fit and style, for instance, but one policy does not a CX strategy make. The truth is CX is built deep into its corporate culture, so much so that Zappos actually pays employees to quit if they’re not in sync with its customer-first philosophy.

Disney is another B2C CX standout. Take their magic bands, adjustable, waterproof wristbands with a small radio frequency chip inside. When you’re at Disney World, these unobtrusive virtual keys let customers unlock their resort hotel room, enter theme parks, expedite entry to events, charge purchases and dining back to their room and more. In short, they take friction out of the visitor experience — and, as we’re fond of saying, less friction means a better customer experience.

On the B2B side, there are at least two organizations that have gotten our attention. Lumen Technologies, formerly CenturyLink, proactively gathers and arms its front-line staff and 7,000 employees with CX insights to immediately address issues. This effort has significantly reduced annual churn. Lumen’s success is not an accident but rather the result of an engaged organization that has adopted CX as core part of its go-to-market strategy. This point is reinforced by a quote from Lumen’s VP of Customer Experience Beth Ard, who stated: “Everyone has to own CX. A big piece of work for us is top down, and holding people accountable across the business. Without that we fail.”

And then there’s FedEx. By heavily investing in successful problem resolution — for instance committing to resolving problems to complete satisfaction within two days — the company has seen an over 5 percent increase in retention rates. That’s not a surprise to us: in our experience, agilely resolving problems is critical to rebuilding loyalty, purchase intent and market share.

So what’s the surest way to get CX right for your company?

It’s a complex question, of course, with no one easy one-size-fits-all answer. In our view, however, too many companies are focused on fixing the wrong CX challenges — essentially, they’re chasing shadows in terms of what’s driving economic performance and strategic market differentiation, throwing money at satisfaction measures and key driver analyses that simply don’t get at the root of most CX challenges. Instead, work on identifying, economically prioritizing and addressing the friction points, the ones that cause the greatest economic and strategic risk, then focus on resolving them to their complete satisfaction. Easier said than done, of course. But get that right and you won’t just rebuild lost loyalty, you’ll grow it stronger as well.

Executive Vice President of The Verde Group
Dennis Armbruster