From Okay to Excellent

According to Forrester’s 2011 Customer Experience Index, which covers 13 different industries, customer experience for almost two-thirds of brands ranges from just “okay” to “very poor”. Only 6 of the firms studied landed in the “excellent” category, down from 10 per cent in last year’s report.

All of which goes to show that mediocre-to-bad customer experiences are the norm, and that great customer experiences are the exception. But there’s light at the end of the tunnel. Through a simple model showing how revenues increase with better customer experiences, Forrester found that wireless operators have the largest potential upside: more than $1bn. The question is – how do you get there?

Modifying the experience
It comes down to defining that perfect customer experience and then knowing – for each customer -- how well you are actually doing at delivering it. Unlike in retail, where the customer experience is driven by a single event, customers interact with their service provider every day, even every minute, over long periods of time. The challenge for the operator is understanding at any given point what the customer experience actually is for each individual.

It requires capturing information on the customer experience, measuring it against what customers expect the experience to be, and then modifying the experience to meet those expectations. After all, the goal is not overachieving in some areas which inevitably means underachieving in others -the goal is consistently delivering what customers expect.

So how will you know whether the next time you engage with a customer is the best time to recommend to them a new product or the last chance to prevent them from leaving? Your “secret weapon” lies in the wealth of data you have on your customers. Why? By monitoring what customers are doing - how they are behaving, what they are experiencing, how they are interacting with you, what they are purchasing, what information they seek - you can easily gauge how close, or far, you are from delivering that perfect customer experience.

How many operators gather this information, share it between groups, and then use it to deliver what is relevant and timely and expected across every touch point and interaction throughout the lifecycle of each customer? 

Satisfaction drives loyalty

So why does customer experience matter? It matters because it’s a driver of key business metrics. “Customer experience” is not a new concept. For years it’s garnered attention, but as price wars, commoditisation, and the onset of new players vying for the mind and market share of customers continues, operators are realising that in order to differentiate themselves, they have to figure it out – which means they have to know how to measure it.

As it turns out, you can measure customer experience and most likely, your company is already tracking many of the metrics. Think of it as a hierarchy – you deliver what you promise to deliver and that drives satisfaction. Satisfaction drives loyalty, and loyalty drives advocacy. Those things, in turn, drive higher ARPU and lead to longer customer tenure which drive higher overall revenue and a lower cost to serve. The end result – higher lifetime value and higher profits.

The reality is that what gets measured gets done. Developing a set of customer-centric loyalty metrics - such as Customer Tenure, New Customer Volume, Share of Wallet, Satisfaction, Net Promoter - to be tracked in the same way, and with the same consistency that business metrics such as sales and profitability are tracked, is key. 

A Heavy Reading analyst recently said it best: “The operator that intelligently manages its customers' experiences can better anticipate their requirements, improve its responsiveness, provide a more personalized level of service, and reap the benefits in terms of lower operational costs, increased customer loyalty, and higher profitability.” Effectively leveraging data analytics to know your customers and proactively act in accordance with their needs will take you from delivering an “okay” experience to an “excellent” one.