The pandemic is changing the world and customer expectations, and the most successful companies recognize that their customer experience must also change. But many leaders are deploying the same digital customer experience (CX) strategies they used in 2019, thereby risking customer churn and dissatisfaction at a time they can’t afford. This article discusses three common CX mistakes, and strategies to address them before your competitors get the chance. By engaging cross-functional teams in CX discussions and understanding customer values, leaders can ensure their brand remains relevant for years to come.
Most businesses claim to have a “customer first” philosophy. And many are building their own customer experience (CX) function to increase customer retention, brand reputation, and recurring revenue. However, many companies’ CX strategies fall short of customer realities after the pandemic.
As a strategic marketing adviser and executive coach for the past three decades, I have seen it in my daily work and private CMO cohorts that many leaders are deploying the same digital CX strategies they used in 2019, thereby risking customer churn and dissatisfaction at a time when they can’t afford it.
Here are the most common CX mistakes I see — and strategies to address them before your competitors seize the opportunity.
1) Prioritize Cost Management over Strategic Investments
In uncertain times, it is tempting for companies to observe balance sheet improvements. In fact, most of my coaching clients are trying to emulate Google’s ambition to be 20% more effective. But this leaves companies vulnerable to competitors who are also focusing on maximizing customer-facing value to improve the bottom line.
For example, one of my clients, a profitable publicly traded company, recently experienced a six-month decline in its stock price. The CFO immediately halted all new marketing initiatives, and they asked each executive team leader to find at least $1 million in expenses to cut.
For the CMO, this represents a lost opportunity to invest in identifying new customer segments, to strengthen their retention strategies, and to experiment with new CX programs. . The CMO brings a wealth of experience from his previous roles – such as strategic account planning, customer advisory board programs, and leadership strategies that strengthen the brand. Investing in just one of those areas can pay for itself by stimulating long-term growth at a time when many of their competitors are cutting back. But his company’s focus on cost reduction made it difficult to pursue such growth opportunities. It feels like a short-sighted strategy that makes the company penny-wise and pound-foolish.
2) Reliance on Old Segmentation Strategies
CX leaders are trained to define customer segments to address (such as psychographics and demographics) and to create sophisticated customer journey maps (which are used to identify common customer challenges and purchasing patterns). Yet they often ignore one of the biggest changes since the pandemic: the desire of customers to understand a company’s stance on diversity, equity, and inclusion, climate change, and other issues. social issues.
KPMG’s 2022 CEO survey found that 69% of executives surveyed noted a higher level of stakeholder pressure to improve ESG (sustainability, social, and governance) reporting transparency – an 11% increase in just one year. It may not be a fad. These topics have risen to the top of customers’ priority lists. It reflects a person’s values. But you rarely find it in modern customer journey maps.
After reviewing several journey maps, I found that most only included superficial data, such as demographics, job functions, hobbies, and common pain points. Few describe the ideals behind it Why buyers choose a software tool, snack brand, or vacation vacation.
3) Treating Employee Experience (EX) and Customer Experience (CX) as Separate Silos
You will hear some leaders say that “the customer is always right”. However that rigid policy can also lead to costly attrition of top people, multiple priorities, and team burnout.
Salesforce recently partnered with Stanford and Columbia Universities to RESEARCH REVEALS showing that only one in three companies have designed a seamless integration between their customer experience and employee experience initiatives. And if they don’t agree, the research team suggests that companies could lose up to 50% of the increase in revenue.
Solving These CX Challenges
To meet these modern CX challenges, here’s what I recommend:
1) Have discussions with the CFO about value creation, not just cost reduction.
Many CX leaders underestimate their value, focusing on activities versus results. An executive recently bragged about juggling ten different buyer personas – a near-impossible feat for their lean CX team.
When faced with cost-cutting conversations, consider these strategies again:
- Show how CX investments drive additional revenue, grow share of voice, accelerate current revenue streams, or increase customer lifetime value. Stop using terms like “program delivery” and “support.” It frames your initiatives as transactional and not imperative.
- Make sure your CX metrics are aligned with your organization’s strategic goals — especially those reported to the CFO on the street, such as revenue growth and operating margins. CFOs rarely pay attention to vanity metrics, such as the number of followers. Neither are you.
- Invite a Financial Planning and Analysis (FP&A) partner to project planning and status meetings. They’ll feel more like collaborators versus rivals – increasing the chances that your strategic CX investments will get serious consideration in the next planning cycle.
2) Integrate customer values research into traditional segmentation exercises.
According to ValueGraphics CEO David Allison, CX strategies built exclusively around demographics are missing the mark. He and his team looked at 750,000 surveys in 152 languages about audience values, wants, needs, and expectations. They were surprised to find that “people in any demographic group are, on average, only 10% alike.” (Full interview here.)
Want to know what your ideal audience cares about? You can conduct values research, schedule one-on-one conversations, or both. If you’re facing a time or budget crunch, these questions will help you get started:
- why you [go to work, attend concerts, buy new clothes, etc.]? Tailor the question to where your audience will experience your brand.
- You just won the lottery. Why would you give away half of your winnings?
- You wrote a letter to your youngest from 10 years ago. What would you say, and why?
3) Align EX and CX goals and incentives.
In a 2019 HBR article, Andrew Chamberlain and Daniel Zhao cited several correlations between high employee engagement and higher American Customer Satisfaction Index (ACSI) scores. Apple, Trader Joe’s, Costco, and Johnson & Johnson still top the list of great places to work. Here’s another thing they share: impressive ACSI scores.
Taking cues from these brand juggernauts, where can you improve EX and CX team collaborations? How do you align incentives across teams? Where can you streamline technology platforms for both groups? How can EX and CX metrics take their rightful place alongside board-level operations and financial reporting?
Additionally, make sure your employees have a say in how you design customer-focused programs. on Experience Advantage study, Salesforce reported that “employees who feel trusted and who feel they can take risks in their roles are 1.5 times more likely to consider themselves top CX supporters.” One of my global clients hosts a monthly employee recognition program for team members who best model the company’s values. In 2022, they celebrated 32% revenue growth and a twenty-point improvement in employee engagement scores.
The pandemic is changing the world and customer expectations, and the most successful companies recognize that their customer experience must also change. By engaging cross-functional teams in CX discussions and understanding customer values, leaders can ensure their brand remains relevant for years to come.
