HBR Analytic Services Study: customer experience programs foster growth
Key business indicators show companies with strong customer experience management programs perform better
Everybody agrees: we live in a customer-driven world. And a new study of 403 global business executives by Harvard Business Review Analytic Services finds that companies prioritizing customer experience initiatives fare substantially better across a range of business measures, from profitability to customer retention. The study, “Lessons from the Leading Edge of Customer Experience Management,” was sponsored by business-analytics leader, SAS.
Customer experience leaders face similar struggles to their lagging counterparts. But they are investing in the funding, processes, and strategy to surmount them and consider successful customer experience programs a strategic business priority. Indeed, 71 percent believe that customer experience efforts provide a competitive advantage.
Unsurprisingly, organizations that downplay customer experience management simply don’t believe it provides such a benefit. Yet this viewpoint may be harming their businesses: organizations prioritizing customer experience initiatives are doing better across such wide-ranging KPIs as profitability, revenue growth, quality and customer retention rates – in some cases outperforming by a factor of two or more.
“What matters most is the complete customer relationship journey—how each experience is orchestrated, how the bumps are handled, and what the customer’s perception is along the way,” said Adele Sweetwood, Vice President of Marketing at SAS. “The right mindset, approaches and technologies help manage experiences and help truly understand what customers want, to build loyalty, and ultimately to create higher profitability.”
The study acknowledges that successful customer experience management is hard. Integration and data issues can thwart attempts to deliver a single view of the customer. Cultivating a customer-focused culture can be a challenge. And proving ROI – tying customer experience efforts to business outcomes – is tricky. However, customer experience management leaders are rising to the challenge. Armed with an intrinsic belief in the business value of customer experience management, they’re putting the funding, processes, and strategy in place to overcome the hurdles.
What does a successful customer experience management leader look like?
- They’re funding customer experience programs – 64 percent believe their programs are adequately funded.
- They have the right skills, tools and systems. An overwhelming majority – around three quarters – say they have the proper support processes in place.
- They use internal and external data efficiently and apply analytics more effectively than others.
- More than half recognize the importance of multi-channel management, and are more likely to adopt new channels such as social media, mobile, and video, juggling as many ten customer channels.
- They are more likely to tie customer experience strategy to corporate strategy; they reward, measure and report on customer experience efforts widely and regularly.
- They employ a number of technologies for customer experience management, including online surveys, marketing operations management, real-time decision making tools, social media monitoring software, and content management systems.
- They recognize the importance of emerging analytics technologies that analyze online behavior, social media sentiment, and text, as well as tools that deliver real-time analysis of large data sets.
- They use a wider range of metrics, often more effectively, to report on their customer experience management progress – measures such as customer lifetime value, indirect traffic, social media sentiment, and upsell rates.
“Customer experiences reflect the clearest impact of digital transformation efforts in business today,” said Wilson Raj, Global Director of Customer Intelligence at SAS. ”Successful customer experience leaders view data, analytics and technologies as a unified digital business capability—to mirror the customer expectations of a unified relationship with the company, regardless of channels.”
For more information about this study please visit Lessons from the Leading Edge of Customer Experience Management.
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