Introduction to Customer Experience

Introduction to Customer Experience

Introduction to Customer Experience Jennifer S. Tomlinson Sr. Manager Partner Marketing Worldwide Channels and Programs [email protected] Table of Contents Why Customer Experience? Customer Experience Overview Customer Journey Mapping Customer Personas Voice of the Customer Research ROI and Quality of Experience Next Steps

WHY CUSTOMER EXPERIENCE? Click icon to add picture Customers today have high expectations of services they receive, service accessibility, choice, speed to resolve issues, customization, personalization and more. What do we remember and share the most? Amazing Experiences Good Service

Great Products The Need For A Focus on the Customer Customer Retention It is all about end-to-end experience & relationship The customer journey (and experience) continues after acquisition and purchase Purchase Paradigm Shift Marketing funnels are being replaced with customer lifecycle Fragmented path to purchases (multiple interactions and channels) Quality of Experience Companies must deliver relevant experiences, or lose customers Companies must measure interaction effectiveness throughout the entire lifecycle Powerful Customer Experience (CX) 70% of revenue growth is received from existing customers Statistics

7 in 10 CxOs believe social/digital interactions is the new imperative 60% of CxOs now look to PARTNERS who will have an equal hand in creating business value 3 out of 4 decision makers stated that top priority is enhancing customer experience One of the top CEOs priorities is Satisfied Customers and Brand perception By 2018 50% of consumer product investments will go toward Customer Experience Innovation Customer Experience As a Differentiator Differentiated Experienc es Services

Competiti ve Positionin g Goods Commoditie s Un-differentiated Market $ Pricing Premium $$ $

Customer Experience Example $.01 $.02 Per Cup Commoditie s $.05 $.25 Per Cup Goods $.75 $1.50 Per Cup Service

$2.00 $5.00 Per Cup Experienc e CUSTOMER EXPERIENCE OVERVIEW Click icon to add picture Creating a world-class, end-toend customer experience can become a key strategic differentiator. However, it requires a deep understanding of both the customers and how they interact.

Plus, a commitment to change business processes based on that understanding. What is Customer Experience (CX)? The sum of how customers perceive interactions with your companys products, services and/or people... Dynamic workplace Merging home & work Responsible organization Immersive, connected experiences

THE CHALLENGE customer experience is whatever your customer thinks it is. Understanding your customer Customer Lifecycle Four Steps to Improve Customer Experience Identify Product or Service Journeys Define Personas & Key

Interactions Validate Perceptions & Define CX Metrics Collaborate within your organization to identify most urgent product/service journeys to fix Start with your segments and audiences in order to narrow down the persona groupings Using voice of the customer

research confirm with customers data points from your journey map. Using industry or custom created ROI formulas prove that desired CX improvement will yield profits. When deciding on the top journey keep in mind the business and customer metrics that you need to improve Journey Identify common attributes

within each personas and their key interaction touchpoints. Decide on the key metrics you want to measure. With ROI confirmation generate the list of improvement projects that company will undertake to Quality of improve customer Experience experiences Mapping

Voice of the Customer Calculate CX ROI & Build Experiences CUSTOMER JOURNEY MAPPING What do customers expect from their relationship with your company? A combination of utility, convenience, value and delight at each interaction based on their individual needs at a specific moment.

Each interaction is an opportunity to strengthen or weaken the relationship with that customer. What Is a Customer Journey Map? It is visual illustration of one personas interactions and experience, from the personas point of view. Goal is to understand what occurs in each stage of the customer journey, and what moves those customers from one to the next. 1

2 3 4 5 6 While mapping the Customer Journey , you will gather and rate three categories of information: Wants, needs, and goals of the persona Personas interaction touchpoints Personas pain-points

What are the Wants and Needs? Wants products or services that are not necessary but that we desire or wish for Needs products or services that are required Wants and Needs represent personas expectations and perceptions at each stage of the journey. Typical questions when discovering wants and needs: What are customers trying to accomplish? Whats most important to them at that stage? How do they want to feel? What are emotions, thoughts, feelings and reactions during experience. What are the Interaction Touchpoints? Touchpoints are customer interactions with a company via any channel, at

any time, for any purpose. Your touchpoints drive customer perceptions of your brand (what you stand for) and experience (how well you meet their expectations) Journey Mapping Approach Summary Choose Key Products or Services To Fix Create prioritized list of products/services that are not meeting customer expectations Collaborate with other team members that are participating in selected customer journey Identify Key Personas Create the list of key customers grouped by common shared traits (role, needs, expectations) Identify and nominate the leaders for each persona (persona ownership) Break the Silos & Map The Journey

Invite cross-team members to map together journey (end-to-end view) Co-create journey map (hypothesis) then validate it through voice of the customer research step CUSTOMER PERSONAS Click icon to add picture A critical part of designing customer experiences is selecting and defining key customer personas, which represent a particular customer segment with shared traits. These behavioral archetypes are used to design specific experiences and interactions based on an understanding of the unique wants and needs of that particular segment.

For example, an individual shopper visiting a web site or calling support will have different requirements and expectations than a business partner. Who Is A Customer? Customer is whoever is taking the journey How Do We Design Customer Experience? We Cant Treat Everyone Differently OR Treat Them As If They Are The Same We design customer experience for a persona

What Are Personas? A proxy for bigger group of customers with shared common traits & business goals Common Traits: Age, Title, Attitudes, Gender, Common Interests, Location Business Needs: Goals, Concerns, Expectations, Perceptions, Painpoints Person a: Alexa Persona Design Approach Summary Who is taking a journey Engage with broader internal teams to create list of top customer profiles Prioritize top customers that are relevant to your journey Define segments Group customers by common traits & align them around business needs Ensure a mix of personas is used to capture broad perspectives

Design your persona Identify top wants and needs as well as top painpoints Map key interaction touchpoints (in the context of the journey) VOICE OF THE CUSTOMER RESEARCH Click icon to add picture The Voice of the Customer is a market research technique that produces a detailed set of customer wants and needs, organized into a hierarchical structure, and then prioritized in terms of relative importance for customer segment(s) being

researched. Voice of the Customer Research Approach GOOD: CX Qualitative Research Small customer sample (10-15 per persona) In person (Interviews) or Online (Discussions Boards) BETTER: CX Quantitative Research Large sample sizes, statistically significant numbers Not a market research survey, rather used to validate the journey and persona interactions and perceptions BEST: Metrics & Drivers Definitions Define key CX metrics that you will monitor Establish and derive key drivers of loyalty, satisfaction and behaviors Validate Your Hypothesis

Qualitative research typically is used when a company has a lack of understanding about customer issues. The objective of CX qualitative research is to provide understanding of a sample populations issues, beliefs, and motivations. Quantitative research is typically used when a company understands the issues, but needs greater certainty

with projectable data. The objective of CX quantitative research is to gather and organize the data and generalize, or extrapolate, the results from the sample set and apply it to the entire population of interest. ROI AND QUALITY OF EXPERIENCE Click icon to add picture A critical part of CX improvements is to have clear

ROI method and well defined CX metrics which provide monitoring and validation of customer experience improvements In order to justify the investment required for CX improvement projects, a common framework/index can be used to measure the CX impact on business. Successful measurement frameworks always include multiple data sources (i.e. perception data, behavior data and telemetry data). Quality of Experience Create Business Case CX ROI

Using voice of the customer research establish key CX metrics Using industry ROI formulas try to calculate CX ROI Build Experience Metrics Collect and create list of most common used metrics Group them by categories that help you build better business cases Implement CX Index Create a comprehensive CX index (multi-part) Example: employee satisfactions, customer perceptions, customer behaviors, brand perceptions CX ROI Example 1. A company with $100 Millions in Primer revenue has current Satisfaction distribution as following:

- 50% of customers are very satisfied - 34% are somewhat satisfied - 16% are not satisfied 2. From their perception survey, company learned that the likelihood to re-purchase is as following: - For very satisfied customers is 81% - For somewhat satisfied is 44% - For not satisfied is 16% 3. If company is able to convert just 1% of not satisfied to very satisfied their ROI could be approximately $1.12 M Current Revenue Index (CRI)

Future Revenue Index (FRI) 50% x 81%= 40.50 51% x 81%= 41.31 34% x 44%= 14.96 34% x 44%= 14.96 16% x 16%=

2.56 15% x 16%= 2.40 CRI= 58.02 FRI= 58.67 58.67-58.02 ROI = X $100M 58.0 2

ROI= $1,120,303.34 Example: Useful CX Related Metrics Customer Loyalty Success Metrics Revenue Satisfaction Employee Marketing Retention Rate Customer acquisition

cost/rate Revenue Per User Overall Satisfaction Revenue Per Employee Market Growth Rate Renewal Rate Reliability (as vendor/ or business

partner) Conversion Rate Stars in Reviews Employee Satisfaction Market Share Buy More Advocacy (recommend to others)

Customer Lifetime Value Compete Score (versus others) Average Employee Tenure Brand Equity Customer Effort Score First Contact Resolution Share of

Wallet Trust (level of organization trust with vendors) Employee Churn Rate Cost per Lead Example: Components of CX Index CX Score Score 25% 15%

47% 13% Employee Satisfaction Customer Perceptions Customer Behaviors Brand Experience - Long term satisfaction is our top priority - I have tools and resources I need to deliver excellent services - Processes an procedures allow me

to effectively meet my customer needs NOTE - Overall Satisfaction - Likelihood to recommend - Likelihood to continue - Easy to do business with us - Enjoyable to do business with us - Increase Share of Wallet - Conversion Rate Renewal Rate Retention/Churn Rate

Buy More Revenue Per User - Company Innovation - Brand Awareness - Brand Engagement - Brand Perception - Marketing Communications - Social Sentiment The presented CX Index components and their metrics should be adjusted based on the industry, service and customer types. Having a compound index helps organizations to bring balanced view and bring together disconnected siloed. NEXT STEPS To Learn More The Truth About Customer Experience

(HBR): https://hbr.org/2013/09/the-truth-about-customer-experience Visit Smart Partner Marketing on: http://smartpartnermarketing.microsoft.com Start your CX self-assessment: http://www.indigoslate.com/cx-self-assessment Microsoft Corporation. All rights reserved.

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