There was nothing wrong with my recent experience at Best Buy. I needed to get some e-readers for my kids, and they had them at a decent price. Picking the products up went fine. I just didn’t sense any of the deeper CX thinking Rick Parrish was talking about.
At last week’s CX North America event, the VP and principal analyst at Forrester cited the retailer in his keynote about the "hard data and soft power" necessary for organizations to bring their customer obsession to life.
According to Parrish, Best Buy’s overarching mission is to “enrich people’s lives through technology.” The guiding principles to fulfill that mission include “be human,” “be real” and “think about tomorrow.”
Honestly, I just bought some e-readers and now my kids use them. My life has not been enriched. The Best Buy staff was “real” in the sense they seemed utterly bored with their jobs. If they were thinking about my future, I was unaware of it.
Even if not every Best Buy location executes on those CX principles every day, though, I was grateful Parrish called them out. They offer a good example of how organizations can approach this more intentionally. There are plenty of compelling business reasons to do so as well.
Proof That Even Small CX Improvements Can Have Big Results
Parrish said Forrester has learned — through compiling its annual CX Index —that even a one-point improvement in CX can lead to a 1.3 per cent higher retention rate, a 1 per cent boost in how much they spend and 1.3 per cent greater advocacy, where customers talk about a company with their family and friends.
If those single digits don’t sound like much, Parrish gave the example of the financial impact within key vertical markets. For the average mass-market auto manufacturer, a one point change in CX can be worth $1.1 billion in incremental revenue, he said.
That’s the hard data, but soft power is different. In politics, soft power is defined as the ability to attract and co-opt, rather than coerce. It’s particularly relevant in CX, Parrish pointed out, given CX leaders often don’t have authority over other functions.
“This isn’t a land grab. We’re not trying to say the CX function needs to own all of CX, whatever that would even mean,” he said. “But the CX team is critical to overcoming those business silos, to helping the company discover the path to the right customer experience, and then enacting it.”
6 Principles To Build Soft Power
Forrester is trying to help its clients develop soft power through a 30-question survey that touches across six key principles. Here they are:
Source: Forrester
Much of this will no doubt sound pretty familiar, but Parrish offered some great real-life examples of how this works in practice.
He noted how Hampton, for example, analyzed data and determined that its most successful hotels tended to have general managers who exhibited nine specific behaviours. One of them was simply being around the breakfast area with guests in the morning, rather than doing paperwork in the back office.
At Nationwide, meanwhile, the company decided to move its experience designers (who had previously reported into the digital team) into a new group focused on corporate strategy and innovation.
“This meant they could apply good design practices to corporate strategy and policy, not just its touchpoints,” Parrish said.
As for technology decisions, Parrish delineated between areas where CX teams should be consulted (such as the use of chatbots) and informed (such as back-office tools) and those where they would be the primary users. He noted how organizations like AARP have dedicated admins for its Voice of the Customer platform, for instance.
Getting all these things right makes metrics more actionable. Parrish advised assessing CX based on customer interactions, perceptions and outcomes, and doing so at the touchpoint, journey and relationship level.
The Other Task For CX Leaders
What Forrester can’t necessarily show in all this, of course, is how soft power is exercised on a daily basis. In other words, what are the actual conversations that go on between CX leaders and other parts of the business that help ensure these principles are applied correctly?
That’s where it may be up to individuals to do their own ongoing self-assessments. Developing the right customer journey is one thing, but to really succeed in CX you may also need to pay close attention to the soft power trip you're taking.