How to prove the ROI of customer experience /Three ways to improve your CX pitch
One of the biggest challenges for CX leaders is convincing other senior executives of the benefits of investing in developing a customer centric culture. We can all share anecdotes of companies who have built their success on keeping customers happy, but the key to getting executives on board with customer experience is to prove it helps the bottom line. Clearly communicating the financial value of your CX programmes is even more critical in the current economic climate with many companies looking at cost cutting measures.
Here are three ways to use data to create a convincing CX story:
1-Establish the right metrics
A compelling CX business case will lead with the financial benefits to the company. The first step is to establish what type of financial return your CX programme will achieve; is it more revenue from existing customers or an increase in cross-selling or referrals? Perhaps your aims are more around cost savings, efficiency gains or reducing customer attrition?
Whatever your objective, it needs to be clearly defined and tracked at different layers such as geography, channel, products and services or even at unique customer level. That will help your management team to understand the baseline position and progress made. Ultimately, it is business impact that will ensure buy-in (and further investment) from senior leadership.
2-Track customer feedback and complaints
Customer-centric companies use the feedback loops between their customer service, sales, marketing and product development teams effectively. For example, call centre agents can be inundated with calls from customers who don’t understand their pension valuation documents. That feedback is invaluable to the marketing team who can use it to review and adjust future communications.
There is also financial value here. Unhappy customers cost more to serve because they require more time and resources. But, you need to show how much money the company is losing each month on negative calls and lost sales.
Tracking these financial and CX metrics can also guide strategy decisions. For example, pushing customers to digital channels can reduce costs per contact. But, it needs consistent monitoring to know if you’re jeopardising customer loyalty and operational efficiency because customers need to endure multiple touch-points to resolve their issues.
3-Focus on Customer Lifetime Value (CLV)
Measuring CLV proves the value of building long term customer relationships and loyalty. This could be as simple as a survey that asks customers how likely they are to make a repeat purchase or refer your company to friends. Tracking each step in the customer journey brings the voice of the customer to internal stakeholders. This enables companies to become better listeners and provide more relevant, personalised customer experiences that build stronger customer relationships rather than wasting resources on marketing and products that simply don’t resonate with customers.
There’s no denying that focusing on customer experience brings strong benefits to companies. But it does require investment and senior leaders often challenge exactly how those investments are going to pay off. A successful CX pitch will use relevant financial metrics and show clearly and concisely that delivering value to the customer also delivers value to the organisation.
CEO, HAPP CONSULTING SERVICES LTD