Sunday, February 16, 2014

Customer Experience Management(CXM): The New Frontier for Companies to Focus on


CXM Overview

You might have heard about the new motto ‘Customer Experience Management (CXM)’ in many professional and official forums. Now days many people seem to be talking about it, analysts are writing about it and conducting many conferences dedicated to it and so on. So, what is it?

Customer experience (CX) is the sum of all experiences a customer has with a supplier of goods and/or services, over the duration of their relationship with that supplier. This can include awareness, discovery, attraction, interaction, purchase, use, cultivation and advocacy in the customer lifecycle. 


According to Gartner, Customer Experience (CX) is the customer’s perceptions and related feelings caused by one-off and cumulative effect of interactions with a supplier’s employees, channels, systems, products and services. 

Amazon, Zappos, Apple, Disney, Nordstrom, Starbucks and Marriott are few examples who pioneered in customer experience management and proved number one in their business areas. Starbucks spent less than $10MM on advertising from 1987 to 1998 yet added over 2,000 new stores to accommodate growing sales. Starbucks' popularity is based on the experience that drove its customers to highly recommend their store to friends and family.


A company's ability to deliver a product or service experience to its customers helps to increase the consumer spending with the company and increase loyalty to its brands/products. Loyalty is mainly driven by a company's interaction with its customers and how well it delivers on their wants and needs. The function/entity within an organization having the goal of establishing and improving customer experience is called customer experience management or customer relationship management.

Building great customer experiences is a complex initiative involving strategy, leadership commitment, technology integration, formulating and fine turning business models and brand management. Customers have an experience every time they interact with a company/brand—whether it is shopping in a department store, using a mobile device, grabbing coffee or making bill payments. That experience can be good or bad or somewhere in between. This experience impacts their impression and loyalty to the brand/product/company. Customers feel more loyal to those brands and buy/use more when they have a delightful experience. Customers’ expectations are growing; companies that completely ignore CEM will be far behind. 

Critical Success Factors

Here are few critical Success factors for an effective CXM initiative in your organization.

1)Define CXM : Amazon and Starbucks provide totally different kinds of customer experiences, and both are successful. Define what CXM means in your organization. Each entity/function in your organization should be clear on how they contribute to CEM and how they can seek to improve it. 

2)Funding: Have a budget for CXM investments. Some initiatives may involve the purchase of software, resources, or other resources. 

3)Cultural Change: Managing the customer experience should be part of the company culture. Initiative requires full support from executives, division heads, and then all employees. 

4) Management Commitment: Strong management commitment is needed for implementing a sustainable CXM initiative. 

5)Incentives: If a company is placing their customers’ experience as a high priority, then its employees should be incentivized for the success in a way that aligns with the KPIs.

CXM implementation Approach

Customer Experience Management topic is very broad and complex, no one can really offer a universal approach that works for every company. The breadth of organizational coverage, along with the specific qualities/goals will decide the complexity of CXM implementation/improvement within the organization. The vagueness in definition and details gives each company the freedom to define and implement the customer experience in a way that best suits to their business model. Here is the recommended approach for the implementation of a customer experience management in your organization

Conclusion

Customers are more demanding now than ever. They feel that interacting with every company should be easy and personalized. For example, when I have already logged into my Amazone site, I shouldn't have to fill out my address again to request for a shipment. They already have all of my information. Why should I ever have to repeat it?
Customer Experience Management as a concept is important because it involves looking at the company from a customer’s perspective. Right digital tools, skill set, culture and processes can help your company to provide best in class user experience to your customers. Knowing who your customers are and presenting them with consistent, relevant content across all the touch points in which they interact with your company will help you to further engage your customers leading to business success. Start leveraging all your CXM technologies, and enable them to work together. This will allow you to deliver the optimal experience to your customers, thus increasing customer satisfaction and loyalty, bringing immediate impact to your brand name, as well as long term benefit to your company.

Related Article: Customer Experience Management (CXM) Implementation Approach for Dummies


2 comments:

  1. Looking forward to detailed approach..

    ReplyDelete
  2. Stopped at high level.. more details required to implement

    ReplyDelete