Why is CX a key element for business transformation and how are clients from various industries looking at it?
The typical way for an organisation to reach out to its customers and differentiate itself has been through its predictive spread: product differentiation, unique positioning in the market, and branding. However, as customer choice is increasing, the product lifecycle and the time that a product has differentiation is changing, across industries be it finance, automotive, CPG, or even government entities. For example, having a large branch network and ATMs is no longer an advantage for banks. With netbanking options, customers don’t need to leave their house to perform simple banking tasks, and banks need to find newer differentiators.
As a result of this rapid change, organisations feel the need to get closer to the customer and capture their interest with a unique customer experience.
Ultimately, any organisation that’s in the business of serving a customer is in the practice of satisfying a customer need. If an organisation can predict customer needs faster, better, and more accurately, then that’s an efficient CX strategy. In the past it used to be a ‘spray-and-pray’ approach. Today, organisations are using constantly evolving technologies to help them get closer to the customer and be part of the customer journey. There’s also a feedback loop that’s constantly changing and modifying. For example, if a hotel chain wants to upgrade, they can consult this feedback loop and figure out what their customers want from them and modify the experience accordingly.
What types of data are organisations sourcing to make CX decisions, and how could they better integrate data to capture a more accurate understanding of their customers?
Various types of data are being used to make very pointed CX decisions. Data is captured through organisation touch points, such as past sales, customer browsing, and transaction data. Data is also available through external sources such as social media, customer profiling, and compiling a 360 degree view of the customers' lifestyle.
What are top three things that should be there on the CX Roadmap for any business?
The first thing to remember is the definition of the customer. We need to revise what a customer means to us today. Is it still the same definition as it was a few years ago?
The second is the offering decision. What is the organisation’s value proposition? What are you offering to the customer? What need are you satisfying?
Third, a roadmap needs to be defined to address these points.
For example, products as diverse as tyres and water coolersare being sold as a service now. Providing, maintaining, replenishing, and predicting customer needs are part of the service that they are offering. You need to know what are the customer needs and prepare a roadmap to achieving complete customer satisfaction.
How do organisations estimate the ROI of a customer experience program?
The importance of ROI depends on the industry. Some industries are in the throes of change, and here it’s not a matter of ROI, it’s a matter of survival. For example, if banks don’t get close to their customers through mobile or digital enabled banking, then their connection to the customer is lost. Most industries in the B2B2C chain rely on retailers to handle their customer interactions. In certain industries, where customer proximity is imperative, the ROI is less about doing it and more on how much of it is justifiable. If you look at traditional commodities or B2B industries, they definitely need to work out the ROI and which parts of the value chain they need to use to get closer to the customer.
The model that’s used now in terms of strategy is based on use-cases. For example, if a customer walks into a footwear store and leaves without making a purchase because they found nothing that was in their size, the organisation must know how to predict such a scenario and keep a response ready. How do you predict and identify the items that you’ll need to keep in stock? How do you ensure that you have the relevant information to give to the customer in terms of any other branch that stocks the product? When will it be available next? What are the delivery options?
In that specific company, 20% of customers selected a product but couldn’t find the fitting that they wanted. If the company decides to make a further 15% sale in order to bring that ratio down to 5%, the act is justified.
These are some of the straight ROI journeys that we were able to calculate.
How can IBM help companies on their journey to provide superior customer experience?
Firstly, we have the capability to strategise. We do design thinking, process redesign, and ideation workshops which primarily help them think, strategise, create business cases, and design roadmaps. Secondly, we have the analytics required to create and implement them. Finally, we help them through their whole ROI journey, be with them, and walk them through the whole process. Once we show them some benefits, we are pulled into becoming a long-term partner and give them one business case after the other.
What are some of the major challenges that CX leaders face today?
The first challenge is differentiation between hype and reality – sometimes people get excited by a lot of hype. You need to figure out which campaign is relevant, figure out the benefits, and prioritise it.
The second challenge is change management in terms of people readiness and infrastructure readiness. While the CEOs and CXOs might be convinced of a campaign, they still need to take the rest of the organisation along. The industry must accept to do the task.
The final challenge is the new technology that will enable this. You need maturity in terms of maturity of system and data analytics. Have you captured the necessary data and can you handle and collate it? Do you have the right systems to capture all this data in one place?