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Last night, I received an email from a good friend of mine asking for my input on a question they had been asked by the senior leadership team of their organization. The question was as follows: "What value has our business experienced as a result of all the Customer Experience (CX) work that has been done?"
They are not the first senior leadership team of a company to ask a question along these lines – they are very unlikely to be the last. Although I was not there when it was posed, it is extremely likely that the question was laid down as a challenge – to either ask for justification as to why the business should keep focusing on CX or to find a way to stop doing so altogether.
Wanting proof of the real financial benefit of a CX focused strategy is a very common requirement of those who run businesses – and so it should be. If an organization is to invest any time, resource and investment into the way it manages its interests, then it is quite right to have an understanding of the return on investment into all approaches taken. However (there is always one of those), Customer Experience Professionals all around the world, still seem to be fighting a justification battle – fending off attack from those who do not believe in the value of CX as a strategic priority, or from those who do not believe that any ongoing investment is required to sustain a focus on it.
In reality, whilst many senior leaders are still not quite believing of the financial benefits of a CX focused strategy, most of them work in organizations which are suffering remarkably demonstrably from NOT having one!
Ultimately, customers the world over are struggling to know what to expect when they interact with businesses in most industries. The lack of consistent experiences is leading to an ever-increasing wave of customer dissatisfaction and unnecessary cost – not just to the customer, but to the business as well.
More and more publicly available evidence is being produced on a monthly basis to demonstrate that this is not soft and fluffy nonsense – but real, hard fact. Only last week, research from Ombudsmen Services in the UK found that 79% of people will avoid a brand or company if they have received poor service in the past – this is not new news. Yet their research calculated that thanks to poor customer service during 2016, the financial cost to companies in the UK alone was costing companies over £37 BILLION!!!
Take a second to digest that information. Even though the media still confuse the difference between customer SERVICE and customer EXPERIENCE, the negative effect of companies NOT being able to focus on consistently delivering the Customer Experience they intend, cost their businesses at least £37 BILLION – and that was just in the UK! Multiple that number as many times as you want to figure out the true cost worldwide.
Only today, UK house builder, Bovis Homes saw their shares plunge as customer service failings dragged down their profits in 2016. They announced that poor customer service cost them £7 MILLION in 2016 – astonishing. Whether this number is accurate or not, it is a sign of how important Customer Experience has become for it to be reported so transparently. These two recent media reports are an incredibly positive step in the right direction – for businesses, for customers and for the Customer Experience Profession.
I have repeatedly written about Customer Experience being seen and understood as a long-term business strategy. It should not be seen as an approach that will drive revenue generation in the short term – if it is seen in that way, then it is unlikely that a business will be able to see any demonstrable financial benefit from focusing on CX. However, unless a business is able to deliver experiences to its customers PERFECTLY, then the negative cost of NOT focusing on CX is undoubtedly significant. Businesses need to ‘wake up and smell the coffee’, when it comes to measuring the value of Customer Experience – it is just as much about the cost being removed from delivering random experiences, as it is the revenue being generated from happier, more loyal customers.
So the next time you are asked the million dollar question – ‘what is the benefit of our focus on CX?’ – whilst you may want to state the measurable improvement in customer focused statistics, you may also want to ensure that the person understands the cost of NOT focusing on it. Even the most customer-centric organizations in the world have to continuously work to improve the CX – they understand that they can never afford to NOT focus on it – doing so could be fatal.