With everything else being equal, your customer experience program can give you a competitive advantage. And we’ve seen tremendous improvements in customer experience in recent years – which makes this an area that should be focused on.
“As you are getting into customer experience programs, be fearless,” said Luke Williams, senior vice president of customer experience at Qualtrics. “There’s an unlimited amount of sustainable advantage. Companies that choose to not compete on this stuff choose to measure their own decline.”
Luke joined Vice President of Marketing Jenn Vogel on this episode of “Reel Talk: The Customer Insights Show” to discuss the topic. You can read this article, watch their chat on YouTube or listen wherever you listen to podcasts to get the details.
“If you look at the average customer experience today … when compared to 15 years ago, they are night and day,” Luke said. “The world is materially better but nobody cares because everyone is like ‘Yeah, it’s better, but it could always be better.’ No one is ever happy. There’s an endless amount of work to be done.”
Building and improving customer experience is a never-ending process, Luke said.
“It’s interesting to see the evolution of customer experience programs,” Jenn said. “Companies were competing on customer experience, but they weren’t calling it that at first. As a consumer, my expectation for that experience as it improves goes up. If that’s not met, I’m disappointed. The bar continually gets raised.”
“Take 50 years ago,” Luke said. “Companies couldn’t figure out supply chain. It wasn’t easy to get stuff where you needed it to go. Everything was done on pen and paper. You had no idea where the ship manifest was … logistics was the issue. And companies started competing on logistics. That was a meaningful competition.”
Today, consumers expect overnight shipping everywhere. Customer experience management programs are undergoing a similar evolution.
Luke said the hedonic cycle illustrates how customer expectation continues to increase, another reason why a customer experience management program is necessary.
- People experience something
- Are happy about it
- Now it’s the norm and expected
“So over and over we have to fill up this bucket to push this thing forward,” Luke said. “Customer experience isn’t fake.”
Customer experience becomes especially important in crowded and highly competitive fields. Take buying furniture, for example.
- Let’s say the furniture is comparable.
- The online shopping experience is great.
- It arrives quickly.
When those are equal, customer experience becomes a bigger differentiator, Luke explained.
Take the example of cars
“Safety is a primary concern,” Luke said. “If it doesn’t have brakes or an airbag, I don’t care that it’s a Porsche. I’m not driving it.”
Today, the real decision-making comes down to fit and finish, Luke said.
“It’s the way the car feels. It’s hard to describe. But if you are really good, you know how to design specifics to deliver those experiences.”
Of course, we have to consider what we can actually pull off, Luke said.
The buying experience
A car dealership was receiving low Net Promoter Scores after a vehicle purchase. The company couldn’t figure out why that was and dug deeper into the situation.
Customers reported that the buying process was too stressful and didn’t make them feel comfortable enough to ask questions. The company then updated processes, communications and more. Scores started going up again.
“Surveys without a closed loop can do more harm than good,” he said. “You have to understand why the score is really great or really poor so you can then go back to the client and either fix the problem, thank them, celebrate or ask the follow-up question.”
Team and strategy integrations
We’ve talked about the importance of teams working together, and that matters in building a customer experience program.
An example: when customers abandon a $50 sale because of a $6 shipping charge.
At the end of the day, place the customer first and deliver a great experience and product across all departments.
Who will the customer experience program help?
Of course, the answer is: Customers. But how do we think about them?
Luke said he doesn’t think of a single person when he thinks of customers but rather thinks of clusters and micro clusters of people who exhibit certain behaviors, have certain attitudes and are likely to commit certain behaviors — things he can try to understand and use to create better customer experiences.
“My background is in research methods and analytics,” Luke said. “How do I build science around decisions people make? How do we make better decisions for the customer with an end in mind?”
Also keep in mind that if the goal is market penetration, you also need to think about the customers you don’t have.
“The people who don’t use you, they don’t use you for a reason,” Luke said. “Those are the things you need to be fixing to acquire more customers.”
Even though brand loyalty might be under attack, good customer experience does create customer loyalty, Jenn said.
“I don’t buy Apple products because their camera is better than Samsung,” she said. “I don’t know if their camera is better. There’s a feeling they sell you. An experience they sell you. That’s designing an experience for the customer.”
And, in the case of Apple, Luke added, people often don’t choose between Apple and a competitor. They choose between one iPhone and another.
Throwback content: Apple received love letters in this Valentine’s Day article
How does a customer experience program impact revenue?
Integrating the right technology is helpful, Luke said. For example, using platforms like Qualtrics or Voxpopme can ensure employees can spend their time on the right tasks and high-impact activities.
“We don’t just need to make experiences better,” Luke said. “We need to make them better to the point that they are actually better than competitors’ experiences, and, as a result, can drive a bunch of revenue.”
To use customer experience to the fullest, understand the baseline of the market and then figure out where improvements can help.
“Do we have strong evidence to make the investment in experience strategy faster?” Luke said. “You see companies competing on that type of stuff all the time.”
It’s easy enough to see customer sentiment of your brand by looking at:
- Social media
- Open tickets
- Customer complaints and feedback
But without diving in deeper, it’s hard to answer what needs to be fixed. Maybe it’s the product. Or maybe it’s a need for call center training, Luke said.
“Companies really come back to the same goals,” Luke said. What can a company do to meaningfully change the customer experience?
The most basic programs solve for issues of:
The most advanced programs solve for:
- share of wallet
- customer lifetime value
- market penetration
Many companies are great at designing a great delivery, but fewer are good at delivering a good customer experience.
“I can promise you won’t be able to compete by 2025 if you don’t have both,” Luke said.
How to get started
“That all sounds like a dream,” Jenn said. “But how do you get started? What if you don’t have the foundations in place?”
“There’s no right answer,” Luke added. “If you ask the 30 greatest painters in the world ‘where do you start?’ “
It depends on where you are. For example, if you are starting with a high churn rate, start there and figure out why. Then fix that problem.
“But first, I have to understand my product and the competitive landscape,” Luke said. If people are saying they are leaving because of a certain experience, set up a program to address those issues.
“The first question I always ask is where are we losing customers and why?” Luke said. “The first thing you want to do is go in there and put a wedge in there.”
That saves money. That then gives you permission to do more.
A good question to ask:
“Am I going immediately operational or strategic first?” Luke said. “Most of the time, you are going to go operational first. Plus, you need that stuff anyway. Where should you start? Well, you start everywhere… and I want to start by understanding why money is walking out the door.”