2019 XM Trends From Qualtrics Thought Leaders

This is the time of year for holiday cheer, family celebrations, and, of course, listings of annual trends!

To help me identify trends for 2019, I reached out to some of the many thought leaders across Qualtrics and asked them to share one or two of the top experience management (XM) trends they are expecting to see in the coming year.

It was a great exercise. We have some amazing people across Qualtrics who regularly help organizations master all aspects of XM: Customer Experience (CX), Employee Experience (EX), Brand Experience (BX), and Product Experience (PX). And the trends they shared highlight the enormous amount of learning and maturing that’s currently happening in the field of XM. For the sake of simplicity, we organized their trends into four broad categories:

  1. Humanizing through Technology
  2. Tailoring Insights for Action
  3. Expanding Predictive Analytics
  4. Authentically Living Brand Values

1) Humanizing through Technology

Companies are starting to recognize that their customers (and their employees!) are real human beings, with their own emotions, wants, needs, beliefs, and motivations. Companies are using technology and data to not only deepen this understanding, but also deliver more emotionally resonant experiences. Here are some trends from our experts:

  • Adaptive, Conversational Listening. “Survey” has a pejorative overlay in the common vernacular in the U.S. today. Customers are over-surveyed with surveys that benefit only the company and not the customer. We’ve come up with a way to change the survey to a conversation, whilst preserving methodological rigor around validity and repeatability. Our method seems simple but is built on a sophisticated process within Qualtrics. First, we identify the conversational aspects of the feedback request before we engage a customer. A conversation is a give and take, a social contract between two people (personas, in abstract) who are exchanging a number of responses that include emotions, meanings, motivations, and memories evoked by current, previous experiences and the cues of the conversation. We identify the main constructs that we are dealing with as part of this feedback strategy: the company, the Feedback Conversation and the Persona who represents the customer, and we adapt the feedback requests based on the customer response.  (Carol Haney, Head of Research & Data Science)
  • Make It Matter To Me. The advancement and application of artificial intelligence is already enabling more meaningful customer experiences. Whether it’s via chatbot, or a truly personalized experience, artificial intelligence has the potential to truly humanize endless reams of data. (Juliana Smith Holterhaus, Ph.D., Senior XM Scientist)
  • Quantify & Discuss Customer Emotions. Thanks to rapidly evolving technologies, in 2019, I expect to see more companies measuring and discussing customer emotions. Emotions play an essential role in how we make decisions and form judgments, and consequently, they significantly impact our experiences with and loyalty to different companies. And yet companies have historically ignored emotions – dismissing them as too squishy and unquantifiable. However, recent advances in technological capabilities – such as cloud storage, processing power, machine learning, AI, natural language processing, etc. – are allowing companies to start identifying and quantifying their customers’ emotions. For example, companies can now use speech or text analytics to automatically surface emotions during customer service conversations, and new analytics can infer customers’ emotions based on their digital body language (e.g. scrolling, clicking, hovering). Additionally, machine learning enables companies to uncover patterns in customers’ behaviors and preferences, allowing them to proactively address problems and personalize customers’ experiences. (Isabelle Zdatny, CCXP, Qualtrics XM Institute)
  • AI To boost Frontline Productivity. We are increasingly seeing more companies incorporate sophisticated technologies such as virtual agents to enable smarter self-service in order to rethink operational processes and deliver immediate gratification. Contrary to beliefs that virtual agents will start to replace agents in frontend operations, we actually expect AI to help drive adoption of virtual assistants to become the primary channel of self service, while saving effort and time for agents and increasing their overall productivity, whereby they can focus on being a source of revenue rather than be a cost-center by selecting and presenting the best possible solution to the customer when engaged in LIVE calls. But, the focus will need to be maintained on relying on mechanisms which can also distinguish when the customer is confused and can understand and distinguish based on that emotion to engage a live agent – so ultimately the experience is frictionless, yet effortless from all involved. (Arpana Luthra, Principal Consultant, CX Practice)
  • Augmented Reality Will Redefine XM. Technologies like augmented and virtual reality will be important in elevating overall experiences and improving decision making. These technologies will make shopping easy, convenient, attractive and certainly differentiated – enabling customers to touch, feel, discover and explore products to create an experiential environment giving them a realistic feeling of the product or service experience much before they make a purchase decision. This will require businesses to re-imagine their people, process, technological and service strategies while ensuring they continue to deliver to their brand promise, but do so more effectively. (Arpana Luthra, Principal Consultant, CX Practice)

My Take: Organizations will increasingly focus on the fundamental component of XM—human beings. It’s important to start with an understanding of how people think, feel, and act. How can organizations apply this knowledge? By applying the Human Conversational Model to all interactions, including the growing number of digital touch points.

2) Tailoring Insights For Action

While most companies are now fairly proficient at data accumulation, collecting data just for the sake of collecting data is not useful in and of itself. Companies must actually use these insights to drive customer- and employee-centric decisions across the entire organization. To do this, they need to be strategic about how they collect information, how they tailor the information to their separate audiences, and how they use that information to identify and act on improvement opportunities. Here are some trends from our experts:

  • Activating Managers’ Engagement Skills. More companies are recognizing that a strong culture and engaged employees are not a result of HR tactics, but on how effectively individual leaders and managers are connecting with employees. I’m seeing more companies putting time into helping managers understand their role in employee engagement and identifying and removing time-consuming administrative tasks that get in the way of managers supporting, coaching, and recognizing employees every day. Companies are also working on improving the feedback managers get so that it enables managers to have more productive conversations with their employees about what’s working and not working on the job. (Aimee Lucas, CCXP, Qualtrics XM Institute)
  • From Survey To Strategy. I’m beginning to see organizations ask how the annual engagement survey can best fit into their overall people strategy. Leaders are taking an interest in linking survey results to business outcomes, aligning surveys along multiple points in the employee journey, taking action that will impact the business both immediately and 3-5 years from now. Surveying is no longer an annual look backward, but a strategic tool in moving forward. These conversations are exciting for both the client and Qualtrics. (Kara Laine, XM Scientist)
  • High Frequency Feedback Isn’t Helping. We have had several customers this year pull back from a monthly employee survey strategy to something Quarterly or even Semi-Annually. Their manager report not having the ability to action it before the next survey goes out and they are overwhelmed by the frequency. We find that instead our successful customers are working to connect with employees at meaningful touch-points, such as during onboarding or on a work anniversary, rather than focusing on frequency. (Austin Nilsson, EX Delivery Services Manager)

My Take: As I wrote in a post earlier this year, the future of VoC is insight & action, not feedback. Companies are increasingly recognizing that they need to drive four different action loops. This requires them to tailor insights to fuel different decision-making processes across an organization. That’s why Qualtrics is so committed to helping our customers deliver role-specific insights.

3) Expanding Predictive Analytics

Customers and employees increasingly expect companies recognize them as individuals, anticipate their needs, and proactively address their concerns. To meet these rising expectations, companies are using powerful analytics engines to combine rich customer and employee feedback with reams of CRM and operational data, surface meaningful patterns within that data, and then generate predictive models that allow for proactive, personalized experiences. Here are some trends from our experts:

  • Hyper-Contextualized, Not Personalized. A positive, consistent experience has long become a table stake. Today’s customers want organizations to respect their time. A good product at a competitive price is no longer the basis for differentiation. Truly customer-centric organizations will increasingly leverage data-driven analytics to spot customers’ buying patterns, behaviors across channels and touch points to design experiences and content, at a time customers want it and deliver them proactively rather than reactively. Customers will increasingly look for a unique, customized experience that is memorable and reminiscent of a personal relationship. There will likely be a rise in teams and knowledge centers focused on identifying the experience along these personalized journeys. Closely tied will be the importance of measuring customer emotions and understanding how they feel in the moment because customers who have a negative experience during a brand interaction are more likely not to forgive that company. We expect analytics to not only empower brands to personalize experiences, but also enable them to identify and prevent issues before they would happen, so they can now shift resources not to problem solve but to get ahead of them. (Arpana Luthra, Principal Consultant, CX Practice)
  • People Analytics. People analytics involves deriving insights from employee data and advanced analytics to make talent management decisions to drive revenue and growth. Over 70% of companies now consider people analytics a high priority, but only 10% believe they have a good understanding of which talent dimensions drive performance in their organizations. People analytics may be leveraged alongside data captured at every employee touchpoint to develop algorithmic selection systems, dynamic workforce planning models, and social networks informing organizational silos and influence between and within teams – to name a few possibilities. (Brandon Riggs, EX Internal Program Lead)

My Take: Historically, insights have been used to describe what has happened in the past. While this retrospective provides value, the ultimate objective is to use insights to prescribe best actions for the future. As predictive analytics becomes more accessible and companies blend together X- and O-Data, we’ll see a surge in predictive recommendations. Qualtrics is putting a lot of energy into making these advance analytics much more accessible to business users.

4) Authentically Living Brand Values

People want to interact with organizations whose policies and practices align with their personal principles, ideals, and attitudes. Companies can build trust and emotionally engage both their customers and employees by authentically championing social causes and demonstrating that they share the same values as their target customer segments. Here are some trends from our experts:

  • Merging Inclusivity And CX. We’ve seen multiple news articles over the past year surrounding how companies can create better online experiences for customers with disabilities. One of my favorite CX-related stories from 2018 was on the work of the Hearing and Speech Agency in Baltimore, MD. The organization is working with D.C. area restaurants to train workers on how to understand and create enjoyable experiences for customers with speech disabilities and disorders. Starbucks also opened its first U.S. sign language store in Washington, DC this past year. (Stephanie Thum, CCXP Chief Advisor, Federal Customer Experience)
  • Maturing Of Customer Journey Mapping. Customer journey maps will sustain their momentum as a popular tool to diagnose and design customer experiences. Successful journey mapping companies avoid the common of mistake of assuming the map itself is the “finish line” but rather bring cross-functional subject matter experts together who use the map’s findings to take action around the key moments of truth that deliver on an organization’s brand promises. In 2019, more companies will use journey maps to highlight the emotional impact of the experience as a way to raise empathy for customers among employees, regardless of their roles. Companies will also shift from using maps solely to capture the current state experience and begin to use them to keep the broader journey in mind while innovating future-state customer interactions. (Aimee Lucas, CCXP, Qualtrics XM Institute)
  • Fusing The Concepts Of Ethics And BX. Customers oftentimes look to online reviews and ratings to make decisions, anticipating or expecting experiences that may be based on those reviews and ratings. But what about when reviewers have been compensated to write positive reviews, incentivized to do so with a discount on a future purchase, or reviews are just plain fake? Similarly, what are the CX ethical implications of score begging, when auto dealerships, for example, beg for 10s on a survey, rather than allow customers to provide an honest review that would then possibly trickle out via marketing to other, future customers? How do we consider and think about these things when creating or honestly evaluating the experience customers are having with brands? (Stephanie Thum, CCXP Chief Advisor, Federal Customer Experience)

My Take: For an organization to optimize its CX, BX, PX, and BX efforts, it must have a deep understanding of its core values. Without this clarity around a true north, it’s nearly impossible to align priorities across an organization. We’ve seen companies live their values by translating customer promises into employee actions —and we expect to see even more of this activity going forward. I recently discussed how Starbucks should have used this approach for training after its recent issues.

The bottom line: 2019 will be an exciting year for XM!

CX Myth #5: Wow Customers During Every Interaction

CX Myths: Debunking Misleading Beliefs About Customer Experience

Many common beliefs about customer experience are misguided, based on oversimplifications or a lack of consideration for real-world constraints. In this series of posts, we debunk these myths.


CX Myth #5: Wow Customers During Every Interaction

What’s Wrong: While it may be appealing to think about creating an amazing experience every time you touch a customer, it’s just not appropriate or practical. All interactions should aim to meet your target customers’ success, effort, and emotional expectations, but in many cases they aren’t looking to be wowed. And if we put the same energy into all interactions, then we are underinvesting in the situations that matter the most to our customers.

What’s Right: Customer experience is not about wowing customers, it’s about delivering on your brand promises. Otherwise, companies that wanted to be great at customer experience would face an endless escalation of costs as they continue to layer on wow-inducing elements across their customers’ lifecycle. You need to understand how you want to be differentiated in your customers’ eyes (brand promises), and make investments in customer experience that bring those differences to life.

What You Should Do:

  • Elevate your brand promises. If you don’t know what makes you special, then you will never be able to effectively prioritize your resources. Start by making clear brand promises, then embrace those promises by helping all employees understand what those promises mean and what role they personally play in making the promises come to life. Finally, keep the promises by holding each other accountable to them on an ongoing basis and measuring yourself against them.
  • Master key moments. A handful of moments disproportionately impact your customers’ perceptions of your organization, and therefore disproportionately impact their loyalty. First identify these moments, and then invest in making those moments emotionally resonant experiences that reinforce your brand promises.
  • Focus on customer expectations. Delivering a great experience does not mean being better than your competitors. Their brand promises may be different than yours, or they may not be setting the right bar for key moments. Instead, measure yourself against your customers’ expectations. Are you exceeding your brand promises in the eyes of your key customers? If the answer is “an easy yes,” then you may want to consider even more aggressive brand promises.

The bottom line: Don’t try and wow customers, live up to your brand promises.

What’s All This About X- And O-Data?

1811_XODataYou might have heard Qualtrics discussing X-data (experience data) and O-data (operational data), and wondered, should we care? The answer is yes, and here’s why.

Let’s start with a basic premise that no individual experience exists in a vacuum. People form their opinions about any experience based on a collection of different factors. The more we can understand those factors, the better we can extrapolate the insights about a single personal experience to form a deeper understanding about other people’s experiences.

Now to my discussion of Xs and Os, starting with customer experience (CX)…

Let’s say that your company has this data:

  • X-Data: NPS responses
  • O-Data: Customer product ownership and support history.

With X-data, you can calculate an NPS for the customers who responded. You can also dig into their feedback, and hopefully understand what’s causing promoters and what’s causing detractors.

That’s extremely valuable, but it only tells you what’s going on with the people who happened to respond to the survey.

By combining O-data with your X-data you can examine (especially through predictive analytics) what types of products and service interactions lead to promoters and detractors, and use this data to calculate the NPS for large portions of your customer base–—even for customers who never responded to a survey.

It could be that ownership of a certain version of a product tied together with a specific type of customer service problem is highly likely to create detractors. You can identify all the customers with that profile and take proactive measures to correct the issues — even though they may never have complained.

Result: More loyal customers and more targeted use of your resources.

This works across all areas, even with employee experience (EX). Let’s assume you have this data:

  • X-Data: Employee satisfaction study
  • O-Data: Employee tenure, promotion history, most recent performance rating

With X-data, you can determine how employees feel about their next steps at the company. You can also dig into their feedback, and hopefully understand what’s causing higher vs. lower levels of career satisfaction.

By combining O-data with your X-data you can examine what influence tenure, promotion history, and performance may have on satisfaction, and use this data to identify segments of employees to invite to participate in a high-potential development program.

Result: More high-performing workforce because you’re investing in the right employees.

Hopefully you can see how the combination of X- and O-data can increase your CX and EX insights. The same dynamic also holds true for brand experience (BX) and product experience (PX). By combining and analyzing the different types of data, you can use feedback from a few people to build an understanding of many, many more. This allows you to better prioritize investments, while making more targeted and impactful changes.

The bottom line: X- and O-data together provides an analytics goldmine.

CX Myth #4: Net Promoter Score Is The Best/Worst Metric

CX Myths: Debunking Misleading Beliefs About Customer Experience

Many common beliefs about customer experience are misguided, based on oversimplifications or a lack of consideration for real-world constraints. In this series of posts, we debunk these myths.


CX Myth #4: Net Promoter Score Is The Best/Worst Metric

What’s Wrong: People often argue that Net Promoter Score (NPS) is the greatest metric, while other people argue that it’s a terrible metric. Both of those points of view are off the mark.

What’s Right: We rarely see a company succeed or fail based on the specific metric that it choses. That doesn’t mean that you can chose a ridiculous metric, but most reasonable metrics provide the same potential for success (and failure). In many cases, NPS is a reasonable choice, as our data shows that it often correlates to customer loyalty. The way you use a metric is often far more important than the metric that you chose.

What You Should Do:

  • Pick a simple metric. It’s important that you choose a metric that employees will understand, so they are motivated to help improve it. The metric can be based on customer attitudes (like NPS), behaviors (like repeat purchases), or even results (like first call resolution). Just pick a simple metric that aligns with your business goals.
  • Follow our five steps. To drive improvements using the metric, follow Temkin Group’s five steps. to a strong CX metrics program: 1) Determine a core CX metric, 2) set achievable goals, 3) identify key drivers, 4) establish key driver metrics, and 5) make the suite of metrics actionable.
  • Focus on all four action loops. People often discuss an action loop with CX metrics, but we’ve identified four customer insight-driven action loopsImmediate responsecorrective actioncontinuous improvement, and strategic change. Any CX metrics program should put in places processes to close all four loops.
  • Don’t compensate too much. When companies establish CX metrics, they often establish compensation based on them. While this can be a valuable approach to raise awareness and alignment, it can also be a problem if the level of compensation is too large (can encourage bad behaviors), it focuses on individual results (CX is a team sport), or the goals are too precise (some metrics are inherently jittery).
  • Have very clear sampling strategy. The approach for sampling often has a very significant impact on results. If you have multiple segments of customers and they each have a different profile (as many do), then your overall scores can change wildly based on the mix of those customers that are included in your calculations.

The bottom line: Obsess about your metrics program, not your metric.

Report: Net Promoter Score Benchmark Study, 2018

Temkin Group Net Promoter Score (NPS) BenchmarkWe published a Temkin Group report, Net Promoter Score Benchmark Study, 2018. This is the seventh year of this study that includes Net Promoter® Scores (NPS®) on 342 companies across 20 industries.

Here’s the executive summary:

Many large companies use Net Promoter® Score (NPS®) to evaluate their customers’ loyalty. To compare scores across organizations and industries, Temkin Group measured the NPS of 342 companies across 20 industries based on a survey of 10,000 U.S. consumers. Here are the highlights from this benchmark:

  • With an NPS of 65, USAA’s banking business earned the highest score in the study, followed closely by its insurance business and Navy Federal Credit Union.
  • Spectrum and Consolidated Edison of NY received the two lowest NPS, with scores of -16 and -12 respectively.
  • The industry average for NPS ranged from a high of 39 for auto dealers and streaming media down to a low of 0 for TV/Internet service providers.
  • USAA’s and Navy Federal Credit Union’s scores both outpaced the banking industry average by more than 40 points, while Motel 6’s and Super 8’s scores both fell nearly 30 points behind the hotel industry average.
  • Only five industries saw their average NPS increase over the past year. Of those, airlines’ and utilities’ scores increased the most, going up three points each.
  • Although a majority (54%) of companies’ NPS declined over the previous year, three companies – BCBS of Florida, Fairfield Inn, and Ameren Illinois Company – actually increased their NPS by more than 20 points since 2017.
  • 18- to 24-year-old consumers give companies the lowest NPS, with an average score of 3 across all industries. Meanwhile, two age groups – consumers between the ages of 25 and 34 and those who are older than 74 – tied for giving the highest NPS, with an average score of 36 across industries.
  • NPS is highly correlated with customer experience. On average, customer experience leaders enjoy an NPS that is 21 points higher than the NPS of customer experience laggards.

See the NPS Benchmark Studies from 2012, 2013201420152016, and 2017.

Here’s a list of companies included in this study (.pdf).

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Check out this sample of the dataset
Purchase Net Promoter Score (NPS) benchmark

Here are the top and bottom 10 companies:

Here are the NPS scores across 20 industries:
Temkin Group Net Promoter Score (NPS) Benchmark Industry Scores

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Check out this sample of the dataset
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Report Outline:

  • USAA and Navy Federal Credit Union Earn Top NPS Across 342 Companies
    • USAA and Navy Federal Credit Union Earn Top Spots in NPS Rankings
    • NPS Increases With Age
  • Want Higher NPS? Improve Customer Experience

 

Figures in the Report:

  1. Temkin Group Measured Net Promoter Scores For 342 Companies Across 20 Industries
  2. Net Promoter Scores (NPS): Top and Bottom 20 Companies
  3. Range of Net Promoter Scores (NPS) Across Industries
  4. Net Promoter Scores (NPS) By Industry (Page 1)
  5. Net Promoter Scores (NPS) By Industry (Page 2)
  6. Net Promoter Scores (NPS) By Industry (Page 3)
  7. Net Promoter Scores (NPS) By Industry (Page 4)
  8. Net Promoter Scores (NPS) By Industry (Page 5)
  9. Promoters, Passives, and Detractors By Industry
  10. Net Promoter Scores (NPS): Most Above and Below Industry Average
  11. Industry Average NPS, 2016 to 2018
  12. Net Promoter Scores (NPS): Largest Gains and Losses Between 2017 and 2018
  13. Net Promoter Score (NPS) by Age by Industry
  14. Customer Experience Correlates To Net Promoter Scores (NPS)

Download report for $495+
(includes report (in .pdf) plus dataset (.xlsx)
Check out this sample of the dataset
buy Net Promoter Score (NPS) Benchmark Study

If you’re looking to create a strong NPS program, check out our VoC/NPS Resource Page.

P.S. Net Promoter Score, Net Promoter, and NPS are registered trademarks of Bain & Company, Satmetrix Systems, and Fred Reichheld.

The Six Laws Of Customer Experience (Video)

This video explains The Six Laws of Customer Experience. By understanding these fundamental truths about how people and organizations behave, companies can make smarter decisions about what they do, and how they do it. You can download the free eBook and see our infographic.


Did you know that the CX institute offers eLearning courses to train your entire organization on the Six Laws of CX?


Video Script:

Just like the laws that govern physics, there are a set of fundamental truths that explain how organizations treat their customers. We call these “The Six Laws of Customer Experience:”

Anyone looking to improve customer experience must both understand and comply with these underlying realities.

<<NOTE: Here’s an infographic that lays out all of the laws>>

The Six Laws of Customer Experience (CX) Infographic

The first law is Every Action Creates A Personal Reaction. Simply put, the quality of an experience is entirely in the eyes of the beholder. An experience that is delightful for one person may be terrible for another person. When it comes to customer experience, one size does not fit all.

Law #2 is People Are Instinctively Self-Centered. Everyone looks at the world through their own frame of reference, and these unique perspectives heavily influence what they do and how they do it. Customers, for instance, care about their own needs, desires, and goals. Employees, on the other hand, have a deep understanding of their company’s products, organizational structure, and processes.

The third law is Customer Familiarity Breeds Alignment. A clear vision of what customers need, want, and dislike can align decisions and actions across an organization. When employees share a common view of who the target customer is, and they have easy access to customer feedback, there will be fewer disagreements about the best ways to serve these customers.

Law #4 is Unengaged Employees Don’t Create Engaged Customers. Walt Disney once said “You can design and create, and build the most wonderful place in the world. But it takes people to make the dream a reality.” He understood the importance of focusing on employees. The data supports that view. Companies with great customer experience tend to have significantly more engaged employees than do their peers.

Law #5 is Employees Do What Is Measured, Incented, and Celebrated. Some executives struggle to understand why their employees don’t treat customers better. But it isn’t a mystery. Employee behaviors can almost always be explained by the environment they’re in. What creates that environment? The metrics the company tracks, the activities it rewards, and the actions it celebrates. Collectively, these three factors shape how employees behave.

The final law is You Can’t Fake It. While it is possible to fool some people some of the time, most people will eventually discern what’s real and what’s not. In the case of customer experience, this means that employees will sense when customer experience is not actually a top priority, and customers will not be convinced that you are more committed to customer experience than you really are – no matter how much you spend on advertising.

The Six Laws of Customer Experience are meant to empower highly effective customer experience efforts. If you understand and follow these laws, you will be able to help your organization deliver great customer experience.

If being customer-centric matters to your organization, then why leave it to chance? Contact Temkin Group, the customer experience experts, by emailing info@temkingroup.com, or visit our website, at TemkinGroup.com.

Report: ROI of Customer Experience, 2018

ROI of Customer Experience (CX), 2018We just published a Temkin Group report, ROI of Customer Experience, 2018. Here’s the executive summary:

To understand the connection between customer experience (CX) and loyalty, we examined feedback from 10,000 U.S. consumers describing both their experiences with and their loyalty to different companies. The CX scores used in this model come from the 2018 Temkin Experience Ratings (TxR), which evaluated 318 companies across 20 industries. Our analysis shows that:

  • The correlation between CX and repurchasing is very high (Pearson correlation= 0.82).
  • There’s a 21-point difference in Net Promoter Score between consumers who’ve had a very good experience with a company and those who’ve had a very poor experience.
  • CX is made up of three components – success, effort, and emotion. While all three elements impact customer loyalty, an improvement in emotion drives the most significant increase in loyalty.
  • We built a model to estimate how a modest improvement in CX would impact the revenue of a typical $1 billion company across in 20 industries. On average, companies can gain $775 million over three years. Software companies stand to earn the most ($1 billion over three years), while utilities stand to earn the least ($476 million over three years).
  • The report contains data charts showing how loyalty levels change based on customer experience across 20 industries.
  • We also describe a five-step process for calculating the ROI of CX for your organization.

Download report for $195+
ROI of Customer Experience (CX), 2018

Here are two of the 14 graphics in the report:

Correlation between customer experience (CX) improvement and future purchase intentionsRevenue increase from improvement in customer experience (CX)

Download report for $195+ROI of Customer Experience (CX), 2018


Report Outline

  • Customer Experience Is Highly Correlated With Loyalty
    • Correlates with repurchasing
    • Links to Net Promoter Score
    • Significantly impacts emotion
  • CX Improvements Results: Up to $1.1B In Revenue Over Three Years
  • CX and Loyalty Across 20 Industries
    • Recommend a company
    • Repurchase from a company
    • Trust a company
    • Forgive a company
    • Try a new offering right away
  • Build Your Own CX ROI Model

 

Figures in the Report:

  1. Customer Experience Correlates to Future Purchase Intentions
  2. Customer Experience Correlates to Net Promoter® Scores (NPS®)
  3. Impact of SuccessEffort, and Emotion on Loyalty (Average Across 20 Industries)
  4. Elements Used in Model to Derive Revenue Impact Based on Improvement in Customer Experience
  5. Improvements in Customer Loyalty From Modest Improvements in Customer Experience
  6. Revenue Increases From A Moderate Improvement in Customer Experience
  7. Revenue Increases From A Moderate Improvement in Customer Experience (Details)
  8. Loyalty Differences Across CX Performance Levels
  9. Recommendations Based on Customer Experience
  10. Likelihood to Repurchase Based on Customer Experience
  11. Trust Based on Customer Experience
  12. Forgiveness Based on Customer Experience
  13. Try New Products Based on Customer Experience
  14. Steps for Calculating the Value Of Customer Experience

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ROI of Customer Experience (CX), 2018

Propelling Experience Design (Infographic)

In the report Propelling Experience Design Across An Organization, we examine how companies can best use a very important skill, experience design. This infographic provides an overview.

Here are links to download different versions of the infographic:

Here are some of the reports with data included in the infographic:

The Six Key Traits of Human Beings (Video)

One of the most important – but often forgotten – elements of customer experience is that it’s all about human beings. Customers are human beings, employees are human beings, and executives are human beings. This video identifies six key characteristics to keep in mind whenever you’re dealing with all types of people.


CX Sparks: Guides For Stimulating Customer Experience DiscussionsThis video is a great introduction to a discussion with your team. That’s why we’ve created a CX Sparks guide that you can download and use to lead a stimulating discussion.


Video Script:

One of the most important – but often forgotten – elements of customer experience is that it’s all about human beings. Customers are human beings, employees are human beings, and executives are human beings.

So if you want to improve customer experience, you need to understand and embrace how human beings actually think and behave.

But human beings are complex and can be difficult to fully understand. That’s why Temkin Group has identified Six Key Traits of Human Beings, which you will need to keep in mind at all times.

Six Key Traits Of Human Beings

First of all, human beings are INTUITIVE. People have two different modes of decision making. One mode is rational, which is slow, logical, and deliberate. The second mode is intuitive, which is fast, automatic, and based on biases and a set of heuristics, or rules of thumb.

Human beings make almost all of their decisions using the intuitive mode, but organizations focus most of their attention on customers’ rational behavior. You can better meet customers‘ needs by catering to their intuitive mode.

Human beings are also SELF-CENTERED. We look at the world through our own personal perspective, which, because of our unique life experiences, is totally different than anyone else’s.  This individual perspective often separates employees and customers, as employees are more familiar with their company than customers are. This knowledge gap frequently causes miscommunications and a lack of empathy. Once we recognize our self-centeredness, we can take steps to mitigate the issues it creates.

Human beings are EMOTIONAL. We remember experiences based on how they make us feel. Our memories are not like video cameras, they’re more like an Instagram account where we take pictures whenever we feel strong emotions, and then we judge that experience in the future based on reviewing those pictures. That’s why it’s critical to proactively think about which emotions an experience is likely to generate.

Human beings are MOTIVATED. We all strive to fulfill our four intrinsic needs: a sense of meaning, control, progress, and competence. So when we think about the people who work for us and with us, we need to spend less time focusing on their compensation and more time helping them fulfill their intrinsic needs.

Human beings are also SOCIAL. We want to connect with other people who are “like us,” and we tend to trust those people more than we trust other people or institutions. So to create good experiences, we should not only recognize that people’s social groups are an important area of influence, we should also help employees and customers build meaningful connections between themselves and each other

And finally, human beings are HOPEFUL. We flourish when we envision a positive future. So you can motivate employees, leaders, customers, and partners by painting a picture of future success that addresses their needs and aspirations.

Make sure to focus on these Six Key Traits of Human Beings whenever you are thinking about customers, employees, leaders, or partners. It will allow you to better influence their behaviors and fulfill their needs.

If being customer-centric matters to your organization, then why leave it to chance? Contact Temkin Group, the customer experience experts, by emailing info@temkingroup.com, or visit our website, at TemkinGroup.com.

Collage of 2018 Customer Experience Infographics (So Far)

We’re always looking for ways to share interesting data and concepts, so we regularly publish parts of our content in infographics. In case you’ve missed any of them, here’s a collage of the infographics that we’ve already published this year.

Collage Of Temkin Group's Customer Experience (CX) InfographicsHere are the individual infographics:

2018 Temkin Emotion Ratings: Wegmans Earns Top Spot

Emotion is one of the three components of a customer’s experience (along with success and effort), so it’s a fundamental element for companies to track. In this post, I examine the eight annual Temkin Emotion Ratings for U.S. companies. It’s one of the components of the overall Temkin Experience Ratings, the open standard CX metric.

Temkin Experience Ratings: The Open Source Customer Experience (CX) Metric

In January 2018, we surveyed 10,000 U.S. consumers about their experiences with companies. We used that feedback to calculate the Temkin Emotion Ratings for 318 companies across 20 industries (see full list of companies).

***Detailed data is included in the overall Temkin Experience Ratings dataset***

Here are some highlights of the ratings:

  • Wegmans earned the highest rating (78%), followed by H-E-B (76%), Aldi (75%), Bed & Body Works (74%), Regions Bank (74%), and Baskin Robbins (74%).
  • At the other end of the spectrum, Cox Communications earned the lowest ratings (32%), just slightly behind Comcast (34%), Spectrum (35%), and Optimum (35%).
  • On average, supermarkets, earned the highest ratings (68%), followed by fast food chains (65%), hotels (64%), and retailers (64%). TV/Internet service providers (40%) and health plans (46%) earned “very poor” average scores.
  • Ten companies earned ratings that are 10 or more points above their industry averages: Georgia Power, Regions Bank, ACE Rent A Car, Alaska Airlines, Alabama Power Company, Citizens Bank, USAA (for credit cards and banking), credit unions, and Bath & Body Works.
  • Nine companies earned ratings that are 12 or more points below their industry averages: Hitachi, Consolidated Edison of NY, Days Inn, DHL, Haier, Chrysler, CarMax, Spirit Airlines, and Motel 6.
  • We compared Temkin Emotion Ratings between 2017 and 2018 and found that nine companies improved by at least eight points: BCBS of Florida, MetroPCS, Dollar General, Airbnb, Avis, Aldi, Wawa Food Markets, Taco Bell, and Hyundai.
  • Eight companies dropped by 15 or more points over the previous year: Hitachi, Audi, Amazon Fresh, Southern California Edison, Haier, HSBC, TXU Energy, and Appalachian Power Company.
  • Led by a seven point drop in utilities and a four point drop in auto dealers, 18 of the 20 industries declined over the previous year.

2018 Temkin Emotion Ratings: Company Leaders and Laggards2018 Temkin Emotion Ratings: Range of Industry Scores

Purchase Temkin Experience Ratings dataset (includes Temkin Effort Ratings)You can access this data as part the overall Temkin Experience Ratings dataset

What is Net Promoter Score? (Video)

Net Promoter® Score (NPS®) is one of the most popular CX metrics, so we are often asked to discuss it with clients. In addition to helping build successful NPS systems, we often provide a basic overview for executive teams and broader audiences of employees. That’s why created this video. It’s meant to explain what NPS is all about and why it may be a valuable approach for some companies. It’s a great video to share across your organization if you are using or considering using NPS. If you’d like more information, check out our NPS/VoC program resources.


CX Sparks: Guides For Stimulating Customer Experience DiscussionsThis video is a great introduction to a discussion with your team. That’s why we’ve created a CX Sparks guide that you can download and use to lead a stimulating discussion.


Video Script:

You may have heard of Net Promoter Score, which is often referred to as NPS. It’s a popular customer experience metric. Let’s examine what it is.

Walt Disney once said “Do what you do so well that they want to see it again and bring their friends.” He understood the incredible value of customers who actively recommend a company.

NPS is a measurement system that helps companies track and increase the likelihood of customers recommending an organization.

First of all, let’s describe the actual NPS measurement. It begins by asking customers a simple question:

“How likely are you to recommend this company to a friend or relative?”

Customers choose a response from an 11-point scale that goes from 0 “not at all likely” to 10 “extremely likely.”

Based on their response, customers are placed into one of three categories:

  • If they choose between 0 and 6, then they are DETRACTORS.
  • If they choose 7 or 8, then they are PASSIVES.
  • If they choose 9 or 10, then they are PROMOTERS.

NPS is calculated by taking the percentage of Promoters and subtracting the percentage of Detractors. You then multiply the percentage by 100 to get a whole number between -100 and +100.

Calculating Net Promoter Score (NPS)

Let’s say that 100 people answered the question, and 40 are Promoters, 50 are Passives, and 10 are Detractors. To calculate NPS, we would take the 40% for Promoters, subtract the 10% for Detractors, which leaves 30%. After multiplying it by 100, the NPS is 30.

While NPS provides a score, 30 in this case, the power of the system does not come from overly focusing on the number.

The goal of using NPS is to find and correct issues that create Detractors and to find and repeat activities that create Promoters. So it is important to understand what is causing customers to choose their responses.

That’s why most NPS programs include a follow-up question that asks the customer why they chose the score that they did. This question should be open-ended, not multiple choice, so customers can express their views in their own words.

What do you do with the data?

First of all, you want to “close the loop” with the customers who responded. This means contacting at least some of the customers who respond. Companies often try to reach out to all of the Detractors, to find out more about their problems and to see if their issues can be resolved. They also often contact Promoters, to thank them and hear more about what they like.

Next, you want to examine the opportunities to improve NPS by looking at what situations and activities cause Promoters and Detractors. This requires analyzing the responses from each group separately, and often involves incorporating other information about customers. You may also want to examine what drives Promoters and Detractors across different business areas or customer segments.

There’s no value in identifying the items that are driving NPS up or down unless a company does something with what they learn.

That’s why companies establish processes for reviewing, prioritizing, and taking action on the items that they uncover. In other words, the way to improve NPS is to have an ongoing approach for improving customer experience.

When used correctly, NPS helps companies follow Disney’s advice and do what they do so well that their customers want to see them again and bring their friends.

If being customer-centric matters to your organization, then why leave it to chance? Contact Temkin Group, the customer experience experts, by emailing info@temkingroup.com, or visit our website, at TemkinGroup.com.

Note: Net Promoter, Net Promoter Score, and NPS are registered trademarks of Bain & Company, Inc., Fred Reichheld and Satmetrix Systems, Inc.

2018 Temkin Effort Ratings: Wegmans Earns Top Spot

Effort is one of the three components of a customer’s experience (along with success and emotion), so it’s a fundamental element for companies to track. In this post, I examine the eight annual Temkin Effort Ratings for U.S. companies. It’s one of the components of the overall Temkin Experience Ratings, the open standard CX metric.

Temkin Experience Ratings: The Open Source Customer Experience (CX) Metric

In January 2018, we surveyed 10,000 U.S. consumers about their experiences with companies. We used that feedback to calculate the Temkin Effort Ratings for 318 companies across 20 industries (see full list of companies).

***Detailed data is included in the overall Temkin Experience Ratings dataset***

Here are some highlights of the ratings:

  • Wegmans earned the top spot with a score of 90%, followed closely by Subway, Citizens Bank, Ace Hardware, and Wawa Food Markets at 89%.
  • Spirit Airlines earned the lowest ratings, 43%), just slightly behind Medicaid (45%), and CarMax (46%).
  • On average, supermarkets, fast food chains, and retailers earned “excellent” Temkin Effort Ratings. Health plans and TV/Internet service providers earned “poor” scores.
  • Ten companies earned ratings that are 10 or more points above their industry averages: Dish Network, USAA, Southern California Gas Company, TriCare, Whirlpool, Citizens, National Car Rental, Florida Power & Light, Georgia Power, and Southwest Airlines.
  • Seven companies earned ratings that are 15 or more points below their industry averages: Spirit Airlines, HSBC, CarMax, Fujitsu, Hitachi, DHL, and Days Inn.
  • We compared Temkin Effort Ratings between 2017 and 2018 and found that three companies increased by more than 10 points: MetroPCS, Avis, and Showtime. Five companies declined by 12 points or more: HSBC, CarMax, BMW, Fujitsu, and Dollar Car Rental.
  • At an industry level, banks and streaming media improved the most over the previous year, while  auto dealers and utilities declined the most.

2018 Temkin Effort Ratings- Leaders and Laggards

Temkin Effort Ratingstemkin effort ratings methodology

Purchase Temkin Experience Ratings dataset (includes Temkin Effort Ratings)You can access this data as part the overall Temkin Experience Ratings dataset

Six Laws of Customer Experience (Infographic)

The most dowloaded content that I’ve published is our free eBook, The Six Laws of Customer Experience. It’s been translated into many languages and read by 10’s of 1,000s of people. It continues to be very popular because it uses simple language and concepts to describe what we call “the fundamental truths about how organizations treat customers.”

We’ve developed an updated infographic that brings the laws to life. If you like the content, then we even have a CX Institute eLearning module that you can use to train everyone in your organization on this important concept!

Six Laws of Customer Experience

Here are links to download different versions of the infographic: