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 Leaders’ Employees Feel Prouder & More Appreciated

If you’ve followed our research, then you’ve likely seen a strong, almost inseparable link between between customer experience (CX) and employee experience (EX). We continued to find that connection in our latest consumer benchmark.

In our Q3 2018 study, we asked 5,000+ U.S. employees to pick a word that best describes how their job makes them feel and split those responses based on how they judged the overall CX that their company delivers. As you can see in the figure below:

  • More than 80% of employees that picked “proud” and “appreciated” work in organizations that they believe are CX leaders. “Confident” is next on the list at 74%.
  • When employees picked “embarrassed” and “angry,” they were the least likely to work for CX leaders and the most likely to work in CX laggards.

Employee attitudes versus customer experience (CX)

The bottom line: CX leaders have proud employees, CX laggards have angry ones.

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.

Employees Want To Make A Positive Impact

What motivates employees? This may seem like a difficult question to answer, but it’s not hard at all. There’s one overwhelming answer: Making a positive difference.

In our latest consumer benchmark study, we asked more than 5,000 full-time U.S. employees to select which of eight job characteristics they felt was the most important. Here’s what we found:

  • Making a positive impact: 42%
  • Earning a lot of money: 14%
  • Advancing your career: 13%
  • Building stronger skills: 12%
  • Using your judgment: 8%
  • Being seen as a top performer: 6%
  • Making friends at work: 3%
  • Impressing your family and friends: 2%

Making a positive impact is also the most important job characteristic across all age groups. As you can see below, it becomes increasingly more important as employees get older. For the youngest employees, being seen as a top performer comes in a close second place, but nothing is even close with older employees.

1811_JobImportanceByAge_v1

We also asked employees about the elements of their job that they enjoy. The chart below shows that once again, making a positive impact comes out on top across age groups and increases with age. For younger employees, building stronger skills is a very close second. As employees get older, using your judgement becomes an increasingly enjoyable element of their job.

1811_JobEnjoymentByAge_v1

The bottom line: Help employees feel like they’re making a positive impact.

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.

For Employees, A Positive Impact Means More Than Money

In our latest consumer benchmark study, we asked more than 5,000 U.S. employees what they felt was the most important thing they want to accomplish at work. The top motivator, by a very large margin, is Making a positive impact. This option was chosen three times more frequently than the next highest option, Earning a lot of money.

I also examined the data by age groups. It turns out that almost all of the items are very correlated to age. Making a positive impact starts at 27% for the youngest workers and grows to 59% for the oldest group. Advancing your career starts off at 22% for the youngest group and drops to 2% for the oldest employees.
The bottom line: Help your employee make a more positive impact.

eBook: Humanizing Customer Experience

Temkin Group eBook: Humanizing Customer Experience (CX)Temkin Group has labeled 2018 “The Year of Humanity.” To support this theme, over the past year we have conducted research and developed content – such as this eBook – specifically aimed at helping fellow CX professionals improve the world around us. In this eBook, Humanizing Customer Experience, you will learn about:

  • The Six Key Traits Of Human Beings that are important to understand how people think, feel, and act.
  • How individuals can improve humanity by embracing diversity, extending compassion, and expressing appreciation.
  • Three strategies for CX professionals to improve humanity: act with purpose, create positive memories, and cultivate deep empathy.

Temkin Group eBook: Humanizing Customer Experience (CX)

 

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).

Download report for $495+
(includes report (in .pdf) plus dataset (.xlsx)
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

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


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.

Humanity And Customer Experience Go Hand In Hand

Hopefully you know by now that Temkin Group has labelled 2018, The Year of Humanity. We’ve been trying to propel people to embrace diversity, extend compassion, and express appreciation.

Temkin Group's "Year of Humanity." Embrace diversity, extend compassion, and express appreciation.We’ve been doing research as part of that effort. In our latest consumer benchmark study of 10,0000 U.S. consumers, we added questions about how often people demonstrate those three behaviors. We then analyzed their responses based on how they rated the customer experience (CX) that their organization delivers. As you can see in the graphic below:

  • When the level of CX improves, so does the prevalence of the three behaviors.
  • For companies with above average CX, at least 70% of them have employees who mostly demonstrate the behaviors.
  • For companies with below average CX, no more than 33% of them have employees who mostly demonstrate the behaviors.

Positive Humanity And Customer Experience Go Hand In Hand

The bottom line: Improving humanity is great for employees and customers.

Report: Tech Vendor NPS & Loyalty Benchmark, 2018 (B2B)

We just published Temkin Group’s annual Tech Vendor NPS & Loyalty Benchmark Study. Here’s the executive summary:

Temkin Group Net Promoter Score (NPS) & Loyalty Benchmark Study of B2B Tech VendorsFor the seventh year in a row, we have calculated the Net Promoter Score® (NPS®) of over 60 technology vendors and analyzed the correlation between NPS and four client loyalty behaviors – likelihood of repurchasing from that technology vendor, likelihood of trying new offerings, likelihood of forgiving the vendor if it makes a mistake, and willingness to act as a reference for the vendor. To gather this data, we surveyed 800 IT decision-makers from large North American firms about their relationships with their technology providers. Through this research, we found that:

  • Across the 61 tech vendors we examined, NPS ranged from +51 to -22.
  • VMware, IBM software products, DellEMC, and Microsoft server software earned the highest NPS, while Check Point, Splunk, and Alcatel-Lucent received the lowest.
  • Overall, the average NPS for the tech vendor industry stayed steady from last year, declining only slightly from 21.4 in 2017 to 21.2 this year.
  • Our analysis shows that NPS is strongly correlated to customers’ willingness to spend more with tech vendors, try their new products and services, forgive them after a bad experience, and act as a reference for them with prospective clients.
  • In addition to examining NPS, the research also provides a benchmark of several areas of loyalty. IT decision-makers are most likely to purchase more from DellEMC and Microsoft server software, try new offerings from Oracle outsourcing and Dell outsourcing, forgive Oracle outsourcing and Micro Focus if they make a mistake, and act as a reference for AWS and IBM outsourcing.

This report includes a .pdf report and a spreadsheet with the company-level data. You can see a sample of the data spreadsheet (.xls).

Download report for $695+
ROI of Customer Experience (CX), 2018

Here are two of the 11 graphics in the report:

Download report for $695+ROI of Customer Experience (CX), 2018


Report Outline:

  • Net Promoter Scores for 61 Tech Vendors
    • VMware Earns Top Net Promoter Score
    • Net Promoter Score Correlates to Multiple Aspects of Loyalty

 

Figures in the Report:

  1. Net Promoter Score (NPS) of 61 Tech Vendors
  2. Average NPS for Tech Vendors, 2012 to 2018
  3. Likelihood of Repurchasing from Tech Vendors
  4. NPS Versus Likely to Repurchase
  5. NPS Responses Versus Likely to Repurchase
  6. Temkin Innovation Equity Quotient(TIEQ) of Tech Vendors
  7. NPS Versus Temkin Innovation Equity Quotient
  8. Temkin Forgiveness Ratings (TFR) of Tech Vendors
  9. NPS Versus Temkin Forgiveness Ratings
  10. Willingness to Act As A Reference For Tech Vendors
  11. NPS Versus Willingness To Act As A Reference

Download report for $695+ROI of Customer Experience (CX), 2018

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

CX Myth #3: You Can’t Manage What You Don’t Measure

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 #3: You Can’t Manage What You Don’t Measure

What’s Wrong: When people talk about CX, they often repeat a popular saying “you can’t manage what you don’t measure.” That’s just not true. Most of the things we manage in life don’t have a formal measurement. Every day we wake up in the morning, get dressed, and get to work – all without any specific measurements. The same is true at work, and with CX. If we see an employee make a client upset, we don’t need a score on a customer survey to know that it’s a problem.

What’s Right: The correct saying should be “you can’t manage what you don’t understand.” Unfortunately, leaders sometimes just slap measurements on CX, which leads to the suboptimal approach of blindly managing by the numbers. When you talk with customers and employees about different aspects of customer experience, you can often discover insights that either never show up in your measurements, or appear long after you should have known about them. Ideally, you use CX measurements to enhance your understanding, not to replace it.

What You Should Do:

  • Increase leadership CX IQ. If you want leaders to be less metrics-centric and more successful at driving an organization towards becoming more customer-centric, then those leaders need to have a clear and consistent view of how a customer-centric organization operates. A good place to start is by having leaders review Temkin Group’s CX Competency & Maturity Model. After that, you can create measurements that map to the leaders’ understanding of CX.
  • Prune action-less metrics. Since leaders are often enamored with metrics, they tend to track an increasingly larger number of them over time. The growth remains unfettered, as very few organizations have a good approach for stopping measurements once they’ve been created. Every year or so, companies should have a metrics cleansing period, during which time there’s a pro-active focus on removing metrics that have not recently provided demonstrable value.
  • Prioritize qualitative research. The push to metrics often causes organizations to put most of their market research budget on quantitative studies that result in trackable measurements. But deep insights into customers often comes from qualitative studies that examine why customers think and behave the way that they do. Look for places to explicitly fund more qualitative studies by cutting back on the least impactful quantitative studies.
  • Measure collective results. CX success requires efforts across an entire organization. So watch out for measurements that isolate the activities of individual people or teams. The narrower the measurements you use, the more likely you are to de-incentivize collaborative behaviors. Focus on metrics that capture real-world team-based activities.
  • Look for leading indicators. Most metrics represent backwards-looking scorecards, describing how an organization performed in the past. While a retrospective view can be helpful, it’s more valuable to understand what activities will impact your organization’s future CX trajectory. Use predictive analytics to identify what activities with different customer segments will most improve your CX metrics in the future.

The bottom line: CX insights don’t always require CX metrics.

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

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