As you read the predictions of the most important areas an organisation seems to focus on in 2009 a common theme is Customer retention. No surprise really in a down turn. What does astonish me is the lack of connection that is made between Customer retention and Customer Experience. For me it is simple, if a customer has a bad experience, or thinks they will get a better one from someone else then they leave, therefore the two subjects are inextricably linked.
According to a new study by the Chief Marketing Officer (CMO) Council, a report by Satmetrix entitled "Giving Customer Voice More Volume,” [1] revealed that:
“Customer experience is one of the most critical determinants of brand strength and business growth. Yet, most organizations and senior marketers suffer from major blind spots and gaps in the way they interact, handle and respond to customer issues or problems,” said CMO Council executive director Donovan Neale-May. “CMOs must assume ownership for the customer experience and establish enterprise-wide measures and disciplines to ensure continuous improvement. We are missing a major opportunity to turn customer pain into competitive gain at every touch point through better use of web and contact center technologies and processes.”
The report goes on to say that:
Senior marketers are clearly aware of the importance of customer experience. In fact, 83 percent of respondents said it is either “essential” or “increasingly important” in driving brand advocacy and business performance.
Therefore there appears to be a contradiction between what CMO’s say and what they do. For example whilst 84 percent said positive customer experiences and word of mouth have helped their brands and businesses grow and yet only 31 percent rate their company’s commitment to customer listening as high. Why the difference? In fact 34 percent of respondents said their companies have made no changes to the way they track and analyze customer experience in recent years. Why?
It is unsurprising that little action is taken as the remuneration, reward and recognition are not aligned to improve their Customer Experience. 58 percent of the 480 executives surveyed said their companies do not compensate employees or executives based on customer loyalty, satisfaction improvements or analytic's. Why not, if this is so important?
What gets measured gets done, and what gets measured and paid for gets really done! This is a no brainer; to improve retention you need to measure your Customer Experience and then pay people against it.
It is of constant surprise to me that there is a big gap between what people know and what they do. Some enlightened CMO’s that I know personally are working on improving their customer experience and this is paying dividends in Customer retention. All it takes is vision, leadership and hard work.
Colin Shaw
International Author on Customer Experience
Follow me on ColinShaw_CX [2]