Emerging trends revealed in unique CX research
We encourage clients to research their customers all the time. Late last year, we decided to take our advice and study our customers and prospective customers, and well, anyone.
Some of the research told us what we expected to hear, but some of the revelations might surprise you. We talked about this research in a recent podcast.
You All Want Growth
One of the critical pieces of insight that came out of the study was the thing that people want most of all in 2020 is growth, whether that means in revenue, market share or return on investment (ROI).
ROI is one of the areas the organizations are struggling with regarding their investment in Customer Experience. As I have mentioned before, Forrester and other research experts determined late last year that marketplaces were flat, and they see no improvement in Customer Experience. Moreover, Forrester said that one in four people in the Customer Experience industry would lose their jobs this year.
We realized that we needed to make a more reliable connection between how having a customer-centric culture that puts the customers’ needs first leads to customer-driven growth. Moreover, we need to train Customer Experience professionals to measure how their efforts lead to it.
The Majority of Companies Have a CX Team
The next stat we learned from our research is that nearly 75 percent of companies have now got a Customer Experience team, particularly in the large and medium-sized companies. This change is significant. Back when I was just getting started in Customer Experience 18 years ago, nobody had even heard of Customer Experience, let alone done anything, done anything about it.
Having a Customer Experience team is a fantastic improvement. The next progression is to prove that they should keep them based on their production. I will refer back to the stat from Forrester that one in four of these exceptional Customer Experience professionals is facing getting sacked this year.
Nearly Half of Companies Don’t Know What to Prioritize
We were also interested in the following stat we also learned in our research, that 46 percent of companies struggle to know what to prioritize first. I thought that was interesting because you think it would be obvious, but it's not. Every organization should be prioritizing the things that drive the most value. Nobody would disagree with that. However, I assume that they don't know what drives value within their organization because they haven't done that research. In other words, everyone agrees that when you want growth, prioritize the things that drive the most value. However, not everyone knows what drives the most value.
We have a program called Emotional Signature® research, which helps organizations tell the difference between what customers say is important and what is. One of the first things that we do with an organization is to ask them what they consider “value.” Most organizations, in my view, don't have a clear picture of what value is.
For us, value typically means how much people are going to spend, the amount of market share the company has, the perception of the brand, improvements in the Net Promoter Score® (NPS), or customer satisfaction score, and so on. However, if in your organization, the CEO says growth means revenues, then that means your job is to prioritize what’s going to give you the most income.
Here's the fascinating insight: the thing that's going to give you the most revenue is not necessarily the thing causing customers the biggest problem.
Many organizations are obsessed with fixing things that are wrong in their Customer Experience. We would argue that looking at the opportunity areas where organizations could gain three or four times the value by satisfying customers’ unmet needs, as identified with research, then they would generate much more revenue.
Customer Experience professionals should be focusing on the things that give them the biggest bang for their buck. Moreover, if they aren’t sure, they should do the math. Determine how much you gain by fixing the problems and how much you could increase by providing a new service that meets unmet needs. Whichever has the higher number is your priority.
CX Teams Are Usually Part of Marketing
Another stat from our research I found interesting was that one in four Customer Experience teams are part of marketing. Ideally, Customer Experience teams should be an independent entity. However, if you'd have to put them into one area, then marketing seems a good option. Customer Experience defines what the marketing wants, but it’s a cross-functional concept, too. Customer Experience covers marketing, sales, customer service, and everything else.
Your success or failure to improve a Customer Experience depends on the culture of the organization. If you are in a Customer Experience role with a lot of responsibility, but not a lot of power, support from above, or budget to implement your changes, then you should run. However, if the organization wants to put a focus on the Customer Experience to gain growth, then they will put the Customer Experience somewhere, it will be respected.
AI Seems to Be the Least of Your Worries
Our research revealed that many companies think that AI or the Internet changing their industry is the least important thing they should be worrying about, to the tune of one in four. To be honest, I am shocked. I think they are mad. The many ways that AI and the Internet have changed business-as-usual are enormous already.
Two-Thirds of You Don’t Think CX Strategy is the Most Important Thing
Another stat we learned is that 66 percent of companies say that setting a Customer Experience strategy is not the most important thing to do. These must be the same mad people that voted aren’t worried about AI and the Internet disrupting their business. Setting a strategy is vital. One of the first things you should be doing is research, and then, based on the study, you should be setting the policy.
Reviewing Data is Not Important to 25% of You
We also learned that 25 percent of people do not think it's important to review data for hidden patterns and insights. (This is an excellent example of framing because I could say 75 percent of people do think it's essential to, but I digress…) That was shockingly high. Maybe these respondents tried to analyze data for patterns before or attempted to identify insights through data in the past and thought it was a waste of time. Or maybe they don’t know how.
However, it doesn’t justify the decision. It’s still a bad idea. While you gain limited insights by the type of data collected, we are proponents of insights wherever you can get them. Many hidden patterns exist that would provide insights to motivation in your existing data, and you should be finding them.
If you don’t have the data analytical skills, then there is no better time than the present to get them. Data is getting cheaper to accumulate and less expensive to analyze. Moreover, data analysis isn’t going away.
Most of You Want to Learn More About Your Customers’ Behavior
The last two stats I will share is that 74 percent of people are interested to learn more about behavioral economics and its effects on Customer Experience, and 75 percent of people are interested in learning about customer behavior. (We asked this question in different ways to see if there would be a difference, but there's not.) We see this in action, too. Our podcast downloads grew by 100 percent last year.
Psychology doesn’t go away just because you ignore it. If you ignore the insights of psychology, you will need to make up your psychology, and it'll be bad psychology. This concept also applies to this broader field of behavioral economics. It can be complicated and have a lot of rules with loads of exceptions. But if you ignore framing, context effects, choice architecture, customers’ hidden motivations and emotions, none of these things go away. I'm rooting for those people that want to learn a bit more.
So, Now What?
So, what should you do with this information? First of all, learn by our example. If you want insights, do research and find out what's going on. So use those within your organization, go out and ask those questions.
Second, remember that most things we do in Customer Experience are about gaining customer-driven growth. And it is. It's all about your focus. If you're on the Customer Experience team, you've got to challenge yourself to attach your efforts to ROI because you tie them to addressing value for customers and getting more business.
Also, when you're looking to prioritize things, you should be prioritizing the things that drive most revenue, value, and growth for your organization. All those words are synonymous to me. Unfortunately, organizations don’t always do that, either because they don’t know what it is or don’t realize they aren’t doing that already.
My final bit of advice for anybody that thinks of the Internet and AI is not going to disrupt their industry needs to wake up, or maybe they need to get a job somewhere else.