Why do so many CX leaders believe their budgets will rise in 2023 and beyond?by
New research from MyCustomer reveals that customer experience leaders are bullish about CX budget growth. Given the challenging economic landscape, what is fuelling this optimism?
Despite the volatile economic landscape, customer experience leaders continue to have robust support and are optimistic about their resources for the future.
In MyCustomer’s new research report - Customer Experience Leadership In An Uncertain Economy - it is revealed that CX teams are growing, more programmes are investing in external support through expert consultancy, and many CX leaders are expecting their budgets to rise over the next 18 months.
The report, published in collaboration with the European Customer Experience Organization (ECXO) - interviewed 150 senior CX professionals.
And it found that despite the difficult economic conditions almost half (43%) of CX leaders anticipate that their budgets will rise in the next 18 months. This is slightly down on the previous predictions from 2022 (60%) and 2020 (65%), but still surprisingly high given the global economic climate. Only 14% are anticipating a decrease in budgets.
Mario Sepp, founder of "Gastspiel", a cross-industry consulting company, believes there are several reasons why there remains so much optimism about customer experience investment and support.
These include increased recognition of the business value of CX; digital transformation and the need for seamless omnichannel experiences (“The shift towards digital channels and the increasing importance of omnichannel experiences has heightened the need for investment… to support customer-centric initiatives.”); and the need to stay competitive.
He adds: “Companies are increasingly recognising the importance of CX and the benefits that can be realised by investing in this core area of their business, and they are looking to stay ahead of the curve in terms of delivering customer experience. Because at the end of the day, customers with positive experiences are what keep us in business.”
Martin Hill-Wilson, founder of Brainfood Consulting, is more circumspect about the findings. “Making stuff happen is easier with an optimistic mindset so it’s understandable even though fewer see increased budgets as likely. And of course, how many then end up with more budget is another matter!”
Customer experience teams growing in size
Another positive sign for customer experience management resourcing is that the size of CX teams has rebounded. Not only has the number of teams comprising only a CX leader shrunk (from 22% in 2022, to just 9% in this latest survey), but the number of large teams has also increased, with 18% of respondents now reporting they have 20+ members of their team, compared with 10% in the previous study.
Sue Nabeth Moore, co-founder of Success Chain, says: “This is a positive demonstration sign by leaders and it is related to the recognition that in times of recession, investment should be made on front-line roles, contributing to retaining existing customers.”
However, Shaun Smith, founder of Smith +Co consultancy warns that larger teams come with their own dangers.
“There are advantages and disadvantages to having a larger CX team,” he notes. “The advantages are that the CX leader has the resources to be able to implement the policies that he or she devises and may have more standing with peers in being a manager rather than simply an advisor. The disadvantages of having a large team is that it is easy for the effort to become compartmentalised and belong to the CX department rather than owned by the C-suite collectively with the CX leader providing best practice advice, guidance and tools.”
There is also another possibility for the growth in teams, suggests Smith.
“In the early days of CX, companies were appointing a CX executive to provide the board with advice and strategic input. Increasingly, I believe companies are renaming their customer service directors or contact centre managers, etc as ‘customer experience’. This means the title is increasingly operational in nature leading to larger teams and budgets. So I don’t think it is necessarily ‘optimism’ that is driving the budget increases so much as necessity to support operational growth.”
In a further show of support for customer experience programmes, the number of customer experience leaders hiring consultants/consultancies is also on the rise. A third (33%) of respondents told us that they are hiring external expertise to support their CX programmes currently, a notable uptick on the 19% that were paying for external support in last year’s study.
Vincent Placer, managing director of Teletech and an ECXO ambassador, believes that investing in external consultants delivers three main benefits for CX programmes:
Speed: “Many internal players are partially dedicated to the CX programme with other operational tasks to conduct. Dedicated consultants ensure to have enough manpower to deliver all the expected deliverables in due time,” says Placer.
Framework and processes: “External consultants will generally provide to the CX programme management team, project management processes and off-the-shelf frameworks that will help internal resources to focus on value-added tasks within the project.”
Benchmark & insights: “Though they will never understand the company as intimately as internal people, external consultants will leverage on their experience of the company's industry, provide relevant benchmarks from other geographies and can bring return of experience of similar initiatives in other contexts. It provides useful material to challenge internal ideas.”
Other findings in the research - which you can download now - reveal that nearly half (46%) of customer experience leaders questioned anticipate that their investment in CX technology will rise in the next 18 months.
Overall, the indications are that despite the economic uncertainty, businesses are backing their CX leaders and customer experience programmes are on a strong footing.
Ricardo Saltz Gulko, founder of the ECXO, concludes: “Most of the organisations I am aware of and work with today are taking CX exceptionally seriously, and in most cases, companies are continuously backing critical investments in CX. If a company does not support CX initiatives and programmes in 2023, they will probably soon cease to exist. No competent leadership team would stop investing in CX.”
After two decades of experience working as a journalist and editor covering business and technology, including over 15 years as editor of MyCustomer, Neil now works as senior content manager at skills-based workforce management platform provider Spotted Zebra. ...