Research reveals why so few CMOs are investing in CX
New research sheds light on why so few marketing leaders are investing in customer experience management, and how obstacles to investment can be addressed.
Despite most chief marketing officers admitting that they have multiple customer experience shortcomings, and harbour concerns that other brands in their industry are improving their own customer experiences, a third of CMOs admit that their organisations are still yet to invest in CX.
Digital agency AmazeRealise surveyed over 100 senior CX professionals from national and international brands for its new report The CX Challenge.
The research reveals that 88% of CMOs expect a focused CX programme to deliver long-term customer loyalty and increasing sales – yet 36% of CMOs surveyed by AmazeRealise for the report admit their brand still hasn’t invested in customer experience, while 77% confess that their business has spent less than one percent of its annual turnover on enhancing CX.
This investment appears to be particularly urgent, as many of those surveyed admit that their programmes require investment in order to address significant CX challenges. These include:
- Over half of respondents (55%) report that they don’t have a single view of all customer interactions across the business.
- 50% report that they are unable to track their customers from offline to online.
- Over half (55%) report that they have no processes in place to measure the impact and costs of their CX.
- More than half (55%) are aware that other brands in their industry are improving their own customer experience.
Chris Barnes, customer experience officer at AmazeRealise, notes: “There’s still a huge and growing gap between customer expectations and the reality of what brands are delivering, especially when you see smaller, more agile disruptors entering the market place and being able to be much more forward-thinking with their digital experiences.
“According to Forrester research, CX improvements have stalled for a third year in a row. It’s clear that brands need to build trust with consumers, actually listen and take action.”
The research comes hot on the heels of recent findings from Accenture that revealed that, while they are few in number, those CMOs that are prioritising CX are delivering huge benefits to their organisations.
The report — Way Beyond Marketing – The Rise of The Hyper-Relevant CMO — found that a small number of innovative CMOs are prioritising customer experience and as a result are helping their organisations generate shareholder returns 11% higher than those of their industry peers.
Do CMOs understand the benefits of CX investment?
The research, based on a survey of nearly 1,000 CMOs and more than 500 CEOs at the world’s largest organisations, reveals that these marketing leaders — the top 17% according to Accenture — are driving transformational change at the highest levels of their organisations, helping them respond quickly to changing customer needs by rewiring their organisations to enable better integration and collaboration and deliver superior customer experiences.
And the AmazeRealise findings indicate that the benefits of a focus on CX are well understood by many marketing leaders - despite the fact that few are prioritising and investing in it.
The research found that nearly all (88%) agreed that the long-term business benefits of dedicated customer experience programmes would include improved loyalty and sales, while half of those surveyed (44%) expected CX initiatives to lead to a decrease in costs and 25% thought they would attract new customers through word-of-mouth recommendation.
Supporting these beliefs, the report suggests that those brands that have already invested significantly in CX are experiencing those benefits in full. 25% of those who’d invested in CX are reporting increased sales as the biggest benefit of their programmes; 22% report that greater customer loyalty has been the primary benefit they've experienced, while 22% say receiving deeper consumer insight that enabled better decisions has been the biggest reward.
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What is preventing CX investment?
So given that there is an awareness of the benefits of CX investment, what is preventing it?
The top three reasons cited for this lack of investment are that they don't know enough about it, the perceived cost of implementation and that they have trouble building the business case for its positive impact based on results.
In addition, nearly a quarter (22%) say the lack of investment is a result of organisational blockers and team structure, while 11% blame a lack of C-suite support and senior buy-in.
However, Barnes recommends: “Brands don’t need to do everything at once. They can start small and go for quick wins – and shouldn’t shy away from getting customers involved in beta testing.
“Every company has some key customer moments, from the welcome experience to how a business reacts when things go wrong. You can identify these key moments by talking to people and place the focus on doing them better.
“A new brand could release a customer-focused service tomorrow that almost immediately makes another look behind the times. A customer Eeperience journey should never end. It requires a culture of constant improvement.”
AmazeRealise’s report highlights the key things brands need to address when fixing their CX, namely:
- Organisation – Start by embedding more iterative working practices – the right operational mindset can deliver incremental change and re-energise teams
- Insight & measurement – Use qualitative and quantitative measurements to hear the voice of the customer and identify the moments that matter
- Realistic ambition – Identify the top three things that will make the biggest change, and start there
- Futureproof your brand – Establish a culture of continuous improvement to stay one step ahead of the competition
Neil Davey is the managing editor of MyCustomer. An experienced business journalist and editor, Neil has worked on a variety of newspapers, magazines and websites over the past 15 years, including Internet Works, CXO magazine and Business Management. He joined Sift Media in 2007.