The 15 Business Dynamics Shaping Customer Experience in 2017

It’s that time of the year again, the most wonderful time as the song goes, certainly the most wonderful time of the year for analyst predictions. Forrester recently published a list of 15 business dynamics that are shaping the future in what they are calling “the age of the customer”.

You can read the complete report from Forrester here or an nice analysis of the proposals in the report by Forbes magazine here. I have looked through the report and the top five dynamics I can see mentioned are as follows:

  • 30% of CMOs will be let go in 2017; that’s scary if you are running a marketing team, but why is the figure so high. Do you remember my last blog on how quickly the marketing function is blending to include customer service and other customer facing activities? Forrester does not believe that every marketing leader will be able to adjust to this change so at least a third of them will be gone and replaced by leaders with a wider vision on how customer engagement works today.
  • Leadership needs digital expertise and a customer focus; customers are using more channels and becoming more demanding. This means that corporate leaders need to really understand how digital transformation is changing their industry and how customer-centricity is shaping the way that companies are structured – see the previous point about CMOs who cannot deal with change.
  • Scarcity of CX experts; if you understand the customer experience and processes like experience design then you will be in demand in 2017. The industry needs people who not only understand customer service processes, but how the entire customer journey works and how customers want to experience brands.
  • Revenue risk increase; this is urgent and important. A single negative experience used to be bad news as millennials would switch brands. Now Forrester is suggested that around 65% of customers will switch brands after one single negative experience. Customers using their ability to switch brand as punishment for even a single poor experience is become normal – not just how the young behave.
  • AR and VR come to life; we have talked about Augmented Reality and Virtual Reality for years, but it looks like 2017 is when brands will really start using them to improve the customer experience for two different reasons. First, there will be millions of Sony and Microsoft games consoles sold in 2017 with VR built-in as standard – that means millions of homes will be equipped for VR experiences. Second, retail brands are desperate to improve their in-store experience as customers are starting to prefer online shopping. AR could be one way to really improve the experience of going to a physical store.

Finally, I think a real focus in 2017 will be the operational models to support all these developments on the customer side with new applications for automation, new skills for customer service staff and a re-evaluation of onshore, near shore and offshore strategy as the cost to serve remains critical in uncertain economic times.

That’s my take on the Forrester predictions. I’d like to hear what you think are the key takeaways from their research on the business dynamics shaping CX in 2017. Leave a comment here or get in touch via my LinkedIn.

Future Interfaces 2014Photo by NYC Media Lab licensed under Creative Commons.

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Does A Brand’s Corporate Structure Affect Customer Experience?

Over the past few years I have become more convinced than ever that corporate structures need to radically change. This is entirely driven by the change in the way that customers learn about products and then engage with brands – either to make a purchase or to just communicate and ask questions.

The concept of the linear customer journey started a slow death the moment that customers started using the mobile Internet and social networks. Now there is no simple step-by-step journey where a marketing campaign informs customers, a retailer facilitates a purchase, and a customer service contact centre offers post-sales help and support.

The customer journey today is jumbled and can be viewed more as a relationship that is ongoing rather than a series of linear steps that logically follow each other:

  • Customers learn about products from a variety of online information sources.
  • Customers ask their friends questions, read online reviews, ask strangers for comment, and even direct questions directly to brands.
  • Customer interaction taking place only after a sale is what has mainly changed – now there is constant interaction with the brand, with friends, and with other customers.
  • There’s been a 10% growth in hands free searches
  • 69% of snapchat users will add a brand as a friend

Gartner neatly defined this concept in their paper exploring the Customer Experience in 2020. They suggested that companies need to reorganise internal departments so any function that is customer facing is performed in partnership with the other customer facing functions. In practice this means that functions such as customer service, marketing, sales, PR, and advertising all need to work together as one team because they are all trying to influence or communicate with the customer.

There is no longer a neat dividing line between marketing and customer service because interactions take place all the time. Gartner suggests that the functions are combined into what they call a Customer Experience Hub.

This strategy is reinforced by INSEAD data published in the Harvard Business Review recently. The research acknowledges that reorganising silos within a company can be difficult, but in this case it is essential because of the way that customer behaviour has changed.

The INSEAD research demonstrates some interesting correlations. Companies that have broken down their internal silos and created a structure similar to the one Gartner describes were found to be best-in-class. That is, they were also the best companies for financial performance and customer experience.

These best in class companies have realised that marketing is about more than just communication today. It requires the customer experience to be managed in addition to the message the company wants to send to customers. At Teleperformance, we already recognise the impact that organisation structure can have on employees and ultimately the CX they deliver. In Guyana for example, our latest site in LATAM, the org chart is inverted with agents as the top supported by the rest of the business.

The INSEAD research suggests that marketing directors should take the lead on reforming their organisation to include a customer experience hub. I’m not sure that I entirely agree with this as it very much depends on the structure of each individual organisation. Some may have a very strong customer service team that can absorb and lead the marketing function. There is no one-size-fits-all solution, but there is a strategic need to rethink how your internal structures affect the customer experience.

Smartphone rituals

Photo by Nicolas Nova licensed under Creative Commons.

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The Guardian ‘worst customer service awards’ 2016

The Guardian has published their awards for the worst customer service examples in 2016. As you might expect, it’s a sorry list indeed, populated with inexplicably poor treatment of customers from some of the biggest brands in the UK.

However, as I cast my eye over the list I noticed that there are some common threads in all the customer service failures that The Guardian documents:

  • They are all financial mistakes; it looks like this investigation into customer service is skewed by a desire to only look into financial errors and blunders. This is understandable as it’s the Guardian’s Money section carrying the news, but then it’s a little deceiving to headline the list as the worst customer service awards for 2016. Perhaps the worst financial errors by companies might be closer to the truth.
  • All the examples cited in the Guardian appear to be blunders rather than a concerted effort to deliver poor service. I have sympathy for anyone who faces a financial penalty unfairly and then finds it difficult to complain, but I struggle to believe that the brands mentioned here are systematically trying to fleece their customers.
  • eBay is singled out for helping customers; The Guardian criticises the protection buyers when buying on the auction site, suggesting that rogue buyers are using it to buy products, use them, then return them later saying there is a problem. Like free bicycle rental for example, if you buy a bike, use it for a week, then tell eBay there is a fault. The buyer is strongly protected on eBay and money is refunded at the cost of the seller almost instantly when complaints are made.

All this takes the fun out of reading the awards. It’s always funny to read lists of customer service disasters because all of us involved in the industry can hope that whatever we are doing, it has to be better than those of a failure list. However, to criticise eBay for protecting their buyers or Thomas Cook for mistakenly processing an upgrade request that was not actually requested, seems churlish.

Mistakes happen and every brand will make mistakes at some point. The way you judge these companies is not by documenting that they made a mistake, it is by explaining how they handled the customer and how the problem was rectified.

What do you think of the Guardian worst customer service awards? I think I’m going to search for another ‘worst of 2016’ list myself, but please leave a comment here with your own thoughts or get in touch via my LinkedIn.

My Photo on Guardian Cover

Photo by Andy Wilson licensed under Creative Commons.

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Delivery Disasters Cause 73% of Customers To Shop Elsewhere

The Institute of Customer Service (ICS) estimates that during the last Christmas period in the UK over 16 million customers suffered delivery delays with items they had ordered and this was directly responsible for 73% of them avoiding the retailer that let them down last year. The average delivery delay was 5.3 days – an entire business week and long enough to ruin the festive season if a delivery really needed to be on time.

The average spend on delayed packages was £250. All this points to a combined set of major issues:

  1. Omnichannel; companies that want to offer an omnichannel experience where every channel is just as good as others cannot possibly tolerate delivery delays. If delays do occur then they need to be resolved in hours not weeks.
  2. Delivery is just part of the process; customers don’t see delivery as a separate process or detached from the retailer. When they click to order an item it is entirely the responsibility of the retailer to ensure that order arrives on time. Accountability cannot be outsourced to a delivery courier even if a courier is responsible for making the delivery.
  3. Retailers that want to excel may need to consider more expensive courier services or even owning some parts of the delivery process.

On this final point, Amazon is already investigating how they could build their own operation to rival Fedex and UPS. This may sound incredible – just imagine Amazon taking over the entire delivery process – but last year they spend almost $11bn with couriers. They are clearly trying to calculate if they could spend the same amount, or less, to deliver items without using a courier, but keeping complete control of the delivery process in-house.

As online retail becomes more popular and retailers strive to achieve the omnichannel target or letting customers shop for any item, anywhere, at anytime, delivery is becoming a genuine concern. Online retail requires a complex mix of delivery, returns, and an ability to plug into a supply chain so stock levels can be controlled even when outside the warehouse.

In the short term, retailers in the UK should worry first about the 73% defection figure highlighted by the ICS. If that’s correct then a lot of loyalty is destroyed over Christmas. Retailers need to manage customer expectations over deliveries to avoid disasters that ruin years of brand loyalty.

What do you think about the online shopping rush and how delivery disasters can ruin customer loyalty? Leave a comment here or get in touch via my LinkedIn.

FedexPhoto by Erik Leenars licensed under Creative Commons.

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Does A Brand’s Corporate Structure Affect Customer Experience?

Over the past few years I have become more convinced than ever that corporate structures need to radically change. This is entirely driven by the change in the way that customers learn about products and then engage with brands – either to make a purchase or to just communicate and ask questions.

The concept of the linear customer journey started a slow death the moment that customers started using the mobile Internet and social networks. Now there is no simple step-by-step journey where a marketing campaign informs customers, a retailer facilitates a purchase, and a customer service contact centre offers post-sales help and support.

The customer journey today is jumbled and can be viewed more as a relationship that is ongoing rather than a series of linear steps that logically follow each other:

  • Customers learn about products from a variety of online information sources.
  • Customers ask their friends questions, read online reviews, ask strangers for comment, and even direct questions directly to brands.
  • Customer interaction taking place only after a sale is what has mainly changed – now there is constant interaction with the brand, with friends, and with other customers.
  • There’s been a 10% growth in hands free searches
  • 69% of Snapchat users will add a brand as a friend

Gartner neatly defined this concept in their paper exploring the Customer Experience in 2020. They suggested that companies need to reorganise internal departments so any function that is customer facing is performed in partnership with the other customer facing functions. In practice this means that functions such as customer service, marketing, sales, PR, and advertising all need to work together as one team because they are all trying to influence or communicate with the customer.

There is no longer a neat dividing line between marketing and customer service because interactions take place all the time. Gartner suggests that the functions are combined into what they call a Customer Experience Hub.

This strategy is reinforced by INSEAD data published in the Harvard Business Review recently. The research acknowledges that reorganising silos within a company can be difficult, but in this case it is essential because of the way that customer behaviour has changed.

The INSEAD research demonstrates some interesting correlations. Companies that have broken down their internal silos and created a structure similar to the one Gartner describes were found to be best-in-class. That is, they were also the best companies for financial performance and customer experience.

These best in class companies have realised that marketing is about more than just communication today. It requires the customer experience to be managed in addition to the message the company wants to send to customers. At Teleperformance, we already recognise the impact that organisation structure can have on employees and ultimately the CX they deliver. In Guyana for example, our latest site in LATAM, the org chart is inverted with agents as the top supported by the rest of the business.

The INSEAD research suggests that marketing directors should take the lead on reforming their organisation to include a customer experience hub. I’m not sure that I entirely agree with this as it very much depends on the structure of each individual organisation. Some may have a very strong customer service team that can absorb and lead the marketing function. There is no one-size-fits-all solution, but there is a strategic need to rethink how your internal structures affect the customer experience.

What do you think and is your company changing already? Leave a comment here or get in touch via my LinkedIn Profile.

A portrait without eyes
Photo by Patrik Nygren licensed under Creative Commons.

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Merry Christmas From Teleperformance UK

_2016_xmas_card

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The 15 Business Dynamics Shaping Customer Experience in 2017

It’s that time of the year again, the most wonderful time as the song goes, certainly the most wonderful time of the year for analyst predictions. Forrester recently published a list of 15 business dynamics that are shaping the future in what they are calling “the age of the customer”.

You can read the complete report from Forrester here or an nice analysis of the proposals in the report by Forbes magazine here. I have looked through the report and the top five dynamics I can see mentioned are as follows:

  • 30% of CMOs will be let go in 2017; that’s scary if you are running a marketing team, but why is the figure so high. Do you remember my last blog on how quickly the marketing function is blending to include customer service and other customer facing activities? Forrester does not believe that every marketing leader will be able to adjust to this change so at least a third of them will be gone and replaced by leaders with a wider vision on how customer engagement works today.
  • Leadership needs digital expertise and a customer focus; customers are using more channels and becoming more demanding. This means that corporate leaders need to really understand how digital transformation is changing their industry and how customer-centricity is shaping the way that companies are structured – see the previous point about CMOs who cannot deal with change.
  • Scarcity of CX experts; if you understand the customer experience and processes like experience design then you will be in demand in 2017. The industry needs people who not only understand customer service processes, but how the entire customer journey works and how customers want to experience brands.
  • Revenue risk increase; this is urgent and important. A single negative experience used to be bad news as millennials would switch brands. Now Forrester is suggested that around 65% of customers will switch brands after one single negative experience. Customers using their ability to switch brand as punishment for even a single poor experience is become normal – not just how the young behave.
  • AR and VR come to life; we have talked about Augmented Reality and Virtual Reality for years, but it looks like 2017 is when brands will really start using them to improve the customer experience for two different reasons. First, there will be millions of Sony and Microsoft games consoles sold in 2017 with VR built-in as standard – that means millions of homes will be equipped for VR experiences. Second, retail brands are desperate to improve their in-store experience as customers are starting to prefer online shopping. AR could be one way to really improve the experience of going to a physical store.

Finally, I think a real focus in 2017 will be the operational models to support all these developments on the customer side with new applications for automation, new skills for customer service staff and a re-evaluation of onshore, near shore and offshore strategy as the cost to serve remains critical in uncertain economic times.

That’s my take on the Forrester predictions. I’d like to hear what you think are the key takeaways from their research on the business dynamics shaping CX in 2017. Leave a comment here or get in touch via my LinkedIn.

Samsung Gear VR
Photo by Maurizio Pesce licensed under Creative Commons.

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