Partner Article

Customer Experience: The New Measure of Success

By: Chris Randall, Vice President, Client Services, ResponseTek

Customers now have more power and influence than ever before. Gartner’s 2015 Marketing Spending Survey revealed that customer experience is the most pressing mandate for marketers; it was the top area of marketing technology investment in 2014, and it will lead innovation spending for 2015. A recent Gartner survey on the role of marketing in customer experience found that, by 2016, 89 percent of companies expect to compete mostly on the basis of customer experience, versus 36 percent four years ago.

In fact, Gartner predicts that by 2017, 50 percent of consumer product investments will be redirected to customer experience innovations. This knowledge is especially important for companies in the financial services industry because customer experience is, hands down, their greatest customer acquisition and retention tool.

The recent Current Account Switch Service (CASS) campaign in the UK is an example of the power of customer experience to influence even financial institution governing bodies. For this campaign, the UK Payments Council implemented new rules to increase competition between banks, support the entry of new banks and give customers a broader range of options in the financial sector. One of the biggest changes they applied was the minimization of the wait time for customers who switched banks. Instead of waiting an inconvenient 30 days for the switching process to complete, they now could move from one bank to another in a hassle-free seven days. This new standard not only increased the efficiency that services companies set for themselves, but it forced institutions to review the way they treated both new and existing customers.

The campaign was met by the banking public with enthusiasm. There have been over 1.1 million customer switches since the launch (a 19 percent increase compared with the same time period one year before). Additionally, 70 percent of the public are now aware of the new service, and 61 percent of the public are confident in how the new service works.

These results demonstrate that customers respond well to choice and opportunity, and that they will even jump through the hoops of switching bank accounts if it means better service and/or other benefits. They are now in the driver’s seat and require great customer service to keep them loyal.

It’s necessary at this point to determine how to thrive in a customer-centric world. If you’re a high-performing financial services company, you’ve probably already started to act based on this reality. You are one of the organizations are outperforming your competition by having a fully integrated digital/physical strategy to aid your customer experience programs. If you’re not, then you are part of the larger percentage who is struggling to apply these customer-focused practices to your business.

A best practice for customer services is to not wait until you hear from them – act first. Focus your energy on being proactive, not reactive. Understand their customer journey and how they interact with your brand. Find out what they want before they start complaining on social network sites about your company. Most importantly, realize that your goal is to keep your customers loyal, not only to win new customers.

For the Forbes study “Customers for Life: Technology Strategies for Attracting and Keeping Customers,” more than 300 senior executives in North America were surveyed for their perspectives on customer experience. The findings revealed that while 94 percent of respondents said keeping customers for life was a priority within their organization, 49 percent were unhappy with their current marketing technology’s ability to support those goals.

Still, old habits die hard. The survey participants fully admitted that customer retention and gaining a single view of the customer were top marketing priorities. However, even with this clear knowledge, they still concentrated on customer acquisition. That is, 38 percent of these companies primarily focused on retaining repeat customers for revenue growth, while nearly half (49 percent) focused on gaining new customers.

It’s a business maxim that it’s less expensive to retain a current customer than to acquire a new one. Organizations need to start taking this maxim seriously, particularly in light of this brave new world of high customer expectations. It’s not enough to gain new customers; you need to keep the ones you have as well.

Fortunately, the way to do both is to focus on providing superior customer service. Your business plan should have a well conceived CEM strategy and program right at the top, and it should be implemented—or augmented, if you have one in place—immediately. Your customers’ feedback provides a wealth of information that will help you to address not only their needs but those of future customers as well. Failure to put customers first will relegate you to the land of fossils as people abandon your organization in search of a better experience.

This was posted in Bdaily's Members' News section by ResponseTek .