Do your CX metrics translate to the financial metrics your CEO needs?
Each year, Customer Experience executives submit budget requests for their planned CX initiatives for the coming year. In justifying their requests, they use terminology associated with the favoured CX metrics for their business. These could be increases to customer satisfaction (CSAT), net promoter score (NPS) or any other CX metrics the company uses.
Whilst the CX executives are focused on CX metrics, the CEO and C-suite are more interested in the top-level business outcomes like revenue, customer numbers and opportunities to remove costs to improve the overall financials.
How do we bridge this divide and get better customer outcomes? Let’s connect the dots between the CX initiatives and business outcomes. The current value chain looks something like this.
Value chain between CX initiatives and business outcomes
An initiative to improve customer satisfaction will lead to happier customers, who will be more loyal, which relates to business outcomes like increased revenue and customer numbers. That’s quite a few dots to connect.
An example might look like this:
We are improving the onboarding process to make it easier for customers.
The expected outcome is that we will improve the Customer Satisfaction by 21% for new customers.
The business knows that when we have increased customer satisfaction that improves customer loyalty which will increase customer retention and revenue. But the link to business outcomes is two steps away. What we really need is a CX initiative that directly drives business outcomes and improves our CX metrics too.
CX initiative directly delivering business outcomes and CX metrics
In this approach, we identify individual customers who are at risk of leaving and step in to retain them. The retention activity is a service contact with the unhappy customer, and it provides the customer with an opportunity to raise any issues or concerns they have.
This approach retains customers delivering customer number targets, retaining revenue and hitting the business outcome targets for the CEO and C-suite.
An example might look like this:
A prediction and treatment initiative will improve customer retention by 20%, enabling us to meet our customer number target.
This retains the customers and delivers financial benefit. Retaining the customers directly and immediately delivers to the bottom line.
In parallel, this method of reaching out to unhappy customers to retain them turns unhappy customers into happy customers which will improve the traditional CX metrics too.
But using AI and the data from across the entire company for prediction, you have a measure on the entire customer experience. There won’t be any surprises, you will have your finger on the pulse of customer happiness.
Gartner defines customer experience as the customer’s perceptions and related feelings caused by the one-off and cumulative effect of interactions with a supplier’s employees, systems, channels or products.
So rather than CX initiatives that hopefully lead to improve business outcomes, you have an initiative that accurately targets and delivers business outcomes with a direct CX improvement too.
We at SmartMeasures genuinely care about how corporations treat customers and have developed the product to help. If you would like to know more, get in touch.