Businesses who continue to elevate their customer experience offering from ordinary to extraordinary are triumphing over their competitors. But, while many brands talk a big CX game, many more still grapple with its implementation. David Nothling-Demmer asks what’s the big deal with CX as he maps out what Kiwi companies are doing to up their game.
Customer experience (CX) isn’t really anything new. The saying about ‘a happy customer tells three people, an unhappy customer tells ten’ or something to that effect, has been around for decades. The main differences recently are scale, methodology and technology. Today, people can much more easily share a good or bad experience with many more people, and sophisticated design thinking is being applied to improving and interpreting CX. Ultimately, the stakes are higher because the tools are better.
As a result, customer expectations are being raised across the board, and competition is more intense as companies intensify their understanding of the perception a customer has of their brand. Because even if you think your brand and customer experience is one thing, if the customer perceives it as something different, that is what the actual customer experience is.
Recently, I found myself with a lot of extra time on my hands – for obvious Covid-19 reasons – and like many got stuck into a few DIY projects. One of these was the restoration of an antique desk. Unfortunately, I could only get so far due to a lack or recourses – the brand of paint I required was unavailable due to trading restrictions. Nevertheless, life went on and another DIY project went unfinished.
Soon after the Lockdown ended, I received an email from the supplier of the paint enthusing that they were back in business and ready to take orders. I thought to myself, great, I’ll get the paint and complete my project. A few clicks later and my order was conveniently completed and on its way to me. Three weeks later the paint still had not arrived, frustrated I called up the supplier to enquire, to which I received an apology and explanation for the delay. Nevertheless, I continued my patient wait. A week later I received a text advising my order had been dispatched and would be with me in the next day. And to my delight, the following morning my paint along with a hand-written note thanking me for my business and patience was waiting at my door.
The journey a customer has with a brand can go through various touchpoints, and includes everything from discovery, to research, to purchasing and even customer support. Each with its own CX offering that – in order to result in an overall positive customer journey with a brand – must be unified in the experience offering. Because it only takes one bad experience at one touchpoint to result in a bad customer experience. My paint story speaks to this in that while I had positive interactions with the brand at several touchpoints, it only took one (the failure to communicate the delay) to have me question my relationship with the brand.
Increasingly, businesses are employing in-house UX/UI/CX/SD strategies – integrated with their marketing and creative offerings – to better understand the customer and meticulously measure the effectiveness of their brand work. Smart brands are focusing on CX in both their SD and business model, instead of a heavy emphasis on marketing and sales strategy. This affords them the opportunity to differentiate in a more meaningful way.
Importantly, CX strategy must approach brand touchpoints from the perspective of the customer, and not the business – although brand buy-in from business employees is essential to understanding CX. “Most companies look at customer processes as the start and end of engagement with their product. This is useful and can result in some great customer benefit. But to truly become experience-centric you must look at what the customer is doing in their life. This is what the customer journey is about,” explains Lohit Kalburgi, executive general manager – corporate strategy and customer experience at ASB Bank.
At the same time, Dan West, head of strategy, Stanley St says that a core focus of internal CX or employee experience (EX), is culture. As the saying goes ‘culture eats strategy for breakfast’. “Since our move back to an independent agency we have been working to redefine our culture, our vision and our position in the marketplace. This has driven everything from the tech stack we have invested in, to the staff events and training. To ensure we keep ahead of the curve we glean learnings from NZ and the global start-up scene, as well as lean on our international staff members who provide new thinking from other markets,” he says.
This further points to the fact that traditional marketing is changing and increasingly more companies are investing in customer experience. The Gartner Top 10 Strategic Technology Trends for 2018 report pointed out that 80 percent of brands say their companies will compete on the basis of CX in two years. That is unsurprising given that a customer’s entire experience with a brand shapes their views of that brand, not just their communications.
Two years down the line, and the good news for New Zealand brands is that the majority of businesses, according to a 2020 Adobe Digital Trends report identified CX as their most exciting opportunity for the year ahead, with the goal to achieve this through improved products and services. The bad news, however, according to Scott Rigby, head of digital transformation for Adobe Asia Pacific, only 3 percent of companies considered themselves CX mature, with “talent sourcing” a major hurdle. This raises the question of how companies can get ahead, before falling further behind.
Investing in customer experience, Rigby says, can change a company’s growth trajectory and establish it as a leader in its field. “Our Digital Trends Report this year found that New Zealand businesses rate their ability to deliver customer experience as not very advanced or immature, well behind global and regional levels. This is despite relatively high prioritisation of CX and good understanding of its value in the country,” he says.
He believes that there is a number of reasons for this. “First, siloed systems in organisations have been the bane of CX management for decades, owing to gaps in customer understanding. Many New Zealand businesses still encounter silos that prevent information sharing and collaboration among internal teams and departments. Second, the average marketing stack consists of disparate platforms, solutions and interfaces that make it difficult to provide a holistic and engaging CX across multiple channels. When adding new technology to the stack, a business needs to ensure it integrates with other processes. Lastly, and arguably the biggest barrier, is finding and retaining the right people with the right skills to create exceptional digital experiences. In an evolving and uncertain world, where challenges are multifaceted and interconnected, businesses need marketers with a combination of hard skills such as AI and product design, as well as soft skills like design innovation, critical thinking and creativity.”
According to Rigby, the banking and finance sectors in New Zealand have great examples of companies using technology to improve products and services, and who deliver more meaningful customer experiences. “Banks like Westpac New Zealand have harnessed technology to connect online and offline experiences to create a more seamless customer service process. Cloud-based accounting provider Xero continues to trailblaze new standards of CX in the industry, by rethinking how its customer service teams operate and rolling out innovative solutions like Hubdoc to help customers grow and thrive. Telco company Spark NZ has also implemented an integrated digital platform to create a seamless experience between its sales, service and the help-desk, as the cornerstone of its CX strategy. These are all great examples of New Zealand companies leading with CX,”
Kalburgi adds that from his experience working with many brands, the biggest barrier to better CX execution is how to turn ideas into reality. “In today’s economy, I believe execution is at a real premium. And unfortunately, many things get in the way of great execution. For example, many large organisations are structured by product (mortgages vs credit cards vs savings) or by function (marketing vs technology) and this creates artificial barriers as the same customer could have multiple products that need various functions to come together. Then you add the complexities of different systems, processes and channels and it becomes really challenging to focus on the end customer,”
Content vs. Context
At a high-level Rigby believes that CX requires two strategies: a content strategy and a data strategy. “In essence, CX is both art (content) and science (data). Data is the voice of your customer, the real time behavioural triggers that you get from your customer telling you where they are at in respect to engaging with your brand, what products/services they are considering, and their loyalty to your brand. Content is how you respond to them indicating you understand how they want to engage, how you will guide them to the path to purchase, to personalise the products, and to reengage them with your brand. You can’t focus on one without the other.
“We see lots of companies developing their data and creating tens or hundreds of interesting audience segments, but then not have the content pipeline and velocity to talk to these new interesting segments. As to the change that is required? This really depends on the risk appetite of the business. From the research we saw businesses that are more customer-centric tend to perform better and be more mature from a CX perspective.”
A company that is leveraging both art and data to design better customer experiences is the Digital Arts Network (DAN). “We are crazy for data, in all shapes and sizes. We always start with discovery, whether that’s reviewing existing client research, running qual and quant studies of our own or simply talking to customers and frontline staff. We go in with an open-mind and a thirst for context… [at the same time] putting the user at the heart of our strategy (aka Human-centred design),” says Jennie Leng, UX director at DAN.
To truly build a stronger relationship with your customers for longevity, you need to reach out to them, talk with them, share their world and design with them. DAN’s recently released Design Maturity Benchmark showed that 71 percent of respondents are measuring customer satisfaction but only 58 percent are testing and validating directly with customers.
“Your CX/UX strategy is key to prioritising where the value lies for your customers and your business. Our study also showed that less than a third of businesses consistently turn the CX/UX strategy lens on themselves. Improving tools and processes for frontline staff increases productivity, consistency and ultimately leads to improved customer experience,” Leng explains.
She says that by doing this, DAN has been able to identify one of its most effective methods for creative problem solving – to co-design with clients, rather than taking a brief away.
Sue Gill, GM of strategy at FCB says that given the breadth of what falls under CX, establishing a strong strategic partnership with clients, with scope to enhance the entire customer experience opens up many opportunities to go beyond traditional advertising briefs and future-proofs the relationship, and ultimately the customer journey with the brand. She says that delivering excellent CX is not easy, and New Zealand marketers face some specific local challenges, such as:
Most tech platforms are US-centric putting pressure on potential ROI, because it costs us the same but with a fraction of the potential scale given population.
- The need to integrate into legacy systems can be limiting.
- The plethora of choice when it comes to tech platforms can be overwhelming.
- The rate of change and enhancement is fast and furious.
“As a result, there has been a real mindset shift from ‘campaign’ to ‘CX management’ thinking; which means we can develop longer term platforms that deliver a more sustainable, on-going value exchange for customers and brands, and ultimately better ROI for organisations. Combined with a more iterative test and learn methodology, it means we can scale those initiatives that show positive returns, quickly; without having to over invest upfront,” Gill explains.
While staying ahead of the tech/data curve when it comes to CX strategy is one thing, Ryan Sproull, strategy and experience director at VMLY&R says that he’s more cautious in his approach, which is more content-focused.
“Customers are humans, and human nature doesn’t change much. Technology changes very quickly, for sure, and so it’s important to keep up with what tech makes possible for solution design. But 90 percent of CX improvements don’t come from using the latest tech; they come from remembering things like ‘people get lonely’ or observations like ‘people are giving the boxes to their kids to play with’. One thing we do is try to bake CX perspectives into all departments, with a lot of internal cross-skilling and buy-in from the top,” he says.
The Right People
This raises the point of having the right people in place to ensure CX strategies are carried out effectively, not only internally at a business level, but having the best talent to ensure winning brand CX. Ben Goodale, CEO of Quantum Jump says that his company has access to some of the best CX strategists in the region through their professional network, who have fostered deep experience in business. “We believe we are much closer to what CEOs and their e-teams are trying to achieve and to the ‘word on the street’ of how these processes are going across companies. Some better than others. We’re not shy to apply a what not to do to our thinking,” he says.
Rigby, however, says that talent sourcing is a significant stumbling block for companies wanting to improve their CX offering. “Finding and retaining marketers with proficient digital and creative skills, and who can lead and accelerate CX technology implementations is a key obstacle for many businesses. But, by coupling technology deployment and talent development, businesses can increase the agility of their marketing teams while improving their CX offering.” He says that businesses can do this by evaluating the digital maturity of their marketing team, deliver function learning opportunities based on identified gaps and making talent enablement an ongoing programme – not a once off initiative.
When it comes to CX – the simple fact remains, the customer doesn’t distinguish between your brand, your digital user experience, your comprehensive CX strategy, and your customer support quality. Customers only want to be understood. To be successful and competitive in the experience business, you need to cater to their needs on the channels they choose at each stage of their journey. If you (or the CX team you employ) can’t visualise how your customers move through and interact with your business, then you can’t understand and anticipate their needs, and identify opportunities to improve and enhance their overall experience.
“Unfortunately the journey that customers take is still too often a mystery for many businesses today, which leads to missed revenue opportunities, and reducing customer loyalty and marketing efficiency. However, our conversations with local customers, tells us that CX is a priority for New Zealand businesses in 2020, as they look to differentiate themselves. While some investment can lag in emerging technologies, local CX leaders are taking an iterative approach to CX, through the use of data and ‘digital KPIs’ across the organisation. There is an overall willingness to be innovative and adaptable to consumer needs, and we expect more businesses to fine-tune CX processes to build more relevant, personalised experiences,” Rigby concludes.
This article was originally published in the June/July 2020 issue of NZ Marketing. You can subscribe to the magazine, here.