B2B Companies Are Struggling With CX, and It's Eating at Their Bottom Lines
Less than a quarter (23 percent) of business-to-business (B2B) firms have implemented customer experience (CX) programs that lead to substantial annual revenue growth, according to new research from Accenture Strategy.
The report, "2015 B2B Customer Experience," surveyed 1,350 B2B customer service and sales executives across 16 industries and in 10 countries. The vast majority of those companies, the official release states, post annual revenues exceeding $1 billion. Judged according to their ability to outline and carry out CX strategies that impact their annual profits, the study classified participants according to three groups: Leaders (23 percent), Strivers (57 percent), and Laggards (20 percent).
A majority of the firms (66 percent) understand that they face threats from "new entrants," which in many cases are providing superior experiences, the study found. The majority (78 percent) also anticipate that rising expectations for tailored B2B solutions will have a significant impact on their businesses, and feel that customers are becoming more self-sufficient when it comes to evaluating suppliers (76 percent). But while these companies recognize they must adjust their business models to accommodate the modern customer, they are failing to introduce changes to enable growth.
"The majority [of B2B companies] are wasting their investments on changes that are delivering mediocre results," said Robert Wollan, senior managing director at Accenture Strategy, in a statement. According to Wollan, who also spoke to CRM, this often means spending on customer portals or apps that complicate operations on the company's end while giving customers more work to do. "With consumer-like expectations and a substantial threat from new entrants, B2B companies must be ready to design and execute a transformed customer experience, or not invest in such improvements at all," Wollan said in a statement.
But for many of the companies, the barriers have been internal. Only 32 percent of those surveyed say they have the resources, skills, and tools they need to provide the experiences B2B customers require. These executives trace the deficit back to complications with their CX processes, a lack of support from C-level leadership, and a failure to integrate across the organization.
Still, while B2B CX excellence is relatively uncommon, the Strivers category has grown 9 percentage points since last year's polling (from 48 percent to 57 percent), and there are fewer Laggards.
But "in a world where [companies] face low-cost entrance and commoditization, companies who strive for average have a higher chance of customers leaving," Wollan says.The difference between a Leader and Striver is not insignificant, either. According to the study, Leaders see a 13 percent annual growth in revenue, while those who do not see an average decline of 1 percent.
To be more like those Leaders, Accenture recommends following these best practices:
- Emphasize post-sale service. Leaders put great value on their success with clients after a sale has been made, viewing it as an integral stage in the customer life cycle. (Sixty-one percent of Leaders claimed as much, while only 34 percent of Strivers did.)
- Participate in disruption rather than avoid it. Sixty-two percent of Leaders consider it a priority to actively defend their organizations from new competitors, while 35 percent are taking action to use customer experience to become disruptive. This compares to just 42 percent of Strivers who consider defensive tactics a priority, and 24 percent who are engaging in some form of disruption.
- Invest significantly in digital, as well as legacy, technologies. Twice as many Leaders (44 percent, compared to 23 percent of Strivers) think their digital investments help them gain a competitive edge, and thus dedicate more of their budgets to them (67 percent versus 41 percent). But Leaders don't stop pumping money into their legacy systems, spending almost twice as much as Strivers (39 percent versus 22 percent) on contact centers, field service tools, and CRM systems.
- Embrace the value of a connected ecosystem. Leaders focus on collaborating with vendors and monitoring their performance to stimulate high-quality CX. (Fifty-one percent of Leaders, compared to 29 percent of Strivers, actively manage programs with external partners.)
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