Are You Wasting Your Customer Experience Spend?
Accenture's recent global survey of nearly 1,500 executives found that customer experience is rising in importance for 80 percent of B2B companies, and investments have increased over the last five years. Companies are investing significantly more in customer experience to keep pace with ever-growing customer expectations.
Yet most struggle to translate these investments into sustainable results. More than half of those surveyed have experienced little, flat, or negative growth in customer retention. And potentially 48 percent of customer experience investments at a majority of companies are used ineffectively or outright wasted.
Why Are So Many Companies Struggling?
Why the significant waste at so many respectable companies? Our analysis indicates several factors:
The battle is lost before it starts. Companies call customer experience a priority but don't demonstrate it through sustained investment and a focus on developing the strategic and operational capabilities that will effectively deliver it. While these companies' leaders believe in the importance of customer experience, the next few layers of the organizations see the challenges of delivering and regard it largely as lip service. Unsurprisingly, these companies yield half the return on their customer experience investments as those that play to win.
Good money is thrown after bad. Another factor is not understanding what customers really notice and value. Investments that are not aligned to and measured by relevant customer metrics are most often wasted, but frequently continued out of fear of negative impacts. Additionally, many companies do not effectively create combinations of digital and traditional channels that can dramatically improve the customer experience. Hidden among the strategic and technical issues lurks another misalignment: failing to make the customer experience central to day-to-day operations.
Leaders march to a different beat. The survey also highlights a lack of collaboration among marketing, sales, and service leaders, as well as between the company and external channel partners, to achieve significant results from customer experience programs. Additionally, there are not enough material incentives for collaboration. Many companies report a lack of accountability for customer experience results and lackluster returns on their customer experience investment. Not only did those companies not consider such collaboration important, but they also did a poor job fostering it.
Steps to Improve ROI
B2B companies have work to do to generate better returns on their customer experience investments. On a brighter note, our analysis reveals important insights about companies that are playing to win. Other companies can learn from them how to begin delivering an experience that is embraced by customers and helps drive revenue.
Forget the title, but start at the top. It all starts with leadership. Leaders must understand and then gain consensus on what customer experience means for their company, then incorporate it into the business strategy and propagate it throughout the enterprise. Proximity to profit and loss (P&L) may be the best test: The closer the person responsible for the overall customer experience is to direct P&L ownership and accountability, the greater the material impact on the business.
Operationalize customer experience. Once a company gets the leadership challenge right, it can address execution. For many B2B companies, effective execution will require a new customer model consistent with today's business environment and customers' expectations and behaviors, a better way to determine which strategic and operational capabilities deserve their investments, and the right tools and metrics to help them operationalize and automate the customer experience.
Customers who are born digital expect to stay digital. It is critical to enable customers who are born digital to stay digital. Many companies promise a digital experience but then force customers into analog interactions. For example, they use digital marketing to acquire customers, only to make them use analog channels for setup and ordering, but then hope they will use digital channels for self-service. Of course, analog channels remain an important part of the mix and should be strengthened while digital channels are added.
So ask yourself—are you playing to win, or just playing not to lose, with your customer experience?
Robert Wollan is the global managing director and Kevin Quiring is managing director, North America, at Accenture Sales and Customer Services.
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