Creating great digital experiences for your customers isn’t just a “nice-to-have.” As Forrester Research writes, “Companies will increasingly win or lose on the battleground of customer experience.”
Delight speaker Andrew Hogan is a Forrester Research analyst serving customer experience (CX) professionals. He says digital CX improvements can drive revenue growth, but you have to focus on customer outcomes and customer feelings, not just interactions.
“Sometimes people will look at you like you have three heads when you say customer experience and digital transformation are about what customers actually want to accomplish,” he said. “It requires a whole reorientation around what it means to create a good experience—which may not involve as many touchpoints or as much engagement as a business might would like.”
When you get it right, though, the benefits surpass the value of an individual digital interaction, helping customers accomplish their desired goals and delivering real business value to your organization. In his talk at Delight 2016 Andrew will share insights and real-world case studies that show how digital customer experience can drive revenue growth.
Customer experience is digital experience
Carmen: From your perspective what is the connection between customer experience and digital experience?
Andrew: The two are completely linked. It’s too hard to separate the two. If you pull your phone out in the middle of the store, is that a digital experience or is that customer experience? What if you’re using a kiosk in a store? Is that a digital experience? It’s certainly part of customer experience. More and more interactions are completely screen-based, too: customer self-service, customer support—any number of things are happening through screen-based interactions. And those obviously make up what Forrester thinks of as customer experience, which is your customer’s perceptions of their experience.
What it actually means when people say “digital experience” is more of a signal of the kinds of tools that will be used (screen-based and frequently connected) to create or shape an experience. The reason you even talk about “digital experience” is because somebody owns the website, and that person is different from the person who owns the store. That’s just where things sit within the organization, but in reality they’re completely connected, and the best experiences happen to be very digital. I think people really appreciate calling Uber through their phone and then getting into a car. There’s a very digital part, and there’s a very physical part of that, and it’s all part of this generally good customer experience, whether you agree with all of the things Uber does or not.
Better customer experience drives revenue growth
Carmen: How does that translate into the business benefits and the way that people measure whether their business is successful?
Andrew: You have two big buckets of customer experience leading to business improvement: cost savings and revenue growth, and digital plays a role in both. Cost-savings has been a long-standing justification for the business benefits of CX. For example, improving an interface might reduce calls, increase adoption of a really important and cost-saving feature, or shift volume to channels that are less expensive, like chat, for those customers who want it.
You also have benefits leading to revenue growth. Because CX and digital are so linked, digital does lead to revenue growth as a business benefit. It’s tough to put a number on it because there are a lot of complicated factors like macroeconomic trends or things like disruption. And, don’t forget the standard competitive questions like barriers to entry and barriers to switching. But in general, when customers have a choice, better CX can be created through digital efforts and will help grow revenue.
Break through the CX noise
Carmen: Everybody likes to talk about customer experience and digital transformation—how do you break through the noise?
Andrew: I think customer experience has become sort of a polluted term. That doesn’t mean we’re going to stop using it, and it doesn’t mean it’s not still important. But not every technology, not every vendor, certainly not every company is actually thinking about real customer experience when they use that word. Customer experience is about your customer’s perceptions of their interactions, and not your designs or your hopes and dreams for what their perceptions are. It’s their actual perceptions.
That perspective is really important when you’re thinking about how to break through the noise because it helps you re-center on whether you’re thinking about what your customers are trying to accomplish—their real desired outcome, the actual benefit of whatever product or service they’re using. Not the path that they used to get that benefit, but the actual outcome. Then what they want to feel and how they want to feel through that process.
And if you as an organization are able to help your customers get to that benefit, you’re going to be most of the way there to getting the business value and success that comes from better CX. It’s just a different way of looking at the world and at business that I think helps to cut through all the buzzwords.
About Andrew Hogan
Andrew Hogan is an analyst serving customer experience professionals. His research topics include digital customer experience strategy, execution, and management. He is based in San Francisco. Prior to joining Forrester, Andrew was associate director of digital strategy at agency R2C Group, working with beauty, CPG, SMB, and retail clients on site, social, CRM, and paid acquisition efforts. Before R2C Group, Andrew was a senior strategist at digital and innovation agency T3. There, he guided strategy on apps, social efforts, CRM programs, and site and product prototypes across convenience store, consumer electronics, hospitality, and insurance clients. He also led agency research to study mobile’s effect on consumer expectations and its connection to customer experience.