Battle of the CXs

Johannesburg, 23 Mar 2016

Paul Swartz, Argility.

Companies are being urged to hone in on customer experience (CX) as central to their 2016 competitive combat strategies. Forget product and service enhancements, increased R&D funding, competitive pricing adjustments and unique value-adds.

This year, according to research firm Gartner, CX will be the currency of competitive advantage. A recent report reveals that as much as 89 percent of companies expect to compete mostly on the basis of CX this year. In line with these results, Gartner's 2015 Marketing Spending Survey identified CX as the most pressing mandate for marketers currently, as it not only topped marketing technology investment in 2014, but lead innovation spending for 2015.

The importance of CX is undeniable, but what determines its success? What does it promise, and what have customers come to expect? And, most importantly, how is it used to grow the customer base, and ensure its loyalty?

Quinton Pienaar, Agilitude's CEO, explains today's definition of CX: "CX is no longer an inside-out, efficiency-driven practice, but rather an outside-in customer journey-driven discipline. Customer interactions, processes and activities are put in place with the customer profile and needs in mind and how best to serve them."

Microsoft SA's marketing and operations director, Nir Tenzer, believes technology has enabled the golden age of the customer: customers can access all the info about a company's product and service offerings and compare prices, then make an informed purchase online, and have their items delivered to their doorstep from anywhere in the world."

Paul Swartz, Argility's divisional executive, stresses that businesses be cognisant of the patterns, preferences and changes in the consumer's buying behaviour, if they are to retain the sale and promote return business.

Today's customer also has a lot more power that ever before. "Customer feedback over social networks can make or break the reputation of a brand, as a single tweet, Facebook post or YouTube clip has the potential to go viral." This is why, Tenzer adds, the customer experience is so important: "Thriving in this era requires organisations to be customer-centric, and that they place a premium on knowledge about customers and excellent customer experiences and service."

Technology has enabled the golden age of the customer.
Nir Tenzer, Microsoft

But how can this information be gathered, and, once captured, how can it best be used to achieve competitive edge?

Having an omnichannel strategy in place, and using advanced analytics to interpret customer data, is a very powerful combination of tools to ensure optimal CX.

CX tech

As Tenzer defines it: "An omnichannel approach involves the delivery of high-value customer experiences across all touch points, resulting in more personal, seamless and differentiated service delivery to customers."

To be omniscient, you need to perceive and understand all things.
Quinton Pienaar, Agilitude

Swartz believes the success of an omnichannel approach depends on the following:

- understanding the customer, their preferences and purchasing patterns;

- having the ability to build a `single customer view' across all transactional activities;

- using this information to enhance the CX and identifying future marketing opportunities.

"Above all, companies must recognise that a consistent customer experience across all channels of engagement is critical to success and return business," he adds. "And although analytics can be a powerful enabler and driver of enhanced service, the information gleaned is worthless without first having an omnichannel strategy in place."

The iron triangle of customer experience

You probably already got the memo that customer experience is the new competitive battlefield. In fact, I'd argue that customer experience is fast becoming the top imperative of modern business.

But while we all generally agree on the importance of customer experience, it's one of those things that's easy to say and hard to do.

There are three overarching patterns of the most successful customer experience programs:

1) Initiated by leadership: Well beyond executive sponsorship alone, CX programmes require senior-most executive ownership. Initiatives that lack executive ownership will likely wither on the vine.

2) Activated by incentives: Let's face it: we're all coin-operated. While CX may be a visible mandate handed down from the C-suite, company-wide behaviours won't manifest in any systematic way without the incentives to drive them forward. Incentives activate behaviours.

3) Reinforced by culture: The highest-performing organisations celebrate both the customer and the employee. Companies that forget this crucial second part rarely get the emotional buy-in necessary to consistently walk the talk on the front lines. The highest-performing companies recognise and celebrate exceptional customer-cantered behaviours and they empower employees to use both their heads and the hearts to do the right things for customers in the moments that count.

While there's a lot that goes into any successful customer experience programme, aligning your efforts to these three basic forces will dramatically improve your odds of getting CX right for your organisation.

By Jake Sorofman, Gartner

To a large extent, modern analytics helps to deal with the complexity and sheer volume of the data gathered by companies today.

As Tenzer says: "Internal applications, a range of customer service channels, as well as social media, generate vast amounts of disparate and unstructured data, which is very often locked in organisational silos, obscuring an accurate picture of current and potential customers."

This is where analytics comes in, he says. "Companies will be able to quickly and easily gather data about customers from any source, rapidly present that data in a visual format to help develop new insights, and then use those insights to drive better business decisions. Advanced analytics solutions further enable companies to anticipate consumer trends in order to take action by optimising their business ahead of those trends and, in so doing, enhance their performance."

CX in SA

In Africa and the Middle East, omnichannel retailing is less advanced than in more developed regions such as the US and the UK, says Swartz.

In terms of South Africa, however, Swartz says it's interesting to note that almost half (42 percent) of shoppers within malls are already shopping online. This number is made up primarily of Millennials (the so-called `Net Generation') and those in the LSM 10 and 10+ groups (those with a monthly income in excess of R37 000).

"It's important to point out that while the size of this group has remained constant, the frequency with which it is using digital channels is increasing," he adds.

Although also positive about SA's growth in CX, Pienaar says our market is behind the global trend. "While most South African companies are only now starting to contemplate how to develop a meaningful CX strategy, retailers in the US have moved one step ahead and have fully embraced the omnichannel already."

Internationally, continues Pienaar, omnichannels are becoming more prevalent as experts predict that retailers will die without them within the next decade. "This bold statement makes the concept a vital one to understand and adopt," he says.

Part of understanding an omnichannel is to accept that it is greater than just the business or your consumer, and that to be omniscient, you need to perceive and understand all things. "An ideal omnichannel should allow a customer to perceive everything and allow them to own their data and experience. In addition, it should also give them the ability to use it to guide creation and context of every future experience," he concludes.