It’s all about the customer experience

Forrester's Report "The State of Customer Experience 2010" makes compelling reading for those passionate about the customer experience and outside-in strategies.

Here is a summary of the report's key findings:

• "Customer experience is critical. When we asked respondents how important customer experience was to their 2010 plans, 90% told us that it was very important or critical"
• "Most companies have some customer experience discipline. Nearly two-thirds of respondents say that their companies have a disciplined approach to customer experience management"
• "There’s a lot of effort underway. More than six out of 10 companies have a voice of the customer programme and use a single set of customer feedback scores"
• "Missing strategy has replaced funding as the key problem. About half of the respondents identified three areas as key issues to their customer experience efforts: lack of a strategy, lack of processes, and lack of cooperation across the organisation"
• "Firms need more customer experience maturity. We asked the executives whether they agreed with 12 statements that represent key competencies for Experience-Based Differentiation (EBD). Only three items got the nod from a majority of respondents"
• "Brands are getting more of the attention they deserve"
• "All interactions fail to deliver, especially online. Our 2010 Customer Experience Index (CxPi) shows that customers aren’t being treated well.

 But how do these executives think their companies are doing? Not so well either. For five of the nine interactions that we asked them to rate, less than half of the respondents thought they satisfied customers at least 75% of the time. The online channel received the lowest marks, especially when it came to customer service".

The industry customer experience scores also make interesting reading, with retailers and hotels registering the highest customer ratings versus health insurance and TV service providers rated the lowest.

"Forrester’s previous research has shown a high correlation between customer experience and three key elements of loyal behaviour: willingness to buy more, reluctance to switch, and likelihood to recommend. But how does that affect a company’s bottom line? To answer that question, we looked at the percentage of loyal customers within the customer bases of more than 100 companies.

 It turns out that customer experience  leaders have an advantage of more than 14% over customer experience laggards across all three areas of  loyalty. The annual revenue gains from a modest difference in customer experience can total $284 million on average across industries."