Monday, May 13, 2019

Moments of Fallacy: Your Customers Don't Leave But Are Invited To Do So

We get the language of customer retention and attrition all wrong. We say things like "customers abandon us," "they leave," or "they attrite." But in framing our brand's retention issues in this manner, we swap the subject and object of our sentences. We make the customer the subject and our brand the object, as if they've done something to us, but the reality is precisely the opposite. We are the subject--our organizations are the ones accountable for the customer experience (CX), for ensuring customer satisfaction, and for earning customers' loyalty and dollars. Our brand is not victimized by ungrateful customers who leave us but has a duty to create an experience that invites customers to remain.

This isn't just about language but about the way we think and act. Our mental models influence the language we use, and the language then reinforces those same mental models.

Your brand may not intentionally "fire" the customer, but make no mistake: If you neglect customer needs and expectations, ignore their feedback, consistently prioritize profit over customer satisfaction, and expect loyalty in return for mediocre and undifferentiated experiences, you may as well engrave an invitation for your customers to quit your brand. To influence customer-centric change in your organization, start with the right vocabulary and mentality. Stop blaming your customers for leaving, and embrace your obligation to offer experiences that invite customers to stay.

Another example of the way our language betrays us is the term "moment of truth," which has been popular in CX for years. The idea that your brand has some limited number of consistent and eternal "moments of truth" that are essential to every customer in every situation falls apart pretty quickly when you poke at it gently.

Any moment can be a moment of truth if your brand disappoints or harms a customer. Moreover, satisfied and loyal customers don't abruptly seek competitive solutions simply because your brand dropped the ball in one, big, predictable moment of truth; instead, you lose customers when your brand suffers a sustained loss of trust, loyalty, and satisfaction due to a series of effortful, disappointing or frustrating experiences. In the battle for customer retention, every touchpoint is a moment of truth, and the decision on which moments matter most is not yours but each customers'.

To read two examples that illustrate how brands invite customers to leave, explore brands' "last-touch attribution" issue with attrition, and begin to improve the customer-centric language and mindset at your organization, please continue reading this post on my Gartner blog. 

Friday, March 29, 2019

One Powerful Tip to Improve Every Business Strategy

Photo by patricia serna on Unsplash
I generally hate blog posts and articles that suggest there is a single trick, hack or tip that can change your world. (I swear if I see one more headline promising the one habit that can turn me into Jeff Bezos or Warren Buffet, my head will explode.) But, there is one powerful tip that, I have found, can help you avoid costly mistakes and turn a weak business or marketing strategy into a powerful one: Define your goals and metrics first, then develop the plan to deliver on those.

That's it. That's the entire tip. Not exactly rocket science, huh?

The problem is that, far too often, we do the opposite. We commit to a strategy we like or a technology that intrigues us, and after our plan is set, we then figure out how to measure the outcomes. The problem with this approach is that we develop metrics to fit the strategy rather than developing a strategy to match what we want to accomplish and what our business needs. By figuring how we'll measure what we have already committed to doing, we end up with vanity metrics rather than important business KPIs.

The 2008 to 2015 social media strategies of virtually every brand illustrates this problem. Every company in the world jumped into social media for reasons that ranged from weak ("our competitors are doing it!") to incomplete ("our customers are adopting it!") So, after an organization committed to a Facebook, Twitter, YouTube, and LinkedIn strategy, all that was left was to determine how to measure it. Thus, we ended up with meaningless metrics such as likes, retweets, fans, and comments. And, having committed to measures that have little to no link to our business goals, brands then spent a lot of money to achieve results that didn't matter. How many brands learned the hard way that Twitter sweepstakes, Farmville giveaways, vapid content, and fan contests were useful only for lifting useless metrics while doing nothing to improve brand health or results?

We can see the same thing happening today with voice devices. Brands continue to jump onto the Alexa and Google Home bandwagon because voice devices are rapidly becoming common in US homes ("our customers are adopting it!") And, as a result, brands are rapidly jumping into developing voice applications such as Alexa Skills, the number of which doubled in 2018 ("our competitors are doing it!")

The problem is that too many brands commit to developing voice apps without really understanding how consumers use them or establishing what the brand wants to accomplish and how it will measure success. The outcome is that a lot of voice applications with little evidence they get used. Amazon doesn't release data on monthly active users of skills (hmm, I wonder why?), but what we do know is that 60% of Alexa skills have zero ratings and only 5% have more than ten. We also understand why people use their voice devices, and every one of the top reasons is core functionality provided by the device makers (time, alarms, online search, directions), entertainment (music, fun questions) or media (news and weather).

To continue reading about the three benefits derived when we set our goals and measures at the beginning and not the end, please visit my Gartner blog. 

Monday, February 4, 2019

Three Words That May Spell Trouble For Your Customer Experience Efforts

The Scream, 1893 by Edvard Munch

Lately, I've been thinking a lot about the language of customer experience. I have hundreds of conversations with clients every year, and my job is to efficiently get to the heart of a CX problem and expeditiously offer practical guidance. My advisory sessions start with clients describing their CX goals or challenges, and I've come to realize there are a handful of words that catch my attention and suggest an area of possible concern worthy of further exploration. Those words are digital, personalization, and buyer.

Before we explore why those words might signify a potential problem with your CX efforts, let me first point you to last month's two-part blog series examining the language of customer experience. Part 1 was about thinking like a customer and part 2 about framing your marketing and business strategies from the customer's perspective. Today's blog post is again focused on language and seems like an appropriate conclusion for the series.

"Digital," "personalization" and "buyer" are powerful and common words used within marketing departments, and the potential CX dangers of each may not be readily apparent. Here is why these words are deserving of attention and further consideration:

Digital

Your brand must constantly strive to get its digital channels, interactions, and experiences right, but a single-minded preoccupation on a "digital journey" can lead your CX program astray. Customers may be embracing digital channels, devices, and habits, but none of us are wholly digital. We are all analog creatures living in an increasingly digital world. As a result, it is rare for customers to complete an end-to-end journey--from need to purchase to loyalty to advocacy--entirely in digital channels. Understanding the ways customers want to navigate back and forth between physical and online interactions permits you to best define your brand's opportunities in both domains.

It's easy to find examples of how merging the best of the real world and digital helps brands. For example, Best Buy, a brand many thought would be "showroomed" out of existence a few years ago, has thrived thanks to a strategy that combines the best of e-commerce and physical retail for customers. Retailers have seen tremendous growth in "click-and-collect" behaviors where customers buy online and pick up at a store; Adobe found that click-and-collect orders grew 46% year over year during a recent one-month period. Meanwhile, another study found that opening and closing a physical store can have a measurable impact on online traffic and image.

All brands--even exclusively digital ones--benefit by recognizing the role of digital and real-world behaviors in improving the customer experience. And if you're in a digital role siloed from physical operations (or vice versa), your success still depends on your ability to recognize how customers want their online and offline experiences merged. (Gartner clients can learn more with the report, "Create Actionable, Insight-Driven Journey Maps.")

Personalization

Like "digital," the word "personalization" represents a positive approach to customer experience--people want and appreciate personalized experiences. The reason this word can raise CX concerns is in how personalization is used by marketers. The critical question is whether your personalization strategies are intended to improve the brand or the customer. The two are not at all mutually exclusive, but a CX strategy is not a CX strategy if it is measured only in increased revenue and not in changes to customer satisfaction, loyalty, and advocacy.

To do personalization right for CX, it is essential to be "outside-in," which means understanding and meeting customer expectations and measuring the impact to the customer. One place to start is to develop, study and understand your different personas, which helps you to define the varied sorts of content, experiences, and features desired by different groups of customers.

A good personalization strategy can lift inbound traffic, clicks, conversions and sales while also delivering more satisfied, loyal customers, but you must be careful not to presume more purchases equate to a stronger sense of loyalty and advocacy. Bridging the gap between behavioral and attitudinal measures of loyalty is vital. (Gartner clients interested in more information on the topic of attitudinal and behavioral loyalty can access our recent report, "Move Customers to Deeper Levels of Loyalty That Strengthen Brand Health.")

To learn of the dangers of the word "buyer," please visit my Gartner blog for the complete blog post.

Wednesday, January 9, 2019

Want to Create Greater Customer Centricity? Start with Customer Language. (Part 2)

Photo by rawpixel on Unsplash
In part one of this blog post, we explored how the language of marketing and business pervades our work lives and discourages the customer centricity our organizations seek. For example, at work, we use language like "content" and "engagement," but at home, have you ever said "I saw some good content on Netflix last night" or "I had some terrific Facebook engagement today"? By subtly changing our language from what customers want and need to what brands do, we alter the way we think and the decisions we make.

This isn't merely a matter of style. Language matters. Studies demonstrate that the words we use do more than just describe a problem; they shape our perception of reality, influence the solutions we consider, and rewire our brain for different cognitive abilities. Corporate talk leads to corporate think and corporate actions.

So, how do you start to transition your language from brand to customer, and what benefits might that bring? Try adopting a structured format for stating your business and marketing strategies from the customer's perspective using customer terminology.

As an exercise, let's say you're a marketer at a financial service provider tasked with promoting a new 529 college savings plan, and your approach will be to use an educational content strategy. Your plan might be summarized as this: "To offer educational content that engages new parents, teaching them about the high cost of their children's future college education and promoting the benefits of initiating savings early in their child's life, with the goal of producing more inbound traffic to our new 529 page and more leads for our financial advisors."

Now, try to phrase that with customer language from the customer perspective. You may find it difficult, and that's the whole idea. If you cannot frame your business or marketing concept in a way that makes sense from the customer perspective, that is a concerning omen. To help, here is a format you might follow to put yourselves in the shoes of the customer:
  • I,
  • A customer with these needs, wants, and motivations,
  • In this specific situation,
  • Who has this relationship with the brand,
  • Will interact with the brand for this reason,
  • Resulting in this benefit.
This approach forces you to think like a customer in some key ways, and it also suggests the level of customer understanding you'll need. Without the right data and insight, you may be able to write a nice piece of fiction, but you must base your strategy on something more than what you imagine or hope. Step by step, this format cuts through the fog created by business and marketing lingo and forces a true customer-centric perspective.

To see how this approach changes our hypothetical 529 plan and consider the impact this customer-centric approach will have on our metrics and success, please continue reading on my Gartner blog. 

Monday, January 7, 2019

Want to Create Greater Customer Centricity? Start with Customer Language. (Part 1)

Photo by Dmitry Ratushny on Unsplash
"We want to become a more customer-centric organization." As a customer experience researcher and advisor, I hear that phrase every single week. I suspect you may, too.

Achieving this is, of course, important for brand health and financial success. Customer-centric organizations are eating the world. Amazon, which seeks to “become Earth's most customer-centric company,” is close to capturing half of all US e-commerce dollars. Southwest Airlines, which is dedicated to "the highest quality of customer service delivered with a sense of warmth, friendliness, individual pride and company spirit,” has seen its revenue passenger miles grow 67% in seven years and now possesses a market share virtually equal to the US airline leader, American.

But saying you want to improve customer centricity is easy; achieving it is not. The struggle for many business leaders is that many of the tools to transform company culture are out of their reach. It's easy to recognize, for example, that our primary business KPIs (like revenue, margin, and stock price) are largely disconnected from customer-centric aims (such as customer satisfaction, loyalty, and advocacy), but how many of us get to set our company's top goals and measures?

So how can one individual help to transform their corner of the organization to be more customer-centric? One place to start--and a particularly powerful strategy for marketers--is to begin to use the language of people and not business. Our corporate and marketing vernacular too often obscures the customer and what he or she wants and expects. It alters our perspective, encouraging us to consider the value we wish to extract from customers, not what our customers desire and need from us. The language of marketing and commerce damages rather than cultivates customer centricity.

For example, does your organization have an "engagement strategy" to build "stronger customer bonds?" Are you striving to execute a "content strategy" to make your brand "top of mind?" Do you seek to make "more meaningful connections?" Are you working to foster "more authentic customer relationships?" Chances are, you are so steeped in the lingo of marketing and business you merely nodded in response to each of these questions, but those are merely brand-centric statements obfuscated beneath a thin veneer of customer jargon. Those statements all make perfect sense--from the selfish perspective of your brand.

Now, instead of thinking like a marketing or corporate leader, think like a customer. You have around 500 brands in your life, between your kitchen, bathroom, closets, devices, car, TV, and desk. With how many of those 500 do you want to "engage" today? How many of the 500 do you actively and regularly seek out and make time to read, watch, listen, and consider their "content?" Of those 500, how many do you wish to so preoccupy your thoughts and attention that they push your family, job, friends, hobbies, and health out of the way to become "top of mind?" Honestly, how many of those hundreds of brands will you invest the time and care to "bond" with--to make a "meaningful connection" and have an "authentic relationship?"

To flip the perspective, consider these same questions from the customer viewpoint, and explore how our goals for customer centricity are harmed when we misuse customer language, please continue reading on my Gartner blog.