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Customer Experience Management

Satisfied customers are customers who’ve had good experiences with a company – a good “customer experience”. And satisfied customers are loyal customers. In a competitive environment in which many products barely differ in terms of price and product quality, good customer experience translates into an economic success factor. Customer service is probably one of the most underrated touchpoints between customers and a company’s potential customers. This is reason enough for us to take a closer look at the topic of customer experience in the contact center and provide some guidance regarding what companies should look for when choosing contact center software in order to ensure a good customer experience at this contact point.

1. Summary

2. Definition: What is customer experience management?

Customer Experience Management (often abbreviated as CEM or CXM) denotes a management discipline that is intended to ensure that customers have good experiences at all points of contact with a company (touchpoints). A study by the international CX Network entitled „The global state of customer experience 2019“ shows how important this is: three quarters of all consumers switch to a competitive brand if they’ve had only one bad experience. Customer experience is embedded in the corporate and brand strategy. Touchpoints can e.g. be the employees in the local company, the switchboard, advertisements, newsletters, mass mailings, the website, an online customer portal, social media channels, and, of course, customer service. The number of possible touchpoints has multiplied in the digital age. As part of customer experience management, customer satisfaction data is collected at individual touchpoints and compared with previously defined key performance indicators (KPI). A wide variety of measures can then be implemented to further optimize the customer experience at the respective touchpoint.

3. Customer Experience Management in the digital age

The strategic approach of placing the customer at the center of considerations regarding the product range and service (customer centricity) is neither groundbreaking nor really new. It has been part of the management repertoire for sustainable business success for years, as testified to by proverbs such as “The customer is always right” or “The customer is king”. Satisfied customers are customers who repeatedly buy from a company or who remain contractually bound over the long term. They ensure recurring sales and high profitability, since the costs associated with marketing, advertising, etc. entailed in acquiring new customers are much higher than keeping an existing customer by providing a good product and good service. At the turn of the millennium, it was still very time-consuming to collect data on customer satisfaction at the various points of contact with the company. In the “analog” age, this was mostly surveys at the point of sale or customer satisfaction surveys done by phone. Only a handful of companies consistently collected such data at that time. One of these companies was Amazon which is considered one of the pioneers of a consistent customer-centric approach. Amazon launched its first international websites in 1998, and an anecdote-rich look back at their start can be found in e.g. digital magazine t3n. Today, management consultants or investors have virtually made a saying out of “You need to become more like Amazon” when offering sound advice. The digital age poses new challenges for customer experience management. More and more data is being collected at the individual touchpoints, but in many cases the systems where the data originates are not integrated with one another and the data quality leaves something to be desired. „Customer-Experience-Management scheitert oft an den Daten“ reads the title of one article in IT magazine Computer Week, for example. Thus, although more and more data is being collected, in many cases it cannot be analyzed and used for strategic customer experience management.

As a result, a market for integrated digital customer-experience service has already established itself, which the consulting firm Lünendonk presents in its 2019 market segment study. On the other hand, consumers in the internet age benefit from unique transparency regarding products and prices, and are significantly more informed as a result — and therefore also more critical — than they were a few years ago. This is precisely why it is essential to obtain a holistic view of the customer experience across the entire customer journey and evaluate all data collected at the relevant touchpoints. In an article on the subject, management consultancy Deloitte expressly emphasizes that an „end-to-end approach“ in customer experience management is the key to tomorrow’s success, and designates customer experience as „the new currency“ in the digital age. In its „Global Consumer Insights Survey 2019“ report, the consulting division of management consultancy and auditing firm PwC goes one step further by introducing a new key performance indicator: the „Return on Experience (ROX)“ is intended to measure the return on investments that are directly related to how customers interact with a brand. One of the study’s most interesting action recommendations for good customer experience is that the latter not be viewed separately from the “Employee Experience” (EX). Satisfied employees are still one of the most important success factors for a good customer experience, even in the digital age. Real user-friendly solutions for important touchpoints — e.g. ReplyOne for customer service — relieve the strain on employees and give them the best possible on-the-job support. This ensures that the same solution equally improves both the employee experience as well as the customer experience.

4. Software solutions for customer experience management

Comprehensive customer experience management is a comparatively young business discipline. Accordingly, there are a variety of software solutions that claim to be able to improve the customer experience. The Capterra internet platform already lists more than 200 software solutions for the keyword Customer Experience Software (CEM) – from onboarding new customers to reputation management, survey tools, customer service software and business intelligence tools. In its „Magic Quadrant for Digital Experience Platforms“ Gartner lists 11 platform providers that try to make a customer’s digital experience transparent on a single platform. This shows that there is no ONE solution that can monitor and control the customer experience, but that it is important to optimize the experience at the individual touchpoints by deploying specific solutions and measures, as well as make effective use of the  data that is collected at the respective touchpoint. This only works with systems that have a high degree of integration capability within a complex enterprise IT infrastructure and are designed to exchange data with other systems. 

5. Automation and AI – good or bad for the customer experience?

There is hardly a topic that divides the industry as much as the subject of automation in customer service. Online forums and social media are full of examples of customers desperately trying to reach a real person in order to solve a problem, but who instead end up having to deal with chatbots that are entirely unable to understand the complexity of their inquiry or have to deal with keyword-based response management systems that merely send the same answer module over and over in response to an email inquiry. In 2018, the Warentest foundation also conducted an online hotline test of some chatbots – with at times devastating results. Test result: incompetent.

Technology is never good or bad. Instead, how it is used defines whether it becomes a blessing or a curse for consumers. Customer service centers are faced with a dilemma here – they want to offer good service but struggle with a shortage of skilled workers and cost pressure, and often have to suffer for the “sins” of other company departments, be it a faulty or repair-prone product, non-transparent pricing policy, a poorly designed online store or wholly inadequate documentation. These are all points that have a significant impact on the customer experience. The solution to the problem appears to be the automation of certain service processes, and in particular the topic of AI: more inquiries can be answered with fewer staff. What is often left out is the fact that a wrong answer significantly impairs the customer service experience and can even permanently sour customers. The automated “processing” of inquiries given up on seems all too tempting. Keyword-based bots or response management systems always pose risks for the customer experience – especially when a human control mechanism is no longer placed in the middle. When it comes to AI, it also depends significantly on how well the AI has been trained by human service experts in certain topics or categories, and on how precise the customer’s concerns are actually recognized.
It is possible to automate service processes intelligently and without sacrificing the customer experience. Artificial intelligence can offer great potential here if it provides a high recognition rate and is used to support human service staff. However, this can only be achieved with AI technology that can analyze texts in a context-related manner and be taught in a structured manner.

6. The problem with customer surveys for Customer Experience Management

Customer feedback from general customer surveys or net promoter score surveys is the new ironclad yardstick of customer satisfaction. Companies that boast positive reviews attract new customers. In addition, more and more service managers are being assessed by the net promotor score or general customer satisfaction. This focus on customer feedback should generally be considered positive. However, this has led to the rise of dubious business models, e.g. in the area of product reviews in online stores, where companies could simply buy positive reviews – that is, at least until the landmark decision by the Munich Regional Court that fake reviews are illegal.

Short surveys that ask the consumer to briefly evaluate their customer experience generally aid in collecting valid customer experience data at this touchpoint. But here, too, the following is once again true: companies that continuously subject their customers to repeated or long-winded surveys are more likely to annoy customers. Asking incorrect questions and thereby knowingly or unknowingly manipulating the results also precludes obtaining honest customer feedback that actually helps to improve the customer experience — it merely provides dressed-up data. While this information can be very helpful for internal justification vis-a-vis company management, it does not contribute to a company’s long-term success.

Kundenerlebnisse Customer Experience Management

7. How can you ensure a good customer experience in the contact center?

Above all, Customer Experience Management at the customer service touchpoint requires very good, specialized tools and high (data) transparency. Customers have a good experience when they quickly and reliably obtain a correct answer via their preferred communication channel. This may mean email today, or chat tomorrow – which is why service managers should emphasize multi-channel or omni-channel response management systems that maintain complete, channel-independent customer contact history. This enables service employees to quickly see which topic the customer has previously reported and allows them to tackle their questions in much more personalized fashion.

With the help of AI-based multi-channel systems like ReplyOne, which pursue a hybrid service approach, standard queries can be answered automatically and/or service staff can be given optimal support when answering questions by having a knowledge management system simultaneously provide them with the right answer or information together with the inquiry. Such partially automated “hybrid” systems ensure that customers obtain the correct, personalized and error-free answer faster. In its Customer Experience Predictions Report 2020, the internationally oriented CX Network formulates the thesis that, in the future, it will be important to maintain human authenticity in a digital world.

During operation, good contact-center software solutions should automatically collect required figures, data and facts and make them available to service managers in aggregate form as part of reporting. Reports create the necessary transparency to be able to critically analyze the current status quo in customer service. If reporting indicates that certain topics come up with high frequency in customer inquiries, this helps enormously when researching the associated causes. This also makes it very easy to identify the biggest areas that have a negative impact on customer experience, e.g. a faulty product, a website that fails to work as desired, or even poor service. Strategic customer experience management can then implement measures to improve the customer experience.

8. Conclusion: What comprises good Customer Experience Management in the contact center?

Good customer experience management in the contact center focuses on customer satisfaction. Customers should have equally good experiences on all contact channels offered by the company. They should be addressed individually and, when inquiring, customers should always receive the same information via different channels, ideally prepared in channel-specific manner. When implementing automation or using AI, the potential effects on the customer experience should always be considered and investigated, since any assumed savings may have a negative long-term effect on customer satisfaction. With the right solution, however, the customer experience can be significantly improved through greater transparency and quality-tested answers, customers have a positive customer experience on all contact channels, and companies can still realize significant savings potential.

If you would like to learn how contact centers can take advantage of a modern response management solution such as ReplyOne in order to ensure a good customer experience in customer service, be sure to read one of our user reports.

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