Most business leaders understand that an excellent customer experience is a brand differentiator. To achieve this mission, companies need to innovate. However, it's easy to get distracted by the bright, shiny objects afforded by the latest technology or to simply focus on process design. The most successful companies know that customers value experiences that demonstrate a deep understanding and respect for their needs and preferences.
The stakes are also rising. Customer experience ranked as the top area for marketing technology investments in 2014 and is leading innovation spending for 2015. By 2016, 89 percent of companies expect to compete primarily on the basis of customer experience, versus 36 percent four years ago, according to Gartner.
However, customer experience design is more than a checklist. Companies need to take a strategic approach to customer experience in order to deliver differentiated value. Here are three companies and the steps they've taken to excel at customer experience design.
Wahoo's Fish Taco
As companies invest in customer experience strategies, using data insights about customer behavior to guide those initiatives is critical, notes Keith Dawson, principal analyst at Ovum. "We're seeing investments in customer experience technology grow across the board, along with analytics," Dawson says. "At the same time, people should be gathering information from the customer base at the macro and micro level to fine tune their approach to the customer."
Journey mapping, can also help business leaders better understand how customers interact with their business and deliver the right response, Dawson adds. "Companies should be asking themselves, what are the pathways, why did customers choose them, and how widespread are they?" Dawson says.
For instance, Wahoo's Fish Taco, a seafood restaurant and franchise headquartered in Santa Ana, Calif., knew it needed a strategy for understanding and meeting its customers' preferences. Given that many of its customers interact with the company using their mobile devices, mobile engagement is extremely important.
As part of its efforts to improve the customer experience, the company selected mobile app developer CircleShout to develop a loyalty app two years ago. Customers receive a QR code for a free taco when they download the app and check in for their first visit at a participating location. They can also place orders within the app and earn points for menu items and promotional giveaways.
Additionally, users can join social groups within the app. More than 10,000 people who downloaded the company's app, for example, are part of Wahoo's Fish Taco's General club and more than 200 members joined the La Jolla club. Club members can receive targeted offers from the restaurant, and post questions or comments about the restaurant's service on a message board.
On the backend, everything users do on the app is tracked to help Wahoo understand its customers' behavior and preferences. "We use a three-part algorithm to track interests across a personal level, merchant level, and social circle level," explains CircleShout CEO Ian Rice. "This enables us to understand customers on multiple angles and target actions based on various factors like age, demographics, what you've ordered, and your interests."
In addition to using those insights to deliver targeted coupons and messaging, it also helps the organization track the success of its engagement initiatives. For example, many of Wahoo's 58 restaurants invite local bands to play at their establishment. "But the manager might not be sure if the bands are bringing in paying customers," Rice notes. "The app has a feature where you can RSVP for an event. The manager can see all the RSVPs and track the attendance in advance. And in many cases, sales increased on the same days that bands played, which helps the store managers know these types of activities generate value."
Indeed, data insights are an essential part of designing an engaging customer experience, notes Wahoo's co-founder Wing Lam. "Before, all you could do was guess at what interested people," Lam says. "Now, we can engage our customers in a much more targeted way."
In addition to leveraging data, experience designs must be flexible enough to adapt to changing customer behavior. When John J. Legere took the reins as CEO of T-Mobile in late 2012, one of his first moves was to rebrand the telecom company as the "uncarrier." T-Mobile sought to be different from its competitors by providing customers with transparency and flexibility, according to Legere. Customers were no longer bound by long-term contracts and pricing had been simplified.
T-Mobile's efforts to meet customer expectations also extended to its customer service. When customers started contacting the company on social media, T-Mobile created a social customer service department. From March 2012 to May 2012, T-Mobile received 2,541 questions or comments on its social media accounts and responded to 86 percent of them. But as its social customer base grew, T-Mobile struggled to keep up with its customers. Social media response times took up to 2 hours, and customer services issues required 8 to 10 clicks to get resolved.
Last year, T-Mobile turned to Sparkcentral, a customer engagement platform provider, for help managing customer service over social media. By streamlining administrative processes and providing a record of each customer's past interactions with T-Mobile, agents have been able to reduce the amount of time spent gathering information about each customer and provide more answers in less time.
"We automate everything except for the conversation," explains Sparkcentral CEO Davy Kestens. "We believe it's important to receive help from an actual person, and our technology makes it easier for agents to handle more questions by using filters that organize and prioritize issues so all they have to do is respond and hit enter and the next question immediately appears." The tool does provide suggested responses for common questions, but it's up to the agent to select the response, Kestens adds.
"At T-Mobile, we believe in providing the best possible customer service by responding to customers quickly and transparently on their chosen communication channel," says Michelle Mattson, director of social media services at T-Mobile. "Our customers view social media as aquick and efficientway to get the information they need, so we needed a way to deliver answers to them in the timeframe they have come to expect." As a result of streamlining its responses and workflow, T-Mobile's average response time was reduced to 10 minutes. Within months, the company increased its volume of customer interactions from 12,000 per month to 50,000 across its social media channels such as Facebook and Twitter.
Gathering and acting on customer feedback is another critical component of a CX design strategy. Speech analytics can be particularly helpful in shedding light on areas of the customer experience that need to be improved, observes Brian Miller, workforce operations administrator at Thomson Reuters.
"Speech analytics doesn't create innovation [per se], but it's the vehicle for it," Miller says. "It causes people to realize that this is the voice of the customer telling us what they need and that causes us to make changes quickly." As an example, Miller points to a software product in the company's tax and accounting division that first-time customers were having difficulty downloading. Through its use of a speech analytics tools provided by Verint, the company determined that the download process was not going smoothly and customers were becoming increasingly frustrated.
Miller's team shared these insights with other departments including technical communications, marketing, and development. The teams collaborated to build a smoother and simpler installation process which led to 5,000 fewer calls about the software within a span of two months. "When calls about downloads normally peak, they actually went down," Miller notes. "This was a great example of how speech analytics helped us understand what needed to be fixed."
Speech analytics offers additional opportunities for Thomson Reuters to understand its customers' needs and enhance the customer experience, Miller notes. For now, though, the company is limited in its ability to leverage those insights until it connects the data with other information sources, such as CRM, marketing, and sales data.
"We haven't tied our speech analytics with other types of data yet, but we're pushing for that," Miller says. "We just started scratching the surface on creating a more consistent customer experience and analytics can help us do that."