In any business environment, success equals understanding customers. Today, however, there seems to be particular emphasis on this aspect.
And yet, understanding customers isn't always straightforward. It used to be that a company could simply push its product, if it was an interesting enough one, onto a large consumer segment and get results. However, this one-size-fits-all approach is no longer effective given the demands for tailored and personalised products or services.
This shift can be observed across pretty much every sector and industry. To pick one out just as an example, financial services today don't differ greatly in people's eyes. Consumers can rarely tell one bank from another besides superficial variances, or explain their choice of bank with clear and specific reasoning. To this scene, add young tech companies who generally have better, simpler ways of interacting with consumers: what results is rising customer expectations for the whole sector, on incumbents and challengers alike.
The winning combination: experience and interconnectedness
It's challenging to address customer experience (CX) because it's so broad: there are many touchpoints along the customer journey, with exciting possibilities for each, but also the need for coherency throughout. Thus, choosing a starting point, while sounding simple, is an important part of the process.
On an operational level, companies must practice connective thinking, i.e. link concepts in new ways in order to foster novel methods of working. The goal is to align the operations and workflows so as to achieve flexibility, a vital enabler of good CX, and ultimately to shift from a system of functional structures to one of a central, secure, durable matrix. According to the Harvard Business Review (2015), over 30% of the Fortune500 have already moved to customer-centric operating models.
KPMG Nunwood, a KPMG member firm devoted entirely to CX research and expertise, found that companies in search of CX-optimised operating models are investing mainly in four areas:
An important implication of these findings is the final area: people. Companies are (or should start) listening to their employees as sources of valuable insight on client behaviour and day-to-day operations. In this context, employee experience becomes particularly important: there is usually a direct link between it and good consumer experience.
The economics of customer experience
Each part of the customer journey has a cost. But each part also has opportunities for cutting out inefficiency, improving service, and lowering that cost—especially in the insurance, banking, and retail sectors.
According to KPMG Nunwood's 2017 report, "evidence suggests that brands that improve customer journeys see revenues increase as much as 10 to 15% while also lowering the cost of service 15 to 20%."
As technology brings new possibilities to each stop of the journey, current processes become outdated. You might notice outdated design, unnecessary duplication, or other hazards to efficiency, all of which threaten a disconnected client experience. Investing in improving these elements, as part of an overall CX effort, should generate real commercial value.
Redesigning the customer journey can begin with analysing all available data about the current customers and then sorting it by pain point, impact on cost structure, and other attributes.
Read more customer experience insights in the Khube Mag special CX edition.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.