Do you know how to impact profitability using your customer feedback data?
According to PwC, more than 90% of organizations measure customer satisfaction, yet very few turn customer feedback data into immediate action. As missed opportunities go, it doesn’t get much bigger.
IBM quality guru Dr. H. James Harrington said it best, “If you can’t measure something, you can’t understand it. If you can’t understand it, you can’t control it. If you can’t control it, you can’t improve it.”
Being able to measure what customers think and feel is essential for experience-led growth (XLG). Companies who capture data and insights and then enable action on their customer feedback data are on the right track. Measuring Outcomes is another critical pillar of XLG maturity. It is the key for continuous improvement. It allows you to pinpoint where you can make the most impact to alter customer perception about your brand.
Chattermill has developed an XLG maturity assessment to improve maturity across four pillars and drive long-term growth.
Let’s dive into the Measuring Outcomes pillar to see how it can help you increase growth using an XLG strategy.
Measuring Outcomes: the third pillar of XLG
CEOs identify changing customer preferences as a current threat to their business that is only going to intensify. According to PwC’s 27th Annual Global CEO Survey, 42% say customer preferences have changed the way their company creates, delivers, and captures value in the past five years. When looking ahead to the next three years, 49% of CEOs anticipate they will need to respond to changes in customer preferences, an increase of 17%.
One way XLG can increase profitability is to have the tools and systems in place to measure the outcomes of actions taken from customer feedback data. Continually improving and even reinventing the customer experience based on measured outcomes helps drive a profitable customer experience and ensures customers remain loyal.
What stage are you at for Measuring Outcomes?
Chattermill helps you determine how to move up the Measuring Outcomes pillar. An XLG assessment provides the necessary detail to ensure you’re starting with the actions that will have the biggest impact based on your specific business goals. As a business matures, they move through different stages of XLG competency:
- Gut feel – Decisions are made on gut feel or anecdotal information and don’t tie back to customer feedback data, at scale.
- Developing – XLG is not a high priority in the organization. Processes for customer-centric decision-making are not robust, repeatable, or predictable.
- Influencing – XLG is widely accepted across a number of teams who rely on customer insights to inform their decisions. Long-term customer loyalty strategies are given priority over short-term profit.
- Leading – Customer-centric decision-making is embedded across all business units. XLG is part of the DNA of the company and is fundamental to its ongoing success.
XLG Maturity: From gut feel to leading the way in Measuring Outcomes
To capitalize on the insights drawn from your customer feedback data, you need to do three things:
- Ensure you’re measuring the impact of actions taken from your customer feedback insights.
- Implement a learning loop of the actions you’ve taken and their outcome to promote continuous improvement.
- Make key stakeholders aware of the impact your actions are having.
Having the ability to measure is not the same thing as doing it. To achieve XLG, measurement and feedback loops need to be part of a continuous process built into ways of working across the organization. The way to improve your Measuring Outcomes maturity is to consistently examine whether the actions you’re taking are having an effect on how your customers think and feel.
What’s involved in the Measuring Outcomes Pillar of XLG maturity?
- Tracking and monitoring – the continual practice of measuring the impact of action taken from customer feedback data, like measuring changes to Net Promoter Score (NPS), customer perception, and business metrics.
- Visibility and continuous improvement – the ability to track and improve the process of gathering, actioning, and measuring impact by creating an internal feedback loop.
Moving from Gut Feel to the Developing stage for Measuring Outcomes
Telltale signs that a business is operating at the Gut Feel stage of maturity are:
- Customer experience (CX) metrics are not reliably tracked
- Assessment of the success or failure of initiatives is mostly based on internal opinion and/or the interpretation of financial, sales, or operational metrics.
Before moving to the Developing stage, the metrics used to make decisions and measure impact must originate with customer feedback data. While common business metrics like sales results tell a story, they do not track the impact of changes that are made from the customers' perspective. They also fail to capture why customers are behaving in a given way and what can be done to improve.
Transitioning from the Developing to the Influencing stage in Measuring Outcomes
Brands at the Developing stage have taken the first step to including the customer's perspective in how impact is measured. They measure the impact of the actions that they make on top-line CX metrics, such as NPS and Customer Satisfaction (CSAT).
To move to the Influencing stage, an organization must go beyond top-line CX metrics and measure the impact of their actions on customer perception. The impact on customer sentiment in relation to a specific change is quantified and tracked.
At the influencing stage, there is also a recognition that the process of finding insights, taking action and measuring the impact needs to be continuously improved. Some teams have ways of working in place to make this “insight to action to impact” process more efficient and effective.
Achieving the Leading stage for the Measure Outcomes pillar of XLG maturity
To be classified as a Leading organization for measuring outcomes, the impact of CX initiatives is both measurable and predictable. In addition to quantifying impact in terms of customer perception and sentiment, outcomes are also measured for their impact on core business metrics such as retention or revenue.
The “insight to action to impact” feedback loop is constantly assessed for new ways to optimize the process and ways of working between teams.
Leaders in XLG maturity benefit from insights-driven decision-making. Measuring the impact of actions taken based on customer insights is built into ways of working throughout the organization and a culture of continuous improvement is embedded in how CX is managed.
