Customer Experience Domination #3

Lesson #3: Identify Customer Experience Opportunities

In lesson #1, we discussed the steps that are necessary to develop a compelling customer experience strategy that can deliver meaningful and lasting results.

In lesson #2, we showed you how to translate those ideas into an action plan.

In this lesson, we’ll show you how to look for specific customer experience opportunities in your business. After all, it’s hard to fix it if you don’t know what’s broken.

Step 1: Give Your Customers Some Personality

Whether you’ve just started your company or have been in business for a while, you know that establishing and maintaining a clear value proposition is critical. When your company launched its products and services, there was probably a very clear value proposition that matched the product or service with a specific customer want or need.

Unfortunately, things can change; competing products are introduced, competitors reposition, and customer perceptions shift. Over time, these changes can blur your company’s value proposition to the point that there is no clear value proposition at all. If you ignore these changes, you can find yourself chasing the competitor’s tail or wondering why your sales are flat or declining.

Staying abreast of the ever-changing conditions of the market requires continuous exploration. That means creating a capability to identify and anticipate emerging customer needs more accurately and more quickly than your competitors. Your company will benefit by having more profitable products and services. Your customers will love you for anticipating their wants and needs and being a market leader.

The best way to identify potential opportunities is to develop a more meaningful definition of your ideal customer. A proven and effective way of doing this is to create a detailed set of customer profiles for your business.

Customer profiling can be a powerful tool to help your company better understand and anticipate the needs, actions and preferences of your target customers. This begins by creating a customer profile with enough details to provide your company with the information and insight necessary to become more empathetic with what your customer really wants. Customer profiling is a method for putting a personal touch to major customer segments that you are targeting.

An effective customer profile contains several elements: a) key customer demographic attributes, b) socio-economic attributes, and c) a description of the customer’s perceptions and behaviors. It is also useful to name each profile and attach a representative image, as appropriate, to give each profile a more personal identity. These profiles can then be used to tailor specific products, services, and marketing messages for the unique needs of each profile.

Each customer profile should represent a unique customer dynamic. Evaluate how well your products or services deliver on your brand promise and fulfill their want or need. This is the time to be honest; any gaps that you identify are important to close.
Developing your own customer profiles doesn’t have to be rocket science.

Here’s what I recommend if you are new to customer segmentation:

1. Assemble a master list of customers. Begin by assembling a master list of customers from the appropriate sources in your company. If possible, include transaction or revenue information by customer.
2. Sort your customers into logical groups. Sort your customers into discrete groups based on logical attributes for your business. To keep it manageable, seek to identify 3-5 major groups that represent the majority of your target customer base. For example, you may group by sex, age group, income level, ethnicity, and/or basic needs.
3. Give your segments a personality. For each discrete group, assign a name and short description that describes their typical perceptions and behaviors. This will give each segment a unique personality that will help you to focus specific product & service attributes and marketing messages.

By identifying key segments and assigning a more personal profile to each one, the segments begin to take on their own personality. For example, Segment A may consist of elderly women in the middle income bracket who have an average of 3.5 grandchildren. Not very personal is it? Now, let’s give this segment a personality. We’ll call her Elsie, and describe her as a conservative grandmother who is on a fixed budget but is willing to spend money on unique toys and gifts for her grandchildren.

Now you can begin to incorporate these personalities into your business. How well does your marketing material speak to Elsie? Are your products and services tailored to Elsie? What else can you do to improve Elsie’s customer experience? What is the best channel and medium to stay in contact with Elsie? Answering these questions for each discrete customer profile can be a powerful tool for identifying customer experience improvement opportunities.

Step 2: Identify Where It Hurts

In the software industry, a defect or problem in the software is called a ‘bug’. The quality of any software solution is often judged by the total number of ‘bugs’ encountered by the customer.

The same is true for customer experience quality. Customer experience is adversely affected when things don’t go as planned; when the process doesn’t work as planned, customers get frustrated, confused, or simply give up altogether.

The answer: Apply six sigma principles to your customer experience process.

What is a Six Sigma Customer Experience? Six Sigma is a measure of quality that represents near perfection. Statistically speaking, it means that your customer experience process encounters no more than 3.4 defects per million opportunities. Practically speaking, it means that your customer experience works (nearly) perfectly. Things just work, problems rarely happen, and your customers are very, very happy.

Let’s face it: All too often, we have bad customer experiences. With touch points scattered across channels, new or untrained employees, and geographic separation, too many things can go horribly wrong. It doesn’t have to be that way. The customer experience is a process, so treat it like one.

Great customer experiences don’t happen by accident. Make it intentional. Model it. Redesign it. Optimize it. Measure it. Minimize unexpected variations. Continually improve its quality. By taking a process-centric approach to customer experience, you can be in control of your customer experience process and eliminate the root cause of problems.

You can begin to identify your own customer experience issues and opportunities by clearly defining and analyzing the touch points and scenarios that make up your customer experience:

1. For each stage in the customer experience process, identify the distinct customer facing events or interactions that occur with your customers. Each descrete point of encounter is a touch point.
2. Describe each touch point in detail (who, what, how, where, when).
3. Identify the key stakeholders that may participate in each touch point.
4. Define the touch point characteristics including attributes such as quality, relevance, timeliness, performance, and convenience.
5. Analyze the touch point portfolio to evaluate quality, complexity, and performance. Do certain touch points meet their objective better than others? Which touch points contribute, or detract, from the customer experience?
6. Review or research the target customer group’s buying behaviors, criteria and touch point navigation preferences. Do different customer segments prefer to navigate your touch points differently? Think about the profiles that we developed in Step 1 of this lesson.
7. Define each distinct touch point path as a unique scenario. Does each scenario pose different challenges for your company?
8. Describe the scenario’s characteristics including attributes such as efficiency, convenience, timeliness, consistency, transitions, and simplicity. Are there points in the scenario that break down or are bottlenecks?

Discretely defining your customer touch points and customer scenarios will enable you to take an important step towards becoming more disciplined in customer experience management. Think about which touch points are causing problems; which ones can be eliminated to streamline the process; and which ones are duplicated across multiple locations. Consider which scenarios are preferred most by you customers; and which scenarios often result in lower customer satisfaction. By analyzing the various customer touch points and scenarios, you should begin to identify a laundry list of potential improvement opportunities.

Take what you’ve learned about your customer experience process and begin to think like an exterminator: eliminate the bugs.

Step 3: Listen to Your Customers

So far, what we’ve covered has been somewhat academic. We’ve covered the blocking and tackling aspects of customer experience management. But don’t underestimate the voice of your customer. Make sure that you reach out to your customers and listen to what they have to say. Ideally, getting customer feedback should be a habit, not just a one-time affair. Here a just a few of the proven methods for collecting customer feedback:

1. Focus Groups
2. Direct Mail Surveys
3. Web-Based Dialog (blogs, webinars, emails)
4. Interactive Surveys (in person interviews with the customer)
5. Customer observation
6. Telephone Surveys

What should you ask them? There are literally hundreds of resources available to help you design and conduct customer satisfaction surveys.
Here is a short list of some tried and true questions for your customers:

1. How did you hear about us? (Identify which attraction method worked)
2. How long have you been a customer? (Indicates customer longevity and loyalty)
3. What was the best thing about your customer experience? (Identify the good)
4. What was the worst thing about your customer experience? (Identify the bad)
5. Would you shop with us again? (Gauge ongoing loyalty)
6. Would you recommend us to other people? (Determine degree of advocacy)
7. Why did you choose us over the competition? (Identify your differentiation)
8. How well did the product/service meet your needs? (Determine product/service quality)
9. What one thing should we do differently? (Identify opportunities for improvement)
10. Do you get the value that you expected? (Determine if expectations were met or exceeded)

The feedback that you receive from your customers is invaluable. Incorporate what you learn from your customers into your customer experience into your list of improvement opportunities.

By now, you should have a list of improvement areas from a) your identification of customer profile gaps, b) your assessment of touch points and scenarios, and c) customer feedback.

That wraps up Lesson #3. To recap our lesson, the three steps that we covered included:

1. Give Your Customers Some Personality
2. Identify Where It Hurts
3. Listen To Your Customers

Stay tuned for Lesson #4, where we will help you to develop that all important customer experience business case.