In long run, there is only so much incremental value to be derived from mastering the status quo. And yet, most customer experience (CX) practitioners would consider it high praise indeed if their CX program was characterized as striving for continuous improvement. Ironically, a continuous improvement program can be the antithesis of a memorable customer experience.
A stream of incremental improvements rarely if ever, sums to the gains that arise from one courageous discontinuity – that is, one major shift to the experience, which should be guided by the organization’s consumer retention objectives.
In 1867 Walter Bagehot in his book ‘The English Constitution’ described business as ‘a sort of twilight; an atmosphere of probabilities and doubt’ where nevertheless, participants had to choose and adhere to a single course. At Forethought in the acquisition of new customers and the retention of existing customers, we talk about three core elements – tenacity, endurance, and brutal singularity.
How is the halo effect impacting your CX?
One of the great oddities of CX data is the double-sided presence of the halo effect. If you do outstandingly well at the main deliverable, those positive impressions infiltrate the customers’ view of other areas. At a practical level, organizations see rising scores in the area they have improved but also, customer ratings improve in areas where no improvements were implemented.
The three core elements of driving customer retention – tenacity, endurance, and brutal singularity
The opposite is also true. If there is a service failure in an important experience area, then a multitude of perceived service failures also occur. Applebee’s Neighborhood Grill + Bar restaurant chain is the largest in its category in the US. The probability that a customer issue will arise during the end-to-end service chain is 21.9%. The probability that this sensitized individual customer will then experience another issue is 52.2% and staggeringly, the probability that the now hyper-sensitive customer will go on to “experience” the third issue is 62.2%. This is a universal finding. Prior to considering this negative halo effect, an aviation client was perplexed to identify the link between late departures and an increase in complaints concerning the entertainment system.
Setting the stage for courageous action
However, making one big bet on driving significant CX improvement on just one element of the service bundle also brings career-limiting risks. That is the risk of placing a bet on a low-ranking driver of retention. How can executives build a compelling case for investment, and depend on this effort as delivering strong returns to the business?
Defection (a lag indicator of poor CX ratings) is largely driven by a service failure. Some chronic service failures become a challenging obstacle in the customer’s journey resulting in defection. The hierarchy of defection drivers (lead indicators of defection) is identified through multivariate analysis (often combining survey and organizational data). The primary drivers of defection are the candidates for brutal singularity in the form of one courageous discontinuity – and are key inputs to building the business case both for organizational improvement and continuing career progression.
A critical question to ask is: Is the proposed initiative core to improving the defection lead indicators and therefore reducing defection? If not, it is probably just an example of continuous improvement and should not be expected to change the prosperity of the organization.
Some chronic service failures become a challenging obstacle in the customer’s journey resulting in defection
How to prioritize CX improvements
The final element is with steely determination, cross-tabulate the customer journey with the drivers of defection and existing CX initiatives. Forethought recommends allocating the CX initiatives into three buckets – win, compete and concede. The following worksheet might be useful.
Building a memorable experience
Finally, all of this comes to nought if the experience is not memorable. Contemporary CX is moving to incorporate emotion into both CX design and measurement. One of the frequent laments of CX professionals is that the organization is often not given credit (in the form of higher scores) for removing pain points. This is thought to mainly reflect the experience not being sufficiently memorable. Forethought is presently working with organizations on how to lay down memories of positive experiences. An essential ingredient and indeed, a precursor to memory formation, is a disruption to be present in the moment plus emotion.
Emotion measurement cannot be stated therefore it must be implicitly measured. Emotion in CX measurement stems from Daniel Kahneman’s work where he separates our ‘remembering self’ from our ‘experiencing self’. Our experiencing self “has no voice” and so for us to make an experience memorable the experience design must incorporate an elicitation of emotion and attention.
But above all else, the bold discontinuity needs to be anchored in a driver of the business outcome you seek to influence – i.e. retention – the raison d’etre for most CX programs.
About Forethought:
Forethought is an advisory, strategy and analytics company driving business outcomes. Our focus is Brand, marketing communication, CEX and Offer Optimization. Taking the consumer’s perspective, Forethought is a global leader in quantifying the hierarchy of organization behaviors that drive customer response, both emotional and rational and subsequent action.
Ken Roberts is Executive Chairman and founder of Forethought.
Photo by Kelly Sikkema on Unsplash
The post Less is Best in CX – Rationing Centricity first appeared on GreenBook.
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