By Gary DeAsi
Update: new research is available. Discover new findings in the 2020 State of Customer Journey Management and CX Measurement report.
It’s no surprise that customer experience is now a make-or-break factor for business success. But how do leading organizations manage their customers’ journeys, improve customer experience and measure its impact on their business?
To find out, Pointillist surveyed over 700 CX, marketing, and analytics professionals worldwide to uncover key trends, insights and benchmarks on:
- Top-of-mind challenges and priorities
- Effective strategies, tactics and approaches
- High priority metrics and KPIs
- Key characteristics, capabilities and practices that separate top performing teams from the rest of the pack
In this post, I’ll highlight some of the key survey findings in our 2019 State of Customer Journey Management and CX Measurement Report.
Customer Experience is a Top Priority for Organizations in 2019
Customer experience is universally recognized as a top priority by most organizations, regardless of industry or size. More than 87% of respondents say providing exceptional customer experience is very or extremely important to their business. Only 2% say it’s not so important.
1. High Adoption of a Journey-Based Approach to CX is Critical for Success
“To design and deliver a great customer experience you need to understand not only your customers’ expectations, the problems they’re trying to solve and the goals they’re trying to accomplish, but most importantly the steps they’ve taken to get there. Centering customer experience around the customer and their journey is the only way to retain customers, which is obviously good business.”Annette Franz
Founder and CEO
CX Journey Inc.
Customer Satisfaction, Retention and Lifetime Value Are Linked to a Journey-Based Approach
Nine out of ten respondents in our survey say their organizations have adopted a journey-based approach to CX. About 80% say a journey-based strategy is of high importance to the overall success of a company, and has particular relevance to customer satisfaction, customer retention, and customer lifetime value.
Only 3% of those who have not yet adopted a journey-based approach said it was due to not seeing the need or value of a journey-based approach.
90% of CX professionals agree that a customer journey-based approach has a positive impact on customer satisfaction, retention & lifetime value #customerexperience #customerjourneys Click To Tweet
2. High Performers Succeed With a Data-Driven, Journey-based Approach to CX
“An understanding of customer feedback doesn’t tell you all you need to know about your customers’ experiences. To get the full picture, you also need to understand actual customer behavior. Customer journey analytics is an approach to insights and measurement that examines customers’ behavior not just at individual touchpoints, but along the paths they take as they attempt to accomplish their goals and tasks.”Kerry Bodine
Bodine & Co.
Co-author of Outside In
Breakdown of CX Performance Levels
To identify key factors that separate top performing teams from their peers, we grouped respondents into three segments based upon overall satisfaction with their organization’s CX performance. Half of the respondents say their teams are average performers. The other half are split between high performers and underperformers.
High Performers Are More Likely to Effectively Integrate Data, Analyze Behavior and Engage Customers Across Channels
“The days are long gone when companies only focused on their products and services. The quality of products and services is still critical, but customer-centric designs that are thoughtfully carved out of a customer journey-based approach are driving overall business success today, as they are key for enabling companies to effectively empathize with and address customer needs, desires and goals.”Nimish Kasar
User Experience Lead
High-performing customer experience teams take a more data-driven approach, which differentiates them from average-performing and underperforming teams.
High-performers are more than 9 times more likely to integrate data from multiple sources, analyze customer interactions across channels, and engage with customers optimally through their preferred channels.
73% of high-performing CX organizations say their journey-based approach is mostly or completely data-driven, compared to only 24% of underperformers #customerexperience #customerjourneys Click To Tweet
High-performing CX organizations are more than 9X likely to integrate data from multiple sources, analyze customer interactions across channels & engage customers optimally across channels #customerexperience #customerjourneys Click To Tweet
High Performers are More Likely to Define Journey-based Metrics and Employ Customer Journey Analytics
High-performers are more likely to employ quantitative, data-driven methods. They include customer journey analytics, journey-based KPIs and milestones, journey testing and optimization and journey orchestration.
Top-Performing CX Teams Have Mature CX Measurement Programs
High-performing customer experience teams have significantly more mature customer experience measurement programs than average-performing or underperforming teams. They are also much more satisfied with their organization’s ability to generate customer insights rapidly, take action based on those insights, and quantify the impact of those actions on important business KPIs such as revenue, churn, or customer lifetime value.
Sixty-nine percent of high-performing CX organizations say their CX measurement program is very or extremely mature, compared to only 1% of underperformers.69% of high-performing CX organizations say their #CXmeasurement program is very or extremely mature, compared to only 1% of underperformers #customerexperience Click To Tweet
3. Organizations Struggle to Quantify the Business Impact of Customer Experience
“Experience-led brands understand that intentional experience design is about serving the organization and the customer. It is also about changing customer and employee behavior to drive financial impact. While experience metrics (like NPS® or CES) provide guidance for understanding the outcome of customer interactions with your brand, the financial outcomes quantify any changes in customer behavior that result. Analytics are the fuel to understand where and how you have an opportunity to change behavior through intentional design.”Diane Magers, CCXP
Customer Experience Professionals Association
Most Organizations Are Not Making the Link Between CX Initiatives and Business KPIs
Organizations are still struggling with CX measurement and quantifying the impact of customer experience on important business KPIs such as revenue, churn, and customer lifetime value. Their inability to quantify the impact of customer experience initiatives makes it far more difficult to obtain the budget and resources they need to improve customer experience.
While over 90% of respondents say their organizations have a CX measurement program, less than a quarter say it’s very or extremely mature, and more than a third (38%) say their CX measurement program is not so mature or not mature at all.
Over 40% of respondents also report they are unsatisfied with their organizations’ ability to generate actionable customer insights quickly, and to take action on insights to make a business impact, more than twice the number of those who are satisfied with their organization’s ability to do so.
50% of CX professionals say they are unsatisfied with their organization's ability to quantify the impact of #customerexperience on business KPIs like revenue, churn & lifetime value Click To Tweet
While most organizations are struggling with CX measurement and quantifying the impact of customer experience on business KPIs like revenue, churn and customer lifetime value, one of the key factors that separates top performing CX organizations from the rest of the pack is their ability to do just that. High performers are 29 times more likely than underperformers to be very or extremely satisfied with their organizations’ ability to quantify the impact of CX on business KPIs (47.6% Vs 1.6%.)
High performers are also much more satisfied with their organization’s ability to generate customer insights rapidly and take action on those insights to make a business impact.
CX Teams Still Rely Largely on VoC-based Metrics That Aren’t Linked to Business KPIs
“In a time when executives are scrutinizing the real value of customer experience investments, it is a necessity for CX teams to focus on business value and employ an analytical approach. This enables you to build business cases that are tied back to the organization’s tangible KPIs to gain buy-in and obtain the budget and resources required to make a positive impact.”Dylan Quah
CX PMO, Customer Journey Design/Channel Experience
VoC-based metrics such as NPS® and CSAT are used by most CX professionals for CX measurement. NPS is the number one most-employed metric (59%), followed by CSAT (54%). The use of business-focused KPIs, such as revenue and return on investment (ROI), as a way to measure customer experience is far lower in comparison. For example, only 26% say they use revenue as a yardstick to measure customer experience success.
While survey-based metrics such as NPS and CSAT are certainly valuable for gauging customer satisfaction levels, most customer experience teams are unhappy with their ability to link these metrics to business KPIs such as revenue, customer lifetime value and churn.
CX Teams Struggle to Quantify the ROI of CX Initiatives and Take Action Based on the Insights They Uncover
Most CX teams are unable to quantify customer experience ROI, which was identified as the top overall CX challenge. As a result, most are unable to justify the increase in budget and resources they require to execute their CX initiatives, and many are also struggling to identify and prioritize high impact opportunities to improve customer experience, which is the third top overall CX challenge.
The top challenges to resolve customer problems, as identified in our survey, are:
- Lack of budget or resources to take action (40%)
- Executing/implementing effective solutions (37%)
- Lack of data to quantify the impact of CX initiatives (32%)
4. Integration of Cross-Channel Customer Data is a Top Challenge
“In order to measure and optimize omni-channel customer journeys, CX leaders need to invest to bring all customer information together and create a single source of truth. Fragmented customer data are a hindrance to CX and customer-facing employees, who will be blindsided by a lack of information about their customer’s true experience over the course of their journeys.”Sandra De Zoysa
Group Chief Customer Officer
Dialog Axiata PLC
Less Than a Quarter of Respondents Believe They Are Effective at Integrating Customer Data
Most organizations are still struggling with data silos, and integrating cross-channel customer data remains a big obstacle in analyzing customer journeys and measuring customer experience effectively.
Even as the number of channels through which customers interact with companies continues to grow exponentially, most organizations still lack a single, unified view of the customer. This was identified by our survey respondents as the number one customer experience measurement challenge (45%). Not surprisingly, this problem is even more challenging for large enterprises (52%) than medium or small businesses.
Less than a quarter (22%) of respondents say that they are very or extremely effective at integrating data across all tools and sources, while almost twice as many (41%) said they are not very or not at all effective at integrating cross-channel customer data.
Most Organizations Use Less than a Third of the Most Common Data Sources for Analyzing Cross-Channel Customer Journeys
The most significant consequence of the lack of customer data integration is that it results in cross-channel customer journey analyses based largely on incomplete information.
Organizations on average are only using less than a third of the twelve most common customer data sources to analyze customer interactions across channels and touchpoints. Less than half of organizations are leveraging data from 11-out-of-the-12 top sources.
Data Integration Challenges Lead to Incomplete Customer Journeys and Sub-Optimal Customer Engagement
Due to an incomplete view of their customers’ journeys, organizations are struggling to effectively analyze customer interactions across channels and engage customers with the best experience.
Only 1-in-4 (26%) respondents are very or extremely effective at analyzing multiple customer interactions across channels and over time, while 38.2% say they are either not very or not at all effective.
Only 1-in-3 (33%) of those taking a journey-based approach analyze connected customer interactions across two or more channels over time, while 46% still analyze and optimize each customer touchpoint independently. However, high performing CX teams are two times more likely than underperformers to analyze connected customer interactions across two or more channels. (45% vs 22%)
Only 1-4 (26%) are very or extremely effective at engaging the right customers with the right experiences over time through their preferred channels, while 31% are not so effective or not effective at all.
52% of enterprise organizations agree that lacking a unified view of the customer and their journeys is a top challenge for effectively measuring #customerexperience #customerjourneys Click To Tweet
5. Current Technologies are Insufficient for Quantifying and Improving Customer Experience
Organizations report spending millions on technologies for customer data, analytics & engagement, yet many say they lack the right technology to succeed, and are unhappy with their organizations’ ability to perform many of the very same tasks these technologies are meant to solve.
Despite that fact that medium and enterprise organizations report to be using an average of 4.5 different customer data, analytics, and engagement technologies:
- 30% say they lack the right tools or technology. This is also one of the top three challenges for effectively measuring customer experience
- 32% consider limitations of legacy tools or technology to be one of their top three overall CX challenges today
Less than 25% are satisfied with their ability to:
- Integrate data across tools and sources to create a single unified view
- Rapidly generate customer insights
- Engage customers with the right experiences at the right times through their preferred channels
- Quantify the impact of CX
In conclusion, our study of more than 700 CX, marketing and analytics professionals revealed the following key insights:
- High adoption of a journey-based approach to CX is critical for success
- High performers succeed with a data-driven, journey-based approach to CX
- Organizations struggle to quantify the business impact of customer experience
- Integration of cross-channel customer data is a top challenge
- Current tools and technologies are insufficient for CX measurement and improving customer experience