By Steve Offsey
Exceptional customer experience has never been more important than it is today. Nevertheless, most CX teams continue to face daunting CX challenges. Even CX leaders are dealing with high customer expectations, intense competition, more rapid customer interactions across an ever-increasing number of digital and physical channels, and limitations imposed by legacy processes and technologies.
Pointillist recently surveyed over 700 CX, marketing, and analytics professionals worldwide to find out more about the challenges and priorities, metrics and KPIs, and strategies and tactics that separate top performing CX teams from the rest. The survey revealed that the top 5 CX challenges facing CX teams today are:
- Quantifying CX ROI
- Breaking down data silos
- Identifying & prioritizing CX problems and opportunities
- Generating actionable insights quickly
- Delivering personalization at scale
In this post, I’ll provide real-life examples of how leading CX teams are overcoming these challenges today using customer journey analytics.
What is Customer Journey Analytics?
Customer experience is now a make-or-break factor for business success. As companies put more emphasis on the customer, CX teams need to understand what their customers are doing and how it impacts their business. Today, your customers expect a consistent, high-quality experience, as they interact with your organization across an ever-growing set of touchpoints and channels. Today, leading companies are using customer journey analytics to meet customer and company needs, because traditional approaches just don’t work.
“[Customer Journey Analytics is] an analytics practice that combines both quantitative and qualitative data to analyze customer behaviors and motivations across touchpoints and over time in order to optimize customer interactions and predict future behavior”– Forrester
Every customer journey is unique—an individual series of interactions taken over time. Journey analytics is a data-driven approach that enables you to look across millions of unique customer journeys to discover what your customers are actually doing. It helps you to determine which journeys you need to improve to make a positive impact on the metrics you’re measured by.
Also, keep in mind that customer journey analytics is not a monolithic approach designed to address just a single problem. It consists of multiple techniques that you can use to solve a variety of CX challenges, ranging from understanding and communicating customer behavior to automating personalized interactions across touchpoints and channels.
CX Challenge #1: Quantifying the Impact and ROI of CX
Half of respondents to our survey indicated that they were not satisfied with their ability to quantify the impact of CX on hard metrics like revenue, churn and lifetime value. So, if you’re having this problem, you’re not alone.
The importance of calculating your customer experience ROI cannot be overstated—how will you build, measure and regularly optimize your customer experience efforts if you don’t know the return on your CX investments?
Customer experience leaders often face hurdles in budget approval because customer experience ROI isn’t forecasted or quantitatively expressed. All the time and effort spent in designing a modern, responsive customer experience program can go to waste if you are not able to articulate in numbers the value that it will bring to your organization.
In order to put CX initiatives on a level-footing with other business programs, it isn’t enough to simply provide the soft benefits. You need a quantitative assessment to make a strong business case and obtain approval for continued investment.
Solution: Customer Journey Analytics Directly Links CX to Tangible Business Outcomes & KPIs
Real-time customer behavior drives the quantitative metrics that you’re measured by, like revenue, customer lifetime value, churn, NPS, and others. Leading CX teams are using customer journey analytics to measure the ROI of their customer experience initiatives by quantifying the benefits of their CX investments.
ROI % = ([Benefits – Investments)/Investments] x 100
Measuring benefits or returns is the toughest part of the ROI calculation and the reason why most CX practitioners avoid ROI calculation. To calculate CX benefits first choose the business metrics most impacted by customer experience. Common benefits include increased revenue from new customers, as well as up-sells, cross-sells, reduced attrition/churn and cost to serve for existing customers.
In this example, you can see a customer success team that used customer journey analytics to analyze and reduce churn. Most companies focus on only the last one or two customer interactions before a customer is lost. This incorrectly assumes that they were reliable indicators of churn, but poor customer experiences accumulate over time.
As in personal relationships, trust and resentment in customer relationship builds up over the years. Customers can have experiences that make them feel neglected or indifferent long before they end their relationship with your business. The CX team realized that they needed to look at the complete customer journey to identify the root causes of churn. In the end, they discovered these were visible far earlier in the journey than anyone anticipated.
CX Challenge #2: Breaking Down Customer Data Silos
In our recent study, 40% of respondents said that breaking down organizational data silos is a major obstacle today. It ranked #2 out of the top 5 CX challenges.
Let’s face it, the traditional process of unifying data is way too slow and labor intensive. This often leads to insights that arrive too late to be useful.
This problem is typically the result of two widely prevalent issues:
- Data is typically stored in disparate, incompatible systems that are set up and maintained by different departments to meet each department’s own needs.
- The traditional process of integrating data requires a comprehensive schema and squeaky clean data, making it extremely labor and time intensive.
Solution: Use Customer Journey Analytics to Integrate Customer Data Across Touchpoints, Channels and Systems
Customer journey analytics solutions help you solve this challenge by unifying customer data in a matter of days or weeks, rather than months or years.
They match customer interactions across channels and over time to create a single view of your customers and their journeys. As a result, you can rapidly generate actionable insights to understand how to impact the KPIs that matter most to your business.
The example below shows how one CX team used Pointillist to rapidly analyze multi-channel customer service journeys. They looked at across mobile, call center and web-based support journeys to learn more about their relative effectiveness.
Agile Data Fusion™ is a unique approach developed by Pointillist. It enables you to start with just the data needed to solve the top problem on your list. The data is quickly integrated and mapped in a matter of weeks. Once you’ve solved your first problem, you can add additional data sources over time, as you need them. This decreases the amount of time required to get started and see value. Now, you no longer need to wait months to years for a data warehouse project to be completed.
CX Challenge #3: Identifying and Prioritizing CX Problems and Opportunities
Like most CX professionals, you’re likely dealing with multiple internal customers all trying to pull you in different directions. The result is an ever-growing list of problems that need to be addressed. All of which are competing with opportunities to improve CX.
So how do you know which opportunities to act on first and which are worth investing your time and resources in? If you choose the wrong ones, you’ll waste time and money, and your customers will be unhappy with the results.
Solution: Use Customer Journey Analytics to Quantify the Impact of CX Obstacles and Opportunities
Customer journey analytics can help you identify and quantify the impact of CX obstacles and opportunities. This will enable you to prioritize them using an objective, rather than subjective, approach.
Below is an example of how a leading Telecom provider measured the relative impact of their customer self-help channels on subscriber disconnects. Using journey analytics, they were able to analyze customer behavior prior to a call to the care center. They learned that online help forums contributed to both the largest number of disconnects and the greatest disconnect rate. They also drilled down and quantified exactly which forum boards were driving the most disconnects and the impact on revenue.
CX Challenge #4: Making CX Metrics Actionable
There has been a significant investment in both technology and services to improve customer experience. Yet a recent Forrester survey found that only a third of employees agree that their companies have CX metrics that provide actionable insights about their customers’ experiences.
Over the last five to 10 years, almost all companies have implemented a Voice of the Customer Program. These days, you can listen to a public company’s earnings call and hear the CEO talk to investors about their NPS score. Everyone’s measuring it. Then the analyst immediately asks the CEO, “what are you doing to improve it?” The CEO has no answer, so she comes back to your CX team and asks, “How do we make this better?”
The mere numbers won’t tell you the root causes for why these CX KPIs are improving or declining. They also won’t tell you what led to those outcomes or what you should do about it. In the end, most CX teams just don’t have a clear understanding about how to improve their CX KPIs.
Solution: Use Customer Journey Analytics to Understand What’s Driving Your CX Metrics
By using a journey-based approach to CX measurement, each customer’s score is directly linked to where and when it was captured in their unique journey. You can directly measure CX metrics like NPS, CSAT, CES, and FCR at specific points across millions of unique customer journeys to understand what drives a change in the scores. You can understand how actual customer behavior impacts your customer satisfaction and experience. As a result, you can pinpoint the drivers of customer satisfaction by identifying high impact journeys that influence your most (or least) satisfied customers.
This example shows how a leading telecommunications company measured the impact of a newly automated messaging solution on NPS. By using journey analytics, they showed a positive impact on NPS for customers that used the messaging system. They were excited to finally have a far more powerful way to justify an expanded investment than traditional statistical methods.
CX Challenge #5: Delivering Personalized Experiences at Scale
Only 26% of respondents to our survey said their organization is very or extremely effective at engaging customers with the right experiences at the right times through their preferred channels.
There are plenty of real-time interaction management and cross channel campaign management tools that companies use to personalize customer experiences.
But before you dive in and create a complex set of personalization rules, how do you know:
- What to personalize first?
- Who to personalize it for?
- When to personalize it?
- And how?
Solution: Use Customer Journey Analytics to Orchestrate Personalized Experiences at Scale
Customer journey analytics can help you overcome this and other CX challenges by orchestrating engagement with your customers at optimal points along their journey in real-time and through the most effective channels. As we discussed earlier, by using journey analytics, you can first figure out:
- What to personalize first by prioritizing those opportunities that have the greatest impact on your KPIs
- Who to personalize it for by evaluating the impact on various behavioral segments
- When to personalize it by analyzing and testing personalization within the context of real customer journeys, and
- How to personalize by analyzing and testing a wide variety of messages across all of your channels.
By using journey analytics, you can leverage behavioral data and behavioral segmentation to personalize individual or group experiences based on actual customer’s past interactions.
In the example below, an eCommerce retailer is using journey analytics to orchestrate a personalized experience via email and web. Similarly, leading banks have also started to personalize customer experience at scale. For example, when a new customer starts the process of opening a savings account online, but doesn’t complete it, this triggers a personalized follow-up email to schedule an appointment to finish the process at the nearest branch.
Core Customer Journey Analytics Capabilities
There are six core customer journey analytics capabilities that can help you overcome your top CX challenges. They enable you to:
- Unify customer data across all your touchpoints and systems
- Visualize your customer’s real world journeys
- Track real-time journey-based metrics and KPIs
- Segment your customers not only by demographic and firmographic attributes but also by their behavior
- Use artificial intelligence to rapidly test hypotheses, predict future behavior and discover what your customers are doing before, after and within their journeys
- Personalize the customer experience and deliver it on an individual level at scale
In this post, I’ve provided real-life solutions to the top 5 challenges provided by more than 700 CX pros. The table below summarizes everything we’ve discussed and provides a handy take away. Now it’s your turn to put these examples to use. Let me know how it goes in the comments below!
|Challenge||Customer Journey Analytics Solution|
|Quantifying CX ROI||Customer journey analytics directly links CX to tangible business outcomes & KPIs|
|Breaking down data silos||Use customer journey analytics to integrate customer data across touchpoints, channels & systems|
|Identifying & prioritizing obstacles and opportunities||Use customer journey analytics to quantify the impact of cx obstacles and opportunities|
|Generating actionable insights quickly||Use customer journey analytics to understand what’s driving your CX metrics|
|Delivering personalization at scale||Use customer journey analytics to orchestrate personalized experiences at scale|