How to Measure Customer Experience 1 1
How To Measure Customer Experience In today s experience-driven world, it is well known that highachieving companies must deliver excellent customer experiences in order to remain competitive. But how do managers know where they stand, and where to go next? As Peter Drucker famously said, What gets measured gets managed, and it is for precisely this reason that customer experience innovation efforts must include the identification, measurement, and digestion of key metrics. After years of work in the customer experience realm, Motiv has developed the following framework for identifying metrics that you can use to quantifiably assess the current state of your customer experience, as well as to track the success of your improvement efforts. Foundational Metrics Before embarking on a customer experience improvement effort, your organization should first identify and begin tracking foundational metrics at each touchpoint along your customers journey. Overarching CX Metric Touchpoints 1 2 3 4 5 Foundational Metrics (O/F/P) Solution Metrics (O/F/P) Motiv Strategies Motiv s metrics framework structures your organization s measures across the customer journey. 2 2
These foundational metrics measure attributes of a touchpoint, and should reflect an organization s goals and priorities. Imagine a budget airline that has identified three touchpoints of interest in their in-terminal process: check-in, baggage drop, and boarding. Based on customer research and a vision derived from brand values, the customer experience innovation team has identified foundational metrics at each of these touchpoints:these metrics measure different aspects of each touchpoint important to the customer s experience, to the airline s vision and goals, or both. Examples of potential foundational metrics might include the percentage of registered users who engage your web service at least once a week, the number of customers who find your email communications very effective, or the amount of sales your company achieves through cold-calling. Solution Metrics As you develop and implement solutions to your customer experience shortcomings, you should consider ways to track the success of each. By measuring which initiatives are successful, you will better understand the causes for any changes in the foundational metrics, and will be able to end unsuccessful initiatives sooner rather than later. The methods you identify will become your solution metrics: specific measurements that can be used to understand whether the initiatives you are pursuing to improve the customer experience are having the desired impact. These metrics will complement your foundational metrics by giving you insight into the causes of change in foundational metrics: a rise in both a foundational metric and a related solution metric might indicate that an initiative is not only meeting standards of success, but also creating added value for your customers. 3 3
Let s revisit our budget airline example. Having conducted creative ideation sessions with a multidisciplinary team, the customer experience innovation team has identified initiatives to solve problems identified in customer research. Two of those are a premium boarding system and an automated bag check process. As you can see, the team developed metrics specific to each solution, tracking the success of each one independently. These metrics should reinforce the mission statement of each initiative, as well as the customer experience vision. Note that a particular solution s metrics are often restricted to one touchpoint, like the airline s premium boarding initiative, but can sometimes reach across the boundaries between touchpoint, like the automated bag check initiative, which specifically bridges the gap between check-in and baggage drop. Further categorizing these foundational and solution metrics as operational, financial, or perceptual allows you to understand the nature of your customer experience drivers throughout the process. 4 4
For example, customer engagement is often an effective operational metric and excitement is a perceptual metric, whereas sales and cost figures are financial metrics. Our airline example highlights metrics from each of these three categories, as shown above. Standardized Customer Loyalty Metric Lastly, an overarching customer loyalty metric allows your organization to take the pulse of the entire customer experience you deliver. By tracking a widely-accepted measurement such as CxPi or Net Promoter Score (NPS), you can gain a high-level overview of customers perspectives of the products and services you deliver to them. It is becoming clearer that the emergence of the experience economy is a reality, and a compelling customer experience will soon be table stakes in the marketplace, if it isn t already. By measuring the current state of your customer experience as well as the effectiveness of the improvement initiatives you implement, your organization will be able to compete in the ever-changing experience economy. Authors Jeneanne Rae President and CEO jeneanne@motivstrategies.com Ian Campbell Director ian@motivstrategies.com Nathan Ritter Consultant nathan@motivstrategies.com 5 5
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