For: Customer Experience Professionals The Customer Experience Index, 2014 by Megan Burns, January 21, 2014 Key Takeaways Laggards Made Big Leaps In CX Quality Twenty brands improved their scores in our Customer Experience Index by 10 points or more this year. Most big leaps came in industries that perform poorly overall -- health insurance, TV service, ISPs, and wireless service. Leaders Held On But Face Stiffer Competition Brands that have traditionally dominated our CXi -- like USAA, Southwest Airlines, and Courtyard by Marriott -- stayed at the top. Most even gained ground, though not as much as the laggards did. Some laggards, like Delta Airlines, closed the gap on industry leaders and are poised to wage a fierce battle for CX dominance in the months to come. Discipline And Hard Work Drove Improvements While macro factors like the economy and the weather likely contributed to this year s gains, many brands shot up because they ve been feverishly working to repair bad experiences. We saw enhanced products and services, personas that help employees understand customers, and technology that makes it easier for customers to accomplish their goals. Forrester Research, Inc., 60 Acorn Park Drive, Cambridge, MA 02140 USA Tel: +1 617.613.6000 Fax: +1 617.613.5000 www.forrester.com
January 21, 2014 The Customer Experience Index, 2014 Benchmarks: The Customer Experience Maturity Playbook by Megan Burns with Harley Manning, Carla O Connor, and Colin Campbell Why Read This Report How good is the customer experience at your company as rated by your own customers? This report helps answer that question by providing benchmarks of the quality of customer experience for 175 large US brands across 14 industries including retailers, hotels, banks, credit card providers, insurance firms, airlines, wireless service providers, and investment firms. We show the highest- and lowest-scoring companies and industries as well as the ones that moved up or down since our 2013 study. Customer experience professionals should use this report to understand their competitive environment and set goals for optimizing their customer experience management practices as they proceed along the path to customer experience maturity. Table Of Contents 2 3 22 23 24 Forrester s Customer Experience Index, 2014 This Year, The Laggards Stepped Up In Contrast, There Was Little Change Among Industry Leaders Customer Experience Discipline Drives Results recommendations Want Higher Scores For Your Firm? Move Up The Path To CX Maturity Supplemental Material Notes & Resources As part of an online survey in Q4 2013, Forrester asked 7,538 US consumers about their interactions with airlines, banks, consumer electronics manufacturers, credit card providers, health insurance plans, hotels, insurance providers, Internet service providers, investment firms, parcel shipping firms, rental car providers, retailers, TV service providers, and wireless service providers. Related Research Documents The Path To Customer Experience Maturity June 27, 2013 The Customer Experience Index, 2013 January 15, 2013 Executive Q&A: Forrester s Customer Experience Index January 4, 2013 2014, Forrester Research, Inc. All rights reserved. Unauthorized reproduction is strictly prohibited. Information is based on best available resources. Opinions reflect judgment at the time and are subject to change. Forrester, Technographics, Forrester Wave, RoleView, TechRadar, and Total Economic Impact are trademarks of Forrester Research, Inc. All other trademarks are the property of their respective companies. To purchase reprints of this document, please email clientsupport@forrester.com. For additional information, go to www.forrester.com.
The Customer Experience Index, 2014 2 forrester s customer experience index, 2014 Improving customer experience can increase annual revenue by more than $1 billion for large wireless service providers, airlines, and hotels and by tens of millions to hundreds of millions of dollars for firms in other industries. 1 Forrester s seventh annual Customer Experience Index (CXi) measures whether or not customer experience actually is improving at major US firms. To create the CXi, we: Asked consumers to identify companies they do business with. Consumers selected the companies they work with most in 14 different industries. In all, we collected data on 248 North American organizations but limited our rankings to the brands for which we had at least 100 responses. Posed three questions about each brand. Customers want a company to meet their needs, be easy to do business with, and be enjoyable to do business with the three levels of the customer experience (CX) pyramid. We asked consumers how each brand they selected measured up on these dimensions (see Figure 1). Calculated CXi scores for 175 brands. To calculate each brand s CXi score, we subtracted the percentage of its customers who reported a bad experience from the percentage who reported a good experience for all three questions. 2 The overall CXi is the average of those three results (see Figure 2). Figure 1 Three Questions Drive The Customer Experience Index Forrester s Customer Experience Index Thinking of your interactions with these firms over the past 90 days... Enjoyable How enjoyable were they to do business with? Easy How easy were they to do business with? Meets needs How effective were they at meeting your needs?
The Customer Experience Index, 2014 3 Figure 2 How We Calculate Customer Experience Index Scores Example: Acme Chose 4 or 5 Chose 1 or 2 Net score Enjoyability criteria (on a scale of 1 [not at all enjoyable] to 5 [very enjoyable]) Easy to do business with criteria (on a scale of 1 [very difficult] to 5 [very easy]) Meets needs criteria (on a scale of 1 [didn t meet any of my needs] to 5 [met all of my needs]) 75% - 1% = 74% 81% - 1% = 80% 82% - 4% = 78% Average CXi score: 77 Note: Component scores for meets needs, easy to do business with, and enjoyability as well as data about the respondent population are available to Forrester Technographics subscribers. this year, the laggards stepped up After calculating the CXi score for each brand, we analyzed the results. We found a pattern of strong upward movement by companies and even entire industries with histories of notably low scores. 3 The overall number of poor and very poor brands declined dramatically. As in past reports, we grouped brands into five categories based on their scores: excellent (85 and higher), good (75 to 84), OK (65 to 74), poor (55 to 64), and very poor (less than 55).This year, the two bottom categories shrank to their lowest levels ever (see Figure 3). Only 10% of brands in 2014 received scores in the poor category, compared with 17% in 2013. The drop was even more dramatic in the very poor category: In 2013, 12 brands landed in this group, but only one brand did in 2014. The lowest scoring industries saw the biggest rise in their averages. Every year, we calculate an industrywide average for each industry in our study. Almost half of the industries we looked at improved their averages by five points or more this year (see Figure 4). Some of the biggest jumps came in the four lowest scoring industries in 2013: health insurance plans, TV service providers, Internet service providers, and wireless service providers. 4 Health insurers had the biggest increase (eight points), thanks in part to four standout brands. Both the TV service provider and Internet service provider industries jumped seven points. Why? Most brands in these two industries posted big improvements instead of just a few that broke away from the pack.
The Customer Experience Index, 2014 4 Some of last year s lowest-rated brands showed jaw-dropping increases. This year, 20 individual brands in our study gained 10 points or more, most from our laggard industries (see Figure 5). Health insurance provider Blue Cross Blue Shield of Michigan (BCBSM) earned the biggest improvement: 22 points. Charter Communications was one of a handful of brands to see big improvement in two different industries, gaining 21 points as an Internet service provider and 16 points as a TV service provider. Formerly low-scoring brands in banking and airlines also took big leaps forward. For example, Fifth Third Bank regained 17 of the 24 points it lost in last year s dramatic plunge, while Delta Air Lines, US Airways, and United Airlines all shot up 13 points. Only five brands posted double-digit declines. The number of big losers in this year s study was comparatively small, dwarfed by the number of brands with big gains. What s more, the biggest decrease by Wyndham Hotels & Resorts was just 12 points, which was 10 points less than the size of the biggest increase. Figure 3 Distribution Of Customer Experience Index Scores, 2007 To 2014 CXi score distribution 42% 37% 10% 11% 1% (0 to 54) (55 to 64) (65 to 74) (75 to 84) (85+) 50% 40% 30% 20% 10% 0% 2007 2014 Base: 175 large North American brands scored in Forrester s Customer Experience Index, 2014; 154 large North American brands scored in Forrester s Customer Experience Index, 2013; 160 large North American brands scored in Forrester s Customer Experience Index, 2012; 153 large North American brands scored in Forrester s Customer Experience Index, 2011; 133 large North American brands scored in Forrester s Customer Experience Index, 2010; 113 large North American brands scored in Forrester s Customer Experience Index, 2008; and 112 large North American brands scored in Forrester s Customer Experience Index, 2007 (percentages may not total 100 because of rounding) Source: North American Technographics Customer Experience Online Survey, Q3 2007, Q4 2008, Q4 2009, Q4 2010, Q4 2011, Q4 2012, Q4 2013 (US)
The Customer Experience Index, 2014 5 Figure 4 Range Of Company CXi Results Within 14 Industries Average industry score Retailers 83 Hotels 80 Parcel shipping/delivery providers 80 Consumer electronics manufacturers 79 Banks 75 Insurance providers 74 Investment firms 73 Airlines 73 Credit card providers 72 Wireless service providers 71 Rental cars 69 TV service providers 65 Internet service providers 64 Health insurance providers 64 = Industry average = Individual company score
The Customer Experience Index, 2014 6 Figure 5 Brands With Large Changes In CXi Score Between 2013 And 2014 Brands with CXi increases of 10 or more points Change Blue Cross Blue Shield of Michigan 75 Charter Communications (ISP) 66 Blue Cross Blue Shield of Illinois 74 Fifth Third 70 HSBC 69 Charter Communications (TV) 61 Capital One 360 (formerly ING Direct) 77 T-Mobile 70 Cablevision/Interactive Optimum (io) 68 Delta Air Lines 79 US Airways 71 United Airlines 67 AT&T U-Verse (TV) 69 Citibank (bank) 74 Comcast (ISP) 61 Dish Network/EchoStar 74 Macy s 87 Verizon (DSL) 70 Kaiser 76 United Healthcare 67 22 21 20 17 16 16 15 15 14 13 13 13 12 12 12 11 11 11 10 10 = 2013 CXi score = 2014 CXi score
The Customer Experience Index, 2014 7 Figure 5 Brands With Large Changes In CXi Score Between 2013 And 2014 (Cont.) Brands with CXi decreases of 10 or more points Change Wyndham Hotels & Resorts 68 BB&T 61 Century Link 49 Marshall s 78 Hertz 66-12 -11-11 -11-10 = 2013 CXi score = 2014 CXi score In Contrast, There Was Little Change Among Industry Leaders Despite their very substantial gains, our most-improved laggards did not displace the top-rated brands from last year. In general, the 2013 leaders retained their positions at the tops of their respective industries, holding on with either flat year-over-year scores or modest improvements. Most industry leaders fended off challengers. There was little change among the top-rated companies in each industry (see Figure 6). For example, Southwest Airlines once again came in as the top airline, even though its score remained flat in an industry that had several large gainers. Courtyard by Marriott once again took the top spot among hotels, gaining two points in the process. USAA remained tops among banks (up one point), credit card providers (up five points), and insurance providers (up four points). Kaiser Permanente returned as the top health insurance provider, racking up a 10-point increase to stay ahead of the other health plans that stepped up their CX game. A few new leaders did manage to emerge. Amazon.com debuted as a consumer electronics manufacturer (for the Kindle) in this year s CXi with a score of 91, making it both the top brand in that industry and the top brand across all industries in our study. America Online which didn t appear in last year s study either came in tops among Internet service providers (ISPs) with a score of 79, edging out last year s leader Verizon FiOS. Other new industry leaders included Ameriprise Financial (investment firms) and Old Navy (retailers).
The Customer Experience Index, 2014 8 Figure 6 Forrester s 2014 Customer Experience Index Rankings By Industry 2014 Customer Experience Index scores airlines Southwest Airlines 81 Delta Air Lines 79 JetBlue Airways 77 Alaska Airlines 74 US Airways 71 American Airlines 71 United Airlines 67 = 2013 CXi score = 2014 CXi score = Same 2013 and 2014 CXi score Note: The underlying data behind each score and the data about the respondent population are available to Forrester Technographics subscribers.
The Customer Experience Index, 2014 9 Figure 6 Forrester s 2014 Customer Experience Index Rankings By Industry (Cont.) 2014 Customer Experience Index scores banks USAA 86 Other credit union 85 Other regional or community/ local bank 82 Navy Federal Credit Union 82 Ally Bank 78 TD Bank 78 Capital One 360 (formerly ING Direct) 77 SunTrust Bank 76 Chase 74 PNC 74 Citibank 74 US Bank 72 Wells Fargo 71 Regions Bank 71 Fifth Third 70 HSBC 69 Bank of America 66 BB&T 61 Note: The underlying data behind each score and the data about the respondent population are available to Forrester Technographics subscribers.
The Customer Experience Index, 2014 10 Figure 6 Forrester s 2014 Customer Experience Index Rankings By Industry (Cont.) 2014 Customer Experience Index scores consumer electronics manufacturers Amazon (Kindle) 91 Sony 83 Microsoft (e.g., Xbox, Kinect, Windows Phone) 82 Samsung 82 HP 81 Apple 81 Nintendo (Wii, DS) 80 Panasonic 78 Vizio 78 LG 78 Dell 76 HTC 75 Toshiba 75 Gateway 73 Acer 72 BlackBerry 71 Motorola 69 = 2013 CXi score = 2014 CXi score Note: The underlying data behind each score and the data about the respondent population are available to Forrester Technographics subscribers.
The Customer Experience Index, 2014 11 Figure 6 Forrester s 2014 Customer Experience Index Rankings By Industry (Cont.) 2014 Customer Experience Index scores credit card providers USAA 87 American Express 79 Barclaycard 78 Discover 76 Citi (e.g., Citibank) 75 Chase 73 PNC 71 Bank of America 68 Capital One 68 Wells Fargo 68 US Bank 64 GE Capital Retail Bank 63 = 2013 CXi score = 2014 CXi score Note: The underlying data behind each score and the data about the respondent population are available to Forrester Technographics subscribers.
The Customer Experience Index, 2014 12 Figure 6 Forrester s 2014 Customer Experience Index Rankings By Industry (Cont.) 2014 Customer Experience Index scores health insurance providers Kaiser 76 Blue Cross Blue Shield of Michigan 75 Blue Cross Blue Shield of Illinois 74 United Healthcare 67 Humana 67 Blue Cross Blue Shield of Texas 62 Other Blue Cross Blue Shield (not Anthem, CareFirst, Empire, 62 Illinois, Michigan, or Texas) Aetna 60 Cigna 59 Anthem Blue Cross Blue Shield 58 Medicaid 57 = 2013 CXi score = 2014 CXi score Note: The underlying data behind each score and the data about the respondent population are available to Forrester Technographics subscribers.
The Customer Experience Index, 2014 13 Figure 6 Forrester s 2014 Customer Experience Index Rankings By Industry (Cont.) 2014 Customer Experience Index scores hotels Courtyard by Marriott 90 Marriott Hotels & Resorts 87 Hilton Hotels 84 Hyatt Hotels & Resorts 83 Hampton Inn/Suites 82 La Quinta Inn & Suites 82 Holiday Inn Express 81 Embassy Suites 79 Best Western 79 Holiday Inn 78 Hilton Garden Inns 77 Comfort Inn 74 Days Inn 74 Wyndham Hotels & Resorts 68 = 2013 CXi score = 2014 CXi score Note: The underlying data behind each score and the data about the respondent population are available to Forrester Technographics subscribers.
The Customer Experience Index, 2014 14 Figure 6 Forrester s 2014 Customer Experience Index Rankings By Industry (Cont.) 2014 Customer Experience Index scores insurance providers USAA 87 State Farm 78 Geico 76 AAA 75 Nationwide 75 Liberty Mutual 74 Other independent insurance agent 73 New York Life 72 American Family 72 Allstate 72 Progressive 71 MetLife 70 The Hartford 67 Farmers Insurance 67 Travelers 62 = 2013 CXi score = 2014 CXi score = Same 2013 and 2014 CXi score Note: The underlying data behind each score and the data about the respondent population are available to Forrester Technographics subscribers.
The Customer Experience Index, 2014 15 Figure 6 Forrester s 2014 Customer Experience Index Rankings By Industry (Cont.) 2014 Customer Experience Index scores Internet service providers AOL (America Online) 79 Verizon FiOS 76 Cox Communications 73 Verizon (DSL) 70 Bright House Networks 67 Charter 66 AT&T U-Verse 66 Cablevision 66 Comcast 61 Time Warner Cable 60 Century Link 49 = 2013 CXi score = 2014 CXi score Note: The underlying data behind each score and the data about the respondent population are available to Forrester Technographics subscribers.
The Customer Experience Index, 2014 16 Figure 6 Forrester s 2014 Customer Experience Index Rankings By Industry (Cont.) 2014 Customer Experience Index scores investment firms Ameriprise Financial 84 Edward Jones 83 TD Ameritrade 80 Fidelity Investments 79 Vanguard 79 Charles Schwab 78 Other full-service brokerage (includes dedicated advisor) 73 Merrill Lynch 72 Morgan Stanley Wealth Management 71 E-Trade 68 Other credit union 68 Wells Fargo Advisors 66 = 2013 CXi score = 2014 CXi score = Same 2013 and 2014 CXi score Note: The underlying data behind each score and the data about the respondent population are available to Forrester Technographics subscribers.
The Customer Experience Index, 2014 17 Figure 6 Forrester s 2014 Customer Experience Index Rankings By Industry (Cont.) 2014 Customer Experience Index scores package delivery services UPS 82 FedEx (Federal Express) 79 United States Postal Service (does not include mailing letters) 77 = 2013 CXi score = 2014 CXi score Note: The underlying data behind each score and the data about the respondent population are available to Forrester Technographics subscribers.
The Customer Experience Index, 2014 18 Figure 6 Forrester s 2014 Customer Experience Index Rankings By Industry (Cont.) 2014 Customer Experience Index scores rental car providers National Car Rental 74 Dollar Rental Car 71 Budget Rent A Car 71 Avis Rent A Car 71 Enterprise Rent-A-Car 71 Hertz 66 Alamo Rent A Car 65 = 2013 CXi score = 2014 CXi score Note: The underlying data behind each score and the data about the respondent population are available to Forrester Technographics subscribers.
The Customer Experience Index, 2014 19 Figure 6 Forrester s 2014 Customer Experience Index Rankings By Industry (Cont.) = 2013 CXi score = 2014 CXi score = Same 2013 and 2014 CXi score Note: The underlying data behind each score and the data about the respondent population are available to Forrester Technographics subscribers. 2014 Customer Experience Index scores retailers Old Navy 90 Kohl s 89 Amazon 88 Costco 87 Macy s 87 JCPenney 86 Sam s Club 86 Target 86 TJ Maxx 86 Lowe s 85 CVS 85 Home Depot 85 Walgreens 84 BJ s Wholesale Club 82 Barnes & Noble 82 Rite Aid 82 ebay 81 Office Depot 80 Toys R Us 79 Best Buy 79 Wal-Mart 79 Marshall s 78 Staples 77 OfficeMax 77 Kmart 77 Sears 75 RadioShack 65
The Customer Experience Index, 2014 20 Figure 6 Forrester s 2014 Customer Experience Index Rankings By Industry (Cont.) 2014 Customer Experience Index scores TV service providers Dish Network/EchoStar 74 Verizon FiOS 71 DirecTV 69 AT&T U-Verse 69 Bright House Networks 69 Cablevision/Interactive Optimum (io) 68 Cox Communications 67 Other cable TV provider 63 Charter Communications 61 Comcast 59 Time Warner Cable 56 = 2013 CXi score = 2014 CXi score = Same 2013 and 2014 CXi score Note: The underlying data behind each score and the data about the respondent population are available to Forrester Technographics subscribers.
The Customer Experience Index, 2014 21 Figure 6 Forrester s 2014 Customer Experience Index Rankings By Industry (Cont.) 2014 Customer Experience Index scores wireless service providers Verizon Wireless 74 Boost Mobile 74 AT&T Wireless 72 TracFone 72 T-Mobile 70 Cricket (Leap Wireless) 70 Straight Talk 69 MetroPCS 68 Sprint 66 Virgin Mobile 62 = 2013 CXi score = 2014 CXi score = Same 2013 and 2014 CXi score Note: The underlying data behind each score and the data about the respondent population are available to Forrester Technographics subscribers.
The Customer Experience Index, 2014 22 Customer Experience Discipline drives results What s behind the bump in customer experience quality scores this year? Although several macro factors probably contributed to the overall rise, they can t explain most of the increases. 5 Furthermore, we know that deliberate efforts to repair broken experiences helped drive scores up for several brands. Blue Cross Blue Shield of Michigan refocused its employees and co-created with members. In 2011, the health insurer established a dedicated CX team. The team launched a program called E4 to educate, equip, and empower employees with the tools and information they need to deliver great member experiences. As part of E4, the firm captured members wants, needs, and emotions in three personas and then brought those personas to life for employees through an interactive persona room. 6 The CX team also introduced BCBSM to the power of co-creation. Instead of redesigning its explanation of benefits (EOB) in a vacuum, the firm asked health plan members what their ideal EOB would look like. In a 2-hour workshop, customers cut up and then reassembled sections of content from several different EOB formats, showing the insurer exactly what information they wanted to see and the order in which they wanted to see it. 7 Charter Communications reduced customer frustration and enhanced its services. Charter Communications is the fourth largest cable company in the US. Since 2012, the firm s senior vice president of customer experience and his team have worked to systematically find and fix sources of customer frustration. As a result, executives report a 15% decrease in the number of times a Charter Communications tech had to go to a customer s house to fix a problem. 8 A series of service enhancements also helped bolster Charter s scores: Major network upgrades now deliver higher Internet speeds and a more competitive TV offering. The average number of high-definition (HD) channels its TV subscribers receive went up by 25% since the end of 2011, doubling the HD lineup in a few markets last year. 9 And with a new ipad app, Charter subscribers can finally do what other firms customers have been able to do for a while access programming via mobile devices. T-Mobile served unmet customer needs with differentiated offerings. T-Mobile leapt out of last place in the wireless industry in 2014 with a 15-point increase in its score. A series of headline-making changes to its pricing and packaging policies fueled this jump. For example, in mid-july 2013, the firm broke with industry norms by decoupling device and service costs, allowing customers to upgrade their phones as often as twice a year. And in early October 2013, the carrier announced that it would no longer charge international roaming rates in more than 100 countries, which is a move that it features in its latest advertising campaign. Delta Air Lines added enjoyment to flights and ease in dealing with cancellations. Recent upgrades to its experience fueled Delta Air Lines 13-point CXi improvement. 10 For example, on its coast-to-coast US flights, Delta Air Lines added creature comforts like Starbucks coffee, a wider selection of buy-on-board food options, and enhanced in-flight entertainment. Buying in-flight service offerings got easier too: New handheld devices let flight attendants email receipts
The Customer Experience Index, 2014 23 to customers for onboard purchases and take payment for seat upgrades if travelers want to snag extra legroom after boarding. What s more, Delta Air Lines impressive new mobile app which proactively delivers flight cancellation notices to customers along with the ability to rebook the next available flight in just a few taps also seems to have helped. Travelers with a smartphone gave Delta Air Lines higher marks for ease of doing business than those who don t use a smartphone did. 11 recommendations want higher scores for your firm? move up the path to CX maturity The only way to get and keep high marks from customers is to treat customer experience as a business discipline. As more companies build their CX capabilities, customer experience professionals in all firms need to help their organizations compete effectively in this arena. Here s what we recommend: 1. If your firm is new to CX, implement a repair process. In the first phase of customer experience maturity, firms use a classic closed-loop process to listen to customer feedback, identify and prioritize customer pain points, and coordinate projects to fix what s broken. CX professionals need to jump-start this process if it doesn t exist today. Some might only have to shift the focus of existing market research to CX issues. Others may need to start their firm s first customer listening program, combining traditional data insights with tools like customer journey maps and customer experience ecosystem maps to help diagnose the root causes of customer frustration. 12 Firms without data can jump-start their repair process using this CXi benchmark. Determine your biggest issue unmet customer needs, ease of doing business, or enjoyability and start there. 13 2. If your company s stuck in the repair phase, shift your focus to problem prevention. The repair phase helps people understand how CX problems happen. More often than not it s because employees and partner don t realize the impact that their actions or decisions have on customers (especially when combined with the actions and decisions everyone else is making). 14 Capitalize on this aha moment to add impact to customer experience as a criterion in key business processes. This simple change forces organizations to stop and think about the effect they ll have on customers before moving forward with a new project or moving on to the next stage of an existing one. If people resist the idea, use data from the repair phase to remind them just what happens when you don t think about CX upfront and how much pain they can save customers by creating a healthy customer experience ecosystem. 3. If your firm already has a disciplined approach to CX, pick up the pace. As we saw this year, many laggards are getting better at the basics, pushing the competitive bar higher and closing in on current leaders. CX professionals at today s leading firms must arm employees with sophisticated CX tools like observational studies, experience co-creation,
The Customer Experience Index, 2014 24 detailed driver analysis, and predictive behavioral models. Observational studies help employees detect changing customer needs before anyone else does and sometimes allow employees to completely reframe these needs to address a problem that no one else has solved. Co-creation brings the creative power of the entire CX ecosystem to bear on the design process, creating experiences that are better than those that one group alone designed. And using driver analyses and predictive models, leaders can choose the best of the best ideas to maximize the organization s long-term success. 15 Supplemental Material Methodology Forrester conducted the North American Technographics Customer Experience Online Survey, Q4 2013, fielded in October 2013 of 7,538 US individuals ages 18 to 88. For results based on a randomly chosen sample of this size (N = 7,538), there is 95% confidence that the results have a statistical precision of plus or minus 1.13% of what they would be if the entire population of US online individuals ages 18 and older had been surveyed. Forrester weighted the data by age, gender, income, broadband adoption, and region to demographically represent the adult US online population. The survey sample size, when weighted, was 7,522. (Note: Weighted sample sizes can be different from the actual number of respondents to account for individuals generally underrepresented in online panels.) Please note that this was an online survey. Respondents who participate in online surveys have in general more experience with the Internet and feel more comfortable transacting online. To help brands get a sense of which customers participated in the CXi and which factors might have affected their scores, we include a variety of different questions in the survey in addition to the three primary questions described above. The full survey instrument is available to clients who subscribe to Forrester Consumer Technographics, but here s a sampling of what s available. Standard demographic questions. Assuming that we have an adequate sample size, the survey allows us to cut the data by criteria like respondents age, gender, income, state of residence, and marital status. Forrester s Consumer Technographics segmentation questions. Because this survey is part of Forrester s Consumer Technographics product, we include questions about how often respondents go online, where, what kind of online access they use, and their attitudes toward technology along a variety of dimensions. Industry-specific variables. In 2012, we added several questions that allow us to cut the data by variables of interest to brands in the travel, healthcare, financial services, and telecom industries. Those include identifying business versus leisure travelers, respondents level of investible assets, those who have health insurance through an employer versus those who buy it directly, those
The Customer Experience Index, 2014 25 with chronic health conditions, those who buy telecom services in a bundle from one supplier, and those who have a local property and casualty insurance agent versus those who buy directly from the insurer. Those questions are once again available for use as segmentation criteria for the 2014 data. For Technographics Clients: How To Get More Technographics Data Insights You can find more information about the data on the survey page online. From this page, you will be able to download the survey instrument. For data subscribers, please contact your data engagement director or manager with any questions regarding the use of Forrester s North American Technographics Customer Experience Online Survey, Q4 2013, or custom data analyses. If you do not have a direct point of contact, please pose all inquiries to the Technographics Team, who can be reached at datarequest@forrester.com. For non-data subscribers, please contact the Technographics Business Development Team with any questions regarding the use of this data or custom data projects at data@forrester.com. Endnotes 1 Customer experience professionals must clearly articulate the business benefits of improving customer experience. Years of Forrester data confirm the strong relationship between the quality of a firm s customer experience (as measured by Forrester s CXi) and loyalty measures like willingness to consider the company for another purchase, likelihood to switch business, and likelihood to recommend. We used that data to build simple models that show how changes in loyalty associated with higher CXi scores can affect a company s yearly revenue. See the March 26, 2012, The Business Impact Of Customer Experience, 2012 report. 2 For a detailed description of the methodology behind Forrester s CXi, see the January 4, 2013, Executive Q&A: Forrester s Customer Experience Index report. 3 While there appears to be a gap between 2008 and 2010 CXi data, this was simply a change in the report s naming convention and publication date. The 2008 CXi was published in December 2008 using data gathered earlier that quarter. The following year s index used data collected at the same time of year Q4 2009 but was called the Customer Experience Index, 2010, because it was published in January 2010. There has been no gap in the index since its inception in 2007. 4 To calculate the average for an industry, we use all responses for any company in that industry even if the specific company did not receive enough responses to be included on its own. For example, if only 50 respondents rated Acme Bank, it would not be listed in the CXi as an individual company, but those 50 responses would be included in the average for the banking industry.
The Customer Experience Index, 2014 26 5 Among the macro factors we considered: the economy and the weather. In the year between our 2013 and 2014 studies, the S&P 500 rose 22%. And in the quarter in which we fielded our 2014 CXi survey, the US economy grew at its fastest rate in two years. Source: Annie Lowrey, Revision Shows U.S. Growing at Fastest Rate Since 2011, The New York Times, December 20, 2013 (http://www.nytimes.com/2013/12/21/ business/economy/third-quarter-us-growth-at-4-1-rate-in-new-estimate.html). According to the University of Michigan, consumers also felt better about their personal financial situations. The 2014 Atlantic hurricane season was also the least active since 1982. Fewer hurricanes mean fewer problems in several of our most improved industries, including airlines, insurance providers, ISPs, and TV service providers. Source: Surveys of Consumers, University of Michigan (http://www.sca.isr.umich. edu/get-chart.php?y=2013&m=5&n=6r&f=pdf&k=7d2e1d8fe5ca7fd42685441b8a764c27); Jeff Kagan, Why Cablevision Is Tweaking Its Own Nose, E-Commerce Times, September 13, 2012 (http://www. ecommercetimes.com/story/76145.html). 6 In June 2013, Forrester recognized the success of the BCBSM persona room with a Forrester Outside In Award in the customer understanding category. Source: Adele Sage, Announcing Forrester s 2013 Outside In Award Winners, Forrester Blogs, June 25, 2013 (http://blogs.forrester.com/adele_sage/13-06-25- announcing_forresters_2013_outside_in_award_winners). 7 An EOB is a printed statement that s mailed to health plan members after a claim has been processed, explaining any payments made on their behalf. 8 Source: Morgan Stanley Technology Media & Telecoms Conference (http://phx.corporate-ir.net/phoenix. zhtml?c=112298&p=irol-eventdetails&eventid=5052599). 9 Source: Third Quarter 2013 Results, Charter Communications, November 5, 2013 (http://phx.corporateir.net/external.file?item=ugfyzw50suq9mja5ndyyfenoawxksuq9ltf8vhlwzt0z&t=1); Charter Completes All-Digital Network Upgrade in North Texas, Charter Communications press release, June 18, 2013 (http://phx.corporate-ir.net/phoenix.zhtml?c=112298&p=irol-newsarticle&id=1830791&highlight=). 10 It s likely that Delta Air Lines score was also bolstered by its on-time performance in 2013. From January 2013 to September 2013, it had the highest on-time percentage of any major US carrier (90.3%) and the lowest rate of canceled flights in that same group (0.1%). Source: US Department of Transportation (http:// www.rita.dot.gov/bts/press_releases/dot095_13). 11 The emergence of powerful mobile devices, connected sensors, and open application programming interfaces (APIs) makes it possible to deliver a new type of customer experience known as proactive experiences. These experiences change the way customers relate to and engage with services by closing the gap between problem and solution, integrating siloed information and services, and personalizing experiences based on context. In this report, we examine how proactive experiences are raising customer expectations and present specific ways that companies can get started on the path to delivering proactive experiences today. See the November 20, 2013, Anticipate Your Customer s Next Move With Proactive Experiences report.
The Customer Experience Index, 2014 27 12 Journey maps help organizations analyze specific interactions and identify opportunities for improvements. If that s all maps are used for, they will deliver value to the organizations that use them. However, some organizations go beyond tactical uses of journey maps and turn to them as foundational tools for driving a customer-centric culture. See the July 27, 2012, How To Get Value From Customer Journey Maps report. 13 Detailed scores for each of the three CXi components are available to Forrester Consumer Technographics subscribers. For more information, email data@forrester.com. 14 Forrester calls the complex set of interdependencies between customers, employees, and partners that shape customer experience a company s customer experience ecosystem. See the February 28, 2013, The Customer Experience Ecosystem report. 15 Driver analyses are custom studies designed to explore which touchpoints or factors like clear language, convenience, or efficiency contribute most to a customer s perception of the three CXi criteria for a particular brand. For more information on conducting a CXi-based driver analysis, please contact your Forrester account manager.
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