Customer Experience Management:

Raising Customer Satisfaction, Loyalty and Advocacy

International Toll Free Numbers
Thank you for Joining Argentina 8006660273 Laitva 8002061
Australia 1800002092 Lithuania 880090072
Today’s Austria 800281475 Luxemborg 80027996
Bahamas 18003890304 Macau 800406
Belgium 80074215 Malaysia 1800805439
Gartner Webinar! Brazil
Chile
0-800-891-6189
800202906
Mexico
Monaco
001866-385-9625
80093201
China - North 10-800-713-0755 Netherlands 8000224103
China - South 10-800-130-0724 New Zealand 800445971
Colombia 01-800-700-1686 Norway 80016162
Costa Rica 0-800-013-0945 Panama 001-800-2018136
Listen to the Audio Portion: Cyprus 8009-7195 Peru 80052599
Czech Republic 800142527 Poland 00-800-111-3630
Dial into the audio portion using the Denmark 80884284 Portugal 800819831
Dominican Rep 18887514304 Russia* 81080021591012
phone numbers provided. Please Finland 800115347 Singapore 8001011350
use the “participant code” below to France 800900053 South Africa 800994050
Germany 8001815287 Spain 900971520
identify to the operator the meeting Greece 00-80018092017692 St. Kitts/Nevis 18002037616
you would like to join. Guyana 18666682080 Sweden 020-791745
Hong Kong 800901700 Switzerland 800835819
US and Canada: Hungary 680014802 Thailand 001800-13-201-7860
Iceland 8001006182 Trinidad & Tobago 18002031409
Audio Conferencing Indonesia 001-8030152017728 Turkey 800142037616
India 8001006182 United Kingdom 8009174860
Ireland 1800397426 Uruguay 40190019
(Toll): +1 (706) 634-0652 Israel 1809457877 Venezuela 8001006010
(Toll-free): +1 (800) 254-4692 Italy 800783240
Jamaica 18002037616
Japan 531160205
Participant Code: 60299932 Korea - South 308140327
Customer Experience Management:
Raising Customer Satisfaction, Loyalty
and Advocacy

Ed Thompson
Jim Davies

Gartner Webinar

Notes accompany this presentation. Please select Notes Page view. These materials can be reproduced only with written approval from Gartner. Such approvals must be requested via e-mail: vendor.relations@gartner.com. Gartner is a registered trademark of Gartner, Inc. or its affiliates.
 What's New? Executive Focus Intensifies
While Complications Multiply
Situation Complications
Metrics Employees
vary are cynics
Executives seek differentiation
Customer
through customer experience power is Who
80% of executives think the customer rising owns
strategy is more important than it?
it was three years ago IT is seen as
95% of business leaders see it part of the
problem Executives
as the next competitive background
are not
sure how to
improve it

Sources: Strativity Group 2008 Customer Experience Management Global Survey, Beyond Philosophy, 2005
Key Issues
1. What is customer experience management?
2. How can technology help improve the
customer experience?
3. What techniques can be deployed to help
understand the customer experience?
 Who Cares About The Customer
Experience And What Do They Measure?
Customer Service
Customer
Sales
Satisfaction
Market research
Churn / Retention
Loyalty /
Referrals / Customer Refs
Customer Advocacy
Loyalty Management
Experience
Marketing Communications
Brand /
Product / Service Design
Reputation
UI Design

Quality Process Improvement

Product Engineering
Service-Profit Chain Methodology:
Linking Customer Satisfaction to Loyalty
Customer Experience Management:
Before, During and After the Experience
4. Repeat Organization
Act on feedback

Customer Value
Proposition
Feedback
$$$ $$
1. Before 3. After
Set expectations $$$$$ Collect feedback
Experience
Feedback
$ 2. During
Focus on what
customers care about

Customers
 Setting Expectations: Competing With
Word of Mouth and Past Experience
Gap 1: Customer expectations vs.
Word-of-Mouth Personal Needs Past Experience management's perception of
customer expectations
= not knowing what
Expected Service customers expect
Gap 2: Management perceptions vs.
Gap 5 service specifications
Perceived Service
= the wrong quality standards
Customer Gap 3: Service specifications vs.
service delivery
Provider = not being able to deliver to specs.
Gap 4 External
Service Delivery Communication
Gap 1 To Customers
Gap 4: Service delivery vs. external
communications
Gap 3 = when promises do not
Service Quality match delivery
Specifications
Gap 5: Difference between customer
Gap 2 expectations and customer
Source: Delivering Management perception of the provided service
Service Quality Zeithaml, Perception of
V.A., Parasuraman, A, & Customer = level of customer satisfaction
Berry, L. 1990 Expectations
 Designing the Customer Experience:
Process Maps Expose 'Moments of Truth'
Life Cycles
Develop
Company Target Inquire Acquire Welcome Manage problems
Perspective
Retain/Win Back
Customer
Perspective Aware Search Select Order Pay Set Up Learn Use Support Upgrade

Events Event 1 Event 2 Event 3 Event 4 Event 5 Event 6 Event 7 Event 8 Event 9

Marketing
Functional Organization

Product
Display
Web Site

Search
Customer Service

Interactive
Voice
Response
Customer
Service

= "Moments of Truth"
Representative
Account
Representative

Catalog

Inventory
Management

Partners
 Listen to the Feedback but also…
Act on Feedback, Tell Customers and Staff
Percentage of Companies • 95 percent of companies
100
collect feedback.
95%
• 45 percent alert staff to
the findings.
• 35 percent make decisions
using this insight.
50 • 10 percent deploy
45% and improve.
• 5 percent inform customers
35% of the change.

5%
10%
0
Collect Alert Use Deploy Tell
Feedback Staff Insight and Customers
Improve
Source: Respond, 2006
 Seven Project Types and Fifty Ways To
Improve The Customer Experience
Listen, From Out Act as Open Get Alter Design
Think, Do to In One Up Personal Attitudes Better
Collect Feedback Find Moments of Achieve More Accessible Personalize Empower Have a
Multichannel Truth Consistent Self-service Products Employees Strategy
collection Process modeling Experiences Configure to order Education and Executive
Track for
Real-time alerts and Identify the weakest Single view of customer Mass training enlightening
actions link customer customization Cultural values Ideal and real
Add channels
Automate and Recognition New product Ownership of the experiences
escalate development experience Program and
project plans

Analyze Opinion Redesign Share Answers Demonstrate Customize Offers Make Clear the Brand
Value analysis Processes Knowledge Trust Bundling Responsibility Execution
Market research Quality controls management Honor privacy product/service Governance and Values and
Segmentation Trading efficiency Skills inventory Share data Personal pricing policing promise

Propensity modeling and experience Better search Use only what you Responsibility Reputation
need Compensation and Communication
contracts

Start a Adapt in Real Time Multichannel Encourage Stripped-Down Recruit Differently Design the
Conversation Real-time rerouting Availability Participation Simplification Profiling the Experience
Expectation setting Analytical-driven Multichannel Review and One size fits all personalities Benchmark
Capturing intent process decisions integration comparison Standardization Balance teams usability and
Device- Communities and scale empathy
Manage dialog Recruit to brand
independent Social networks Digital design
interaction cool
Key Issues
1. What is customer experience management?
2. How can technology help improve the
customer experience?
3. What techniques can be deployed to help
understand the customer experience?
 Multiple Technologies Can Help For All
Customer Experience Project Types
Listen, From Out Act as Open Get Alter Design
Think, Do to In One Up Personal Attitudes Better
Collect Feedback Find Moments of Achieve More Accessible Personalize Empower Have a
EFM Truth Consistent eService Products Employees Strategy
Data mining Experiences Product eLearning Consultants
Survey tools Tracking
Lead mgmt CDI configuration WFO Advisors
Event analytics Field force
Segmentation MDM optimization Pricing mgmt Sales analytics Branding
BPM
BI BPM Remote New product CSS analytics Value analysts
QA monitoring development
WFO ERMS monitoring Web analytics
ERMS Storefront

Analyze Opinion Redesign Share Answers Demonstrate Customize Offers Make Clear the Brand
Customer value Processes Knowledge Trust Product Responsibility Execution
Analytics BPM modeling management Data privacy configuration HCM, ICM MRM
Data mining Data mining Search Security tools Pricing mgmt Employee contract EMM
Segmentation Workflow eService Partner mgmt PIM, content mgmt management Content mgmt
Sales, CSS, Mking Content Product catalog QA monitoring Community
Web analytics management Order mgmt WFO mgmt

Start a Adapt in Real Time Multichannel Encourage Stripped-Down Recruit Differently Design the
Conversation Business activity Availability Participation Simplification Recruitment Experience
Dialog management monitoring Application Review and Order mgmt Induction Web
ERMS Workflow integration comparison BPM modeling analytics
technologies Community mgmt
Search In-line, event-driven Mobile Web design Web design
analysis technologies Community mgmt Content mgmt
eService Storefront
ERMS, IVR, SMS Social networking Storefront
Investment in CRM Isn't Helping the Customer:
It's Time to Focus on the Customer Experience
Percent Millions of Dollars
100.0 8,000

90.0
7,000
80.0
6,000
70.0
5,000
60.0

50.0 4,000

40.0
American Customer Satisfaction 3,000
30.0 Index (ACSI; Jan 2008)
2,000
20.0 Worldwide CRM License and
Maintenance Revenue 1,000
10.0 (Gartner; Jan 2008)

0.0 0
1994 1996 1998 2000 2002 2004 2006
1995 1997 1999 2001 2003 2005 2007
 The True Customer Experience: I Rarely
Need You, and When I Do, You're Not There
Amount customer relies on direct
interaction with the enterprise
1%
99%
Amount customer relies on self-
service and social networks
Bottom line: You are the likely last resort for credible information.
* Based on interaction with 300 clients in 2008.
But this differs by industry
and region:*
Online retailers: 1%
Retirement services: 3%
Retail banking: 5%- 20%
Automotive: 60%
Property and casualty 30%
What you control less:
Community forums
Blogs
Third-party support sites
Social networking sites
The Customer Experience Challenge:
Where Is the Service Process Designed?
Customer
(Self-Service)
Outsourced
Service
Insourced
Each channel
Service manager sees a
ATM/Kiosk great process,
while the
In-Store
Interaction customer
Reseller's experiences a
Customer broken process.
Database

Service
Technician
Bottom line: Customers are turning to
social networks, where the better answers
are, and the people more friendly.
HP PhotoSpace Listens to the Customer
Hp.communispace.com
Benefits to HP:
• Understanding consumer needs
• Insight gathering and idea generation
• Concept development and evaluation
• Exploration of corporate issues:
Allow hundreds of HP employees to
observe real-time consumer reactions
to surveys, discussions, topics of Benefits to HP Clients:
interest and new concepts. Allows HP really values the opinions of its customers. 58%
HP employees to see members' Provided a trustworthy forum for exchanging 54%
unfiltered feedback opinions.
Enabled me to give candid feedback to HP. 52%
• Provide immediate qualitative
Made me feel my voice "matters" to HP. 49%
feedback (sometimes within a few
hours) on topics such as: I feel more respect for HP as a company than 43%
I did before.
Examples of product shortcomings,
life style information (usage patterns, I'm more inclined to consider HP products than 36%
I was before I joined the community.
storage, locations), product name,
and tag line input and prioritization I don't expect any changes to result from the 1%
feedback from this community.
 Map The Productivity and Customer
Experience Impact of Your 2009 Projects
Example: Customer Service and Support Technology Projects
Desktop Productivity Tools KM/Search
Secret
Interactive Kiosks
High Agent
Field-Service
Optimization WFO Predictive
Speech- ACD Analytics
Enabled Intelligent Chatbots
Applications ERMS Device Mgmt. Case Community
Customer QM Mgmt. Mgmt.
Service Medium WFM Interaction/
CCPM E-service
Productivity E-learning Behavior
Analytics
Speech IVR CTI
Recognition
Feedback Mgmt.
Low IDM/Self-Healing
IM/Chat?
Collaboration
(certain situations)

Low Medium High

Achieving ROI Customer Experience
ACD: automatic call distribution
Easier CTI: computer-telephony integration CCPM: contact center performance management
IDM: intelligent device management ERMS: e-mail response management system
Moderate IVR: interactive voice response IM: instant messaging
QM: quality management KM: knowledge management
Challenging WFO: workforce optimization WFM: workforce management
Key Issues
1. What is customer experience management?
2. How can technology help improve the
customer experience?
3. What techniques can be deployed to help
understand the customer experience?
Understanding the Customer Experience:
Feedback Takes Many Forms
Explicit Feedback Implicit Feedback
(EFM) (Direct and Indirect)

Holistic
Understanding of
the Customer
Experience

Operational Feedback Behavioral Feedback

(Monitor and Evaluate) (Implied)
 Implementing Customer Feedback Systems:
A Three-Tiered Approach

Guided Key
Planning
Conversation Customers
Are Consulted

Five to Seven Questions Every Customer Is Customer

Chosen Channel Measured for Satisfaction Satisfaction

Two to Three
Short Questions Every Customer Interaction Is Point of
Measured for Effectiveness Delivery
All Channels
Making Feedback Event-Driven

Customer event Questions Response can

triggers survey personalized to event trigger workflow

Use to
maximize
response rate
and overall
business
value
Ongoing Feedback — Measuring the
Customer Pulse
Monitor key attitudinal indicators through regular
surveying — not "one and done"

Activate:
• Recovery action
• Agent coaching
• Policy change

Detecting "murmurs" drives timely actions before

customer behavior changes
Panel Management:
Not Just for the Panel

Use demographics,
psychographics, profiling,
interaction and feedback
history to pinpoint the right
respondents for each
feedback event.

Balance burnout with Balance sample size with Balance channel

neglect statistical outcome preferences with budget

Apply concept to ALL customers not just those in a panel

Optimize Response Rates Through Eight Best
Practices for Who, What, When and Why
1 Be Timely 5 Offer Feedback
Adds relevance and A perception of being
enhances accuracy listened to will enhance
future responsiveness

2 Get Shorter 6 Drive Motivation

Get to the point, not What's in it for the
seek insight on multiple customer? Cash is not the
topics answer

3 Give Preferences 7 Don't Inundate

Ask the questions on the Avoid over surveying by
format the customer prefers blocking delivery to
— SMS, Web, IVR, … maintain future willingness

4 Get Personal 8 Optimize Sample

Engage with the individual Pick an appropriate segment
and topic you want of people or business event
feedback on for each survey initiative
Recommendations

ƒThink about the before, during and after of customer

experience management and determine your start point:
- Get the basics right — Fix the must-be aspects
- Move above average — Invest in the before and after
- Stay on top — Avoid the middle ground
ƒCreate technology matrices to help prioritize future
operational investments and consider innovative deployment
methods rather than novel technologies to drive differentiation
ƒAppreciate that feedback can come from many sources but
that surveying plays a key role and should be viewed as
ongoing, personal and linked to customer events
Gartner Reduces IT Cost in Four Distinct Ways

Visit gartner.com/economy now to see

exactly how Gartner takes cost out of IT
Gartner for IT Leaders – Applications
• Gartner advice in the
context of your role
• Dedicated portal focused
on what you need to know
from Gartner or the media
• Analysts as coaches
• Influenced by Peers
• Toolkit content helps you
be more efficient, effective
• Access to all 8 Roles

Let Gartner make you successful

Follow up with your Account Executive Today
Contact Information
• Please follow up with your Gartner Account
Executive if you have additional questions,
comments or requests.

• If you need help with who that is, please e-mail:

gartnerwebinars@gartner.com.

• If you would like a copy of today’s presentation,

e-mail us at: gartnerwebinars@gartner.com.