Thursday, May 30, 2013

How to Calculate CX: Hypothesize, Test, Measure and Adjust

Investing to improve your business’s customer experience (CX) can determine its success or failure. When companies take time to plan their CX, it pays. In fact, according to Forrester Research, there was $1.3 billion in additional revenue for companies that improved CX. The ROI that comes from improved CX is related to increased customer loyalty – each customer buys more, fewer customers are lost, and customers are willing to spread good news about your business.

The benefits that come from improved CX depends on your ability to measure your investments in CX, otherwise you won’t know which are working. Measuring CX will cause your investments produce a return because they generate new business, larger sales and even save money. When you start to measure CX, you need to take a step back from traditional product-centric measures of performance and focus on the basic functions of your business.


Image via blog.vitria.com

Everage Insights shares four steps you need to take if you want to be able to measure your CX.

Step 1 - Get into Your Customer’s Brain
First, get to know  your customer. This helps you set aside your beliefs about your product and move towards understanding their perspective. I’m sure you already know your customers - you have demographic information on what they like to read. But many businesses still fail to understand them.
Ask questions including:
  • Since I know what they read, why do they choose to read those blog posts or ebooks?
  • What problems are my customers trying to solve?
  • What questions do they need answered?
  • What kind of information did they need, but were unable to find?
  • Are my customers and their behaviors changing?

Step 2 - Identify Points of Contact
Measuring CX depends on identifying each point of contact your customer has with your business. A touchpoint can occur virtually or in the real world. Each contact your customers make with your product will determine how long someone sticks around.

Touchpoint metrics are specific to CX - they are developed to measure the attributes of each point of contact someone makes with your brand and how they relate to your businesses goals. By monitoring how well you meet customers’ expectations and how effectively you are achieving business goals at each touchpoint, you will know if and how you are impressing customers.

Step 3 - Develop Solutions
Now it’s time to develop solutions that can address these problem areas. If you measure touchpoint metrics for customer or technical support, you can theorize potential solutions to those problems. Until you measure these ideas, they are only theories -possible solutions to the problems plaguing your CX.              
                                                    
Step 4 - Measure Metrics
Solution metrics, qualitative and quantitative metrics that measure the effectiveness of your solutions complement touchpoint metrics. Solution metrics can narrow your focus to the problem areas identified with touchpoint metrics. I ask myself one question: Are the problem areas improving or worsening after I implemented my solution?


Using solution metrics, you can test your ideas to see which effectively address the problems you identified and which fail to do so. Once you know which solutions are effective, you’ll know where to focus your business’s resources so you can see the biggest improvement in customer experience.  
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