Very recently I stayed at the Courtyard by Marriott. It wasn’t the most convenient hotel for us since it wasn’t close enough to my son’s college. In fact, I was thinking about staying somewhere else next time I visit my son. However, the excellent service that I received at Marriott made me think about their intangible value, and why Marriott is a better hotel than the other hotels that I was considering. All of the employees treated my family with empathy. Their core values of, putting people first, pursuing excellence… acting with integrity and serving our world, was reflected in the behavior of the entire Marriott staff. I can see how the Courtyard By Marriott won the best customer experience in the Hotels industry, according to the 2017 Temkin Experience Ratings.
In today’s fast-paced world, customers are making the rules – and their expectations have changed. Customer experience (CX) is king, or queen! It drives revenue and creates loyal brand advocates. A positive experience can favorably impact sales, and is increasingly viewed as a key business goal – so much so that the compensation of executives and line of business leaders is now being tied to CX. And, if an interaction is negative, the damage to a brand can be irreparable. Line of Business Leaders know CX is important. Board of Directors know CX is so important that they are making business leaders personally accountable for providing good CX – but is it enough?
Perhaps the most recent memorable example of poor CX comes from United Airlines, following the viral public relations catastrophe that occurred last month. A passenger was violently dragged off a flight by a police officer before a flight’s departure from Chicago to make room for a company employee. The episode was captured by other passengers on cellphones and quickly spread on social media. Initially, United CEO Oscar Munoz appeared to blame the passenger, Dr. David Dao, for causing the incident. But amid a backlash, Mr. Munoz changed course and said he felt “shame” over how the situation was handled. Since this event, according to New York Times, “United Continental Holdings is also adjusting its incentive compensation program for senior executives to make it ‘directly and meaningfully tied to progress in improving the customer experience.’”Was it Mr. Munoz’s fault that one of his customers had a horrific experience, even though he didn’t have a direct interaction with him? Society now says yes.
It’s a customer demand economy versus a company supply economy. Loyal customers drive more revenue, and because of this, revenue numbers are closely tied to CX. Simply creating a good product or solution without integrating CX across marketing, sales, commerce, and service will not necessarily increase a business’ bottom line. All employees and partners must be engaged in what it means to deliver a superior experience.
According to Forrester, a one point change in a company’s CX score can move revenues by the millions. For example, if a rental car companies loses just one point in their CX score, they can expect to lose $67 million in revenue. Because poor scores can greatly impact revenue, executives are focusing on how they can improve their CX. They must encourage alignment across their organization in order to improve customer-facing touchpoints: make their interactions easier, personal, timely, and valuable – both digitally and traditionally.
In order to encourage adherence to CX improvement initiatives, many companies are tying compensation to customer feedback related to their experience with the brand. But, CX can be difficult to track. According to Gartner, “Hundreds of CX metrics exist. Large organizations will often use more than 50, and no organization uses the same combination.” Companies may use quantitative scoring such as NPS, CSAT, and CES, and they also conduct qualitative research through interviews, shop-alongs, and journaling.
Unfortunately, many companies that link CX and compensation find that a significant number of employees are coaching customers on how to respond to requests for feedback. Some employees are even soliciting customers for perfect scores. At times, their bosses, who themselves feel frustration with the team’s inability to quickly move the needle, often support shrewd ways to manipulate the system, such as excluding dissatisfied customers from the survey database. I’ve even seen a restaurant manager pre-fill a customer survey and just ask the customer to sign it! Incentive compensation can certainly be a powerful motivator. But unless companies are careful, they can wind up incentivizing the wrong things and sending the wrong messages about what’s important.
So how do companies truly understand, effectively track, and improve CX?
Most importantly, brands must understand that implementing new CX initiatives and incentivizing employees to follow them can produce some positive results, but it isn’t enough. CX will only improve if its foundation comes from a strong and unwavering sense of customer empathy. Brands that make empathy the central tenet of their corporate culture often experience the greatest success. While the front desk knew that my family has Elite Marriott status, I doubt that the servers and maintenance employees would have that information. It was obvious that Marriott has successfully changed the culture of all employees, and that their core values are embraced across the company. To better understand if employees have an empathetic approach to CX, a blended approach should mix surveys with digital methods such as social listening and AI tone analysis with traditional methods such as personalized outreach from top executives.
For example, Ford Motor Company is no longer depending on just surveys and CSAT scores. They have initiated a post purchase 90-day drive program that transforms empathy into insights – a day by day, sometimes minute by minute, view into the new car ownership. Vehicle purchases are important decisions for customers, therefore the communications from the company during this period are the most crucial for retention and future purchase. Ford’s goal is for every customer to receive a personalized, hand written note mailed to their house that thanks them for their purchase.
Companies with employees that notice, internalize, and are sensitive to the needs and feelings of the entire ecosystem produce more loyal customers. These employees assess what is unique about a situation and are able to make smart decisions in the moment. The brands that produce the most positive experiences don’t treat their customers as transactions. Marriott-Annapolis will retain us as customers because they were empathetic. And we all know that retaining a customer is much less expensive than trying to attract new ones.