If you ask a company executive if customer experience (CX) matters to them, they will most likely say yes. But how do you get them to invest in and commit to a robust, long-term CX management practice? In a recent webinar, Medallia shared its approach to helping organizations quantify the financial linkage of their CX management initiatives and validate requests for future investments.
Investment in CX impacts all levers of your organization’s P&L — from reducing costs to growing deposits.The goal is to equip practitioners with the tools needed to build a business case that fits their needs.
In their webinar, we addressed the following six key questions to help organizations arrive at that financial linkage:
What behaviors will we focus on?
Can we track individual customers?
What is our time horizon?
Which segments do we focus on?
Which data analysis do we use?
They received some great questions following the webinar, thought we’d share a few.
Q: How can we leverage machine learning and AI to create better CX predictions? Are there inputs that work the best?
The explosion of data and computing power has made machine learning and AI a legitimate and powerful solution. We see companies using AI to solve a number of CX-related problems. From predicting satisfaction of customers who don’t answer surveys and prevent issues from escalating, predicting customer churn and proactively intervening, to identifying root causes of both customer satisfaction and dis-satisfaction to improve products, processes and policies.
Unstructured data, which can come from survey verbatims, social media, contact center notes etc, provide a wealth of information, which can now be quickly mined and categorized through AI. This insight becomes even more powerful when combined over time with operational and behavioral data. Done well, AI allows you to quickly single out problems, recommend actions, and flag items that need human review and judgement — leading to more accurate, meaningful and relevant customer interactions.
Q: What behavior factor can we use for financial services? The “Amy” example in the webinar is about spend. What would it be for banking?
As mentioned in the webinar, it’s important to make sure that the behaviors you are focused on are relevant to your business model, understood across the organization, and aligned to your business priorities. Because “Amy” was a retail store customer, spend was the appropriate metric for that particular analysis. In banking, we see behavior factors focused on both sides of the P&L, revenue generation and cost control. Common behaviors include net new asset growth, depth of relationship metrics (i.e., number of products/services, transaction types), and cost to serve (i.e., number of calls to the contact center). For more narrowly focused business such as mortgage and credit cards, we’ve seen metrics such as new loan originations, average net receivables, and sales transaction volume used.
Q: How can the right technology enable financial linkage, and what are the important features to look for in this technology?
Often, organizations will start to do ad hoc types of exercise off-line, but as you grow in size and scale, with the right technology in place, your analysts will spend less time collecting and aggregating data, and more on higher value, complex analysis.
Key technology advantages include:
Ability to link operational and financial data with CX data. This not only allows you to segment and contextualize your results, but is also critical to conducting the analysis itself.
Ability to perform analysis within the platform. Whether it’s summary statistics, regression, or even the advanced AI tools mentioned earlier, having access to this information within the platform helps to highlight issues and opportunities and drive action more effectively. The ability to automatically collect large amounts of data in real time into the platform gives users of all types the results at their fingertips, displayed in a way that is meaningful and relevant to them.
The ability to monitor results and test over time. The goal of an effective CX program is to drive action to continuously improve the experience. It’s critical that your technology platform allows you to quickly understand what’s working, what’s not, and what specific actions you need to take to improve.
By tying your Customer Experience management program to ROI, you can put real numbers behind the actions you are putting in place to drive the program. In addition to tracking your investment in CX, financial impact helps you track results of specific initiatives, enabling you to continuously innovate and evolve.