Will The Customer Experience Bubble Burst In 2011?
November 26, 2010 6 Comments
(I originally published this post on The 1to1 Blog)
For several years, I’ve seen company after company jump on the customer experience bandwagon. In a Temkin Group survey earlier in the year, two-thirds of large North American companies said that they had ambitions to provide the best customer experience in their industry within three years.
It’s not mathematically possible for that many companies to be leaders in anything. But it does show the unfettered aspirations that companies have when it comes to customer experience.
The largest obstacle to customer experience that companies identify is “other competing priorities.” Hmmm… they want to be the best at customer experience, but other things are more important. This situation reminds of a poem that Robert Herrick wrote in 1650:
NO PAINS, NO GAINS.
If little labour, little are our gains:
Man’s fortunes are according to his pains.
To become in leader in customer experience takes effort. It requires making difficult tradeoffs between short-term financial goals and longer-term customer loyalty. That can be a painful decision.
Companies are anxious to lead, but are they prepared to make these tough decisions? Not really. In a recent post called Top 10 Customer Experience Incompetencies, I highlighted data showing that only about 25% of large firms are prepared to make that painful tradeoff between customer experience and short-term financial results.
Despite the widespread mismatch between ambition and commitment, some companies are breaking through. In recent Temkin Group report, Profiling Customer Experience Leaders, we looked at the difference between customer experience leaders and laggards. It turns out that the leaders:
- Focus more on building a customer-centric culture
- Put less emphasis on pure cost-cutting
- Have more centralized customer experience efforts
- Reinforce the core values of the company
- Tap into more customer feedback
And, leaders suffer much less from “other competing priorities.”
I’ll be writing a series of posts in my blog that help organizations plan their 2011 customer experience efforts. While the content will likely appeal to the majority of companies that have strong customer experience ambitions, it will probably only be helpful to those that are truly committed to making a difference.
Will the customer experience bubble burst in 2011? Hopefully “yes” for some companies.
The bottom line: I expect many companies to start pulling away from the pack in 2011.
About Bruce Temkin, CCXP
Customer Experience Matters® 
The Profiling Customer Experience Leaders document is very insightful… thanks for the reference.
I just hope that more brands walk as impressively as they talk, particularly as a customer myself!
Given the inquiries that I’m seeing, I anticipate a lot of customer experience activity in 2011. Many companies are beginning to realize that their customer experience journeys need to address all Four Customer Experience Core Competencies. Those that think they can make dramatic improvements with superficial changes will see their bubbles burst in 2011.
Couldnt agree with you more. Your bullet points between the laggards and leaders is very interesting. Having to change a culture to be more customer-centric vs just trying to get onto a bandwagon that says we do that and other things as well is a challenge for many of us that are trying to pave the way in organizations that have never thought along those terms in the past.
Making sure the leaders have a commitment to longer term goals and they are willing to work until they get it right. I suspect that tying all of this to direct revenue gains is also a big help at the C level.
It’s a double edged sword when it comes to customer experience. On one hand a company has to show profit (reason for existence) and on the other hand they can not afford to be myopic and get lost in improving customer experience to the point where they have completely deviated from their long term strategy and are meeting the immediate needs of the customers. Long term needs are typically based on feedback from customers and also what the competition is doing and what might be emerging. If the company misses profits they are condemned and if they are too far sighted well…you get the drift.
Challenge and this is not a new challenge, continues to be the balance between meeting the customer’s needs, forming the strategy and executing it while making profit. Well the prophets (no pun intended) are the customers who not only define their needs but also drive the changes to the needs based on their changing pallet. Companies have to learn to be nimble and change with the ever changing needs of their clients or they become obsolete. Customer experience is the #1 variable that defines when it is time to make changes or close shop because of the gap between the customer’s expectations and the and the product/service from the company is not meeting the needs of the customer.
All companies practice “Customer Experience” of some type with varying degrees of involvement. But I am a firm believer that jumping on the customer experience band wagon is what I call “going through the motions” without understanding the true principles behind it, such as, “going to a tin can alley and calling yourself a snipper”. This has to be imbedded in the genetic code of the organization including employees who do not engage with the external customer and their immediate customer is another employee from the same company. It all goes back to “understand then be understood”
I couldn’t agree more. In addition to your point, I believe that the reality of what a true customer experience company is/means is also becoming more evident as time passes. I presume many companies selected customer experience as a core competency because they perceived it as the easiest. In reality I think it is the hardest.