cx value for customers
Dr. Maxie Schmidt is Vice President, Principal Analyst at Forrester Research and is a Customer Experience expert helping companies create, improve, and sustain customer experiences that drive loyalty and business growth.
Maxie leads Forrester’s research on CX Measurement and Value for Customer and advises leaders how to build effective CX Measurement programs and co-create value with customers.
CX thought leaders think of Dr. Maxie Schmidt as “The Leading Expert” on CX measurement.
“ Only if customers get value from doing business with the company, does the company get value from doing business with the customer.”
In terms of topics, I've been trying to get people in customer experience to be more at the leading edge of thinking about the value exchange between the company and the customer.
Most companies don't even know when customers are getting value, right? They're thinking, engagement is value, but it's not. They think usage is value, but it is not.
A customer is trying to get something done and they derive value if they get more than they give up in pursuit of their goal.
Specifically, along 4 Value Dimensions:
Economic
Functional
Experiential
Symbolic
What’s more, as customers pursue their goals, they interact with a lot of people.
Just think about buying a car, right? There's a bank involved. There is an insurance company involved. There are friends involved. Maybe there’s a negotiation service involved. There's the dealership and manufacturer and so on. Right?
Companies who want to be customer obsessed need to earn a place in that Value Network.
“ Step away from the metrics we often use as proxies for value.”
So, the first big take away for incorporating value for customer to measurement is to step away from the metrics we often use as proxies for value.
Oh, the person has logged in 20 times in the last month. They might find the software very valuable, versus the person has only logged in five times.
Yeah, because maybe they must log in so many times because they got thrown out of the program.
There are a lot of metrics that we use that we think are proxies for value but aren't.
So, the first step, like in any customer experience measurement needs to be to understand what it is that customers expect and value, and then think about the metrics we can use to measure that.
“ That’s where the business case for CX has to go.”
I'm aware of that journey economics work that you mentioned.
In 10 conversations that I have, 5 are about the business case and in each of those five conversations, I tell people that tying customer experience to revenue at the company or organization level is a sexy story at best.
“Oh, One point of NPS at these companies, it's worth X in revenue.” Full story, it gets you some air cover.
But the real work happens at a journey level.
Where you can measure very specifically whether a journey is successful. And when I say successful, I mean successful for a company and the customer.
And then you can see how much it costs you, which is part of success. And you can see what it would take to improve it.
For example, take a mortgage journey. The mortgage journey is successful for a company if they sell lots of mortgages, ideally to customers who don't default. And the cost to sell per mortgage is low because much of it happens digitally.
That's success.
For customers, it's successful if they get the mortgage before they need to close on their house. And if they get a low rate, and if they feel confident that they made the right financial decision.
Again – these are quite specific success metrics that you can measure.
