Customer Experience News & Trends

Top 3 reasons customer experience programs fail – and how to avoid them

Creating an experience that customers love is a worthy goal, but it can end up buried in metrics, data and analysis. The following are the top three reasons customer experience programs fail, and how you can avoid them.

Most companies want their customers to have experiences that leave them highly satisfied and ready to buy again. So CX leaders come up with (or order) plans to dig deeper, analyze customers and processes, and make adjustments.

Then where does it go wrong?

“While it’s critical that CX programs be well-designed and methodically sound, sometimes wasteful activities are allowed to creep into the design process and bog down the program,” Ryan Smith, co-founder of Qualtrics, said in the Harvard Business Review. “Lack of momentum and sluggishness spell doom to a CX program, and leadership must propel the program.”

This is what you want to avoid:

Mistake #1: Failure to change and innovate

The goal for every customer experience program (or customer service initiative, on a smaller scale) should be to make intelligent changes that benefit customers and the business.

Yet, many CX programs track performance, follow behavior and gather data. Then employees use that to gauge how they’re doing. That’s a good first objective, but it stops short of actually moving forward.

Many times, CX leaders get analysis paralysis. They gather so much data but don’t budget enough time and resources to make sense of it and think about how to use it. So they nod in agreement that everything looks good, and move forward without change.

Customer experience programs should be about change, Smith says. The most effective programs prioritize what gets measured and use the data to decide what gets changed. The idea is to uncover the fewest possible moves to can create the most positive changes.

What you want to do: Build more “think time” into the plan so you can understand the implications and applications of the information you gather. You can see how the pieces fit together, formulate a few options on changes to make and create the right strategy.

Mistake #2: Taking too much credit

Many customer experience leaders make the wrong link between metrics and business outcomes. If a score improves, they consider it proof that the customer experience innovation alone made the needle move.

Where’s the problem? You can’t figure that your CX innovations had the lone impact on the rising score. Plus, a rising score doesn’t always mean an increase in sales or revenue.

What to do: So before customer experience innovations are launched, leaders want to prepare to measure results on two fronts: satisfaction (with something such as Net Promoter Score) and financial (with profits).

More specifically, Smith suggests you consider these factors:

  • Cost to acquire and serve a customer. You can lower this by understanding your customers and building experiences they crave.
  • Customer penetration and share costs. “Penetration” is increasing the number of customers you have and “share” is how they spend their money with you. Look at what part of the experience drives and/or prevents these.
  • Customer lifetime value. It’s a complex metric to measure, but the best companies understand it and make it a central part of their experience evaluation.
  • Customer churn. The best programs calculate what’s lost (compared to gains) when customers leave.

Mistake #3: Moving without purpose

Some customer experience programs run on autopilot. Then, when something declines, a new program comes to life.

The most effective CX programs are in a constant state of growth. Leaders are either confidently moving through problems or uncovering the next move.

What to do: CX programs work best when there’s:

  • Ownership. One person needs to be ultimately responsible for the success and continuation of the program.
  • Expertise. The leader doesn’t need to be totally hands-on, but needs to know as much as possible about the research methods, analysis and strategy.
  • Empowerment. The leader has to have the authority to make changes at any point and ensure success.

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  • Nicho

    Nice article….I would add 2 additional reasons for failure:

    1. Design of a Customer Experience Program should
    not be a “Program” but a “Culture” – the way we do things, it need to be
    Customer Centric rather than Business Centric

    2. Design of Customer Experience “Culture” should
    be self-evolving – it should learn and adapt to changing Consumer needs without
    huge investments and resources

    • Michele McGovern

      Thanks Nicho. Great points. Do readers have any other reasons you’d throw in, too?