Measuring the return on experience is critical for brands. Source: Shutterstock

Measuring the return on experience is critical for brands. Source: Shutterstock

Understanding the why and how of measuring return on experience

BUSINESS leaders understand that customer experience (CX) is critical to success in today’s marketplace.

It’s why most organizations are exploring omnichannel touchpoints, personalized marketing, and working on creating a more intelligent and engaging journey for past, present, and future customers.

Hence, a new report by PwC suggests that companies pay more attention to their return on experience (ROX) as most of these efforts require an investment of time and resources.

Tracking ROX, PwC argues, will also help companies quickly hone in on parts of their experience that need an overhaul.

“It’s not as if organizations don’t currently attempt to measure customer satisfaction or quantify their direct investment in customer-facing tools and resources,”  the report points out.

But the reality is that most spend far more time measuring their investments and outcomes in other parts of the business, or take too siloed an approach to customer experience.”

Why do organizations need a ROX measurement framework?

“What gets measured gets managed,” said the father of management Peter Drucker in his book published in 1945, The Practice of Management.

The words still hold true, which is why consultants at PwC believe that organizations should work on creating a ROX measurement framework.

According to the report, a ROX framework zeroes in on customer touchpoints that need more attention before they can provide a good CX.

“It can also help identify the things your company does exceptionally well, and then make sure your IT systems, data infrastructure, business processes, and performance metrics are aligned with those core capabilities.

“It identifies your company’s ‘critical few’ behaviors, too, as defined by Jon Katzenbach, James Thomas, and Gretchen Anderson in their book The Critical Few: Energize Your Company’s Culture by Choosing What Really Matters.”

Building ROX metrics reinforces a virtuous cycle and amplifies value. Source: PwC’s Global Consumer Insights Survey 2019.

Building ROX metrics reinforces a virtuous cycle and amplifies value. Source: PwC’s Global Consumer Insights Survey 2019.

The think tank’s consultants believe that thinking about creating a ROX framework will force the company to evaluate the key behaviors that distinguish the business from competitors and showcase its strengths — which in turn will reveal other elements critical to the brand’s CX.

As illustrated above, PwC believes this will drive a virtuous cycle that amplifies value as the organization aims for continuous improvement in the sphere of CX.

How can organizations go about improving their ROX?

While PwC’s report is focused on consumer insights, it’s important to realize that the CX that the brand provides is hinged upon a variety of factors, including employee experience, technology, and many more.

Here are a few of the recommendations that the report provides for businesses looking to improve their ROX:

# 1 | Fuse CX and employee experience

Organizations that create the most delightful experiences for customers understand that it is the employees that deliver it (for the most part), which is why, crafting a great employee experience is essential to maximizing ROX.

Virgin Group Founder Richard Branson, in a recent interview with Inc clearly explained why employees are critical to the overall CX that an organization provides:

“If the person who works at your company is 100% proud of the job they’re doing, if you give them the tools to do a good job, they’re proud of the brand, if they were looked after, if they’re treated well, then they’re gonna be smiling, they’re gonna be happy and therefore the customer will have a nice experience.”

# 2 | Build communities with a purpose

“Find opportunities for meaningful engagement with both internal and external audiences, especially using mobile and social tools, since engagement on these platforms is growing,” suggests PwC.

Essentially, the idea is to ensure that brands are constantly engaging with external stakeholders, and have a finger on the pulse of the market as well as the needs of its past, present, as well as future customers.

Thanks to digital, creating global communities is easier — and brands such as the L’Oréal Group and PepsiCo are great examples of how social media can be leveraged to not just share the brand’s message with customers but also engage with them to co-create stories and experiences.

# 3 | Respect data and provide (incredible) value

Over the past few months, data privacy and security have become incredibly important for all kinds of stakeholders — regulators, businesses, as well as private individuals.

As awareness about personal data and its uses soars, brands need to be more mindful of how they choose to use the data that customers trust them with — and ensure they provide incredible value when they use it to engage with them in a more targeted fashion.

One of the important use cases for brands exploring how data can help provide value is in the realm of “marketing personalization”.

Striking the right balance is critical here as over-personalize can alienate customers and cost the company dearly. However, under-personalization is also quite damaging to brands as customers expect convenience and rewards for behaviors like continued loyalty.