Customer Experience (CX) is one of the most frequently talked about topics in marketing these days.

The discussion revolves around how we, as marketers, can get a clearer view of how our customers are using our services and buying our products.  

This clearer view of the customer, in turn, helps us to improve our marketing in ways other than just increasing conversions. We can help provide a better overall customer experience.

Focusing on CX also has additional benefits such as helping our companies create better products and provide better ongoing customer service.

But are businesses serious about improving CX? Have they allocated budget? Are they measuring ROI? And what are companies actually doing when they are focusing on CX?

To find out the answer to these and many other CX-related questions, Econsultancy, in partnership with Epsilon, surveyed 350 marketers in Australia and New Zealand about the maturity of their customer experience programmes.

Responses came from both client-side and agency marketers who work for companies of all sizes and represent a broad range of industries.

Below are four key findings from the research. Subscribers can read the entire report here.

1. Most companies have not reached CX maturity

When we asked respondents to describe their CX maturity, only one-third (33%) said that they were 'very' or 'quite' advanced.

More than half (53%) said that they were 'not very advanced' and the remainder said that they were 'immature' and 'haven't even started on this [CX improvement] journey'.

We used this designation to divide the survey responses into two groups.

One group was responses from marketers whose company was 'very' or 'quite advanced' and the other group was responses from marketers whose company was 'not very advanced' or 'immature' with regards to CX.

Using these segments, we compared market leaders with market laggards.

2. Responsibility for CX is allocated, but budget is not

One of the most interesting results from the survey was about how CX budget and responsibility are allocated.

Only 13% of client-side respondents said that 'no-one has responsibility' for customer experience within their organisation. The remaining respondents (87%) named at least one department that is responsible for customer experience. 

When we asked about budgets, though, only 34% said that they had allocated a dedicated budget for understanding the customer journey, far fewer than those who had allocated responsibility for CX.

What does this mean? Why would nine out of 10 companies allocate responsibility for CX, but only around one in three have a dedicated budget?

The main reason for this apparent contradiction is that, at most companies, CX initiatives are using budget from other departments.

Four in ten (41%) respondents indicate that they use budget assigned for 'other things', while only 24% of those surveyed have no budget at all.

And when we look only at those marketers who consider themselves 'very' or 'quite' advanced in CX, we see that even fewer (13%) have no budget at all.

So, it seems that CX is being funded by other departments.

This is understandable because CX is still finding its place in organisations. It's not yet clear where CX ownership should sit within the org chart, or whether it should be a department on its own.

And while CX requires commitment from multiple departments it is likely that it will draw budget from across the company as well.

3. Companies are sticking to traditional ROI metrics

Improving CX is different from other marketing efforts because it aims to improve touchpoint performance from the customer's perspective, not according to traditional channel metrics.

So it was surprising that the survey revealed that most marketers are still using familiar channel metrics to measure ROI instead of customer-based metrics.

When asked how they measure ROI on CX, nearly half (45%) of company marketers said they look at 'increased conversion rates' to measure ROI and a similar amount (43%) said they used 'increased sales'.

This is disappointing. The reason for implementing CX programmes is to improve what customers think about our companies, not just to get them to buy more stuff.  

More conversions and sales are necessary in the long run, yes, but measuring conversion rates is not the best way to determine the success of a CX initiative.

All is not lost, however. When we look at the responses from those who consider themselves 'very' or 'quite' advanced in CX, we see that nearly half (46%) are using the popular CX metric 'Net Promoter Score' (NPS) to measure ROI.

(For those unfamiliar with NPS, please refer to our post on the topic.)

So though it seems that many companies are still using channel metrics for CX ROI, the CX market leaders are starting to use CX metrics instead.

4. Only half of organisations understand the customer journey

When asked to rate the understanding of the customer journey at their respective organisations, only half (50%) of company respondents said that they had at least an 'intermediate' understanding. 

The other half said that their analysis of the customer journey was at most at an 'elementary level' with 'a lot of missing parts'.  

This result reveals a weakness which perhaps was not so clear previously.  

When reporting on single-channel performance, marketing departments shine. They can now deliver accurate touchpoint metrics and polished KPI reports.

But when asked about customers, it seems that their capabilities are much more modest. The survey indicates that most marketers are not able to piece together the customer journey and, as a result, are not sure why their customers choose their product or service over another.

This is a gap which needs to be addressed if marketers are going to continue to gain influence and grow their budgets within companies.

Marketers whose companies are 'quite' or 'very' advanced with regards to CX maturity are again leading the way.  

According to the survey, they are more than twice as likely to have an 'intermediate' understanding of the customer journey and six times more likely to have an 'advanced' understanding than those who are 'not advanced' with regards to CX.

5. Companies are taking up the CX challenge

There is reason to believe that this situation will improve, however.

Nearly two-thirds (63%) of company marketers indicated that over the next five years their company will differentiate themselves from the competition through CX initiatives.

And over seven in 10 said that those which improve the customer journey are 'very important' to their organisation.

Focusing on CX is, it seems, still very much on the minds of marketers in Australia and New Zealand.

So...

Although most companies in the region have not reached CX maturity, our survey reveals some best practices from those who have.

Companies that are 'quite' or 'very' advanced in CX are more likely to have allocated budget, use CX metrics for measuring ROI, and understand the customer journey.

These findings, and the many more in the report, will help those who are looking to follow the CX market leaders and adopt best practices.

We encourage subscribers to download the report to learn more.

Jeff Rajeck

Published 9 May, 2016 by Jeff Rajeck

Jeff Rajeck is the APAC Research Analyst for Econsultancy . You can follow him on Twitter or connect via LinkedIn.  

226 more posts from this author

You might be interested in

Comments (0)

Comment
No-profile-pic
Save or Cancel
Daily_pulse_signup_wide

Enjoying this article?

Get more just like this, delivered to your inbox.

Keep up to date with the latest analysis, inspiration and learning from the Econsultancy blog with our free Digital Pulse newsletter. You will receive a hand-picked digest of the latest and greatest articles, as well as snippets of new market data, best practice guides and trends research.