how customer experience transforms and defines …• customers who had a good experience invested...
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How Customer Experience Transforms and Defines Luxury Brands
Harley Manning, VP & Research Director
January 16, 2013
© 2012 Forrester Research, Inc. Reproduction Prohibited
“Even if they’re more expensive and I have to pay the difference in the ticket price myself, it’s worth it.”
Willingness to consider for another purchase
Likelihood to recommend to a friend
Likelihood to switch business to a competitor
Customer experience correlates to loyalty
• Customers who had a good experience
invested 4.5x more money with Fidelity
• Their investments added up to billions of
incremental dollars per year
Two U.S. stock portfolios
Top 10 publicly traded
companies in the Customer
Experience Index
Bottom 10 publicly traded
companies in the Customer
Experience Index
CX Leaders CX Laggards
CXi Leaders 22.5%
S&P 500 Index,-1.3
CXi Laggards-46.3%
-50%
-40%
-30%
-20%
-10%
0%
10%
20%
30%
Cu
mu
lati
ve t
ota
l re
turn
5-year stock performance
Source: Watermark Consulting
© 2012 Forrester Research, Inc. Reproduction Prohibited
Comprehensive
Best Practices
for Creating a
Great Luxury
Goods
Customer
Experience
© 2012 Forrester Research, Inc. Reproduction Prohibited
Angela Ahrendts
CEO
Burberry
“Burberry Regent Street brings our digital
world to life in a physical space for the first
time, where customers can experience every
facet of the brand through immersive
multimedia content exactly as they do online.
“Walking through the doors is just like
walking into our website. It is Burberry World
Live.”
© 2012 Forrester Research, Inc. Reproduction Prohibited
Customers would not download and install a mobile app for this infrequent task
They often plan their next exotic vacation during downtime in a limo
33
Repeatable problem-solving process that incorporates the needs of customers, employees, and other business stakeholders
Perception What customers think happened
and how they feel about it
Descriptive What happened in the real world
Outcome What business result you expect
from what happened
© 2012 Forrester Research, Inc. Reproduction Prohibited
Porsche uses NPS to gauge the health of the overall customer relationship but…
Dealers started rigging the system by offering incentives to customers for higher NPS scores
Dealers’ inconsistent behavior and “pandering” to customers was damaging the brand image
Porsche is now planning to de-emphasize NPS
38
© 2012 Forrester Research, Inc. Reproduction Prohibited
“Really the NPS doesn’t have much
business value, it’s just an indication of the
customer’s view at that moment in time. The
real business value comes from the words
people use in their verbatim answers.”
Nina Jones
Head of Customer Experience
Porsche Cars Great Britain
© 2012 Forrester Research, Inc. Reproduction Prohibited
Governance practices
Standards
Policies and processes
Project portfolio management
Role-specific responsibilities
41
© 2012 Forrester Research, Inc. Reproduction Prohibited
Rise of the chief customer officer
Emerging role: 550 identified in 2012
Average tenure: Two years
Typical background: Executive-level position (not customer experience)
Notable: Cleveland Clinic, Fidelity, GM
42
© 2012 Forrester Research, Inc. Reproduction Prohibited
“If I can't differentiate
and make you feel
special about the
experience, then it is all
about price, and then
we're no different than
any other commodity
product in the car
business."
Steve Canon
CEO
Mercedes-Benz USA
© 2012 Forrester Research, Inc. Reproduction Prohibited
Culture practices
Hiring
Onboarding and Training
Rituals and Routines
Rewards
45
© 2012 Forrester Research, Inc. Reproduction Prohibited
Service Values: I Am Proud To Be Ritz-Carlton
I build strong relationships and create Ritz-Carlton guests for life
I am always responsive to the expressed and unexpressed wishes and needs of our guests
I am empowered to create unique, memorable and personal experiences for our guests
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