Customer Experience – Are You Measuring?

CX Measurement

It is a no brainer and almost common sense that achieving great customer experience (CX) should be an important element of your business strategy. Also, it does not take much to convince people that investing in CX would give you a lot more insights that help one take better decisions. An Oracle Survey found that 93% of Senior-level executives believe that ‘Improving CX’ is one of their top three priorities, while 97% rating it critical to success. Despite this only 37% have formally introduced a CX practice. Why?

The question of Return on Investment (ROI) on CX management is a crucial one. And when you are calculating ROI, measuring and benchmarking right metrics is even more critical. I will get to the measurable aspects a little later, but if as a CEO or key decision maker, you are not convinced about the ROI, read the numbers below:

1] Gartner estimated last year that by 2014 “failure to respond via social channels can lead to up to a 15% increase in churn rate for existing customers.” Are you still blocking your employee’s social interaction?

2] As per the 2011 RightNow (Now  –  Oracle RightNow CX Cloud Service) CEI report, 49% executives believe that customers will switch brands due to poor CX. In reality 89% of customers agree they would or have already switched brands.

3] Dell’s internal metrics shows that they were able to turn around 97% of its dissatisfied customers through proactive intervention. More importantly, more than 40% of these became Dell’s raving fans.

It is no coincidence that organizations that listen to their customer and focus on them, have done well even in the stock market in the last 6 years. The chart below by Watermark consulting highlights this very fact. It is a comparison of companies which are considered CX leaders and laggards against the S&P 500 (stock market index based on market capitalization of 500 large companies listed in NYSE)

Customer Experience Leaders Outperform the Market


One may still have questions on how to measure CX?? There is no straight answer to this. All methodologies may sound right and not so right at the same time. You may not be able to measure a direct outcome from a particular initiative taken towards CX but collectively you can measure the change.

Customer experiences are complicated! They are subjective and driven by emotions. If you try to collect and organize this information the meaning may be lost. Moreover, traditional indirect measurement methods may not be correct and scarily misleading. Also, sometimes, capturing responses, and averaging feedback scores may not be enough.

For instance, sometime back, I was speaking to a friend who was looking to buy a new phone. Her Apple iPhone 4S has started giving problems after almost 2 years of use and she was literally frustrated with how the phone was disrupting her daily life. I met her again after a week and as expected she had got herself a new phone, but to my surprise she purchased a newer model of iPhone. When asked why, she responded “Two years, the phone hasn’t really given any problems and I trust Apple”. Another friend going through the similar issues immediately decided to switch to an Android platform.

Excellent keynote

Thus, the experience may vary customer to customer. Also, responses may vary industry to industry. A few negative feedbacks against some average feedback may not hamper the sales of a no frills airline, furthermore for an organisation a definition of an important customer set will differ. The responses may also differ for sales and after sales. Hence, setting parameters for measurement is very contextual.

But let’s try this – Two most basic outcomes you want to see out of an investment are:

1] Increase in Revenue

2] Decrease in costs.

This could be further broken into two more metrics.

Mapping your CX initiatives from the outcomes

Mapping your CX initiatives against each of these desired outcomes is fairly easy. Then each could be measured by a relevant metric. An example of one such grid is shown below.

Intended Outcome CX Examples through the customer journey Descriptive Metrics
Acquire New Business Visually Appealing Website with self-service features Direct or Indirect Traffic, Page visit, Frequency
Acquire New Business A targeted campaign done using Oracle Marketing Cloud Marketing Campaign Effectiveness, Conversion Rate, Cost of acquisition
Retain Existing Business A promotional campaign done using Oracle Marketing and Oracle Social Relationship management Upsell or Cross Sell Rate, Customer Churn Rate,  Revenue per customer,  Renewals
Retain Existing Business Promote Facebook and LinkedIn pages through your Social engagement and monitoring investment Net Promoter Score, Brand mentions, likelihood to recommend
Retain Existing Business Feedback or survey sent to customer after every service interaction using Oracle RightNow CX Customer Satisfaction, Average scoring
Reduce Employee disengagement Internal training on New applications Average  Resolution Time, Turn Around Time Initial Training Time,  Service Costs
Reduce cost of operating channel Multichannel support provided through chat on customer’s website or through self-service portal First Contact Resolution, Self Service Rate, Channel Costs, Customer Effort score


Although this process is involved, there are ways to streamline it. One such  methodology by Forrester is explained below. Below approach would cover most of your permutations and combinations while measuring your CX.

CX Measurement

Measuring CX is important. Benchmarking the results against industry and self standards is indispensable. An organisation is required to reassess its progress in regular intervals. Only doing so would help you lead your segment and industry.

About CRMIT Solutions:

CRMIT Solutions is a leader in transforming businesses with cloud based Customer Experience (CX) solutions on sales, service, marketing & social cloud.

We are committed to provide customers with the best service in the industry. Everything we do – every order, every delivery, every service, every offering – centers on the satisfaction of our customers, and making them more efficient at what they do.

Testimony to Customer Excellence

Inputs from

Pratik Bajaj
Principal Business Consultant –Industry CRM & CX Solutions.
CRMIT Solutions

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