Customer loyalty continues to be a top-of-mind concern for CEOs, as studies and surveys from the likes of IBM and others have shown. During the past decade or more, we have seen the use of customer satisfaction surveys, Net Promoter Score, and the rise in customer experience as means for gauging customer loyalty. The central points being that of keeping customers satisfied and providing great customer experiences will keep customers loyal.
In fact, a recent study on customer experience surveying 500 plus executives sponsored by Genesys, showed a very strong correlation between providing high-quality customer experiences and customer retention. Here is what Paul Segre, CEO of Genesys says about the survey:
“This study clearly demonstrates that C-level engagement in customer experience initiatives drives competitive advantage. In an era when consumers have more choice than ever, the research validates that investment in CX is a sound investment in sustainable competitive differentiation.”
The survey makes a strong case for C-level engagement and making an investment in customer experience.
Disruption On The Minds Of CEOs
Despite the needed uses of these approaches, CEOs are confronted with a troubling decline in customer loyalty. Leaving many to wonder – how can this be? And, some are achieving the highest marks they ever have when it comes to customer satisfaction and providing notable customer experiences. Yet, customer loyalty is like entering a greasy pole climbing contest. Difficult to hang on to and difficult to climb higher.
This dilemma is raising the conscious level of CEOs and their organizations on a more pressing issue. One they are learning to keep top-of-mind. That is, how to stay relevant in the minds of their customers and buyers today as well as in the future. The phenomenon behind this dilemma is the speed and scale of disruptive new technologies.
During the past few years, we have seen a literal explosion of new digital technologies enabling innovative operating and business models. Cloud-based technologies serving as one example. It has created avenues of opportunities for new entrants to offer competitive subscription-based alternatives to expensive hosted premises technologies. Thus, creating the phenomenon of organizations that achieve the highest possible customer satisfaction marks, Net Promoter Scores, and ranking in customer experiences seeing an erosion in customer retention and loyalty.
A recent 2015 KPMG survey of 400 CEOs indicated ninety percent (90%) of CEOs surveyed were concerned about competitors taking business away. Nearly sixty percent (60%) were worried about new competitive entrants disrupting existing business models. A strong indication CEOs are losing sleep over keeping their organizations relevant in disruptive market environments. Here is how Beth Mooney, CEO of KeyBank is quoted on disruption:
“I see more competitive disruptors on the landscape than I’ve ever seen. Companies are attempting to use some new technologies to bypass what has been the traditional payment system.”
Safe to say that staying relevant and having an eye towards the future are pressing concerns for CEOs today.
Staying Relevant With Customers And Buyers
To stay relevant, CEOs are beginning to recognize not only the need for keeping customer experiences at the highest quality levels possible, but they also must go beyond. Going beyond means having a plan in place to stay relevant. A plan involving listening to and engaging customers about the future.
This is an important perspective for CEOs and their C-level teams to grasp. Oftentimes, CEOs and their organizations can be caught flat-footed because the “future” arrives at their doorsteps unannounced. Leaving no time to respond and a C-level group to stare out of the window as customers leave for a disruptive competitive alternative.
Having a plan to stay relevant means CEOs will need to be intentional about having a deeper understanding of their customers and their goal-directed behaviors. Why goal-directed behaviors? There have been several studies in this area on the correlation between goal-directed decision behaviors and loyalty. These studies (Illinois University, 2006) show this correlation is strong.
What does this mean? Loyalty is tied to the ability to accomplish and fulfill goals. If customers are presented with newer and innovative means for accomplishing their goals, then they may choose these alternatives. This is the key principle, which makes qualitative buyer insights research vitally important to staying relevant.
For example, previously mentioned Genesys conducted qualitative buyer insights research and utilized buyer persona based scenarios to anticipate future customer movement towards mobile and cloud technologies to accomplish their goals in customer contact management. Addressing the then early nascent need to offer digital omni-channel customer support and customer experiences in such areas as banking. Thus, when the future arrived at the doorsteps of Genesys, they were ready as recent Gartner Magic Quadrant and Forrester reviews have pointed out.
For many CEOs, getting a handle on three to five years out will become paramount to staying relevant. Time is a wasting as the saying goes. The inability to stay abreast and anticipate the future can mean doors opening to being replaced by seen and unforeseen competitors, current products and services no longer being relevant, and room for disruptive new technologies creating easy choices for customers to choose alternatives. By the sound of them, none of these three scenarios can be good ones.
(Here is a marvelous TED talk on staying relevant by pastor Rick Warren. He begins with a very profound statement: “When the speed of change around an organization is faster than the speed of change inside the organization, the organization becomes irrelevant.” Listen, learn, and enjoy.)