Financials and customer experience management (CEM) go hand-in-hand, whether it’s a matter of identifying financial results from CEM efforts, or a matter of financing CEM to begin with. New insights to this conundrum are seen in the 2012 CleaAction Annual Business-to-Business Customer Experience Management Best Practices Study, where more than half of participants said that difficulty correlating CEM to business results is one of their top five obstacles to CEM success. While budget restrictions were cited less often as one of the top two obstacles in 2012 compared to 2011, still more than half of participants named budget restrictions as one of their top five obstacles in 2012. (Note: the obstacles list in the 2011 survey did not include big data or correlation of CEM to business results among the selection set.)
Customer Experience Management Investment
Uncertainty in the 2012 business climate may have been a factor in reduced investment levels of 35-60% as compared to 2011 and 2010. Interestingly, in 2010, shortly after the major global economic crisis, CEM investment increased for the majority of participating B2B firms. This appeared to be evidence of management's recognition of CEM as an essential building block toward revenue and profit goals.
Most "customer knowledge areas" have seen a decrease in investment since the previous year for 35% to 60% of companies. 2012 investment in both VoC and touch-points has increased since last year for one in four participating B2B companies — and has decreased in these areas for one in four companies as well.
Investment has decreased in co-innovation for 65% of companies, followed by lifetime value for 60%, customer communities and CX innovation for 57%, retention for 50%, and experiential marketing for 48%. A question for the next study: If you did not decrease investment, are your customer experience results stronger than your competitors who did decrease CEM investment?
Connecting Revenue to Customer Experience Management
Many business-to-business companies are making strides in customer experience management best practices, and the 2012 ClearAction study features numerous stories of companies' progress. Here is an example from Citrix:
After mapping customer contract values to their ratings for likelihood to recommend the brand, Citrix knew they could increase revenue by increasing customers' and prospects' propensity to say good things. Through listening posts across brand awareness to brand advocacy, valuable insights are gained about functionality that could have increased positive word-of-mouth, and specific revenue lost or increased is monitored along with customers' satisfaction level and likelihood to recommend. After product trials and contract periods, they ask the question: "What could we have done differently that would have led you to buy?" The Customer Insights team created a business case model that uses this data to help managers prioritize product changes based on their impact on keeping customers as well as acquiring new customers. This quantified approach has helped internal stakeholders embrace the methodology and the importance of customer experience management, and it brings the customer to the decision-making table on a regular basis.
If you're interested in linking financials to customer experience data, make sure your company is making operational and attitudinal changes in response to customer inputs (i.e. customer experience management). Finding linkages based on marketing and sales efforts alone may not be sufficient impetus for marked patterns.
"Knowing the spending levels of customers who provide overall satisfaction ratings at different levels across the scale is valuable for the enterprise line of business in helping managers envision revenue gains that can result from better customer experience,' said Emilie Smith, former Customer Experience Manager at telecom provider Orange. 'In B2B there's an even bigger argument for CEM linkage to revenue and profitability because often the products and services for businesses are a lot more sophisticated and cost a lot more for the company to provide them. For one account, millions may be at stake. So B2B really needs to make sure the profitability will be there."
To hear the Citrix online interview Customer-Driven Business Cases, see http://tinyurl.com/cem-show
See more information about the customer experience success factors that were identified through the B2B CEM study.
See the table of contents of the Annual ClearAction Business-to-Business Customer Experience Management Best Practices Study and download your copy today.
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- ROI Opportunities for B2B Customer Experience Management
- 8 Paths to Value via Benchmarking Studies
New opportunity: participate in the 4th Annual State of B2B CEM survey
Limited time offer: buy the 2012 report now and a complimentary copy of the 2013 report will be sent when it is published