Sometimes the Best Metrics May Be Counterintuitive

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[/vc_column_text][vc_column_text]There is no shortage of customer experience metrics today: digital data feeds, customer profile data, cross-channel performance, operational data, etc. The trick seems to be in fully understanding and focusing in on the key sets of metrics that really matter to build and sustain customer lifetime value across all channels.

But it’s easy to get the proverbial cart before the horse; to mistakenly just use the available metrics you’ve always used, and then decide how to improve.

Instead, we should first clearly understand the real long-term business goals before identifying the best measures to support those goals.

In our client work we have numerous examples where low performance for an isolated measure may actually be positive for the company. Below are just three actual retail client examples of such a phenomenon. The recommendations that we proposed only make sense in the context of measuring the overall customer journey.

Lengthen Customer Service Call Time

This retailer’s contact center employees were given incentives to lower the average time of a customer contact. The purpose of the incentive was to improve call center efficiency. The customer journey analysis revealed, however, that the contact times were actually too short. The analysis showed that the cost of taking a little more time with customers would result in greater customer satisfaction and higher lifetime value returns from future purchases across the channels.

Limit Branch Short-Term Profit

This retail company had a dedicated customer contact employee at each branch. This customer contact employee was responsible for strengthening relationships with the branch’s local customers. When a corporate initiative was announced to improve branch profitability over a 3-month period, 30 branches responded. These 30 branches made deep operational cuts, including the elimination of the customer contact employee under the assumption that the customer contact could be conducted by other branch staff. The result was that many of those 30 branches saw a dramatic jump in short-term profitability.

Fortunately, the corporate office was measuring satisfaction with the customer journey, and early indications of low touchpoint scores and customer dissatisfaction revealed that the short-term profits from those 30 branches were coming at the cost of future revenue growth. Corporate management called for the rehiring of the customer contact staff at the branches, but it was too late to prevent the revenue shrinking that took place at several of those 30 branches the following two quarters. The good news was that the damage was mitigated through early detection through their measurement system.

Increase Contact Center Administrative Tasks

This retailer had a good revenue mix from both physical stores and online business. Because the retailer evaluated the entire customer experience across the channels, they had developed a clear understanding of the overall financial value of interactions with customers. Two of the primary customer touchpoints were floor associate interactions at the physical stores and contact center employees handling orders and customer service.

As this retailer examined the customer journey, it became clear that these two touchpoints were not optimized. Acting on this insight, this retailer invested in technology that enabled floor associates to transfer some administrative tasks to the contact center. With this new workload adjustment, the administrative tasks for the contact center increased, making the contact center “less productive” with their customer contact interactions. However, this administrative change opened up more time for the floor associates to interact with customers at the physical store and, consequently, increased customer satisfaction, strengthened customer loyalty, and enhanced overall customer lifetime value.

In each of these three cases, the correct management decision was counter-intuitive. When viewed in isolation, management will naturally seek to reduce customer service time, increase branch profitability, and minimize administrative tasks at the contact center. When measured as part of the complete customer journey, however, these touchpoints can be optimized around the long-term business goals.

Executives are faced with numerous decisions such as these each and every day. The only way these decisions can be made correctly is by making decisions based on the right metrics aligned with the customer journey.[/vc_column_text][/vc_column][vc_column width=”1/4″][/vc_column][/vc_row]