It was the annual meeting of the company, a large manufacturer with a dealer network across North America. Several hundred employees gathered at a plush Virginia golf and conference center, including the corporate staff, sales and product development professionals, dealer executives, and—importantly—parts and service managers.
As is typically the case at this type of meeting, there were a lot of discussions about the trends and challenges affecting the company and its industry. Competition and commoditization have squeezed margins out of the hardware side of the business; it is increasingly difficult to make much money just from selling equipment. The more profitable side is now aftermarket sales of services and replacement parts. In past years not many parts and services managers had been part of the annual meeting—but this time they attended in record numbers.
I heard one dealer’s service manager say to a peer, “We are here because we are where the money is.”
How was this company going to make sure all parts of the business stayed healthy? The overriding theme was a culture shift—from a singular focus on product features and quality to a broader view of the customer experience. This meeting was an important first step toward defining the customer experience and sharing practical steps that dealers could put to work immediately.
How are you approaching customer services and customer experience (sometimes called “CX”) in your business? One of the issues that holds up some CX initiatives is simply getting the definition straight. Customer experience is not, for example, the same as customer service (which typically describes specific behaviors that employees are to engage in, such as answering calls or emails within some specified time frame or resolving issues during the first service call). On occasion, companies can get sidetracked if they consider customer service too narrowly. I might receive efficient, pleasant service while at the dry cleaner or while picking up an order from a retail store—but I might have a better customer experience if I didn’t need to make that trip in the first place.
Nor is customer experience necessarily the same as customer satisfaction (which is a type of research or feedback metric, used because the organization believes it will help predict customer loyalty or attrition). Instead, CX is an all-encompassing look at what a customer sees, hears, thinks, and feels across encounters with the organization (phone calls, face-to-face interactions, social media, the website, etc.).
After some discussions with this manufacturer’s leadership team, we approached customer experience as a three-component cycle:
- It is vital to gather and understand customers’ impressions in order to know what to do. Some dealers had sound data while others are just getting started. Your feedback might be qualitative (e.g. Voice of the Customer) research, quantitative ratings, or both. In any event, it’s important to be proactive and representative—gaining an understanding of all customer types and interactions, and not just waiting to learn how the company responds to questions or problems.
- These dealers are committed to knowing whether the associates who deal with customers have the wherewithal, knowledge, and skills to deliver an excellent experience—and to do so consistently. There are big implications for recruiting, training, and compensation.
- We discussed many areas for potential process improvements, including the ways different units use customer data, when to offer self-service options, and how new associates are onboarded.
If you’re building or refining your approach to the customer experience, then I hope you find these three components a helpful place to begin. After all, that’s probably where the money is.