5 Ways You Can Show the Value and ROI of CX
Do you believe your company understands the value of its customer experience (CX) programs? If not, you’re not alone. Despite the fact that CX is becoming a top business priority, 37 percent of CX professionals don’t agree with the statement “My company understands the role of CX and the value I bring.” What’s more, 24% of respondents identify “continuously proving value” as one of their top three on-the-job challenges.
So how can CX professionals show ROI and prove the value of their CX programs? What are the necessary steps to securing executive leadership buy-in, budget, and resources for their initiatives?
Here, we’ll explore 5 ways you can improve the perception of your CX program. From defining and driving cross-functional alignment on goals to establishing actionable metrics, these strategies can help your organization better see the value of CX.
- Align your CX goals with your organizational goals: Before you plan your CX program, identify the top priorities for your organization. For example, is the business focused on acquiring new customers? Building customer loyalty and driving repeat business? Gaining market share for a new product? Define these priorities and plan supporting CX initiatives. Tying your CX goals closely with top-level business goals is a great way to ensure you’re focusing on—and moving the needle for—your organization’s most critical objectives.
- Identify priority stakeholder goals: If you’ve ever struggled to get your cross-functional partners to take action on customer feedback, the secret is to get aligned first. While delivering great CX is everyone’s job, once priorities have been locked and roadmaps have been planned, it’s challenging to change course—even when customer feedback seems to be pointing in a new direction. The key is to hold thoughtful conversations with your stakeholders and cross-functional partners early on to understand what their top priorities are and how customer insights can help. For example, by understanding what key performance indicators (KPIs) the Product team is measured by, you can align your own KPIs to demonstrate the value you’re able to add to Product.
- Define success—and establish metrics to evaluate progress: Our recent survey revealed the top challenge CX professionals face is “no clear metrics defined or measured.” Without a defined set of metrics, organizations lack a north star to guide efforts and evaluate the impact on customer experience. Once you’ve identified key organizational and stakeholder goals and mapped supporting CX initiatives, it’s time to define what success looks like—and how you’ll measure it. Let’s say you’ll focus on building customer loyalty to help grow sales with existing customers. In this case, you might define success as retaining existing customers, selling them more, and receiving new business referrals from them. Your metrics might include retention, share of wallet, referral rates, and cross-sells and upsells. Once you have a clear goal in mind, use this catalogue of metrics to help define CX success and guide your choice of metrics.
- Marry customer data to operational data to accelerate—and show—progress toward business goals: As you obtain CX insights, connect that data with operational data to show impact. For example, operational data might show that revenue for the quarter is up by 20 percent, while your CX data show that the share of wallet among existing customers touched by your loyalty program is up by 60 percent. In this case, you can point to a correlation between the data sets as an indication your CX efforts are driving success against topline revenue goals. Other ways you can connect your CX metrics with business results include mapping to sales metrics, cost of service, customer defections, and churn rate.
- Calculate the return on investment (ROI) of your CX efforts: Make a strong business case for leadership to invest in your CX programs by connecting CX efforts to financial impact. By providing a clear forecast, in numbers, of the ROI for a solid CX program, leadership will understand how your program correlates to business results. To get started, first get familiar with the formula for calculating ROI. Then incorporate this data into your planning as you continue to evolve and align business and CX objectives over time.
Today, CX is top of mind for business leaders and they’re keen to invest—if they know they’ll get a good return. When you align your CX initiatives with topline business goals, set and consistently measure defined metrics, and demonstrate the ROI of your CX program, you communicate the value of CX in ways your organization can truly appreciate.