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Is Customer Experience Dead?
By Janet Gerhard
Perhaps no other industry is as deeply rooted delivering a quality customer experience than hospitality. Yet, while other industries such as financial, healthcare and retail have senior level customer experience officers within their companies, hotels do not. Are we better or worse for it? Does hospitality even need Chief Customer Experience Officers?
My hypothesis is that customer experience management is assumed to be so foundational to the DNA of hospitality that all roles are responsible for it. Therefore, why tap a senior level officer with this specific responsibility? It is perceived redundant in the c-suite. And, who strives to be that easy target when it is difficult to justify the position when the going gets tough or the winds of priorities change? After all, a Chief Customer Experience Officer can only be successful when (s)he demonstrates value to the CEO through his/her contribution -- increased revenue, decreased costs or mitigated risks. Ultimately, this rationale or justification translates to no one being truly accountable.
Compare this to what is happening across industries beyond our walls. The rise of the Chief Customer Experience Officer is well underway. According to Forrester Research, the number of Chief Customer Officers (CCOs) — and synonymous titles such as Chief Experience Officer, Chief Global Customer and Marketing Officer — almost doubled between 2009 and 2010.
Many of these individuals are also new to the job and typically are the first to hold the position. Of the 100 executives responsible for enterprise customer experience interviewed, over 80% of CCOs have spent two years or less in the position. The majority are internal hires with significant history at their companies. Even though their teams are small, they do have great influence over how the company prioritizes and spends resources. And, it is not just about fixing problems. Hoorah! The investment in CCOs is about accelerating growth. In fact, research from the Chief Customer Officer Council identified the top priorities for CCOs as:
Hotels go to great lengths to measure. Millions are spent on satisfaction surveys, employee research, brand studies, quality assurance audits, mystery shopping, and now social media monitoring. We fall down, however, on giving this data meaning. It’s rare for executives to have the authority or mandate to look across the entirety of the customer experience to intentionally manage it. Why?
Let’s face it. At its core, our industry still has a dual bias — the constant focus on quality assurance and the resolution of problems as its primary cure for all that ails. Don’t get me wrong. quality assurance has its place — but is doesn’t define customer experience management. Better problem identification and resolution are not the promise of CEM. Collaborating across the functions and silos is the critical differentiator of the CCO position, which means they often must rely on influencing not mandating change.
So, What Does This Mean For Customer Experience?
In an industry steeped in functional leadership and protocols that require cross-department, cross-continent, multi-branded, and owner-represented steering committees, it’s no wonder enterprise customer experience efforts are doomed without executive level support. Could the influx of better technologies, new social media channels, and senior level leaders around the world demanding more connected, meaningful and actionable data be the opening to usher customer experience management to the c-suite? If not now, when?
January 2013 research by Deloitte confirmed what many of us know as travelers ourselves: Brand loyalty is in peril. The 2012 North America Hotel Guest Satisfaction Index Study by JD Powers reported that “Hoteliers Are Falling Further Behind in Meeting Guest Expectations,” and spoke of improving fundamentals. And, the American Customer Satisfaction Index (ACSI), the stalwart of satisfaction, says hotels are only slightly better than hospitals and on par with banks and computer software. Can we really be an industry steeped in customer experience with this type of showing? If we make it a hospitality comparison, is being significantly better than airlines something to hold up proudly? Unless our goal is to be one of the taller dwarves, our industry needs to aim higher.
“The single reason most organizations fall victim to inappropriately valuing customer loyalty, customer experience, or related topics over the years is that most have never tied the work to core strategy because they don’t understand how or why these efforts accelerate this strategy,” says Lou Carbone, founder of Experience Engineering and widely credited as the pioneer who launched the intentional experience management movement, “Time after time, when these corollaries are outlined at the outset of efforts vs. trying to justify them after the fact, I have seen them become a fundamental part of business plans, funding and commitment from boards, executive and senior management, and a transformative culture that begins to realize the experience is the value the customer receives.”
Companies that excel in customer experience management consider it a key differentiator for the business from the top down. Not something merely touted at industry events or in the annual report. I’ve grown weary of hearing Amazon, Southwest and Starbucks being held up as exemplary. Best practices in CEM outside our industry have been around for years, yet this is an area where we should have more success. So, how do we get there? I offer this list of 10 suggestions from Shaun Smith, thought leader and author of “Managing the Customer Experience” --- with some slight tweaks added based on my own experience.
If we put these steps to work perhaps then, in our industry, customer experience management is not dead…just an undiscovered sleeping giant.
About the author
Janet Gerhard is the founder of Hospitality Gal, LLC which helps companies generate new and repeat business as well as create strategic partnerships to add considerable value and growth to the bottom-line. Most recently, Janet led the Hospitality sector of newBrandAnalytics, a leading provider of social market intelligence tools. Prior, she spent almost a decade with Maritz and several years in quality assurance with LRA Worldwide. She holds a BS in Hotel Administration from Cornell University and has a passion for customer experience design and measurement. Janet can be reached directly at email@example.com or @Hospitality_Gal.
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