The High-Five: 5 Questions with Customer Experience Leader Augie Ray
Each month, Warm Name will visit with someone who has expertise about a particular topic or industry. This month, we welcome Augie Ray. Ray is a Vice President Analyst at Gartner, a research and advisory firm. He covers customer experience for marketing and CX leaders and helps them launch and manage successful CX programs.
The High-Five:
5 Questions with Augie Ray
Q. “We are not what we say we are. We are the experience we provide to customers and what they say we are.” That quote from you really resonated with me. Which brands or organizations truly embody that quote and why?
A. So many organizations strive to craft a brand that inspires customers or a purpose statement to engage employees, but in the end, if they don’t change what they do, how they do it, and what they reward, then they’re still just a company focused on short-term quarterly results like everyone else. The brands that we all tend to respect are the ones that weigh their short- and long-term outcomes, balancing their financial metrics with measures of customer relationship, such as satisfaction, loyalty intent, and brand advocacy.
I’m biased since I worked at this company, but USAA comes to mind. In a vertical not known for strong, differentiated, customer-centric brands, USAA continues to get some of the highest NPS scores of any brand in any category. That doesn’t happen by accident. That company measures and rewards leading customer outcomes, such as positive survey scores and retention, not just short-term profitability. This leads employees to make decisions that prioritize time and care for the customer over efficiency. USAA is known for what it is and does for customers, not just what it says in its ads or PR.
Amazon comes to mind, as well. Everyone wishes to emulate Amazon’s adoption of technology or its specific strategies, like Prime, but few seek to understand and emulate the leadership and organizational principles that created these success stories. Amazon didn’t just create a brand or purpose statement but then operate in the same manner as everyone else; they start by recognizing customer needs and wants first, and then work backward to understand the technology, services and products that satisfy those needs. And, while its bricks-and-mortar competitors remained focused on quarterly financial performance, Amazon made clear to investors it intended to prioritize investment in innovation, customer experience, and growth over short-term return for shareholders.
I believe these examples are instructive because they demonstrate that changing what you do takes tough decisions, effort, and commitment. What you do has to match what you say, and that isn’t easy in today’s high-pressure, ROI-driven, dollars-and-cents world
Q. You just assumed the reins of the customer experience department for.a major company. What CX program questions would you want explored or answered in the first 90 days at the helm?
A. It probably goes without saying, but preparation would start before day one on the job. I think a new CX leader must use the time before starting in their new position to experience the brand as customers do. We all quickly lose the ability to be objective the longer we’re in a company, so those precious weeks before starting can be very valuable to provide some of the stories you use to convey your vision and what it means to the company and customers.
Once I started, my first order of business would be to gauge the level of understanding of CX within the organization. CX is widely misunderstood, so recognizing the various definitions and expectations within your new organization is vital to prevent missteps that can occur with mismatched visions.
I’d also want to establish how my success will be measured, and I’d think of this is as much reactive (what does my boss want) as proactive (how can I shape their expectations). If we do not establish the right metrics from the start, then my direction as a CX Leader can be compromised from day one.
Finally, I’d want to understand the state of CX efforts and assets. Who has CX responsibilities? What efforts are underway within the organization? How coordinated or aligned are they? What is the state of the organization’s Voice of the Customer (VoC) and customer research programs? Have personas been established and are they used commonly? Has the organization attempted to understand the customers’ preferred journeys from end-to-end—from the buy cycle to the own cycle to the loyalty cycle?
We have a report published at Gartner on the first 100 days of a new CX leader in marketing, so if your readers are Gartner subscribers, they find this report worthwhile to learn more.
Q. In a previous story I interviewed you for, there was no debate in your mind about measuring customer metrics only through the “Holy Trinity” of loyalty, satisfaction and advocacy. It is only then you will begin to identify and create ease-of-use, value and trust on behalf of the customer. This is a two-part question. In what ways can we tangibly measure customer loyalty, satisfaction and advocacy? And, how do we begin to apply that same paradigm for the employee? It feels to me that customer experience and employee experience are inextricably linked and, that, without a good employee experience the customer experience suffers. What are your thoughts?
“We are not what we say we are. We are the experience we provide to customers and what they say we are.” -Ray
A. I work with Gartner’s clients to help them understand how to establish the relationship between customer satisfaction (as measured through surveys and other means) and the desired customer behaviors that drive the top and bottom lines—loyalty and advocacy.
There are two broad ways to measure customer loyalty: Attitudinal measures and behavioral measures. Too often, CX leaders lean on one or the other, but delivering reliable CX results requires both. Behavioral measures are the easiest and also the closest to financial results. These measures vary depending on vertical, but they tend to measure if customers are buying with increasing frequency and greater average order value or if they are renewing versus churning? The problem of behavioral measures is that they don’t tell you what customers are feeling or intend, so these are lagging indicators and are not instructive—we can tell if the brand is failing to retain and grow customers after the fact, but we do not know why. This is why attitudinal measures of loyalty are some important—when we ask people what they feel or plan to do, it is both a leading indicator but also helps understand the “why.” What is working and what isn’t? What drives up loyalty or what dissatisfiers are increasing the likelihood of churn?
Advocacy can be more difficult to measure on a customer-by-customer basis, and the methods vary considerably from one category and brand to another. Some organizations have referral programs, which provide a direct way to measure customers’ advocacy behaviors and impact. Other brands will seek to measure customers’ willingness to complete online ratings and the scores they share with others. Some B2B companies create scoring mechanisms to evaluate individual customers’ advocacy, such as their willingness to allow logos to be shared, to create case studies, to speak at user conferences or to act as a reference for prospects. While the measures vary, they all share the same goal of measuring not just what people say they might do to recommend you (such as their Net Promoter Score) but also what actions they take to increase your brand’s reputation, awareness, and consideration.
Q. Enhancing our human intelligence with artificial intelligence has the potential of improving our individual and collective existences - as long as manage to keep the technology beneficial to our experiences and their outcomes. What should be the role of AI in customer experience? And can you share some use-cases of delivering better customer experience with AI?
A. I recognize that AI will help CX leaders to do a better job of understanding customer perception and executing customer-centric programs, but I also tend not to concentrate on AI in CX. To me, AI is HOW we do something, not WHAT we do. I sometimes joke with CX vendors who wish to discuss their new AI capabilities that I don’t care if their platform is powered by gerbils in exercise wheels or is powered by AI—my focus is on the outcomes the platform produces, not how it does so. This also suggests another belief I have about AI in CX, and that is that vendors will bake AI into their platforms and tools rather than AI being something we go out and purchase. I don’t expect CX leaders will need to acquire AI tools but should instead seek to understand how their VoC platforms, digital analytic programs, and journey optimization platforms are utilizing AI to improve results.
AI is a multiplier. If a company is too focused on short-term, company-centric, financial results, then it will put AI to use accelerating results that put the company first and ignore customer needs. Meanwhile, if a company has established the right customer-centric goals and measures, then AI can multiply CX outcomes. But, in the end, I see CX as being primarily about priorities, culture, goals, decisions and actions, not just about technology and automation. AI won’t make the tough decisions we discussed above—only leaders can do that.
Q. Life in perpetual BETA is essentially the notion that you are constantly and continually in the state of becoming. You’re never quite there and always are striving to improve. This concept is one I introduce when I speak about rapid organizational change and individual development and growth. I have introduced BETA as a mnemonic to explore ways in which one could bring about positive change in one’s life or organization. The mnemonic is below. Would you indulge me and share how you would apply these words as it relates to your personal life or your life as a customer experience professional?
Belief
Empathy
Trust
Advocacy
A. I like your BETA concept. In some ways, it encapsulates everything we’ve discussed. It starts with Belief, which forces leaders to ask what they believe—who do we put first, how do we measure success, and what difference do we want to make in the world (and not just to our stock price)?
Next, we have to put action to those beliefs—empathy is important to achieve that. The only caution I offer to my clients about empathy is that we must focus on creating and measuring empathy, not merely counting empathy actions. There is a terrible trend in customer service these days to hold CSRs responsible for expressing empathy. But saying you’re sorry or that you understand the customer’s frustration is not the same as actually being empathic. We cannot simply write scripts and expect our employees to mime empathy but must consider how our policies, staffing level, tools, expectations and rewards encourage or discourage true empathy for our customers.
And if you get your beliefs and actions right, then your brand will create trust and advocacy. Trust is a component of loyalty, and as previously mentioned, we must ensure customers don’t just trust the brand but that they act on that trust. (That’s the difference between attitudinal and behavioral measures of loyalty). And, advocacy is what increases our reputation, builds inbound traffic and referrals, and improves our acquisition, conversion and close rates.