This article originally appeared on Forbes.com.
Consider how revenue growth at Trader Joe’s, the US grocery chain, has outpaced most other large competitors in recent years. It built a devoted base of highly educated, often middle-income customers not only by providing an innovative product mix at low prices, but also through a carefully conceived experience. Its stores have an intimate, slightly exotic atmosphere, with helpful staff to provide advice. Online product guides and recipes complement the stores. And Trader Joe’s equips employees to deliver on the brand promise through comprehensive frontline training and ample autonomy to make in-store decisions.
Bain & Company analysis shows that companies that excel in the customer experience grow revenues 4%–8% above their market. That’s because a superior experience helps to earn stronger loyalty among customers, turning them into promoters who tend to buy more, stay longer and make recommendations to their friends.
Yet creating experiences that consistently impress and stand out from the crowd remains a difficult endeavor, and companies often falter after an initial burst of energy. Companies serious about building a compelling experience need to develop thorough, nuanced answers to five questions.
1. What do we want to stand for in the eyes of our customers?
Senior executives might understand the opportunity to improve the customer experience, but they often fail to mobilize people at the front line. Beyond a slogan or slide deck, leaders need to paint a compelling picture of the destination—what the company should and should not stand for—so that employees know what the initiative means for them and how their behavior and approach should change.
One European telecommunications provider distilled its vision to being “simple and friendly”: simple through such features as clear pricing and easily installed and used Internet service; friendly through greater accessibility to service agents and follow-up on a problem until it gets resolved. The company translated that vision into specific performance indicators such as the clarity of sales pitches and the share of customers that find it easy to register online. It distributed a card to employees listing the behavior principles guiding the effort, and it charged two senior executives as “Mr. Simple” and “Mr. Friendly” to lead the efforts.
2. What are our must-win battles?
If you have hundreds of uncoordinated initiatives across different parts of the organization, that rarely adds up to a powerful whole because each one receives too little attention or funding. Experience leaders sift through early initiatives to identify those that work well and deserve more resources, while avoiding or quickly ending those that don’t matter to most target customers.
That’s what a European air carrier did to regain its standing among highly profitable segments of premium business customers who had given the airline weak loyalty scores. Root-cause analysis identified a handful of initiatives under way, grouped them into themes and identified the handful that deserved more investment or that could serve as quick wins. For the theme “make it speedy,” for instance, the carrier moved gate locations to shorten the walk and accelerated VIP security lines. Improving the overall experience for key customer segments helped the carrier to regain its lost market share.
3. How can we use customer feedback to promote learning and behavior change among employees?
People with clarity about their mission—and who receive positive and helpful reinforcement for doing the right thing—go the extra mile to deliver. Mobilizing and harnessing employees’ energy requires two types of feedback loops.
An inner loop collects customer feedback through one or two simple questions—Would you recommend company X? Why?—following key episodes. This feedback routes quickly to the relevant employees and supervisors so that they can discuss customers’ perceptions and feedback, share learnings, escalate issues that cannot be resolved locally and follow up with select customers.
Customer feedback also fuels an outer loop of improvement to broader systems. This outer loop aims to identify major issues and root causes of problems and strengths, which typically involve multiple functions and departments. Management can deploy resources to address these systemic issues and make improvements that benefit the overall experience.
4. When we put ourselves in the customer’s shoes, what aspects of the experience need to change?
Experience leaders display deep empathy toward customers’ core needs. They generally start with a clean sheet and redesign certain important episodes, or even the entire experience, to repair breaks and seize opportunities for “wow” moments.
One UK-based bank identified detecting and deterring fraud as a moment of truth that could strongly influence customers’ advocacy or detraction of the bank. It described four episode categories of suspected fraud, and then mapped all of the people and processes required in each episode to resolve the fraud effectively. By surveying customers after their fraud resolution experiences, the bank found that for all four journeys, higher loyalty scores correlated with fast resolution of the problem and resolution in one phone call by the first agent contacted. So speed, process and service became the cornerstone of the redesign of the experience.
5. How can we anticipate and mitigate the risks, in order to sustain the changes?
Senior leaders committed to building a superior experience will need an achievable plan that can be delivered while carrying on with day-to-day business.
First, map out which employee groups are most critical for carrying out the required changes. These groups then need to be properly equipped with the technologies or process changes that will allow them to succeed. Finally, a concerted effort to improve the experience requires sponsors at all levels of the organization. This “sponsorship spine” might track direct reporting relationships, like a call-center agent, his supervisor, her manager and so on. But it often also includes respected advocates in other units, people who have influence by virtue of earned authority and reputation.
By answering each of these five questions, companies can develop a culture that delivers exceptional customer experiences, time after time.
Written by Frédéric Debruyne and Andreas Dullweber, partners in Bain & Company’s Customer Strategy & Marketing practice.