When Q1 performance does not go as expected, departmental budgets see a strategic tightening. Customer experience leaders know that investment in tools and technology influences positive customer relationships and organizational success. This dichotomy makes managing budget shifts a challenge.
It is difficult to achieve a satisfactory ROI without efficient tactics, and customer experience technology plays a crucial role in ensuring that you get the customer journey right. These solutions work to streamline internal and external communication, provide consistency across interactions, and add a personal element to remote engagements. However, customer experience tools do come at a cost. Ultimately, though, the investments yield profitable results for both your customers and your business.
There are numerous examples of businesses who used customer experience to propel forward, save a failing brand, or disrupt an industry. Brands like Apple, Burberry, and Airbnb are just a few examples of names that show what wise investments in tools and a customer-first mindset can do to a bottom line. Recursive Labs has found that brands experience a greater than 300% ROI on our cobrowse and customer engagement solution, Realtime. This solution, when serving as part of a well-rounded customer experience ecosystem, can transform your customers, your brand, and your bottom line.
Unfortunately, many executives still view customer experience technology as a discretionary cost instead of a return on investment. Furthermore, many leaders fail to recognize the continued relevance of human connections. The growing emphasis on intelligent automation, such as chatbots, gives a skewed perception of customer expectations and preferences. Today’s customers are digital and remote. They want real-time engagement and fast results. However, they also want the sales and support process to be personal.
That’s not to say there are not opportunities to cut costs. There are always ways to operate more efficiently. That being said, deep budget cuts and demands for faster, automated work is not a way to increase profits. In fact, it might be a way to watch them decline.
Automation Is Not Enough
Automation is an excellent tool for enhancing strategies and providing support coverage. But your customers are demanding a personalized experience. You need people to develop and execute those strategies, track analytics, and offer a human on the other side of the phone when your customers are looking for one.
Automation can enhance customer interaction and relationships. IVR systems streamline early customer questions. Chatbots gather valuable information. Artificial intelligence and big data add context to engagements and analysis of customer behavior. However, removing the human element from human interaction entirely can be detrimental to long-term customer success.
Automation is not enough. You must also invest in business agents and the tools they need to reach and connect with customers. A chatbot might be able to answer a significant portion of all customer questions, but its impact will be wasted if there is not a trained representative available to answer the remaining questions and to intervene when there is confusion. Furthermore, a customer service representative might be talented and knowledgeable, but unless they have the tools to allow them to connect with customers, they will make little impact on overall customer satisfaction.
Brands that approach their customer experience budgets with a short-term view will pay significant costs in terms of customer acquisition and retention down the line. The customer experience and the technology needed to support it are investments, and they should be treated as such.
Coping with Budget Constraints
While customer experience leaders are going back and forth over budgets, they are missing valuable opportunities to put into place solutions to connect with audiences and drive growth - which is the point of the customer experience strategy in the first place.
If you want to navigate these decisions better to achieve desired results, you should consider the following strategies:
Get clarity around goals
It can be difficult to understand why and how executives expect budget dollars to be allocated as a part of the customer experience. Customers interact with many departments and organizational units throughout their lifecycle, so knowing the desired outcomes across departments is essential. It is important to get clarity about spends and cuts as well as ensuring that the team understands the anticipated results, both positive and negative.
To set a budget, you must understand the goals and the anticipated outcomes. For example, if you are asked to trim budget while simultaneously increase sales and customer retention, it is essential that you address these discrepancies outright. Having this conversation at the beginning of the budgeting process allows both your team and the rest of the company to focus on building exceptional, results-oriented ecosystems.
Hold regular meetings to discuss key performance indicators
After the initial budget is set, the negotiations typically slow. However, the ROI remains a constant conversation as it relates to KPIs. Everyone involved in the organization has a vested interest in having a successful customer experience strategy.
Regular, cross-departmental meetings to review KPIs not only ensure that everyone is on the same page, but they also help you prove the value of the solutions you have chosen or make a case for other needs. Furthermore, with these meetings, you can spot potential problems well before they happen and begin to anticipate pushback. Regular communication can alleviate pain points and enable the company to work together harmoniously.
Emphasize and clarify ROI
You should be clear on the expected return on investment of any solution and any customer experience initiative. The last thing you want to realize is that you can’t deliver the promised KPI or revenue or that the agreed upon budget still falls short of your needs. Establish the forecasted ROI, and track spending on these goals. You must take ownership of the customer experience and company outcomes, which is why knowing the end game is so critical.
Ultimately, everything comes down to ROI. Executives are wary of spending on customer experience technology because they have been burned in the past and don’t immediately see the value. If you consistently deliver results and drive up their profits, your company will continue to spend.