OBSTACLES
TO CUSTOMER ENGAGEMENT
H OW T H E C M O C A N C H A M P I O N C U S T
E
OM
R
ST
R AT E G I E S T
H
AT
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U LY D R I V E G R O W T H
BY PHIL BOUNSALL AND PATRICK GIBBONS
Every executive knows
it makes sense to align
strategies behind one voice –
the voice of the customer. However,
too often voice-of-the-customer
initiatives occupy too much energy
and produce meager results. How
does this happen? After all, it seems
pretty logical – if we put forth an
organized effort to listen carefully
to our customers, interpret what
they’re telling us, and act on their
insights, we should be able to build
a better business. Many companies
have benefited by weaving this into
the way they operate.
However, often the complexities of business
tend to get in the way.
At Walker, we work with dozens of marketleading companies developing customer
strategies to drive performance. We’ve seen
the successes and we’ve seen where companies
struggle. This document highlights five
common obstacles companies encounter when
implementing their customer strategies. Being
aware of these and focusing on overcoming
these obstacles will help your company make
better decisions to drive growth.
IS ANYBODY
LISTENING?
Ineffective listening is the first key
obstacle every company must overcome
to be truly engaged with their customers.
Unfortunately, many companies simply
don’t have a good system set up to
gather insights from their customers.
WHY IS IT SO HARD?
Some underestimate how tough it really is. Here are some of
the key areas where customer listening falls short:
• No accurate listing of customers and contact information.
• Gathering feedback is periodic or haphazard.
• Not enough thought behind asking the right questions.
• Not enough probing to prompt action.
• Not a good mix of input – surveys, social media, operational
metrics, etc.
• Information collected isn’t relevant to the needs of the
business.
WHAT CAN I DO?
Start by asking yourself, “What am I going to do with this
information?” The answer can give you some great guidance
on the questions to ask, or even how to involve an expert to
understand the best ways to get information that can drive
your business. Developing an effective listening program
means you’re asking the right questions, you’re probing in the
right areas, you’re in touch with the right contacts, and you
have a good mix of feedback that provides a well-rounded
view of your customers.
INEFFECTIVE
LISTENING
DOING IT RIGHT
RIGHT SURVEY QUESTIONS
LEADS TO $200 MILLION
A leading provider of technology
solutions established a goal to
generate sales from an obvious
source – their existing customers.
This guided them to develop
a series of questions in their
relationship survey that would
identify customers interested in
additional products and services.
As customer feedback was
received, these “loyalty leads”
were immediately forwarded
to account managers for follow
up. The result? More than $200
million was credited to this
program where focused listening
had a big payoff!
TOO MUCH
INFORMATION,
NOT ENOUGH
ACTION
Too many companies suffer a lack of
infrastructure when it comes to putting
customer insights to use. They gather all
kinds of feedback from their customers,
then look at it and say, “Now what do I
do with all of this?”
WHY IS IT SO HARD?
DOING IT RIGHT
HOT ALERTS PRODUCE
$150 MILLION
A Fortune 500 advanced
manufacturer sought to reduce
customer churn and identify
customers that may be willing
to increase their business. To
do this a series of key questions
were used in surveys to trigger
immediate notification to
account managers when there
was a problem or opportunity
to address. Account managers
were trained in the “hot alert”
process and were required
to document their follow
up procedure, including the
estimated ROI. In the first
six months they were able to
identify more than $150 million
in the form of business saved or
new business created.
LACK OF
INFRASTRUCTURE
Processing customer information can be tedious. Here are
common challenges:
• No thought behind who is actually going to use the
information.
• No system for determining who gets what information.
• Timing is poor – information does not get to users until it is
too late.
• Training is not in place so people don’t know what
to do.
• No buy-in – people don’t find the information helpful or
relevant.
WHAT CAN I DO?
The goal is action, so you need to build an infrastructure that
manages the information, distributes it to the right people,
and makes them accountable for putting it to use. Training
and education are key components to ensure that all involved
understand the goals of the program and their specific role.
Essentially, customer insights need to be “built in” to processes
and systems across the company.
WHO’S IN
CHARGE?
Leadership at all levels is a critical
element to ensuring that voice-of-thecustomer initiatives are truly strategic.
WHY IS IT SO HARD?
It seems logical that customer programs would be important in
any organization. However, here are a few reasons why that is
not always the case:
• Not a priority – too often leaders are only focused on
quarterly earnings.
• Customer strategies compete with other initiatives instead of
being woven into everything the company does.
• Executive sponsors are not in place to advocate for customer
strategies.
• Internal communication is ineffective so people just
don’t know about the customer programs.
• The CEO and other senior leaders aren’t on the front lines
meeting with customers, insisting that others do
the same.
WHAT CAN I DO?
Look at all levels to develop leadership for your program. First,
the CEO should be an advocate of voice-of-the-customer
strategies. An executive sponsor should represent these
initiatives at the board and executive levels to ensure it has
the necessary resources to be effective. Managers throughout
the company need to be leaders within their areas to ensure
they are aligned behind the voice of the customer. Finally, the
team running the program has to show effective leadership and
communication to ensure their program is not lost in the clutter
of everyday business.
POOR
LEADERSHIP
DOING IT RIGHT
GLOBAL COMMUNICATION
SPARKS ACTION
A leading U.S.-based provider
of information storage services
goes to great lengths to
ensure their customer listening
program is a high priority. An
aggressive team leads the
program, called “G.R.O.W.”–
Gather, Respond, Own, Win.
They take their message on the
road by visiting regional offices
around the world to educate
employees on the initiatives and
how managers can be effective
leaders within each region. The
CEO is also front and center.
He issues a video message to
customers sharing key learnings
and committing to actions
aimed at improving customer
experiences. The energy behind
this program has created
effective leadership at all levels,
driving action and results.
MAKE
IT MATTER
LOYALTY
STOCK
DOING IT RIGHT
ALIGNMENT DRIVES
COMPETITIVE EDGE
The CEO of one of the world’s
most influential technology
companies invites customers
to provide input by saying,
“Customers are our number
one priority.” This is evident
throughout the company – even
on the company intranet where
customer scores are displayed
right next to the company’s
stock price – a clear indicator
that the two are closely related.
Their program reaches out to
dozens of departments, business
units, and an entire network
of channel partners, and is a
standard topic at operational
reviews conducted by the CEO.
This level of alignment drives
a culture where more than 80
percent of their users indicate
that customer insights have
a positive influence on their
business performance.
When customer initiatives aren’t aligned
with other company strategies they
lack relevance and meaning. Suddenly,
investments don’t make sense and
employees see the lowly survey program
as just one more thing to distract them
from their real job.
WHY IS IT SO HARD?
When customer initiatives are aligned with business objectives,
employees see a clear line of sight toward improving the
business. However, too often these initiatives are not in sync
with corporate growth strategies. Here are a few reasons why:
• Objectives are not clear or widely known.
• Results are not understood or widely used.
• The program is isolated, separate from the other parts of the
business.
• Employees see it as disconnected or even conflicting with
their other goals.
• People don’t understand how customer feedback is to be
used.
WHAT CAN I DO?
Start by looking at your key corporate strategies. Pick them
apart to understand how customer initiatives line up with each
one. Make customer feedback results an important part of
the management information system and ensure leaders are
keenly tuned into how customers’ viewpoints are aligned with
their own key strategies.
WEAK
ALIGNMENT
SHOW ME
THE MONEY!
Too often, companies can’t (or don’t)
calculate the payoff. Customer strategies
shouldn’t stand by themselves–they
should connect with other business
metrics and prove that there is a strong
impact on corporate performance.
US
WHY IS IT SO HARD?
Companies get bogged down for a variety of reasons. Here are
a few:
• Objectives are unclear so no measurement is in place.
THEM
DOING IT RIGHT
• Customer measures are viewed separate from operational
metrics.
ROI FOCUS DRIVES
CORPORATE VALUE
• Compensation incentives don’t exist, or they don’t make
sense to those involved.
One of the worlds largest
electronics distributors initiated
a voice-of-the-customer
strategy to drive business
process improvement and to
improve customer service.
By tying each activity to the
program, they were laserfocused on improving the
metrics most critical to their
business strategy. It worked.
They saw operational expenses
as a percentage of gross profits
decrease 15 percent, operational
income margin almost doubled,
and return on capital employed
more than doubled. What’s
more, during this time their
stock price increased 35 percent
while their biggest competitor
increased only 8 percent.
• Improvement isn’t really the goal; instead the company
is trying to make marketing claims, meet an industry
certification, or just keep score.
• It is an afterthought – people are too caught up in the details
to determine the impact.
WHAT CAN I DO?
Start by asking yourself, “What key business metrics will
change if our strategies are successful?” Set up processes to
monitor those metrics and focus action planning to tie directly
to these measurable outcomes.
INADEQUATE
PAYOFF
THE CMO AS
THE LEADER
In many companies the
marketing function drives
customer listening activities –
and that’s a good thing! You
should already know how such
strategies can accelerate growth,
spark innovation, and sharpen your
company’s competitive edge.
Your challenge as a customer-focused
leader is to make sure everyone knows this.
It goes beyond just telling colleagues that
customers are important. Everyone knows
that. Rather, you must provide clear evidence
of the return on customer-driven activities
that boost customer retention, increase cross
selling, identify cost savings, improve service,
strengthen innovation, and more.
WHAT IF YOU’RE NOT INVOLVED?
If you’re not already involved in your company’s
voice-of-the customer programs, you should
be. Think about it. You probably have direct
responsibility or some degree of responsibility
for the organization’s brand, sales strategies,
product strategies, and long-term strategic
direction. All of those are significantly influenced
by customers. What’s more, CMOs are wired to
constantly think about the company’s position
within the market. You are responsible for
developing strategies to set your company
apart from competitors and you should know
that distancing yourself based on customer
experiences is one of the strongest levers you
can pull.
CMOs get it – you understand the importance
of the viewpoint of customers. And, you can
make sure that customer initiatives receive the
visibility that is necessary for them to make a
big difference.
Leadership is critical in developing and
deploying voice-of-the-customer strategies.
The breadth of responsibility, the strategic
influence, and the ability to broadly
communicate the profound impact of the
customer experience are all reasons the CMO
should be a clear advocate and strategist for
your customers
ABOUT
WALKER
Each case cited in this
document is a client of
Walker. Based on decades of
experience we help some of the
world’s most influential companies
overcome their most difficult
obstacles to drive bottom line results.
Walker specializes in customer loyalty and
related customer strategies, including innovative
approaches to segmenting, valuing, obtaining,
serving, and growing customers. Walker’s
diverse team of consultants provides tailored,
comprehensive solutions to help companies
achieve their business objectives and, ultimately,
grow shareholder value. Walker’s consultants
regularly conduct workshops and assessment
programs to help organizations improve their
ability to administer customer listening programs.
THE WALKER INDEX™
$3,200
$2,800
$2,400
$2,000
$1,600
$1,200
$800
$400
$0
1994
1997
2000
2003
2006
Walker Index
Dow Jones Industrial Average
2009
20 1 1
2013
S&P 500
NASDAQ
The Walker Index is a stock index comprised of
current Walker clients. Companies are included
in the index only during their tenure as Walker
clients. Companies attracted to Walker are
committed to using the customer perspective
as an impactful management tool. The Walker
Index indicates these companies outperform
the broad markets.
For the most up-to-date Walker Index, please
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AUTHORS
PHIL BOUNSALL
PRESIDENT
[email protected]
blog.walkerinfo.com/blog/valuable-accounts
PATRICK GIBBONS
PRINCIPAL, SVP MARKETING
[email protected]
blog.walkerinfo.com/blog/engaging-the-enterprise
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