customer experience matrix mechanics and geeky crm cx cem
DESCRIPTION
Customer and marketing analytics using CxC Customer Experience Matrix as rules framework. Big data, omnichannel and multichannel marketing, programattic markiting, CRM and internet of things make customer management, campaign management business processes exponentially more complex requiring a Customer Experience Framework, The CxC Customer Experience Framework enables managers to "automate what works and spend their time innovating."TRANSCRIPT
Copyright 2014 ClientXClient LLC. www.clientxclient.com. 908.542.1134 Share & Enhance & Share 1
The CxC Customer Experience Matrix Combines Customer & Business Perspectives, Cost, Processes
Copyright 2014 ClientXClient LLC. www.clientxclient.com. 908.542.1134 Share & Enhance & Share 2
Customer Experience MatrixTM:
Repair DisposeSelection SupportUsePurchaseAwareness
Customer Process
x
x
x
xxxx
x
x
x
x
x
xxxx
xxxxx
xxx
xx
x
xx xxxx
Bu
sin
ess
Pro
cess
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Customer Experience MatrixTM:
Community
Outdoor
Affiliate
TV
Radio
Newspaper
Direct Mail
Web
Call Center
Signage
Events
Retail
Billboard
Repair DisposeSelection SupportUsePurchaseAwareness
Customer Process
x
x
x
xxxx
x
x
x
x
x
xxxx
xxxxx
xxx
xx
x
xx xxxx
Ch
ann
el
30% 90%25% 70% 20% 15%$ $ $ $ $ $ $=LTV
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Customer Experience MatrixTM:
Community
Outdoor
Affiliate
TV
Radio
Newspaper
Direct Mail
Web
Call Center
Field Sales
Events
Retail
Branch
Repair DisposeSelection SupportUsePurchaseAwareness
Customer Process
x
x
x
xxxx
x
x
x
x
x
xxxx
xxxxx
xxx
xx
x
xx xxxx
Ch
ann
el
30% 90%25% 70% 20% 15%$ $ $ $ $ $ $=LTV
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Strategic Target Focus Areas
Web VisitsGross
EnrolledNet
Enrolled
Fall SystemClient Countswith Projections 7,308,276 24,170117,637428,293 36,568
12,398
0.5003%1.6096%5.8603% 0.3307%
0.1696%
1. Increase “Attended” 8,500 (.XX%) via XX follow-up contacts (calls, letters, email) to “Responded Select” growing net enrolled XXX (use funnel formula)
2. Grow “Gross Enrolled” via XX follow-up contacts (calls, letters, email) to “Responded Select” growing net enrolled XXX (use funnel formula)
3. Reduce Withdrawals XXX via XX follow-up contacts (calls, letters, email) to “Gross Enrolled and Withdrew win back” growing net enrolled XXX (use funnel formula)
4. Grow Net Enrolled via XX follow-up contacts to (calls, letters, email) to “Attended” growing net enrolled XXX (use funnel formula)
42
3
1
3 Pg Action Registered
Cancelations
Immediate Term: Phase I Initiatives
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Simple Customer Value Growth ROI Calculator(Top Line Revenue)
No 1. Grow Response Rate 0.000%
Yes 2. Grow Registered Rate 1.000%
Yes 3. Grow Enrollment Rate 1.000%
Yes 4. Reduce Withdrawal Rate -1.000%
First Year Benefit $2,650,178.15
Based on annual projections this chart calculates ROI Benefits of increased conversion performance at each stage of lead conversion process
This is the first year return expected with $400,000 investment. $10.3M three year return includes list and mail efficiencies realized in year 2 & 3.
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1. How do you get businesses to recognize the value of customer experience? How do you define customer experience?
2. How do you help businesses/your business create process and discipline around developing excellent customer experiences?
3. How do you make the right choices around customer experience design? How do you know you are doing the right thing?
1. Designing experiences that exceed expectations2. Distinguish where the function of customer experience
contributes to process-sales, communications, research3. Distinguish key touch points of the design4. Avoid common mistakes5. Designing with specific motives,6. And objectives that can easily be adapted and changed
Questions Answered By CxC Customer Experience Matrix
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Scenario Example:Situation Description
• Business Context– direct marketing– 600 products with 50,000 promotions/year– control issues
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Situation Description
• Promotion Spending Decisions– volume:
• high number of decisions• quick response required• many alternatives to consider
– complexity• many types of promotions• executed by separate groups• impact multiple departments
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Customer Experience MatrixTM:
Repair DisposeSelection SupportUsePurchaseAwareness
Customer Process
x
x
x
xxxx
x
x
x
x
x
xxxx
xxxxx
xxx
xx
x
xx xxxx
Bu
sin
ess
Pro
cess
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LTV Calculation
• Data Available– transaction records
• date• customer ID• product ID• promotion ID• revenue• promotion cost• product cost
Transaction Type:
First Order= earliest date per Customer ID
Replacement Order = other order where (product ID = First Order product ID)
Cross Sell Order = all others
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LTV CalculationT
rans
actio
n T
ype
Cross Sell
Order
Replacement
Order
First Order
Product Cost
Marketing Cost
RevenueOrder Count
Value Type
xxxxxxxxxxxx
xxxxxxxxxxxx
xxxxxxxxxxxx
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Total LTV
First Order Promo Cost
Replacement + Cross LTV
Replacement Product Cost
Cross Sell LTV
Cross Sell Promo Cost
ROI Calculations
First Order ROI =
Replacement ROI =
Cross Sell ROI=
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Calculation Comments
• double counting is OK
• treats each ROI as independent of others (is best guess unless know otherwise)
• particularly questionable for Replacement ROI
• apply discount rate to account for risk
• still need to estimate incremental impacts
This is really,
really, really
Important!
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Estimating Incremental Impact
Square Root Rule:change in revenue =
square root of change in promotion cost
• captures diminishing returns
• replace with better info if available
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Preparing the Analysis
• set program parameters:– an increase / decrease test (e.g., 20%)– minimum incremental ROI to consider– minimum aggregate LTV to consider– ranking metric: ROI or LTV? – Do both and more – We have big data
capabilities – create more derived values representing multiple strategies and scenarios
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Preparing the Analysis
• calculate actual ROIs for each promotion
• calculate average ROIs across all promotions– promotions with below-average ROI are
candidates for reduced investment– promotions with above-average ROI are
candidates for increased investment
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Preparing the Analysis
• calculate estimated incremental results for each candidate
• filter based on thresholds
• rank on selected metric and report
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Analysis Results
• Ranked opportunities by 6 action types:– acquisition increase– acquisition decrease – replacement (product cost) increase– replacement (product cost) decrease– cross sell increase– cross sell decrease
• Estimated impact of each change
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Customer Experience MatrixTM:
Community
Outdoor
Magazine
TV
Radio
Newspaper
Direct Mail
Web
Call Center
Field Sales
Events
Retail
Dealer
Repair DisposeSelection SupportUsePurchaseAwareness
Customer Process
x
x
x
xxxx
x
x
x
x
x
xxxx
xxxxx
xxx
xx
x
xx xxxx
Ch
ann
el
30% 90%25% 70% 20% 15%$ $ $ $ $ $ $=LTV
+Invest
+Divest
+Invest+Invest +Invest
+Invest+Invest
+Invest
+Invest
+Invest
+Invest+Invest
+Invest
+Divest
+Divest+Divest
+Divest
+Divest+Invest+Invest
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Sample Analysis - Summary
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Sample Analysis - Drilldown
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Actual Findings
• Estimated 10% increase in company LTV vs. current base promotions
• Opportunities beyond current base would produce additional benefits
• Rules and process transparency spawns innovation
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Next Steps
• move beyond promotion keys to specific decisions e.g. keyword analysis
• more detailed LTV models, more precise estimates of incremental results
• automated execution of recommendations
• more frequent data feeds
• analyze results of accepted recommendations
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Business Rule Perspective
Rules embedded in system:1. increase or decrease investment in
programs with above or below average ROI
2. limit consideration to programs above specified ROI and LTV thresholds
3. rank opportunities based on LTV or ROI
4. could also have rule to terminate programs failing to meet specified goals
5. could consider calculations to be rules
OK, today
This is even
More
Important!
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Rule Management Framework• capabilities
– rule complexity– scalability / response time– integration across rules– integration across systems– Novice user tools, visualization, testing
• administration– rule definition (processes, skills required, security)– rule verification– rule change management
• value measurement– utilization reporting– results reporting– cost / benefit analysis– Process:Rule Visualization
This is what
We should
Talk about
908.542.1134
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Applications vs. Framework
• capabilities– rule complexity: low– scalability / response time: high– integration across rules: high– integration across systems: low
• administration– rule definition: via programming– rule verification: via programming– rule change management: via programming
• value measurement– utilization reporting: none– results reporting: possible– cost / benefit analysis: possible
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Lessons Learned
• rule-based analysis can make business intelligence actionable
• even simple rules can identify major opportunities
• use pre-calculations to make complex decisions with simple rules
• LTV is long-term measure; must also consider immediate profits, cash flows
• framework enables continuous improvement • framework provides transparency for greater
business participation
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Thank You!
Michael R Hoffman
Client X Client
www.clientxclient.com
908-542-1134
Usual Response to “We are already doing this” – (white space is opportunity)
1. Awareness
2. Information
5. Negotiation
4. Selection
6. Contract
12. Care/Support
7. Logistics
9. Delivery
10. Acceptance
13. Repair
14. Community
8. $Collection
11. Use
3. Identification
Geography
Digital
Store
3rd Party
Direct
Community
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*Yes, Big IOT Opportunity with CxCFramework
Geography
Digital
Store
3rd Party
Direct
Community
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5. Negotiation
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6. Contract
12. Care/Support
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9. Delivery
10. Acceptance
13. Repair
14. Community
8. $Collection
11. Use
3. Identification
Customer Optimization Wizard – Dashboard for Performance Management
Numbers in each cell represent: customers, potential revenue, costs (per and aggregate), customers at risk, customers in process, forecast closed sales, forecast lost customers, forecast referrals, simulation under market conditions.
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Geography
Digital
Store
3rd Party
Direct
Community
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1. Awareness
2. Information
5. Negotiation
4. Selection
6. Contract
12. Care/Support
7. Logistics
9. Delivery
10. Acceptance
13. Repair
14. Community
8. $Collection
11. Use
3. Identification
Every Interaction Cell Measures Cost and Revenue Opportunities
Interaction CostActual RevenuePotential Revenue
(I used zoom out from one cell to represent some information contained in each cell)
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Geography
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1. Awareness
2. Information
5. Negotiation
4. Selection
6. Contract
12. Care/Support
7. Logistics
9. Delivery
10. Acceptance
13. Repair
14. Community
8. $Collection
11. Use
3. Identification
Customer Optimization Wizard – Dashboard for Performance Management
Alerts indicate opportunity, risks, activity that is outside of plan parameters. Alerts require attention to exploit opportunity, avert risk, or amplify downstream resources, reduce upstream flow, divert/adjust activities (inventory, staff, promotions, pricing). Alerts are delivered according to manager responsibility and controls. The Customer Optimization Wizard may invoke corporate standard policies and make recommendations based on probabilistic outcomes (upstream and downstream scenarios)
ALERTS
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Geography
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Store
3rd Party
Direct
Community
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1. Awareness
2. Information
5. Negotiation
4. Selection
6. Contract
12. Care/Support
7. Logistics
9. Delivery
10. Acceptance
13. Repair
14. Community
8. $Collection
11. Use
3. Identification
Customer Optimization Wizard – Dashboard for Performance Management
Move bar along bottom to see impact scenarios for current customer flow. Adjust parameters for multiple scenarios and set independent performance threshold ranges at multiple nodes to test complex market scenarios
Resource, Opportunity, Time Scenarios
week 1 week 8 week 9 week 10week 6 week 7week 5week 2 week 3 week 4
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Community
Geography
Digital
Store
3rd Party
Direct
Community
Awareness
Information
Negotiation
Selection
Contract
Care/Support
Logistics
Delivery
AcceptanceRepair
$CollectionUse
Identification
The Customer Experience Matrix requires a customer-involved contact.(business to business)
C. Client contacts business acquaintances, clicks on “business services email”; calls 1-800 Biz Info”; schedules in-person meeting; negotiates 3 month contact; finances expense for 12 months through third party; contacts customer service for “emergency”.
C C
CC C
C
CC
C
CC CC
CC
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Customer Experience Interface: hover over cell for information
ActivitiesYieldMetricsSystemOwnerDataAdministrationSystem
1. Awareness
2. Information
5. Negotiation
4. Selection
6. Contract
12. Care/Support
7. Logistics
9. Delivery
10. Acceptance
13. Repair
14. Community
8. $Collection
11. Use
3. Identification
Monitor Key Performance Indicators for Every Interaction
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Thank You!
Michael R Hoffman
Client X Client
www.clientxclient.com
908-542-1134