Customer Experience Tips and Tricks: A Conversation Between Rachel B. Lee and Augie Ray

By: on January 27, 2021

The following is an edited transcript of a conversation between Software Advice senior brand manager Rachel B. Lee and Gartner VP and customer experience analyst Augie Ray that occurred on LinkedIn Live in October 2020. This conversation has been edited for length and clarity.

Rachel B. Lee: It’s global customer experience (CX) day and it’s customer service week, which gives us the opportunity to recognize great customer work.

To help us understand some of what CX actually means, I’m very excited to have Augie Ray with us today. Augie is the VP analyst of customer experience for CX and marketing leaders at Gartner. He’s worked with some of the best companies for customer experience across the globe, from American Express to USAA. He’s also been a small-business owner when he created a pet boutique with his wife. So he knows what customer experience is all about.

Augie, welcome to today’s LinkedIn Live.

Augie Ray: Thank you, Rachel! Happy CX day to everyone.

Lee: Thank you, Augie! First, I’d love for you to tell us a little bit about who you are.

Ray: I’ve been at Gartner as an analyst and VP for about five years, where I get to research CX and consult with Gartner about best practices. Before that, I was the director of customer experience action at American Express, one of the companies known for their customer experience.

I’ve also had the good fortune to work for other companies that are known for their very strong customer experience including USAA. I was even a Disney cast member at a Disney store so that I could get the experience from a company that we all recognize as a CX leader.

I’ve been in digital for almost 25 years, and the thing that drove me into it wasn’t that this was a new method for delivering content or advertising. I gravitated toward digital spaces because this was a new method for conducting business.

I feel like I’ve been in the CX space for almost 25 years even though it’s been only the last 10 to 15 years that people have really gotten to see CX as a discipline.

Lee: Thank you, Augie. So, let’s start with this first: What is the definition of customer experience and why does it matter?

Ray: It’s a great question, and one of the things we work with our clients on first is to make sure they get the definition of CX right off the bat. When organizations define CX incorrectly, they move in the wrong direction and then they fail to get results. When that happens, they inevitably will blame CX. That’s why we think it’s so important that we define it correctly.

First of all, I think it’s important to point out that there are two aspects to the definition of customer experience and it’s really vital to understand this.

One aspect is customer experience itself, and that’s what the customer owns.

It’s their impression that they accumulate of your brand. This includes every touch point they have with you. So we recognize that every touch point becomes important. The thing that’s really vital to understand is that it’s not our definition as business owners and leaders.

The second aspect is customer experience management — it’s what business owners and leaders have to do. The important thing about this aspect of CX is that it turns it into a discipline and not simply a mindset

It’s not just about being customer-centric and thinking of the customer; we all want to do that. But attaining that mindset takes actual execution, and that means doing actionable things.

Customer experience management is about knowing and understanding what customers want, need, and expect so that we can provide the experiences that meet or exceed expectations and deliver customer satisfaction, loyalty, and advocacy.

So if businesses aren’t really focused on building loyal customers, then they’re really not focused on customer experience.

Really understanding what we’re focused on and how to measure performance becomes an important first step in making sure we build our CX strategies and tactics in the right way.

Lee: So, can you talk a little bit about how you do that? How do you start to build that customer experience, and what is the difference between that and customer service?

Ray: Let’s start with the second part of your question and work our way back because it’s a great question. There are biases in the way people think about customer experience depending on what department you’re part of in a large company.

For instance, if you’re in the customer service department, you think CX is all about customer service. If you’re in marketing, you tend to think it’s more about marketing experiences or content. If you’re in digital, you think it’s all about the digital experience. Those different approaches are good because you want everyone to feel ownership of the customer experience.

In fact, one of the things that we coach our clients on is to not worry about the word ownership. Oftentimes there are debates about who should own customer experience when the simple answer is that everyone should own customer experience. It’s OK that customer service people think that customer service is all about CX.

But when we talk about doing customer experience right, whether you’re a small business or large business, we have to understand that every touch point is part of the experience—not just customer service (CS). Customer service might be an important touch point, but there are companies where customer service isn’t that important. Think of consumer packaged goods (CPG) brands like Dove. Their most important touch points are all product-centric. In other words, it’s all about store aisles, and when people get the product home.

Another good example where CS isn’t as important is in business-to-business companies where the most important touch points are account services and client success. Really understanding what those touch points are and defining what’s important is a first step toward understanding how CX fits into your business.

It’s fine that different organizations in a company think they own the customer experience because they should own the touch points they are responsible for.

But as a discipline, and this answers the first part of your question, we have to think about what it takes to be customer-centric. It’s very important to listen to your customers—we want to understand what they think, feel, and want. We want to understand their perspective. We want to understand what their drivers of satisfaction and dissatisfaction are.

Too often what happens, particularly in larger companies, is that we treat CX like a mindset. We want everyone to be customer-centric, but then we don’t provide them with any information about the customer. We ask people to imagine what the customer wants and needs, and then everyone goes off and creates a version of the customer that’s like them.

You have to have mechanisms in place to listen, understand, and disseminate important customer information to your organization so that they know what customers think, want, and feel. Then, they have a much easier time putting your customer at the center of their thinking.

Lee: So Augie, that sounds like a very intentional approach to imagining how CX fits into a business. At Software Advice, we help small businesses. Sometimes they’re 100-person companies, and sometimes they might just have 10 people. With that in mind, what are some of the benefits or drawbacks when you are a small business and you’re thinking about customer experience?

Ray: At the top of the call, I mentioned I’ve been on both sides of this. For eight years, my wife and I owned a very small pet boutique. We had an online business and an in-person business which my wife basically ran day to day. I was the digital and marketing person, but I was mostly supporting my wife. It was interesting to see the challenges she had as a small-business person.

In small businesses, one of the benefits is that you’re just innately closer to your customers. You tend to get to know your customers better and can have meaningful one-to-one relationships. As businesses scale up, they get filled up with thousands of people who don’t actually talk to the customers regularly, so it’s very easy to get disconnected.

Another benefit small businesses have is that they tend to focus on more narrow niches. In other words, they know their marketplace. Their customers are more uniform, and it’s easier to understand the experiences of those customers. When businesses get larger, they grow out of those niches and try to become all things for all people.

Clearly there are also drawbacks to being a small company. I don’t have to tell this to anyone on this call, but the primary drawback is resources. I watched my wife struggle with providing her employees hours and, of course, we struggled with money. My wife would get calls from companies every day that wanted to be her agency, offer services, or do consulting, but she would say that she barely had enough money to pay her employees. We recognize that resources are a real problem.

Another problem is that, while small companies are closer to their customers, small-business owners aren’t always good at listening objectively. When you have strong one-to-one relationships, you think things are going well when they actually aren’t because your customers are less likely to say anything for fear of offending their friend or someone they have a personal relationship with.

One thing we’ve seen from smaller companies is that they’ll lose customers and not know why; they’ll think that things are good until they aren’t. So it’s important for small businesses to understand how to use listening tools. Even for small companies with close relationships, surveys have a place. It’s a way of getting good, objective, and quantifiable information.

Small businesses tend to think they don’t have access to the same strong digital tools that larger companies do. That’s generally not the case. There are terrific platforms to help you with ecommerce, to help your enterprise resource planning (ERP), help you manage your employees and HR, do a better job of your email marketing, or manage your social media. The challenge when you’re a small company is sometimes you lack the resources to evaluate and implement these digital tools.

I’ll give you an experience from owning a small business. We sent an email marketing message to our email database once a month. We promised that if you signed up we would only send one email marketing message a month because we recognized people don’t like to be spammed. We said the message would always contain discounts and benefits only for members of our list. That really helped us promote the list, but we got to the point where producing the email became a real burden.

The list was growing so we needed to take it more seriously, but the tool we were using was pretty kludgy. So we weighed our options and made a decision that for one month we won’t send this email. We decided to skip this month in order to move our database to a new platform that has better tools which made it easier to execute, saved us time, and improved our open and click rates. We sacrificed one month of our email so that we could do a better job with our email marketing in the future, and within three months we were very happy with that decision.

Sometimes it’s just a matter of making sure you understand the tradeoffs. But the important thing to realize is that there are tools out there that allow you to compete with larger companies.

Lee: I love that you mention that software and tools are for everyone. There are free options which may be what you need. Of course there are ones that you pay for which give you more ability to scale, but the point is that there are software tools out there for you if you need them.

You also mentioned something interesting about email. Last month, Blake Clark, VP of Software Advice, talked with Rand Fiskin who really reiterated the importance and necessity of gathering emails from your customers, and that it’s one of the most valuable assets you can have. Creating a great email structure is a relatively simple thing that most small businesses can do to help start those great customer experiences that you were talking about.

Most of these relationships right now are digital relationships. Some CX is in-person, but I think about restaurants and conferences and realize that everything is virtual right now. With that in mind, I’m wondering, are the words we say and the way we talk to people using digital tools more important than ever?

Ray: Absolutely. Here’s a story about our pet boutique: Like many small-business owners, we were taking more time than expected to lift off after the first year in business. We were getting into a cash crunch, so it was a decision moment for our fledgling business. Even though we had an online website to promote the physical store, and even though my wife got into this business to pet dogs and get to know pet owners, we made the decision to try online selling.

We got a low-cost online store, got online, and within 18 months, 90% of our business was online. It saved our business, but at the same time, my wife didn’t get into the business to be a warehouse director and have pallets of stuff going in and out. It was an interesting dichotomy that what ended up saving our business removed some of the joy my wife had for owning the business to begin with. We ended up solving that problem with employees, which I believe is something you wanted to talk about.

Lee: Yes! What you just noted was that digital pivot. We’re in a time when we need to look online and make those shifts. We need to understand where our customers are coming from and engage with them where they’re comfortable, and that might not always be comfortable for us. In many ways, the survival of the hundreds of thousands of small businesses is up to the technology at our fingertips. I think that’s really being proven over the last few months where businesses are moving online and it’s resulted in saving their business.

I do think a really important part of this whole equation is employees. It’s our teams and employees that are doing the customer experience work that will ultimately provide that payoff of scaling and growing a business. So my question is this: What role do employees play in bringing customer satisfaction, loyalty, and advocacy?

Ray: One of the challenges—and this is a challenge for small businesses and big businesses alike—is empowering your employees. At Gartner, we’ve done research that shows that employees show up to do a good job. They want to help customers. Paychecks are not, at the end of the day, why people show up to work. They want to be respected and do good work and make a difference in people’s lives.

What gets in the way isn’t that they don’t have the skills or lack the drive to put the customer first, but that leadership gets in the way with rules. For instance, in larger businesses we talked about how you can spread information about really relevant customer information that helps employees better perform their jobs. Things like the aggregate net promoter score (NPS) aren’t as important as taking the data we get from surveys and customer studies and getting it into the hands of employees so that they can see what’s most meaningful for the customers they’re responsible for.

In small businesses it’s oftentimes about empowering your employees. Here’s another quick story. I talked about the challenges we faced with ecommerce earlier. We ultimately decided we couldn’t run a store and also run to a warehouse where we had to ship things out each night after working all day, so we hired a young guy in college to just work an hour or two for us each week.

His job was to go to the warehouse, print out shipping labels, and pack and ship. That’s all he was responsible for. He was a bright guy and expressed an interest in managing our Google Adwords. I thought, great, that’s one less thing for me to do. Then he showed an interest in our ecommerce operations, so I showed him what he needed to do for that to run. He improved upon it. True story: That guy is now a vice president at Google and probably making more money than me now.

The point is that we really benefited by giving up the reins and trusting our employees. It doesn’t even have to be in the digital side of things either. In our store, we gave our employees autonomy to shift things around in the store or run promotions within the limits we provided. We’d go home on Friday and show back up on Sunday or Monday, and the whole store would be redesigned. We’d have promotions on things we never would have thought to promote. Our employees felt this remarkable sense of ownership and had extraordinarily low turnover. We hired a bunch of college students who would still want the job as a part-time job after they got a full-time job out of college. I don’t tell this story to brag but to demonstrate the importance of giving your employees ownership.

If you have employees who are young and passionate, take the handcuffs off them and let them have more responsibility. Let them become part of your solution in finding and implementing these digital tools.

Big companies struggle with all the rules and procedures and bad systems that get in the way of progress, and small companies sometimes struggle with the fact that the leaders don’t give up enough power to let employees have a sense of ownership.

Lee: Of course revenue is important, but we’re equally concerned about making sure we instill confidence and loyalty year over year with our customers…

Ray: Of course. So often businesses are really focused on how they’re doing this quarter: How are profits, what’s the click rate, etc. Those things are essential. You need to do those.

The problem arises when you focus solely on those things. It becomes a short-term focus. Companies do not grow and succeed in the long term by simply focusing on customer acquisition. Growth requires retention. Growth requires strong word of mouth. Growth requires advocacy.

One of the things we find that really strong companies do is that they bring balance to their metrics. Do you evaluate something like a NPS score almost as importantly as you do revenue or click rate or conversions? Do you focus on churn rate as much as you focus on lead generation? The fact is that most companies don’t.

Companies that are really good at building reputation and excelling with CX typically bring a lot more balance to what we consider financial measures versus other leading measures like satisfaction, loyalty, likelihood to purchase, retention, referrals, and churn.

Lee: How have you seen the conversation evolve the last few years? Where do you think we’re going in the future?

Ray: Technology is not the place to start when it comes to your CX plan. We’ve already talked about how and why technology is important. But there’s a problem with focusing only on technology without a strong foundation.

Trends will say bots are the future of customer experience. Or that augmented reality or virtual reality (VR) is the future of customer experience. Or even that voice via digital assistants like Alexa or Google is the future of customer experience. There’s a challenge with a focus on that technology because, while we need to be innovative, technology is not the place to start.

Something I’ve seen with my clients the last several years is they tell me they’ve deployed voice applications to improve CX on Alexa and Google and haven’t seen the success they were expecting. We know that voice is hot; there’s an explosion of voice devices in people’s homes. My clients say they have literally zero people using this. They might have a few thousand downloads, but most people will only use it two or three times. That’s because that’s not how we use our voice devices. We use our devices to play music, turn on lights, or get news and weather reports.

This isn’t to say voice isn’t important. We know it’s going to be important, but like any other technology, it takes time to get the technology right and develop new adoption habits.

The problem is that when we only focus on the technology, we develop solutions in search of a problem. So the trend I’m more focused on isn’t what the role of AI or VR is, but rather how are we doing a better job of understanding what customers want and need.

We’re seeing more test and learn cultures in businesses where customer research and user research become essential to every step of the process. User research and customer research aren’t just something you do at the beginning and move on. Being a successful business means you use an Agile development process to bring that voice of the customer into the process.

The trend I’m excited about is businesses having a better understanding of the customer experience discipline and what it takes to be customer-centric. I’m not as excited about whether Oculus Rift (a VR headset) will be the new way people shop.

If you understand what it means to be customer-centric and understand your customers’ needs, you’ll know how to use that innovative technology to solve those needs. If you start with the technology, you’re not always going to be successful.

Lee: Okay, Augie. This has been such a great conversation, and we’ve talked about so many things. To finish, what are a few actionable takeaways or tips for our small businesses that are listening today?

Ray: Tip number one is listening. By all means, leverage those close relationships that the larger competitors can’t match at scale. Don’t rely solely on that though. Understand the value of surveys. There are cheap and free survey tools out that you can use. You will be amazed at what you can learn in an objective survey from somebody who might not want to tell you something face-to-face but might put it in an anonymous survey. So think of those survey tools as a mechanism for understanding what people want and need, but also as a mechanism of discovering that customers might not be as happy as they say they are. You can use that to prevent churn.

Tip number two is try to do a better job at being close to customers. Ask the tough questions even though it can be difficult to do so. Don’t always ask what they think of your existing services and tools but ask about what they need. Be brave enough to ask what you need to improve upon. Ask about the unmet needs that you might not be providing but nobody else is either. That’s a great opportunity to pivot into a space where your competitors aren’t and gain an advantage while also having a customer-centric mindset.

Tip number three is to empower your employees. I’m not saying turn over the reins and go to chaos, but trust your team to know what to do. Remove some of those limits and empower them to act.

Here’s one more story about owning a store. Keep in mind we’re a really small boutique pet store. We maybe had five or six employees at any given time, all of them part-time. There was a pet product show every year in Chicago where they would showcase new exciting pet products for stores to sell.

Every other store would send the owner or marketing officer, but we would pay for our employees to come down and let them help us choose what to feature and pick to sell in the store. That way, they could hear the pitches that were given on the tradeshow floor, so they could sell better. If they thought something was going to sell but we weren’t sure, we would still try it because they had skin in the game to motivate them to make those sales.

It’s something that was wildly successful for us that I have not seen repeated in other stores, but it was a way that we tried to make our employees partners in the success of the store.

So really think about ways you can tear down the barriers between decision-makers and doers, and you can find that you have a lot of resources that you aren’t tapping.

Lee: I love that. This has been such a wonderful conversation. Thank you so much Augie. We’re honored to be able to talk to you on this customer experience day.

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