A few years ago, when I would mention “customer experience” to business people, I would receive an expected response. Smiling, nodding, then moving on. It just wasn’t important.
When the economy was booming, sales were the name of the game. Most key performance indicators (KPI’s) went something like this:
1. Sales Per Day
2. Sales Per Week
3. Sales Per Month
4. Annual Sales
5. Net Revenues
6. Leads Per Sale
While it’s slowly getting better as companies realize there is value in not just GETTING the customers, but KEEPING them, we still have a long way to go. If every KPI is focused on acquisition, you can bet you do not have a customer-centric culture.
I worked with a company that was so very proud of their KPI culture. The real-time dashboards were prominently promoted via flatscreen monitors posted in strategic places throughout their headquarters. Every manager received a daily report. These guys could answer to a tenth of a percentage point the various increases they were tracking.
One thing stood out to me, however. The word customer was not mentioned anywhere in the reports, dashboards or conversations. Success was about acquiring more customers; more money. What about the customers who leave? Well, that was more difficult to track.
I don’t believe this is a unique situation. I believe most executives believe their KPI’s should focus on the cold, hard facts of profits, loss and sales. I don’t deny that data should be included. But if you don’t mention customers, or track significant metrics around them, then you are setting yourself up for disaster.
Don’t have customers in your KPI’s? Here is a short list of where to start:
1. Customer Lifetime Value (CLV)
Here is a well-done infographic about the various ways to calculate this metric: How To Calculate Customer Lifetime Value
2. Customer Satisfaction/ Loyalty
I prefer tracking loyalty, which is based on actual behavior, versus just satisfaction, which is based on what customers say. But if you start with satisfaction, it’s something.
3. Customer Sentiment
This one can be less scientific, but have you tracked what customers are saying about you via social media and other channels? They tell their networks about their distrust of you before they tell you. Pay attention!
4. Customer Engagement
Harder to create metrics around this, too, but you can tie this back to actual behavior. When customers visit your web site, what are they doing? Do their visits to your content lead to higher sales? It’s all there to review in your analytics.
There are many, many other ways to track customer metrics, but the important thing is to put your customer front and center. You can’t do that if you never mention customers in your KPI’s.
Photo credit: Mr. T in DC via Creative Commons license