Chapter 2 CxC Matrix Unveiled

  • Customer flow is a barometer for success
  • Each contact is a battleground
  • Single channel excellence: Amazon.com
  • You are not Amazon, and Amazon does not have all the answers
  • Amazon’s lesson
  • You, too, can Think Like a Customer
  • From contact cacophony to clarity
  • Easy to get started
  • Corporate objectives executed per contact
  • Analyze the potential personalized treatments
  • Continuous learning through data capture and behavior monitoring
  • The Matrix shepherds customers through the consumer cycle
  • Think Like a Customer
  • CxC Matrix is common sense to business improvement
  • The Matrix leverages existing resources
  • The alternative to contact chaos
  • Five essential Matrix deliverables
  • Isn’t this just sales and marketing?

The CxC Matrix

 Right this minute, companies are missing hundreds of opportunities to grow revenue and reduce costs. Hundreds of assets are being under-utilized.

 Worse yet, these assets are completely paid for, and in the time it took you to read to this word, hundreds more opportunities were lost.

 What if you could coordinate the messages across each of the advertising channels, promotion channels, sales channels, and operations channels? What if the call waiting message, the “thank you” at the store, the owner’s operations manual/instruction manual, and the welcome letter were all presented as a unified message and single call to action? What would the impact be on the rest of your business?

 Each contact a customer has with a company, its products, its services, and its partners is an asset and a pivot point for company success. Every interaction has tremendous revenue opportunity, along with enormous risk potential. Yet, customer interactions are the most under-utilized asset in the company.

 Adopting the “Think Like a Customer” mindset requires a tremendous shift in management, operations, and finance. It’s a cultural shift, not a systems upgrade or replacement, not a firing and rebuilding. It’s a paradigm shift in mindset, developing an inquisitiveness focused on what we can do better for customers at each contact.

 What would the value of a 00.05% improvement in customer flow, conversion rate to purchase, or additional 00.05% increase in referrals do to your bottom line?

 What if each individual message was refined and scoped specifically for every contact, crafted based on the customer’s interests and profile—hitting each customer’s value-set spot on, making the customer feel exceptional and trusting of your company?

 Who could ever compete with you if you had all of that going for you? Who could match your ability to manage the customer experience? This competitive advantage comes from a company’s ability to factor the customer’s interest in each customer contact, leveraging technology and design to get the highest return per interaction.

 Excellent, profitable customer experiences are about winning. Profitable growth and sustainable competitive advantage comes from mutual wins—wins for the customer, wins for the employee, wins for the company, and wins for the company’s partners and shareholders. Collectively, how do we move this customer further along in the relationship? How do we create urgency across all of the contact points?

 The CxC Matrix clearly delineates all of the win points, all of the individual contacts, and all of the desired outcomes at the exact interaction points, including the systems, people, actions, resources, and tasks required to win and achieve success at each customer life stage.

 Customer Flow is a Barometer for Success

 Customers vote with their wallets and their feet. Plain and simple, this is the reality underpinning the CxC Matrix: Closely manage success in each customer contact, and reap the benefits of more business per customer, achieve higher margins, and grow more customers. The Matrix captures customer flow at its most granular levels, customer-by-customer and contact by contact.

 Companies without visibility to contact data are continually surprised by revenue shortfalls, inventory outages, resource cost overruns, and diminished customer satisfaction. Traditional financial measures lag too far behind customer activities to be effective for timely business decision-making. Meanwhile, operations and quality metrics are too far removed from customer’s interests, intent, and preferences. As a result, a company’s internal measurements can look fine and quality and operations metrics can appear good to great, but customer and contact flow may still reflect disengaged and indifferent customers. The result is revenue decline and business erosion.

 These companies are doomed to become customer-irrelevant and earn lower profit margins. They remain at a competitive disadvantage as they make critical decisions using dated financial metrics which are lagging performance indicators.

 Shareholders, management, and the market don’t see the results of failed contacts until financial reports show declining sales, increased costs, and lost market share. These are all lagging indicators that report on the deterioration of customer contact performance much too late.

 The CxC Matrix is designed to help companies quickly find and exploit untapped customer value opportunities while working with existing company measurement, decisioning, and planning tools. The CxC Matrix affords companies the ability to integrally weave “customers” into their strategies, planning, and goal setting.

 The Matrix is the first approach that relates actual business results with a consistent, end-to-end view of the customer experience. It allows companies to measure how changing any aspect of a CxC Matrix contact affects business processes throughout the company.

 Despite the use of a variety of business analytics and software, few companies can create a complete view of all customer interactions or manage the customer experience across functions through the customer life cycle.

 The CxC Matrix is built from the customer’s perspective. While businesses use many forms of buying models and customer life cycle models, the Matrix pays special attention to matching a company’s people, systems, information technology infrastructure, and performance metrics to each customer life cycle stage and corresponding set of contacts.

 Transparency

 Executives, managers, and all stakeholders use the Matrix like a glass bottom boat floating over the entire company, delivering a customer-eye view of all operations, systems, policies, and departments. But the Matrix provides more than a simple window on the customer experience. It is a complete methodology to measure customer value, assess the value and impact of alternative business policies, and quickly test and implement the policies deemed most effective.

 The CxC Matrix enables companies to execute with operational and financial transparency to customer activities and customer flow. Managers can see trends as they form and test alternatives, measuring the projected and actual results.

 When companies better understand customer processes, they can construct the appropriate mechanisms, messages, devices, and systems to make it easier for customers to buy. And this often results in exponential revenue gains.

 Each Contact is a Battleground

 The contact is the new battleground for companies looking to secure more business and fend off competition.

 

 The diagram above represents a small sample of obvious customer contacts. Notice that each contact is divided into sections representing message blocks that can be customized and personalized. Modern technology, digitized content, Internet connected media, and advanced analytic methods can be used to determine what message fills each slot in each contact. These can be based on the customer, the time and location of the contact, inventory levels, news announcements, the customer’s messaging device, the company’s goals and objectives, and just about anything else.

 There are virtually limitless combinations of messages that can be delivered individually to each customer through each slot in each contact. The company has no choice but to pay for each contact, so each slot in each contact should be treated as an asset. Customers also make an investment in each contact, investing their time and attention and, ultimately, buying or not buying from the company.

 Technology and business practices have evolved to enable businesses to compete at this atomic level. Every sub-message or “slot” in every contact—from the greeting on a voice mail to each 20 individual slots or sections in a single web page to the labels on the outside of a box and the text message that appears on the customer’s Personal Digital Assistant (PDA) as they enter your location—represents the new frontier for competition.

 Visualizing, analyzing, monetizing, and optimizing each slot in each contact is the substance of the CxC Matrix. The Matrix assesses the effectiveness of each slot and each contact and provides companies and customers a platform to continuously innovate and improve the customer experience.

 Quick Payback through Common View and Customer Impact Analysis

 The CxC Matrix identifies simple improvements that reduce costs in weeks, not months. It evaluates major business decisions, including technology investments, acquisitions, and new market launches using a simple metric: yield per customer.

 Company management and product managers use the Matrix to quickly uncover untapped revenue and margin growth opportunities by tracing customer activities and exposing under-utilized customer contacts.

 The Matrix exposes under-utilized contacts not only to internal departments and managers but to select third parties and partners that can also be invited to collaborate on revenue building and cost reduction initiatives contact by contact. Allowing third parties to participate in company contacts—such as selling advertising space on a web site, re-marketing alternative offers to internally low potential customers, or including paid inserts in shipping cartons may generate incremental income at little or no cost.

 From Contact Cacophony to Clarity

 Building a complete picture of every customer contact across your company and across every channel is not easy, but it is vital to aligning company resources to achieve optimum customer yield.

 Customers interact with companies through an immense variety of contacts across a mix of media and channels all managed by different departments, managers, and partners. These include not just traditional marketing and sales programs, but all contacts, such as packaging, purchases through distributors, product usage, paper and digital manuals, self-help centers, chat support, user forums, customer service, and repairs

 And while some companies look to reduce their number of customer contacts and channels due to escalating costs per contact, other companies seek to grow the frequency and breadth of customer contact channels in order to extract more value per customer, promote more products, get closer to customers, generate referrals, and affiliate revenue.

 Easy to Get Started

 The CxC Matrix starts as a simple tool for companies to inventory and categorize every possible customer contact in the context of the customer’s life cycle. Then, each contact is assigned an owner responsible for operation, technology, and execution. Each contact is then placed in the Matrix according to channel, medium, and system. Each contact point or Matrix cell is then measured for the number of customers who pass through the contact point. Contacts are monetized to expose their cost and potential revenue and analyzed further to uncover revenue enhancement and cost savings contact by contact.

 Corporate Objectives Executed Per Contact

 A core CxC Matrix concept is that each customer contact can be related to the entire customer experience and managed according to a company’s business objectives. This level of design in the Matrix assumes that each contact can become more intelligent and that companies, customers, and a network of service and goods providers will participate in each customer contact.

 The Matrix establishes “customer” as a corporate performance metric that spans and connects all departments, disciplines, systems, and processes.

 Analyze the Potential Personalized Treatments

 By exposing every element in every customer contact, the CxC Matrix conceptually requires each contact to behave like a seasoned sales and customer service representative. Each contact then uses a wealth of company and business knowledge, combined with customer knowledge, to script the perfect customer interaction with a beginning, middle, and end, while assessing the customer’s needs, values and preferences. This accomplishes the company’s current priorities and objectives. A similar high tech example would be a sophisticated web page that presents and arranges multiple messages that can be configured and personalized. These messages are synthesized and synchronized through combinations of behavioral information, business rules, and service provider capabilities.

 Continuous Learning through Data Capture and Behavior Monitoring

 The CxC Matrix provides an orderly method for capturing information from every contact to analyze performance from contact to contact, channel to channel, and department to department.

 The Matrix shows the comprehensive picture of how many customers are in each stage and channel and forecasts how many customers will move to which channels in which timeframes. The customers who don’t move in the expected period of time are then available for closer inspection and analysis.

 The Matrix Fosters Faster Response to Market Changes

 The Matrix helps companies shorten their reaction time to market shifts and abrupt changes in customer preferences and behaviors, providing service flexibility and market nimbleness for an unprecedented competitive advantage.

 The Matrix Shepherds Customers Through Life Stages

 For the first time, companies can ensure that customers do not fall through the cracks in internal processes due to incomplete, fragmented, and disparate internal systems and missed intradepartmental hand-offs. For customers, the CxC Matrix provides a conceptual map of how a need is met by searching, finding, buying, and using a product and service.

 Because the CxC Matrix tracks all customer contacts and all customer experience threads, companies can anticipate where their customers’ next series of contacts are likely to occur, the channels they are likely to use, and even estimate the likely timing of the subsequent contacts.

 

“Nearly 60% of customers want you to let them begin an order in one channel (say, your web site) and finish it in another (say, your downtown store.) By 2012, these types of cross-channel transactions could account for 38% of all retail sales.”

From “Strategies for Satisfying the Spoiled Consumer With Cross-Channel Execution,” June 2008 webinar promotion, Multichannel Merchant

Yes, the CxC Matrix Really Works

 The CxC Matrix has uncovered hundreds of thousands to tens of millions of dollars in untapped revenue, cost avoidance expense, and operations expense at some of the world’s largest, mid-size, and small companies. The Matrix has been used as a solution framework in industries ranging from telecommunications, manufacturing, technology, financial services, packaged goods, business process outsourcing, non-profits, publishing, entertainment, direct marketing, business and consumer services, and in both business-to-business and business-to-consumer environments.

  Think Like a Customer

 The Matrix typically provides a wealth of insights very quickly. Even in its simplest form, the CxC Matrix provides a platform for interdepartmental dialogue and solution building. Managers and employees “get it.” Discussing business challenges and opportunities using the customer as a vehicle makes obvious sense: It improves operations for the customer, improves quality for the customer, and measures by customer. Employees from all levels in a company are empowered to participate as they speak on the customer’s behalf, and they can easily chart a customer’s current and potential paths through the company.

 The mantra, “Think Like a Customer!”, opens conversations to innovative solutions, exposes artifacts of corporate folklore, and exposes management blind spots all centered around and measured by customer flow and contact performance.

 CxC Matrix is Common Sense to Business Improvement

 Like everyone else, I have been the customer of countless companies that have left money on the table, that failed to fully utilize my time and investment in learning their processes and operations, that failed to simply ask for more business, or failed to make me aware of how I could better utilize their services. This is what the Matrix exposes—the opportunity resident in each instance, interaction, and contact. The Matrix seeks to generate additional revenue streams from every single customer contact customer-by-customer.

 The Matrix Leverages Existing Resources

 The best news of all for companies adopting the CxC Matrix method is that most companies already possess all of the ingredients required to achieve tremendous success. All that is required is some level of process redesign, repurposing current capabilities and resources, modifying current operating practices, and expanding often-unused functionality in current systems.

 A large amount of value is uncovered when company management simply visualizes their business in the Matrix. Visualization reveals what management and employees intrinsically know:

 Customers get lost within the company’s walls.

  • Missed departmental, process, and systems hand-offs forfeit opportunities and increase costs.
  • Analyzing business from the customer’s perspective unveils opportunities and risks.

 The Matrix clearly depicts what everyone at every company knows—that they could perform better if only they:

 Knew about all of the customer’s activities.

  • Were able to leverage all of the options at each customer stage when they answer the phone or greet a customer in person.
  • Were able to leverage all of the options when the customer logs in to a web page or sits alone at a desk and opens a package.

 These contacts are rich with untapped, unmeasured opportunities, and the Matrix encourages and enables companies to tap these under-performing assets.

 Why now? Managing at the contact level is a new capability only made possible through technical advances that standardize data access through open systems. These systems engage customers and employees via the Internet and through Internet-connected devices, services, and communities.

For example, traditionally billing statements were static pieces of paper that listed items and cost. But with digitization and customer database connectivity, companies can leverage the customer’s invoice to present new product offers, stuff the billing statement envelope with targeted messages, and promote a new service on the outside of the envelope in one (albeit complex) contact.

 Electronic billing statements afford even greater flexibility and personalization. They can be accessed and delivered across any electronic network, formatted to each customer’s specifications. They can include Internet web page links to product, service, warranty, maintenance, and corporate information. They can spawn alerts and other activities.

 The customer billing statement, historically viewed as an operations and finance department basic requirement and cost of doing business, can now also be valued by the amount of potential incremental revenue it generates. It can notify customers, generate referrals, and/or generate revenue from third parties that pay for this specific customer’s attention in this contact.

 Every contact is rich with revenue potential and cost savings when exposed through the Matrix. Hundreds of similar opportunities exist through the company customer contact network. This is the domain and the function of the CxC Matrix.

 Contact Chaos—The Alternative

 While per-contact costs such as telephone support minutes, envelopes, and emails seem to be tightly managed to peak efficiency, cost per customer continues to increase due to escalating messages, offers, services, and product complexity. This complexity also appears to be the source of customer dissatisfaction and disengagement.

 The burden of creating, responding, managing, and monitoring customer messages overwhelms companies. Costs continue to escalate while communications quality, management oversight, governance, and controls range from non-existent to less than 30% contact visibility. In-bound voice messages, emails, letters, ever-expanding web mentions, customer reviews, chat sessions, YouTube videos, customer-generated media, partner communications, and all of the person-to-person service calls and sales pitches continue to grow out of control, raising costs and business risk exposure across multiple departments and multiple fronts.

 Companies must improve efficiencies, operations, and return on investment (ROI) across standard contacts and processes in order to opportunistically deploy resources at the right time and point of contact. That is the only way to secure exceptional margin and strategic benefits.

 Protecting the brand and the company against risk is another major area managed through the Matrix. In bygone times, headquarters sometimes did not know about a customer issue or crisis until they read it in the paper. Today, public relations is at a tremendous disadvantage when injured, disgruntled, and scorned customers can cheaply and easily post a message on an electronic bulletin board, blog, or chat room, send an email to a news service, or post a video on YouTube. How does a company respond? How does a company most effectively and efficiently contact customers?

 The CxC Matrix brings order to the chaos of the out-of-control customer contact ecosystem and provides a means to manage, observe, measure, and monitor customer contacts.

 Blue Oceans and Bunsen Burners

 The CxC Matrix is the next stage of business evolution. It is not a management fad or a radical approach to business strategy and operations. Enabled by advances in technology, communications, business design, and analytics, the Matrix provides companies the ability to innovate beyond their own resources to design, build, execute, automate, and optimize customer-centric solutions.

 The CxC Matrix is a new way of critically looking at a company’s business performance from an extremely granular, analytic, and actionable perspective. It provides each department with unprecedented transparency of how its actions and decisions directly affect customers while also providing transparency downstream and upstream along the customer’s experience path to view the eventual outcome of cumulative decisions.

 The Matrix represents a dynamic view of a business, and it will continue to grow and remain a tool for evaluating success and failure across every department. It is one of the few tools that creates mutual performance criteria across all business functions and facilitates inner department discussions, as well as continuous performance improvement. This alone should justify using the Matrix.

 Strategy Clearly Connected to Execution

 The Matrix simply connects corporate strategy, goals, and objectives to customer contacts for transparent performance. Where companies fail to execute on strategy and the business strategy is obfuscated by layers of management, policies and corporate folklore, the Matrix provides a crystal clear picture of strategy performance executed customer-by-customer and contact by contact.

 Essential Matrix Deliverables

 Visualize: The Matrix emphasizes visualization to provide the broadest customer understanding across departments and functions and among partner companies.

 Analyze: The Matrix provides a rich data set for companies to analyze performance by contact, by customer, and in conjunction with existing metrics.

 Monetize: Every business decision and every scenario—complete with downstream and upstream impact visibility—is monetized in the Matrix.

 Prioritize: Focus time, resource, and effort on the contact areas that show the greatest potential return. Automate what works, and invest your resources in innovation.

 Optimize: The Matrix provides a means to quantify, replicate, and automate best practices, leveraging its analytical and monetization foundation to fuel continuous improvement

 More a Mindset Than a Toolset

 The Matrix is the only company-wide approach to customer centricity. While many companies tout customer focus, very few companies monitor customer level activities other than sales and customer support. Individual employees have never been able to grasp their role or their connection to customers.

Isn’t This all Just Sales and Marketing?

If Marketing is responsible for generating more revenue from every customer, answering every phone, designing every product, selecting every office location, and shaking every customer’s hand, then yes—the Matrix is just marketing.

While the CxC Matrix focuses on customers and contacts, which is the traditional domain and function of marketing, most of the contacts (especially under-utilized contacts) are not advertisements and sales contacts. They are contacts across the entire customer life cycle and throughout every channel.



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Michael R Hoffman,
Feb 29, 2012, 6:07 AM
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Michael R Hoffman,
Feb 29, 2012, 6:14 AM
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Michael R Hoffman,
Feb 29, 2012, 6:15 AM
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Michael R Hoffman,
Feb 29, 2012, 6:12 AM
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