10/07/2023 | BlogPost
Measurement Evolution: From KPIs to CXIs
James May | Managing Director Healthware Engage
The rapid advancement of technology and access to vast amounts of data has presented new challenges in measuring and understanding customer experiences. In this article, we will explore some key themes in this evolving landscape.
The Complexities of the Customer Journey
Traditional customer journeys have become increasingly complex in the digital era. A study by IQVIA revealed that what used to be a simple four-stage process has now expanded to eighteen stages, accompanied by over twenty digital touchpoints. While this proliferation of touchpoints offers more data to measure, it also poses the risk of overwhelming analysis paralysis.
From Passive to Active to Interactive Engagement
In the realm of global media and customer experience, there is often a tendency to focus on impressive numbers like millions of impressions or website visits. However, such metrics fail to provide insights into whether these interactions are actually influencing customer behavior. Passive engagement, such as views or clicks, offers limited value in achieving desired outcomes. Instead, it may be more fruitful to concentrate on "active engagement," where customers take deliberate actions such as downloading guides or providing personal details. Interactive engagement takes this a step further, involving real-world commitments like in-person meetings.
Transitioning from KPIs to CXIs
Key Performance Indicators (KPIs) have traditionally been used to measure internal progress, including sales, awareness, and market share. Shifting the focus to Customer Experience Indicators (CXIs) directs attention towards the customer's perspective. However, it's important to clarify that CX does not stand for Customer Experience but represents "the customer's experience or the experience of the customer," as highlighted by Forbes. This slight distinction holds significant implications.
Introducing Customer Experience Indicators (CXIs)
It is easy to create CXIs that merely serve as proxies for KPIs - for example, measuring customer satisfaction - without considering its passive nature. However, some companies, like The North Face, take a more comprehensive approach. They offer lifetime product guarantees, providing free repairs, replacements, or refunds. Additionally, they repurpose, recycle, or donate irreparable products. This commitment to sustainability and customer satisfaction enhances loyalty, justifies premium pricing, and stands in contrast to the negative environmental impact of fast fashion.
Understanding What Truly Matters to Customers
In a thought-provoking article by Gene Cornfield, he suggests a shift from KPIs to Customer Performance Indicators to promote customer-centricity. Rather than focusing on revenue, growth, or market share, organizations should measure their performance against indicators that truly matter to customers. Cornfield proposes speed, accuracy, peace of mind, and trust as worthy customer-centric indicators.
Shifting Measurement Focus to CXIs
While KPIs have been an integral part of marketing for decades, it's crucial to adapt to the data-rich environment we now operate in. Conducting a Net Promoter Score (NPS) survey twice a year is no longer sufficient. If you are interested in exploring CXIs further, please feel free to reach out to me on LinkedIn. I am eager to hear your thoughts and experiences.
This article is part of our Innovation as Strategy series.
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James May | Managing Director Healthware Engage
Consumer Centricity - a peace offering
James has been working in the fields of communications, advertising, media, and digital with two decades spent in the emerging markets of China, Russia, Southeast Asia, and South America alongside ten years in the leading Agency Holding Groups in London. He has worked across multiple categories, with health and wellness experience that includes global product launches for the largest pharmaceutical companies as well as digital transformation support for Europe-based pharma brands.
