At the end of the day, the goal of all efforts remain the same: to fulfil or exceed customer expectations because satisfied customers exhibit higher retention rates, pay higher premiums and give recommendations to others. Thus, they allow long-term safeguards to an increase of the firm’s added value – while at the same time lowering costs.
What about the issue is therefore new?
The fragmentation of communication channels and methods is constantly increasing. If we start in 2012 with an average of 51-75 touchpoints between a firm and its customers, we will find 221 such touchpoints as of 2016 – according to a study by Franz-Rudolf Esch from 2016. At the same time, customer-to-customer interactions are always increasing through the capabilities of social media. This brings with it challenges and opportunities for businesses. As a consequence, customers’ journeys and along with them the correlated effects between the influence variables (touchpoints) and target variables (e.g., customer satisfaction) become decidedly more complex.
The difficulties outlined result in – among other things – the fact that 46 percent of marketing budgets flow into touchpoints that are irrelevant for customers (cf. Esch et al. 2016). For the circa 4,000 participants of the State of Marketing Report 2016, the correct formation of interactions with customers belongs to the most important criteria for a successful customer journey. This result is stressed in a study by the Gartner research firm: according to the study 89 percent of marketers expect that customer experience management will become the most important success factor in 2017. As far as consequences go, numerous firms – such as KMPG, Amazon, and Google – have already created positions like chief customer experience officer or customer experience vice president. The relevance of this theme has also been highlighted by research. The internationally-renowned Marketing Science Institute, again in 2016, set the issue of customer experience management at the top of its list of research priorities. An adequate sensitivity to the subject is therefore assumed. Now it is a matter of developing professional attempts at a solution.
Customer satisfaction as a central link between touchpoints, customer behaviour, and financial performance
A core element for the understanding and management of customer experience is the ability to measure and monitor the reactions of customers to the oerings of companies in the form of perceptions and attitudes. In addition, top researchers Katherine N. Lemon and Peter Verhoef have underlined in a current edition of the Journal of Marketing the long-known construct of customer satisfaction. This is because customer satisfaction is conceptualised as the matching of the actual-delivered performance with the expectations from the customer’s side and thereby a suitable target value for the highly compressed measurement of overall customer perception. Customer satisfaction serves ultimately as the central interface construct between touchpoints and downstream behaviour parameters and financial target values. Apart from that, researchers De Haan, Verhoef, and Wiesel in 2015 show in a study that the predictive power of customer satisfaction and the intermediate, often alternatively inserted, net promoter score are comparable.
Measuring touchpoint quality and content
In order to produce transparency and comparability between touchpoints, a firm measurement for touchpoint quality in various dimensions is indispensable. So, of interest is the touchpoint extent on one side and the intensity of perception on the other, as well as the relevance and “attractiveness” of touchpoints from the point of view of the customer. For this purpose, concrete measurement instructions have to be defined.
Calculating the influence of touchpoints and customer satisfaction, brand strength, and value creation
Decisive for the deriving of reliable recommendations for actions is ultimately however not the isolated performance measurement of individual touchpoints but its effect on downstream target dimensions such as customer satisfaction, brand strength, preference, behaviour, and added value. The differing levels of effectiveness on one side and he effect of interaction between touchpoints on the other can be indicated on the basis of analysis of market drivers. Driver analyses can be carried out on the one hand on the basis of calculated touchpoint quality and on the other hand on the basis of focussed content with the touchpoints.
Deriving recommendations for action for the control of touchpoints
Should recommendations for action in the direction of prioritisation be derived from, for example budget allocation to touchpoints, then the strength of drivers will be calculated on the basis of touchpoint quality described above. The result can, for example, be a ranking of top touchpoints with their related strength of influence to defined target criteria such a customer satisfaction, brand strength, and customer loyalty. On this basis, valuable derivations can be gathered for an e£cient and eective budget allocation. Should recommendations for action in the direction of content formation of touchpoints be derived in regard to the target setting of customer satisfaction, brand strength and further downstream target constructs, then the calculation of power of drivers for focussed brand content will take place. The results provide information as to which brand content plays a special role in customer perception. On this basis, determined agent briefings will finally be formulated in order to be able to optimally formulate the individual touchpoints in the sense of consistent branding. The defined extent of measurement can finally be a starting point for a comprehensive touchpoint control.