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Ecommerce in 2019: the Ultimate Guide to Customer Experience Management

Everything you need to take control of your online store and provide fantastic experiences to your customers

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CHAPTER ONE

What is Customer Experience Management?

Customer experience is an all-encompassing term that refers to every interaction a customer has with a brand across every channel – be it in-store, on the phone, or online.

Customer experience management refers to how a company goes about measuring – and ideally improving – these customer experiences.

In the context of ecommerce and online retail, customer experience management refers to how a retail company manages the experiences and interactions a customer has across its online shop.

When good experiences go bad

The difference between a good customer experience and a negative one is wholly down to how a retail business sets up and monitors its websites and apps.

retail-stats

Say, for example, you’re in the market for a new pair of trainers. You open your laptop, visit your favorite online store, quickly find the pair you want, select your size, add them to basket, and proceed to checkout.

All pretty smooth so far. This is a nice, easy customer experience.

But suddenly, out of nowhere, an immovable popup plonks itself over the purchase button. You attempt to close it, but it will not budge. You resize your browser window, attempt some unorthodox maneuvers with your mouse, try any number of hotkey combinations, but the popup determinedly stands between you and your desired trainers. There is nothing you can do.

What started as a positive experience quickly turned into a bad customer experience that resulted in a lost sale for the retailer.

Online experiences are just as tangible as those in-store

The quality of most experiences in online retail is not so binary. Some will be merely annoying, or unintuitive – others will be okay, or nondescript. The point is this: just because an interaction with a brand takes place remotely on a personal device, the experiences customers have online are just as tangible and important for retail businesses to consider as those in-store.

Just because an interaction with a brand takes place remotely on a personal device, the experiences customers have online are just as tangible and important for retail businesses to consider as those in-store.

Indeed, all an unhappy or frustrated customer has to do to end the interaction with your brand online is close your website or app – and in all likelihood they’ll never come back.

With ecommerce growing almost four times faster than in-store retail and set to account for half of all sales made by 2021, businesses cannot afford to discount the importance of managing customer experience online.

CHAPTER TWO

8 Key Stats on Why Customer Experience Management is Crucial for Ecommerce

Providing fantastic experiences should be a no-brainer for online retail stores seeking to win and retain customers online. Sometimes, though, in the face of seemingly more urgent business needs, investing in customer experience can slip down the pecking order of a digital team’s priorities.

Download the stats as an infographic to share with your team

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However, providing good experiences online is business critical; it should never be viewed as a luxury. These eight key stats illustrate why.

189% customers stop doing business with a brand after a bad experience

That’s right. With the likes of Uber and Amazon raising the bar for expectations around digital interactions, and with so much choice online, all it takes is one bad experience for a customer to abandon a website or app – and never come back.

Companies are no longer just competing within their industry, they’re competing on the best digital experience a customer has ever had.

2Only 1 in 26 people complain after a bad experience; the rest just leave

Of the people who leave after a bad experience, only 1 in 26 will directly tell you. Not only do you lose business, you learn nothing from it to prevent future churn.

3It takes 12 positive customer experiences to make up for one negative experience

Determined to win that customer back? That’ll take some doing. A much more efficient investment would be to minimize the likelihood of bad customer experiences occurring in the first place.

4Customers are twice as likely to share bad experiences than talk about good ones

Amazon CEO Jeff Bezos emphasized this point when he said, “If you make customers unhappy in the physical world, they might each tell six friends. If you make customers unhappy on the internet, they can each tell 6,000 friends.

If you make customers unhappy in the physical world, they might each tell six friends. If you make customers unhappy on the internet, they can each tell 6,000 friends.

“If there’s one reason we have done better than of our peers in the Internet space over the last six years," he continues, "it is because we have focused like a laser on customer experience, and that really does matter, I think, in any business. It certainly matters online, where word of mouth is so very, very powerful.”

5Companies waste 26% of their digital advertising budgets

It’s seven times more expensive to acquire a new customer than to retain an existing one, and this expense largely comes from the amount spent on advertising.

If your online retail store invests heavily in advertising to attract new customers, consider what happens when those customers land on your website or app. Does an optimal experience await them, increasing their likelihood of purchasing? Or is the experience lacklustre, confusing, or frustrating?

Investing in advertising without investing in experience management is a one-way street to wasted budgets.

Investing in advertising without investing in experience management is a one-way street to wasted budgets.

686% of customers will pay more for a better brand experience

Investing in customer experiences isn’t just to prevent the negatives that come from neglecting it. With Gartner stating that customer experience is the new battleground for enterprises , customers are actively seeking and willing to pay more for better experiences.

Investing in customer experience, therefore, is very much a positive strategy.

7Increasing customer retention rates by 5% can increase profits from 25% to 95%

Harvard Business Review emphasizes the value that investing in customer experience can deliver. It’s simple. If customers have good experiences on your online store, they’re more likely to return. And if they return, this means more revenue – without the cost of acquiring a new customer.

8According to Forrester, in retail, CX leaders outperform the laggards by 26%

And finally, the cherry on top. In retail, not only do those investing in customer experience build a good brand reputation, retain customers, and increase profit – they lead the way against the competition too.

retail-bags

The statistics are clear: if online retail companies don’t invest in improving customer experiences, they face being left behind by their competition – and their customers. It’s not just a question of thriving; it’s a question of surviving.

The task now is working out how online retail companies can go about improving customer experiences. With so many different customers accessing your website or app with unique devices, it can seem a daunting task.

However, by adopting the right approach, companies can develop a highly successful digital experience transformation methodology – and reap the rewards from doing so. The first step lies in obtaining as much visibility into digital customer experiences as possible.

CHAPTER THREE

Measuring Customer Experiences in Ecommerce

The digital retail landscape is chaotic. Customers land on your online store from all directions in contrasting emotional states, acting on unique motivations, wielding different devices with which to get their shopping done online.

This might seem overwhelming, but there is an entire industry dedicated to making sense of these digital interactions. Marketing Technology provides ecommerce businesses with the tools to measure, benchmark, and improve digital experiences across their websites and apps.

It’s all about data

The savior for obtaining visibility into online customer experiences lies in data. Data about website or app performance, your customers, and your customers’ behavior and state of mind.

By monitoring and using customer data in intelligent ways, businesses develop sophisticated, automated processes for measuring and improving customer experiences.

Customer data comes in quantitative and qualitative forms, and it is through combining the two that businesses make truly meaningful changes.

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Learn what’s happening with quantitative customer data

Quantitative customer data is essential for getting an overall view of customer behavior and website performance . Digital teams use tools such as Google Analytics and Adobe Analytics to investigate things like most-viewed product sections, where validation errors occur, where most users drop out of the checkout funnel, and so on.

When analyzing quantitative customer data, digital teams focus on reporting metrics like page views, bounce rates, and conversion rates – and segment this information across their audience.

When analyzing quantitative customer data, digital teams focus on reporting metrics like page views, bounce rates, and conversion rates – and segment this information across their audience.

This enables them to form a broad impression of web or app performance, and reveals areas that need more attention – a major drop off on a certain stage of the checkout process, for example.

Teams may also visualize on-page behavior – where customers click, hover, and scroll – with heatmaps in order to garner an understanding of which content engages customers and which doesn’t.

This can be particularly useful for assigning hierarchy to elements on a product page, or – as Tesco Mobile did – analyzing customer scroll depth on product listing pages.

While quantitative customer data gives teams a general idea of customer interactions and provides useful summary information, focusing only on broad metrics like page views and conversion rates results in a significant knowledge gap in understanding true customer behavior and sentiment.

In order to obtain this understanding and empathy, brands must combine quantitative user data with qualitative user data, which grants rich, deep insight into user sentiment.

Understand the ‘why’ with qualitative customer data

Qualitative customer data refers to user data that describes attributes or properties. Examples include session replays, direct customer feedback, user testing – and anything else that involves deep, direct insights into customer sentiment and motivation.

Qualitative user data adds a whole new dimension to a brand’s visibility into digital customer experience. Collecting it provides useful, direct insights into customer sentiment.

Session recordings can provide incredibly in-depth insights when used effectively. In fact, they’re often the easiest and most cost-efficient way to get into the minds of your customers. Session recordings allow you to get very granular; they tell you parts of the story that, for example, heatmaps and scrollmaps may be missing.

Michael St Laurent
Optimization Strategist
WiderFunnel

Due to the deep, rich nature of qualitative insights, they are typically from a small sample size. It’s therefore important to combine them with quantitative user data to ensure that not only the nature but also the scale of any issues can be established too.

Get fully informed with qualitative customer data at a quantitative scale

Quantitative customer data provides the ‘what’ of website performance and customer behavior, while qualitative customer data enables teams to go deeper and understand why things are happening a certain way.

Quantitative data has scale but lacks depth; while qualitative has depth but lacks scale – there are only so many session replays teams can watch back, for instance, only so many customers who give feedback, and so on.

Discover the new category of customer experience data for retail, DXS®

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The ideal for teams is to have access to qualitative customer data at a quantitative scale – i.e. rich, deep, intelligent insights about every single interaction and experience across their websites and apps.

With a new category of data emerging thanks to the latest technologies, not only is this kind of analysis possible, it is actively incorporated into the digital experience strategies of the world’s leading retail brands.

Harness a new category of customer experience data

The first ever all-encompassing metric for measuring customer experience online, Decibel’s Digital Experience Score (DXS®) is a new category of customer experience data, combining the rich nature of qualitative data with the scale of quantitative.

DXS® automates the process of experience analysis across online retail stores, so teams can see exactly where and how to improve – in real time.

Powered by machine-learning, Decibel’s proprietary algorithms process hundreds of smart new digital interaction metrics – purpose-built to measure experience online – and automatically calculate an experience score for every visit to your websites and apps.

DXS® is based on five pillars of digital experience: navigation, engagement, frustration, technical and form experience. Reporting-wise, it rolls up from individual sessions, to individual pages, to the entire website or app – so you have visibility into opportunities for improvement at every level of the online customer experience.

With the Digital Experience Score, online retail teams no longer need to sift through dozens of reports or maintain custom KPIs to track the quality of experience on their digital properties.

dxs

Instead, they have a go-to, universal metric that can be segmented across their entire offering and audience for immediate insight into where the biggest wins lie – all without having to ask customers a single question.

Find digital experience issues before your customers do

With the automation of experience analysis comes the efficient surfacing of experience issues. Be it an unacceptably high load time on your checkout page, erratic mouse movements on your product page, or low scroll reach on your home page: Decibel’s Experience Issues dashboard prioritizes exactly which issues affect the most users, radically reducing the time it takes to find actionable, meaningful, impactful insights.

experience-issues

By automating the process of user experience analysis in this way, teams can immediately identify specific issues that affect users – and this insight can be segmented across pages, conversion flows, and audience segments.

With less time spent researching and automating the measurement of customer experience, this frees teams up to focus on what matters: improving experiences and increasing conversions.

CHAPTER FOUR

How to Improve Customer Experiences in Ecommerce

To truly improve customer experiences, online retail stores need to consider two key things.

First, you need to think about the long-term strategy you’ll adopt for researching and implementing improvements in the face of business and customer needs.

Second, you need to think about the reactive strategy you’ll utilize for responding to customer experience issues in real time.

Emergent digital experience intelligence technologies have caused leading online retail stores to adapt the way they improve customer experiences.

Both these points – the second in particular – largely depend on the way you currently measure customer experiences in ecommerce, as discussed in the previous chapter. Indeed, the emergent digital experience intelligence technologies discussed have caused leading online retail stores to adapt the way they improve customer experiences.

The traditional way to improve experiences in online retail: conversion rate optimization

The traditional way online retail companies have gone about improving their websites and apps is through a process known as conversion rate optimization, or CRO.

At its heart, conversion rate optimization is a model that turns more website or app users into customers.

Digital teams research areas of opportunity for improving particular metrics on their websites and apps - conversion rates on product pages, for example, or other metrics like page views and session duration.

They then hypothesize how to improve the metric they’re focusing on, and test the suggested changes. If the changes result in uplift, roll them out; if not, start the process over.

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Conversion optimization is persuasion-centric, not customer-centric

Conversion rate optimization is an extremely effective short-term method when applied to something specific, like a product or payments page.

Relying on conversion optimization, however, puts testing hypotheses at the front and center of improving digital experiences, which is inefficient in that it’s time intensive and expensive – especially if the insights hypotheses are based on are not all that compelling.

Relying on conversion optimization puts testing hypotheses at the front and center of improving digital experiences, which is inefficient, time intensive, and expensive.

Furthermore, conversion optimization focuses on optimizing conversions, not experiences: it is persuasion-centric, not customer-centric. It is therefore limited as a guiding philosophy for brands looking to improve digital experiences.

The new way: digital experience optimization

The emergence of experience data and machine learning means online retail companies can take advantage of a more streamlined, evidence-based approach to optimizing customer experiences.

Having access to qualitative data at quantitative scale means digital teams can do away with trial and error and instead pinpoint exactly how to improve experiences for their customers.

Digital experience optimization is an online retail improvement model that aims to optimize digital experiences. It cycles through three stages: measure, understand, and improve.

dxtransformation

Measure. The measure stage is almost fully automated. Teams monitor experience data across their online stores and respond to alerts regarding experience or technical issues, and analyze trends in user behavior.

Understand. Once a potential problem or bottleneck in the customer experience has been surfaced, it’s time to start honing in with specific analysis. Watch back session replays and review customer feedback to gain a fuller understanding of the problem, and use in-depth quantitative analysis to investigate its scale.

Improve. The initial problem has been thoroughly examined with quantitative and qualitative analysis. There’s either a straight fix, a hypothesis for a test, or an opportunity for personalization.

This experience optimization model puts the focus on the customer and removes the emphasis on guesswork from optimizing digital experiences.

Depending on the departmental set up of online retail stores, digital experience optimization models differ in the details (for example, see how LexisNexis harnessed digital experience optimization to increase annual website revenue by 81%).

However, they each share in incorporating the best aspects of conversion rate optimization – a scientific approach, a focus on the bottom line – while also considering digital experiences, the optimization of which is essential to establishing customer loyalty.

Respond to customer experiences issues in real time

Digital experience optimization is a cyclical, long-term strategy for improving experiences. It’s powered by having access to experience data.

It’s this same experience data that powers reactive strategies too, enabling online retail stores to respond to customer experience issues in real time.

It is only through having access to intelligent experience data that online retail stores can take advantage of responsive customer experience management.

Say you’re attempting to order a new sofa online. Halfway through filling out the payment and delivery information, the website refreshes, wiping out all the details you’ve put in so far. You have to start again.

You shake your mouse in frustration.

Now a notification pops up. ‘Sorry about that – our fault, we’ve applied a 5% discount to your order for your inconvenience.’

You not only forgive the online store – you’ll be returning for future purchases.

It is only through having access to intelligent experience data that online retail stores can take advantage of this kind of responsive customer experience management.

And this experience data is just the beginning.

CHAPTER FIVE

What Does the Future Hold for Customer Experience and Ecommerce?

Customer experience is the new battleground for online retail stores, and technology that provides data specifically designed to measure experiences is becoming increasingly adopted throughout the industry.

This kind of customer experience data is used to power reactive strategies – alleviating experiences issues in real time – as discussed in the previous chapter. However, this is just one use case for how businesses can utilize the data.

As adoption becomes more widespread and machine-learning technology becomes more sophisticated, the potential for how online retail stores can deliver fantastic experiences to their customers is limited only by the creativity of their digital teams.

The expert view

It is already recognized that customer experience is your most important marketing strategy. It’s a given that what you sell does what it’s supposed to do. What will separate you from your competition is the experience. For ecommerce that means being easy, with less (or no) friction. The more time and energy you save your customers, the more likely they are to return. The proposition is simple: customers will pay more for convenience. And they’ll choose to do business with the people and companies that make their lives more convenient.

Shep Hyken
Customer Experience Expert

For John Lewis, the future means deeply integrating online and in-store in a way that enhances the customer experience of both. Ultimately, every retail store could sell the same things – you need to give consumers a reason to shop with you. For us, that means offering great expertise and experiences to our customers. That’s where collaboration comes in – building internal teams that involve both online trading managers and offline buyers so that it’s a symbiotic relationship, with OKRs that aren’t specific to digital or in-store but consider both. In this way, the website enhances the store, and the store enhances the website: that’s the future for us.

Steve Kato-Spyrou
UX Manager
John Lewis

In order to deliver on the promise of personalization at scale, aka ‘great digital experiences’, businesses will no longer be able to rely solely on business rules, hypotheses and intuition. Data and machine learning must be in the forefront and leveraged to realize personalization at scale.

Michael Klein
Director, Industry Strategy & Marketing
Adobe

One online shop: personalized, unique experiences

The day is not far away where you’ll navigate to your favorite online store and the experience you have is totally tailored to you.

In some respects, this day is already here. The Amazon homepage, for example, is filled with products recommended to you based on all the data Amazon has gathered on you – largely formed around your purchase history, which is not always the best guide as to what you want to purchase next.

No website or app will ever be the same for two individual shoppers: experiences will be tailored according to both what customers want to purchase, and how they want to purchase it.

However, this kind of customer profile will soon be informed by specific customer experience data. What kind of shopping behavior, for example, has this customer exhibited in the past? Are they direct? Or do they ‘window shop’ online? What sort of experience would best suit them?

Ecommerce stores could use customer experience data to dynamically change their websites or apps depending on the answers to these questions. No website or app, therefore, will ever be the same for two individual shoppers: experiences will be tailored according to both what customers want to purchase, and how they want to purchase it.

Preparing your online store for the future

The first step into this new world of delivering personalized shopping experiences to your online customers is in gathering experience data now.

Decibel’s unique technology is spearheading the way in this. Join leading brands like Lego, Gucci, and Tesco in securing your digital future with customer experience data.

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