Forrester: Brands struggling to meet CX standards in 2017

New analyst firm report shows customer experience quality has actually worsened this year, with more Australian organisations slipping down the ranks

The quality of customer experience standards in Australia has actually worsened in 2017, with more brands slipping down the ranks, a new report from Forrester reveals.

The Australia Customer Experience Index, 2017 is based on a survey of more than 18,000 adult Australian customers and Forrester's CX Index methodolog. The latter measures how well a brand’s customer experience strengthens the loyalty of its customers.

But this year, not a single brand made it into the ‘excellent’ category of the index and scores on average were stagnant. Some businesses once achieving good scores slid back, while those with poor scores fell even faster, Forrester stated. In fact, of the 33 brands measured last year for the CX index, 22 lost points and only 11 gained points in 2017.

Not one brand rose to the top of the report’s rankings, either marking a distinct lack of CX leaders this year. Even the percentage of scores in the good category dropped slightly, from 18 per cent to 17 per cent. And in another first, not a single industry average improved this year.

In the banking sector, Bendigo Bank, ING Direct and Suncorp maintained the top three spots. For the first time, Commonwealth Bank fell out of the elite scorers in the retail banking category. However, CBA did lead the way for credit card providers, with American Express and NAB following suit.

Read more: Bendigo Bank rolls out customer-led metrics framework

Read more: Bendigo and Adelaide Bank invests in real-time personalised interactions with customers

RACQ, RACV and NRMA held the top three positions in the auto and home insurance sector, respectively. In traditional retail, The Good Guys and JB Hi-Fi maintained their first and second rankings, while Officeworks jumped from fifth to third, overtaking Kmart, which dropped a rank. Online retail also saw a shift, with Kogan overtaking Amazon as CX leader.

The four disappointing faces CX

Forrester's report further revealed a real struggle to keep up with CX, and identified four disappointing types of brands: ‘languishers’, ‘lapsers’ and ‘lockteppers.’ Languishers, brands that rose high then stalled, make up 11 per cent of brands in the CX index, and 40 per cent of credit card providers.

'Lapsers', or brands that rose and then fell back, have been on the decline for two years. Among them are CPA and 60 per cent of credit card providers. 'Locksteppers', or the brands that move up and down with the pack, made up over two-thirds of all brands, and a shocking 79 per cent of retail brands. Finally laggards, brands that have stayed at or near the bottom, makeup 8 per cent of CX Index brands, all of them in the retail sector.

An emotionally positive experience remained a priority of CX leadership, and rose as the bigger influencer on customer loyalty in nearly every industry, the report showed. And in every industry, elite brands came out as delivering better emotionally positive experiences than negative ones.

Top-tier brands provided an average of 17 emotionally positive experiences for each negative experience; the lowest-performing brands provided only six emotionally positive experiences for each negative experience.

But contrary to conventional wisdom, making customers happy is not the single most important emotional driver of loyalty. In fact, happiness is only one of the five emotions that most often appear among the top three that are most important in any industry studied - the report showed other four are appreciated, confident, understood, and valued.

Meanwhile, angering your customers isn’t as harmful to their loyalty as making them feel annoyed, disappointed, or frustrated, Forrester reported.

The online retail industry had the largest percentage of customers who felt disappointed out of any industry analysed.

Follow CMO on Twitter: @CMOAustralia, take part in the CMO conversation on LinkedIn: CMO ANZ, join us on Facebook: https://www.facebook.com/CMOAustralia, or check us out on Google+:google.com/+CmoAu

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