How hard are customers willing to work? We found that successful companies are offering customers the option to work as hard as they want while remaining loyal to the brand. We set out to understand how companies are designing CX to meet the needs of high- and low-involvement customers to grow their business and increase customer loyalty.
Our second interview in this three-part CX design series is with Ryan Drew, Senior Manager Consumer Insight & Loyalty at DAVIDsTEA.
CMA: Do you distinguish between high- and low-involvement customers when planning CX?
Ryan: We look at the retail and online channels differently in terms of CX, but ultimately, they need to work together to deliver on our customers’ expectations. We see retail CX as high-involvement, while online CX is low involvement. Our in-store experience is where all the “magic” happens, and a strong in-store experience helps deliver positive customer outcomes in terms of loyalty and advocacy. We have very few online exclusive customers; customers are using our website as a compliment to their path to purchase. Therefore, a typical customer will shift between low- and high-involvement experiences with us. It is important that the online experience is a strong compliment to the in-store experience and therefore we monitor them as one journey in terms of CX.
CMA: What customer analysis and insights informed your organization’s need or opportunity to redesign CX across high- and low-involvement customers?
Ryan: We knew there was a need to redesign our CX by looking at our transactional data, web behavioural data and email engagement rates as primary data sources. We also went into the market and asked our customers directly through ad hoc surveys and focus groups, and by leveraging our VOC program.
CMA: How do you measure the success of your CX options between high- and low-involvement customers? Are the metrics the same or different between these two segments?
Ryan: At the root, they have the same core KPIs we measure all our segments on, including increases in frequency, higher LTV’s (life-time value) and shorter visit intervals. To measure the finite changes that drive these KPIs, we look at different tells depending on the segment. For high-involvement customers, we measure brand love, advocacy and favourite place to shop. For low-involvement customers, we measure email metrics and web behaviour—and other non-transactional touchpoints—to see if we are moving the needle with the customer’s consideration to purchase. We have different KPIs for measuring success online compared to in-store, but that is only because everything online is tracked. For example, we can’t measure how many times a customer walked into the store and picked up an item without buying, but we can measure their activity online.
CMA: What were the failures and successes of your dual target CX strategy? How did you solve and correct the failures? How did you amplify the successes? How did you replicate the successes from one segment to the other?
Ryan: We are in the early stages of our strategy and are monitoring the key KPIs against our benchmark. We are planning and have an agile approach with a “test and learn’’ strategy. If it works, we scale, and if it does not, we pull back and reassess. One example of a success that we noticed through market research was how customers navigated our iconic tea wall: it was different from how we talked about it internally. Customers rarely shopped by tea type, but rather by caffeinated versus non-caffeinated, then flavour and finally benefits. We were able to test multiple concepts of filtering online to see what funnel customers chose the most. Once we were satisfied with where the customer was going, we replicated the changes in select stores through a new store design concept and we continue to find ways to implement this new journey through updated training chain-wide.
CMA: What has been the reaction of your high- and low-involvement customers to your CX strategy redesign? Are your customers utilizing one or multiple CX options? Are your customers experiencing any friction between CX options?
Ryan: So far, our customers have been reacting positively; we are seeing increases in frequency and lower interval times. We find our customers follow their own CX path as there are many different touchpoints a customer uses before they choose to purchase with us. Like all brand trying to elevate their CX, we sometimes see friction with the speed that we can implement change—some touchpoints are lagging due to internal resource limitations and the customers are noticing that. The biggest hurdle we have to overcome is in-store training. With such a large retail footprint and with seasonal staff, it is hard to move as swiftly as we want.
In addition, some of the changes we are implementing require reprogramming certain parts of the website; it is difficult to get development of this scale to move at the pace we would like it to. The good news is those friction points are on our road map so when we get there the customer will be ready to adopt it.
CMA: What advice would you give to organizations that are looking to redesign their CX options to address the needs of high- and low-involvement customers?
Ryan: Listen to your customer and find out why there is a need to revisit your CX in the first place. As retailers, we can get caught up in our internal needs without truly understanding customers’ friction points and the reason behind them. If you can redesign with their actual needs in mind, your brand will have a truly customer-centric journey. No matter how fast you want to move as an organization, it takes time. Finding out the issue is the “easy” part, managing change within the organization is always a thorny issue and fraught with differing priorities. It is key to outline your plan and tie it back to measurable outcomes so you can get leadership buy-in and have the ability to report back with progress so you can maintain leadership support. If you can do this, you will alleviate some of the resource issues because you can shift the priorities.
DAVIDsTEA has successfully introduced a continuous and customer-centric approach to CX journey design that contributes to the achievement of KPI targets. A few takeaways for organizations looking to optimize their CX:
- To identify CX points of friction and their root causes, leverage multiple data sources such as transaction data and voice of the customer research.
- Set KPI metrics that are appropriate for high- and low-involvement customer experiences.
- Align measurable outcomes and organizational capabilities to address CX opportunities and issues, and to gain leadership support.
Authored by CMA CX Council Members:
John Chan, Managing Director, Pearl Strategy and Innovation Design Inc.
Jennifer McLeod, Vice President, SinglePoint Group International Inc.
Lori Cohen, Head of Marketing, KPI
Read the first interview in the series here.