Featuring:
David Truog, VP and Principal Analyst & Pete Jacques, Principal Analyst
Show Notes:
The results of this year’s Forrester Customer Experience Index (CX Index™) are in, and they are not pretty. Index scores — which gauge the quality of experiences customers have with companies and their impact on loyalty — registered their steepest-ever year-over-year drop and are now at their lowest point since the Index’s inception. What’s driving the decline, and what should companies prioritize for improvement? VP and Principal Analyst David Truog and Principal Analyst Pete Jacques weigh in on this week’s What It Means.
The episode starts with an overview of how the Index is compiled. Jacques explains that each year’s scores are based on a survey of roughly 100,000 consumers that covers 223 brands in 13 industries. Questions center on brands’ effectiveness (how well do they meet customers’ needs?); ease (how easy are they to do business with?); and emotion (how did interacting with the brand make customers feel?).
This year’s score was 69.3 out of 100, a 1.6-point drop from last year. While that may not sound like a lot, every point has significance for company revenue, says Truog. Scores dropped in 10 of the 13 industries measured; only airlines improved.
The discussion then turns to how we reached this point. At the height of the COVID-19 pandemic three years ago — when CX Index scores were at their highest — “companies were doing a lot to be able to meet customers where they wanted to be met and where they could be met,” Jacques says. Consumer expectations have remained high since, but many companies haven’t maintained their level of service post-pandemic. More recently, inflation has squeezed consumers’ spending and enhanced dissatisfaction over perceptions of the value they receive from companies, the analysts add.
Truog and Jacques then dive deeper into other factors contributing to record-low CX Index scores. Truog notes that chatbots — a focal point of customer service-related investment for many companies — have largely failed. The emergence of generative AI has perhaps deepened the disappointment, as consumers now expect more from conversational experiences. Lack of customer obsession among leaders is also to blame — just 3% of companies are customer-obsessed, Forrester data shows, though 81% claim to be.
The episode closes with advice on how companies can turn things around, with Jacques and Truog each providing a few in-depth tips. Leaders should see the current state of CX quality as an opportunity, Truog notes, since they can now commit to taking action to differentiate their companies from competitors.
