Framework Primer Customer Experience Evaluate Discover Discover/

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Framework Primer Customer Experience Evaluate Discover Discover/ Consider Purchase Purchase Promise Evaluate Consider Experience This is an exclusive document to the FlevyPro community - http://flevy.com/pro Delivery Use

Contents Overview Consumer Decision Journey (McKinsey) Nonstop Customer Experience Model (Accenture) Customer Experience Trends Templates This document is an exclusive document available to FlevyPro members - http://flevy.com/pro 2

At the core of Digital Transformation is the Customer Experience—this presentation covers 2 new frameworks on the modern Customer Experience Executive Summary Emerging technology trends are driving businesses to Digital Transformation across industries. At the core of most Digital Transformation projects is the evolution of the Customer Experience, from a traditional linear process (with few touch points) to a continuous, circular process (with constant touch points). This new approach to Customer Experience has been captured by many top-tier management consulting firms. In fact, this presentation will provide overviews for 2 such frameworks: McKinsey’s Customer Decision Journey Accenture’s Nonstop Customer Experience Model This deck is an excerpt from a comprehensive framework guide, Digital Transformation Strategy, which is available on Flevy here: https://flevy.com/browse/document/digital-transformation-strategy-2249 This document is an exclusive document available to FlevyPro members - http://flevy.com/pro 3

Driven by new technology, the fundamental nature of the Experience (and Purchase) Process has changed Shift in Customer Experience In the modern view, the customer goes through a cyclical process, as she moves from Discover/Consider to Purchase and eventually back again. Each phase in the process represents a potential marketing battleground where companies compete for the customer’s purchase and loyalty. This is a fundamental shift from the traditional view of sales, which is conceptualized linearly (with no feedback cycle component). TRADITIONAL PROCESS MODERN PROCESS Discover Evaluate Consider Evaluate Discover/ Consider Purchase Purchase Use Experience In this deck, we will look at 2 versions of the modern process developed by management consulting firms, McKinsey and Accenture. Source: Consumer Decision Journey, McKinsey & Co., 2009; Digital Customer, Global Consumer Pulse Research, Accenture, 2013 This document is an exclusive document available to FlevyPro members - http://flevy.com/pro 4

The Consumer Decision Journey is a new-age view that captures the customer’s path to purchase Customer Decision Journey (1 of 3) 2 Active Evaluation 1 3 Initial Consideration Set Moment of Purchase 4 Post-purchase Experience Ongoing exposure This path can take from several days to several months, mostly driven by the product category and market maturity. Source: Consumer Decision Journey, McKinsey & Co., 2009 This document is an exclusive document available to FlevyPro members - http://flevy.com/pro 6

Each phase of the journey represents a marketing battleground Customer Decision Journey (2 of 3) 1 2 Initial Consideration When the customer first conceives the notion of buying a product, she will develop an initial set of brands to consider buying. Brands in the initial-consideration set are three times more likely to be purchased than brands that aren’t in it. This means that Brand Awareness is vital. In this phase, we should focus on push marketing. Active Evaluation Next Slide In the evaluation phase, the customer is seeking information and shopping around to make an informed purchase decision. She will ask for recommendations from friends and family, read reviews online, go to the store to test out products, and so forth. This phase empowers both the customer and the company. Companies have the opportunity to enter the consideration set–and even force out companies in the Initial Consideration Set. Big brands can no longer take their position for granted. With increased online and social presences, companies are increasing the number of touch points with the customer–thus increasing their influence over the customer’s purchase decision in the Active Evaluation phase. Source: Consumer Decision Journey, McKinsey & Co., 2009 This document is an exclusive document available to FlevyPro members - http://flevy.com/pro 7

. At each phase, we can influence the customer’s purchasing decision Customer Decision Journey (3 of 3) 3 1 4 Moment of Purchase Post-purchase Experience This is the point in the time when the customer goes to the retailer and makes the purchase. Even at stage of the journey, companies can still influence the purchase. After the purchase, the customer builds expectations based on her experience that will impact her next purchase journey. This creates the circular nature of the journey. This is done through in-store marketing and influence of store salesmen. In this phase, our goal is to foster customer loyalty, which will drive repeat purchases and word-of-mouth marketing. Likewise, if the customer is dissatisfied with the purchase, she will become a negative influence on the purchase decisions of others. Initial Consideration Set This is not limited to her immediate circle of friends and family either. For instance, she can post a negative review on a prominent website, which will be read by countless potential customers in the Active Evaluation stage. Source: Consumer Decision Journey, McKinsey & Co., 2009 This document is an exclusive document available to FlevyPro members - http://flevy.com/pro 8

The Nonstop Customer Experience Model is another new framework on the purchase experience Nonstop Customer Experience Model (1 of 2) Open content and channels Discover Promise Purchase Evaluate Consider Branded content and channels Delivery Use Customers now expect their experiences to be continuous, constant, customized, and cross-channel—the key for us is to deliver a continuous customer experience. Source: Digital Customer, 2013 Global Consumer Pulse Research, Accenture This document is an exclusive document available to FlevyPro members - http://flevy.com/pro 10

The Nonstop Customer is constantly exposed to companies and offerings Nonstop Customer Experience Model (2 of 2) Discover Purchase Enabled by technology, customers expect to easily control and vary their routes within and across channels to suit their needs at any given moment. Promise Evaluate Delivery Consider Today's customer journey is dynamic, accessible, and continuous, because the digital touch points consumers are exposed to are always on and customers can constantly re-evaluate their purchase options. Use Nonstop Customers find it easier to compare a provider's promise with its delivery and how the overall customer experience meets their own expectations. Every customer is a “Digital Customer:” Traditional Experimental They rely on traditional channels and interactions— but even then, they leave digital traces. They selectively engage in digital for utility value, discovering how the experience improves. Transitional They strive to leverage digital more broadly, but may not always be able to do so. Digital Savvy They make digital technology part of all dimensions in their lives—mobile access is key. In the “Switching Economy,” customers may quickly switch to a different provider if they find the current one isn’t as “digitally intense” as they would like. Source: Customer 2020, Accenture, 2014 This document is an exclusive document available to FlevyPro members - http://flevy.com/pro 11

Several trends indicate companies need to stop admiring digital opportunities or doing things better Shift in Customer Experience Trends (1 of 3) 1 2 3 TREND TREND TREND Customers are buying less from current providers, always keeping one eye open for something new. Consumer spending across most major industries and key markets have been in the years after the 2008 economic downturn. Yet during that time, the proportion of consumers in our study who expressed their intention to buy less from their current provider has increased, indicating that most companies have failed to tap into this spending growth. Companies are still inviting customers to leave by failing to improve first-contact resolution. Of the consumers who switched to another provider due to poor service, more than 80% said they could have been retained, mailing if their issue had been resolved on their first contact with the company. First-contact resolution has consistently remained the top frustration factor for consumers (generally cited by around 8 in 10). Companies aren’t capitalizing fully on their own website and other channels they control to make it easier for customers to prospect. Consumers continue to rely on multiple channels when prospecting, with the corporate website and physical outlets remaining the preferred primary of information. However, the impact of the corporate website and in-store information on consumers’ purchase decisions has been declining. Only 14% of consumers overall strongly agree that companies are effectively providing a positive customer experience through convergence between new digital, mobile, and social channel interactions and more traditional ones. Source: Customer 2020, Accenture, 2014 This document is an exclusive document available to FlevyPro members - http://flevy.com/pro 13

and start to use emerging technologies as an enabler and source of growth potential Shift in Customer Experience Trends (2 of 3) 4 TREND 5 6 TREND TREND Customers still encounter significant barriers that prevent them from more widely adopting the digital service channels they want. Satisfaction with online customer service channels is relatively solid compared with traditional channels. However, adoption of digital channels as part of the overall channel mix is low due to several barriers companies have not completely address—e.g., lack of right info provided by the channels, lack of trust in them, lack of knowledge on how to access/use them. Customers’ service expectations are rising faster than companies are willing to adapt. The percentage of consumers saying their biggest frustrations with providers (i.e. failure to deliver on promise, inefficient and slow customer service, and lack of interaction convenience—have remained consistent in the past years. Customer loyalty program adoption is rising, but it’s still not prevent customers from switching. Across industries, the percentage of consumers saying that participate in at least one customer loyalty program has increased since 2009, as has the percentage indicating such programs persuade them to stay with a provider. Unfortunately, program adoption is primarily driven by the desire to gain access to the “best deals,” indicating a sort of short-term loyalty that fails to keep customers committed for the long term. Source: Customer 2020, Accenture, 2014 This document is an exclusive document available to FlevyPro members - http://flevy.com/pro 14

Shift in Customer Experience Trends (3 of 3) 7 8 TREND TREND Lack of compelling offers prevents companies from winning back customers. About 1/3rd of consumers who switched from a provider said they would consider returning within 2 years for better pricing or a superior product. Today, only about 1 in 4 consumers said they are satisfied wit the pricing or product quality offered by the companies that do business with. “Non-traditional” competitors are gaining ground with consumers. Globally, 44% of consumers would be open to consider products and services from companies that are not generally considered part of traditional industry definitions. For example, 23% of consumers would consider buying insurance products from Google, if available. We need to adopt new customer-centric practices that can help us become a multispeed customer organization—one that acts at the same pace as consumer now act. Source: Customer 2020, Accenture, 2014 This document is an exclusive document available to FlevyPro members - http://flevy.com/pro 15

Insert headline McKinsey Customer Decision Journey – TEMPLATE 2 Active Evaluation 1 3 Initial Consideration Set Moment of Purchase 4 Post-purchase Experience Ongoing exposure Insert bumper. Source: Consumer Decision Journey, McKinsey & Co., 2009 This document is an exclusive document available to FlevyPro members - http://flevy.com/pro 17

Insert headline Accenture Nonstop-Customer Experience Model – TEMPLATE Discover Promise Purchase Evaluate Delivery Consider Use Insert bumper. Source: Digital Customer, 2103 Global Consumer Pulse Research, Accenture This document is an exclusive document available to FlevyPro members - http://flevy.com/pro 18

This primer was extracted from the complete Digital Transformation Strategy framework published by LearnPPT The Digital Transformation Strategy is a comprehensive guide to understanding Digital Transformation, developing your Digital Transformation Strategy, and then ultimately executing that strategy to realize the transformation. Topics covered include Customer Purchase Process, Customer Experience Matrix, McKinsey's Customer Decision Journey, Accenture's Nonstop Customer Experience Model, Digital Maturity Model, 6 Layers of Successful Execution, Service Delivery, Social Media Strategy, among others. You can find this document here: https://flevy.com/browse/business-document/digitaltransformation-strategy-2249 This document is an exclusive document available to FlevyPro members - http://flevy.com/pro 19

This presentation was created by LearnPPT. We are a team of management consultants trained by top tier global consulting firms with a collective experience of several decades. Our documents consist of business templates, business frameworks & methodologies, and PowerPoint templates. View our available presentations on Flevy here: https://flevy.com/author/LearnPPT This document is an exclusive document available to FlevyPro members - http://flevy.com/pro 20

Flevy (www.flevy.com) is the marketplace for premium documents. These documents can range from Business Frameworks to Financial Models to PowerPoint Templates. Flevy was founded under the principle that companies waste a lot of time and money recreating the same foundational business documents. Our vision is for Flevy to become a comprehensive knowledge base of business documents. All organizations, from startups to large enterprises, can use Flevy— whether it's to jumpstart projects, to find reference or comparison materials, or just to learn. Contact Us Please contact us with any questions you may have about our company. General Inquiries [email protected] Media/PR [email protected] Billing [email protected] This document is an exclusive document available to FlevyPro members - http://flevy.com/pro 21

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