1. Presentation Title Name Title Customer Experience: Whats Your Next Move? BOB AZMAN CHIEF EXPERIENCE OFFICER 10.2.2014

2. Customer Service Video

3. Todays Session Objectives Customer Experience strategies what they are and why they matter Keeping customers who are satisfied AND loyal Call to Action!

4. First Task 1 Name a company that is easy to do business with

5. Online Retailers Leading the Change Amazons secret plan - to sell you everything! Same day delivery! Groceries; books; anything! Delighting customers: Lightning fast response Never argue about returns Treat good customers well Expect problems, be a solution Treat customers like individuals

6. Are YOU Easy to do business with? ? ? ? ? ? ? YES! WELL

7. Staple Yourself to an Order Harvard Business Review July-August 1992 Benson P. Shapiro, V. Kasturi Rangan, and John J. Sviokla

8. What is Customer Experience (CX)? The customers perceptions and related feelings caused by the one-off and cumulative effects of interactions with a suppliers employees, systems and channels or products. Did You Know? Of all company interactions with its customers are through customer service.

9. The Integrated Customer Experience Its not about multi channel Its about omni channel Contact Center Interactive Voice Response Web Mobile Social Email Video Portals Chat Next ?

10. Why Do Customers Leave? Did You Know? Poor CX Of US consumers will abandon an online transaction if their questions or concerns are not addressed quickly. Purdue University Benchmark Seek Alternatives Prefer Competitor Dissatisfied with Products/Service Die Move Away

11. How do you Quantify CX? 40% 70% 80% 75% Of customers began purchasing from a competitive brand because of its reputation for great customer service Would be more loyal to a business following a positive customer experience Of firms would like to use customer experience as a form of differentiation Of all company interactions with its customers are through customer service

12. Customer Experience Payoff Leaders vs. Laggards Companies that successfully bring great customer experience are rewarded There is power in great customer experiences Stock market returns are better for companies that deliver good CX than those who do not. Cumulative Total Return Customer Experience Leaders S&P 500 Index Customer Experience Laggards 2013 Watermark Consulting 43% 14.5% -33.9%

13. Employee Experience Payoff Increased Annualized Returns From 1997-2011, employee experience leaders outperformed the broader stock market, generating an annualized return that was three times greater than the S&P 500 Index. Annualized Return FORTUNE 100 Best Companies To Work For S&P 500 Great Places to Work Institute, Inc. 10.3% 10.0 % 8.0% 6.0% 4.0% 2.0% 0.0% 3.7%

14. Second Task 1 Write down your companys service strategy.

15. Consider this service strategy

16. The results? Founded in 1960 Acquired by SC Johnson in 1986. Serving more than 12,000 restaurants in 43 states; revenues $30M+ Charged up to 10 times more than its competitors. Had disproportionately high market share in operating areas. Paid out less than .004% of revenues in support of the guarantee Built the people, processes and tools based on the guarantee Sold to Orkin in 1999. Re-acquired the name from SC Johnson in 2003. Re-building the company based on same principles.

17. With all this commitment to customers Why do these things happen? Interactive voice response units (press 1; press 2) that are malfunctioning; and/or provide information that is not needed or wanted by the caller. Your call is important to us but hold rates are excessive; coupled with a lack of foresight on activities that could cause increased call volume Automated requests for information to verify my identity that have to be repeated when Im finally connected with a representative. Lack of documentation the who did you talk to that told you that? syndrome. A service recovery process that fails to recover from the service failure Hollywood set satisfaction guarantees that lack teeth and do more harm than good when challenged.

18. Real Stories Real Companies

19. Home Depot

20. Home Depot Results $78.8B in sales (FY 2013); Up 7.2% PY $5.4B in net earnings (FY 2013); Up 18.7% Earnings per share $3.76 compared to $3.00 PY Increased dividend 21% to $.47 cents per share The Companys guidance for fiscal year 2014: sales growth of 4.3% with comparable store sales up approximately 4.6 percent for the year; diluted earnings-per-share up 16.5% or $4.38 and cash flow of $8.8B with 7 new stores. 2,200+ stores (US, the District of Columbia, Puerto Rico, the U.S. Virgin Islands, Guam, 10 Canadian provinces, China and Mexico) 300,000+ Full time employees 100,000 customer surveys / week

21. Home Depot & Potting Soil = Service Strategy

22. Home Depot Total Rehab The beginning of the end Short Term Strategy = Short Term Results Centralized operations Real estate market bonanza Growth & Expansion EPS doubled

23. Home Depot Total Rehab(continued) The beginning of the end The Impact: Store managers focused on metrics unrelated to customer service Loss of local control and quirkiness (think beach chairs in December in Minnesota) Looked good on paper bad in reality CEO squelched dissent and dismissed criticism of his pay ($30M!!) Customers revolted Competition mobilized Real estate balloon approaching maximum pressure

24. Home Depot Service Strategy Putting the Customer First What did Home Depot do? Simplification Stores focused on remaining in stock, store appearance, customer service No strategic flavors of the quarter Removed tasks 200 weekly reports and emails replaced with 1 single page weekly scorecard Put people in the aisles Trained to be more helpful Evaluate on effectiveness Training & Rewards alignment

25. Home Depot Stock Performance

26. Developing a Strategic Service Vision

27. Elements of the Strategic Service Vision Service Delivery System Operating Strategy Service Concept Target Market Segments What are important features of the service delivery system including: The role of People? Technology? Equipment? Layout? Procedures? What capacity does it provide? Normally? At peak levels? To what extent does it:: Help ensure quality standards? Differentiate the service from competition? Provide barriers to entry by competitors? Does the service delivery system support the operating strategy? What are important elements of the strategy? Operations? Financing? Marketing? Organization? Human resources? Control? On which will the most effort be concentrated? Where will investments be made? How will quality and cost be controlled? Measures? Incentives? Rewards? What results will be expected versus competition in terms of: Quality of service? Cost profile? Productivity? Morale/loyalty of servers? To what extent is the value of results and process quality for customers leveraged over cost to the service provider? What are important elements of the service to be provided stated in terms of results produced for customers? How are these elements supposed to be perceived by the target market segment? By the market in general? By employees? By others? How do customers perceive the service concept? What efforts does this suggest in terms of the manner in which the service is: Designed? Delivered? Marketed? How well is the service concept positioned in relation to customers needs and competitors offerings? What are common characteristics of important market segments? What dimensions can be used to segment the market? Demographic? Psychographic? How important are various segments? What needs does each have? How well are these needs being served? In what manner? By whom?

28. Strategic Service Vision Service Delivery System What are important features of the service delivery system including: role of people, technology, equipment, layout, procedures? What capacity does it provide, normally, at peak levels? To what extent does it, help ensure quality standards, differentiate the service from competition, provide barriers to entry by competitors?

29. Strategic Service Vision Operating Strategy What are important elements of the strategy: operations, financing, marketing, organization, human resources, control? On which will the most effort be concentrated? Where will investments be made? How will quality and cost be controlled: measures, incentives, rewards? What results will be expected versus competition in terms of, quality of service, cost profile, productivity, morale/loyalty of servers?

30. Strategic Service Vision Service Concept What are important elements of the service to be provided, stated in terms of results produced for customers? How are these elements supposed to be perceived by the target market segment, by the market in general, by employees, by others? How do customers perceive the service concept? What efforts does this suggest in terms of the manner in which the service is designed, delivered, marketed?

31. Strategic Service Vision Target Market Segments What are common characteristics of important market segments? What dimensions can be used to segment the market, demographic, psychographic? How important are various segments? What needs does each have? How well are these needs being served, in what manner, by whom?

32. Customer Experience Alignment The Three-legged Stool We need to align and simplify these 3 elements to maximize the experience People Customer Tools Process Link Employee Engagement to the customer experience Align skill sets; rewards and recognition programs; career pathing Provide consistent processes and procedures that make the company easy to do business with. Eliminate outdated policies and procedures that impede first call resolution. Standardize; consolidate; upgrade tools, telephony and technology to improve delivery of the experience Measure results; create scorecards; track customer interactions

33. Happy Customers are Loyal Customers!

34. Formula for Building Customer Loyalty Design it Right Price it Right Sell it Right Deliver it Right Make it Easy + = Comprehensive Service Recovery Contact Management - Respond to Individual Customers Service Recovery ID Sources of Dissatisfaction/Confusion (Root Cause Analysis) Continuous Improvement and Problem Prevention Customers Who Are Satisfied and Loyal Renew with Us Buy Our Other Products Recommend Us to Prospects Positive Word of Mouth Doing the Job Right the First Time

35. Call to Action 3 questions that can make a difference 1 What would our customers say about this product, service, policy or practice? 2 ? What do our employees think about this product, service, policy, practice? 3 What is 1 thing I can do in my job to make a difference in creating a better customer experience?

36. Find Out More About the Avtex Experience Connect with the Avtex Customer Experience Consultants to Optimize Your CX Strategy BOB AZMAN bazman@avtex.com 1-844-CXChamp (1-844-292-4267) KEEP IN TOUCH WITH AVTEX: @avtex facebook.com/avtexsolutions linkedin.com/company/avtex-solutions-llc

37. Customer Experience: Whats Your Next Move