Why most CEM initiatives are failing

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By: Wise Marketer Staff |

Posted on May 12, 2014

Despite there being a strong correlation between customer experience management (CEM) and increased profits, a significant 81% of organisations have seen their CEM initiatives fail over the past three years, according to a study by business collaboration solutions firm Avaya.

The study examined the emphasis that companies are currently putting on CEM and found that increasingly high expectations are creating a business environment where the majority of organisations are struggling to keep up. While CEM programmes are being undertaken on a global scale by businesses of all sizes, the survey found that China leads the pack with 84% of businesses having a CEM solution followed by the US (73%), India (72%) and Brazil (63%).

CEM activities are strongly tied to business success and growth trajectories. The study found a solid correlation between a strong CEM programme and increased profits. Some 81% of those that have seen a significant increase in profits have a CEM programme in place, compared to those that have seen profits remain static (46%) or suffered a decrease in profits (35%).

Companies with a CEM strategy also tend to see the biggest improvements in customer satisfaction, loyalty, retention and repeat purchasing, which the survey indicated is largely attributed to the fact that 88% of customers would rather spend their money with companies that make purchases easy.

Despite the fact that 95% of business managers say CEM will be important to their organisation in the near term, only 59% of those surveyed actually had a comprehensive plan in place. And, even with a plan in place, there is no guarantee that a CEM approach will produce results, considering that 83% of companies can only deliver some of the elements of a personalised customer experience automatically and in real time.

While 81% of organisations reporting seeing their CEM initiatives fail in the past three years, 43% of managing directors, CEOs and business owners believe the top reason for CEM failure is "project misalignment with customer preferences", indicating communication barriers within organisations themselves.

Another possible explanation is that companies do not typically think of internal functions like finance, R&D, IT and operations as dealing with customers. This could be a blind spot in the way they approach and plan CEM initiatives, given that people across all departments within the company have direct or indirect contact with customers and prospects and not just the roles typically seen as customer facing.

Today's multichannel/multidisciplinary way of working with customers requires strong support from enabling technology. Of companies without a CEM programme, 31% blame its absence on a lack of appropriate technology in place - a figure that rises to 35% of multichannel companies.

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