The Top 10 Best Practices in the Development of Customer Experience (CX) Excellence Programs (CEEPs)

Customer Experience (CX) is becoming a greater focus for many companies world-wide. WHY? The development of Customer Experience Excellence has been demonstrated to enable marketplace competitive advantage and to create fiercely loyal customers who are willing to advocate for the company and its brands and are also willing to pay more for their products and services in exchange for uniquely excellent customer service. In addition, when customers are provided with truly exceptional/memorable customer service time and time again, they repeatedly tell positive stories about their amazing customer experience, telling as many people as they can influence about your company, how their experience made a positive difference in their lives and how your company cares about them vs. your competitors. In essence, delighted customers transition themselves into adjunct company marketing and sales agents for the company that is equal to millions in company paid efforts, plus their grass-root and viral influence is judged at least 5-10x more credible/believable vs. company paid advertising, marketing and sales.


The chart below is a small sample of the benefits gained by my clients and many other companies as a result of the systemic implementation of a customer experience excellence program. In addition to the above, employees are found to be much more content working for a company who truly cares about the well being of their customers and the service they are receiving.  It makes employees, as a client employee once said in a leadership meeting, “ I am Part of it, Proud of it”. In essence, making customers happy in turn makes employees feel satisfied.

Benefits of Having an Excellent Customer Experience
Benefits of Having an Excellent Customer Experience

As a result of my experience developing Customer Experience Excellence and CRM Programs for numerous Fortune 500 companies including {American Express, Intuit Software, HP, Ritz-Carlton, Pfizer, Wells Fargo, AT&T, Starwood Hotels, Marriott, JC Penney, Macy’s, Toyota of America, Nissan, General Motors, Lenox, Southwest Airlines, Astra-Zeneca, Bristol-Myers Squibb, Welch Allyn Medical Systems, Vanguard, Citibank, Allstate, AXA Insurance, SONY, Siebel & Oracle Systems, SAS Software, Unica Software, Neopost, Bank of America, Samsung, Chrysler, Toyota, Nissan, Hilton, etc.}, I have developed the following set of top 10 best practices in relation to the development of a customer experience excellence program:


1. The program must be advocated, supported and championed at the CxO level. This is evidenced by the increases in staffing of the position called the “Chief Customer Experience Officer” that most top companies now have.

WHY?:  Forrester reports that 76% of executives say improving CX is a high or critical priority and many companies have established a C-level position to oversee it. Great read, source: “Why every company needs a Chief Customer Experience Officer”, Harvard Business Review:


2. A set of balanced scorecard metrics must be developed to measure the ongoing effectiveness of the program so that it may be continuously improved. A heavy emphasis must be placed on customer ratings of the program and associated service delivery.

WHY?: The metrics are the vision of the program and without these, the program is flying blind on whether the program is resonating with the customer.


3. The customer must be invited, as a brand-company partner, to participate in the program development, roll-out and ongoing evolution.

WHY?: Without really asking the customer about what they want/need directly, all other attempts or approximation of customer needs through analytics or intuition based decision making are merely guesses of what the customer really needs and wants and are likely to miss their mark.


4. The program must be benchmarked against, and kept competitive with, all companies who are considered to be world-class customer experience companies.

WHY?: You might feel you have a great customer experience program, but without quantitatively benchmarking it against the best of the best companies, you will have no idea how really good it is, whether it is falling behind with current/leading practices, etc.


5. Customer Excellence procedures, policies (SOPs) and standards must be developed that are in total alignment with the customer service vision statement and overall strategy.

WHY?: Customer experience excellence procedures are the bridge and playbook that takes the higher level customer service vision and strategy and translates into the behaviors (culture) and major actions are needed on a daily, weekly, monthly, quarterly basis to bring this vision and strategy to life and make it real to every employee.


6. Employees must be supported in the delivery of customer experience excellence by a set of training and development programs that certify them to be able to deliver on the customer service and experience excellence standards, policies, SOPs, etc.

WHY?: The customer experience excellence training programs translate the higher-level customer experience excellence procedures and policies into a detailed playbook of specific and tactical employee actions and interactions that are required to deliver an exceptional customer service experience. In essence, these are the detailed ‘how-to’ of customer experience excellence delivery that makes the program real for front-line and customer facing employees.


7. The program must be underpinned and supported by best of breed technology infrastructure to capture customer knowledge and intelligence, mine customer information, automatically deliver relevant customer information real-time, allow customer to set preferences, etc.

WHY?: Technology will not only become the longitudinal memory for customer insights including needs, wants, preference, etc., but it will also serve to automate the delivery of intelligent customer interactions such that the program doesn’t become burdensome (vs. simple) to operate as it evolves and grows.


8. Related to #7 above, the program must be sophisticated in delivering on the various customer segment needs and wants, yet needs to be simple to engage and manage for customers and employees.

WHY?: People do business with companies that make it easy to do business with – fast, efficient, responsive companies are sought out more than those that are not. In addition, a program that is difficult to administer is at risk for execution errors by employees or by them short-cutting or avoiding the process.


9. The organizational culture at all levels must be created that is supportive of the customer experience excellence standards and all incentives must be aligned to encourage employee excellence in its delivery.

WHY?: Research by Gallup shows that work units in the top quartile in employee engagement outperformed bottom-quartile units by 10% on customer ratings, 22% in profitability, and 21% in productivity — and they experienced lower employee turnover, absenteeism, and safety incidents. In other words, it is difficult (impossible?) to deliver excellence customer service without a great corporate culture.  Original Source:


10. The CEE program must be viewed holistically that takes into consideration people, process, technology and culture (PPTC) capabilities as well as all customer segments across all customer preferred channels of interaction.

WHY?: Pure and simple, a great program is implemented with the full (holistic) spectrum of capabilities considered. Focusing on only 1 or 2 of the 3 pillars of CEE (refer to CEEF framework chart below) will sub-optimize its performance.

Symptoms of a Poor Customer Experience

Symptoms of a Poor Customer Experience

While the previous chart pointed to benefits of implementing customer experience excellence, the above chart, while self-explanatory, highlights a few negative impacts of having poor customer experience delivery. In addition to the above, companies that have a poor customer experience also experience the following:

  1. Market share erosion

  2. Declining customer acquisition success

  3. Declining cross-sell and up-sell success

  4. Customer social sentiment that is increasingly negative across an array of social media platforms

The above chart illustrates that in order to effectively gauge the effectiveness of your current customer experience program, you must be measuring across a number of company areas to determine what is working and what is not. Sound familiar?   2) ” A set of balanced scorecard metrics must be developed to measure the ongoing effectiveness of the program so that it may be continuously improved. A heavy emphasis must be placed on customer ratings of the program and associated service delivery.”

Best Practice Customer Experience Framework

Best Practice Customer Experience Framework

The above chart is a best practice Customer Experience Framework that depicts the major pillars that enable customer experience excellence.

  1. The first pillar is the customer knowledge and insights that enable you to provide the customer with the right interaction at the right time and by the right channel of their choice.

  2. The 2nd is a robust customer strategy and delivery model to define the desired level of customer service delivery and how you will enable it.

  3. The 3rd and last is the development of a customer oriented culture to nurture and expand customer relationships that not only provides a differentiated customer experience, but also drives increased sales, loyalty and spend per customer.

I use this chart above, along with others, to develop the customer strategy, vision, policies, etc. Sound familiar?  5) Customer Excellence procedures, policies (SOPs) and standards must be developed that are in total alignment with the over developed customer strategy.

Key Deliverables in the Development of a  Best Practice Customer Experience

Key Deliverables in the Development of a Best Practice Customer Experience

The above chart is the waterfall development method I use to develop customer experience excellence. With few exceptions, each of the top level items must be mostly developed before the following lower level items can be developed.

For example, the top level CEE program vision, strategy and goals must be developed first, to be used as a guide for the development of its supporting standards, policy and guidelines.  All of these customer experience excellence deliverables align with the ten (10) best practices we covered at the beginning of this article.

Best Practice Customer Experience Development Approach & Methodology

Best Practice Customer Experience Development Approach & Methodology

Above are the depicted major work-streams I employ to develop customer experience excellence for my clients. These major work-streams align to delivering the top 10 CEE best practices as well as my waterfall deliverable development schema in the previous chart.


In summary, improving your customer experience delivery doesn’t have to cost a great deal, can start slowly, can now be measured and the return on investment is generally in multiples (2-10x+) of the cost. Without a delivering an exceptional customer experience (via an exceptional corporate culture),  you will be unable to acquire and retain great employees, will have more costly sales and marketing efforts and your customers will not be acquired as quickly or remain as loyal (vs. competitors). With all this being true, do you really have any excuse at all remaining not to actively work on ensuring you are delivering the best company customer experience possible as to create competitive marketplace advantage?!

If your organization is seeking experienced assistance in measuring and improving your customer service and customer experience, then give me a call or e-mail me at 518-339-5857 or

Lastly, this is just one article of 40+ total I have written on customer strategy, customer experience, CRM, marketing, product management, competitive intelligence, corporate innovation, change management – all of which I have significant experience in delivering for Fortune 500 companies.  In fact, my blog is now followed by nearly 121,000 world-wide and was just named one of the top 100 CRM blogs on the planet by Feedspot, alongside, Infor, Microsoft, SAS, etc. – Reference this informative site here:

The 80/20 Customer Profitability Rule

Develop intelligent customer service & customer management programs based on customer value insights…

Has your business ever performed an analysis of your customer base to determine any of the following:

1)      Which customers are frequent visitors and have the greatest repeat business?

2)      Which ones rarely do business with your company?

3)      Which ones are the most valuable and profitable to your company?

If you haven’t then you really don’t have the insights necessary to really develop an effective customer service, customer management and/or loyalty program.  In performing analytics and customer analysis for nearly 10% of the Fortune 500 companies in the United States, I have found a very revealing and astonishing pattern (rule) in this customer analysis that holds true company after company.  The pattern is as follows:

80% of all company profits are derived from ~20% of your customers

Take the chart below (Chart 1) from one of the top US banks that shows 20% of their customers are responsible for 82% of their profitability and that a full 47% of customers are actually unprofitable and not worth having as customer as each transaction costs the bank more than it is worth (each customer interaction/transaction actually drives the bank further away from profitability) {Click on Chart for a larger/clearer image}:

80% of all company profits are derived from ~20% of your customers

80% of all company profits are derived from ~20% of your customers

When I presented this customer profitability analysis to the bank, the bank executives were amazed at the results and of the customer profitability distribution. (Note – The deciles were developed using a SAS generated RFM analytics model whereby Recency (How recent customer have visited/purchased), Frequency (How frequently customers have visited/purchased and when they visited/purchased) and Monetary spend (How much they spend and on what types of products/services they spent their $$ on). The RFM model was then used as input into a profitability model, using actual profit data for each product/service/customer using a unique customer id to match the profit data to the RFM score.)Why are these insights and analytics so important and what might the bank or any other business do to manage customer relationships more effectively?  These insights are key in developing a customer relationship management (CRM) and loyalty program that is tailored and specific to each customer group. 

Note: The 80/20 rule applies to companies that have higher transaction volumes, a diverse set of product & services and a heterogeneous customer base.

Ask yourself the following questions:

  1. Should your company treat your best and most profitable customers differently than other, less profitable customers?
  2. Should your company develop special customer programs so that the 20% most profitable customers are not lured away by competitors?
  3. Do you think your company’s most profitable and valuable customers want to be shown appreciation for their repeat and profitable business in a way that makes them feel welcome and special?
  4. Is it in your company’s best interest to want to develop strategies and programs that turn unprofitable customers into profitable or at least revenue neutral customers?

The answer to all four questions should be a resounding YES!

Armed with the above insights and analysis a company can start to architect customer intimacy and loyalty programs such as the following:

  1. Offer most profitable customer special discounts or accelerated loyalty rewards earning rates
  2. Conduct special top customer, by invite only, appreciation events
  3. Deliver occasional special top customer gifts or recognition when they interact with you in-person or on-line
  4. Invite your top 1-5% of customers to participate in an invite only customer advisory board or insights group event every year at an exciting destination where most or all expenses are paid for by your company
  5. Develop unprofitable customer management programs such that these customers become more profitable, cost less per company transaction and/or they are effectively ‘encouraged’ to migrate to competitors.

Take the same chart above and now overlay customer treatment programs to each customer decile and sub-segment (Chart 2) {Click on Chart for a larger/clearer image}

Effective Customer Management Programs Based on Profitability Insights

Effective Customer Management Programs Based on Profitability Insights

Even though decile #1 (10% of all customers) has been identified as the most valuable customer segment generating 65% of all company profits, the decile can then be further sub-segmented based on further profitability analysis/decomposition.  In this particular case:

  1. The top 5% of the top profitability decile customers generated 42% of all profits
  2. The remaining 5% of the top profitability decile customers generated 23% of profits

As shown in the ‘golden’ box (#1) above and below, these top tier customers should be given special access and special attention and made to feel totally appreciated and a partner of the company. The golden box also demonstrates the types of special programs you might want to provide to this top profitability group. It is of your utmost importance to do everything in your company’s power not to lose these most valuable/profitable customers. These suggested treatments are just a sample, but ones I have developed for many clients in the past, including top tier banks, retailers, life sciences companies, telecommunications providers, etc. {Click on Chart for a larger/clearer image}:

Top 5% of Customers Receive Platinum Plus Customer Programs

Top 5% of Customers Receive Platinum Plus Customer Programs

The next (Green) group of profitable customers highlighted in box #2 (below) can receive special treatment as well, but not quite the golden treatment as the most profitable 5%. These next valuable set of customers would still receive top customer treatment, but not quite the platinum access that the most valuable 5% would receive. You wouldn’t want to lose these valuable customers either, so their treatment would still be special, memorable and differentiated vs. your competitors. {Click on Chart for a larger/clearer image}:

Next Top Set of Customers Receive Top Treatment, but not Special Access, Handling Like the top 5% (Platinum) Group

Next Top Set of Customers Receive Top Treatment, but not Special Access, Handling Like the top 5% (Platinum) Group

The blue box (#3) in the chart below speaks to customer migration programs that incentivize customers to spend more, visit your company (physical or online) more, purchase higher value items, buy in bundles, etc. {Click on Chart for a larger/clearer image}:

Effective Customer Management Programs Effectively Transition Customers into More Valuable Customers Over Time

Effective Customer Management Programs Effectively Transition Customers into More Valuable Customers Over Time

One very effective way to do this is to develop what I call modeled incentives. In that, if a loyalty program is to be effective there should be an incentive for the customer to model the behavior to achieve the next loyalty reward level and the following must be present:

1)      Every customer group must know what they need to do to achieve the next loyalty rewards level

2)      Customers need to feel the next loyalty rewards level is significantly more valuable than their existing level

3)      There should be prestige and/or notoriety associated with achievement of the next loyalty rewards level so that customers feel privileged, special and differentiated from regular customers.

Lastly, the red box (#4) below speaks to customer management programs that need to either turn these unprofitable customers into profitable customers or find ways to reduce the cost to serve these unprofitable segments. Some strategies including limiting these customers to self-service, providing incentives to transact during off hours, incentivizing them to seek lower cost providers, etc. {Click on Chart for a larger/clearer image}:

Effective Customer Management Program Also Address Unprofitable Customers

Effective Customer Management Program Also Address Unprofitable Customers

The bottom line is that, through customer insights and analytics, you will find that not all customers are the same in terms of profitability (the 80/20 rule), therefore it makes no sense whatsoever to treat all customers the same. Through a robust customer insights program you will then be able to leverage these insights and develop a sophisticated and custom loyalty and retention program in order to accomplish the following:

  1. Develop break-away tier 1 (Platinum) loyalty programs that stand alone in the industry such that your top 1-5% most valuable customers would not even consider defecting to another provider
  2. Develop programs to retain your most profitable customers and make them want to remain a loyal customer
  3. Develop a loyalty migration path for customers to want to achieve the next loyalty rewards level (Silver, Gold, and Platinum) so that they simultaneously feel more recognized/special/connected to the company while providing your company great value/profits/monetary return.
  4. Develop programs to mitigate expenses when dealing with your least profitable customers (more self-service, helping them ‘discover’ lower cost competitors, offering more limited services, etc.) (the other 80%)

Blow Away Your Competition by Replacing Your Old CRM Program with the New Customer Relevant Relationship Management (CRRM) Model

Blow Away Your Competition by Replacing Your Old CRM Program with a more effective Customer Relevant Relationship Management (CRRM) Model

1)               Introduction

  1. Do you have a robust CRM program in-place, but you feel you are still missing the mark in terms of delivering what your customers really want & need?
  2. Is your organization at risk of making market decisions that can cause a backlash and mass defection by your customers like the Bank of America $5 fee decision or the Netflix business split decision?
  3. Do you have volumes of consumer data and analytics, but sales are declining or flat and customers are churning at an increasing rate?
  4. Do you feel you could improve the quantity and quality of your customer insights including ascertaining critical consumer needs, preferences, likes/dislikes, interests, preferred communication channel for you to contact them, preferred timing and frequency for you to communicate with them, etc?

If you can say “Yes” to any of these questions, the rest of this post is a MUST READ for you and it is time to consider this more effective CRRM Model to replace your outdated CRM Model.

2)               CRM vs. CRRM Model Overview

The following diagram depicts the major differences between the old CRM Model and the new CRRM Model including the problems associated with the old CRM model and benefits of the newer CRRM model.

Old CRM Model vs. Customer Relevant Relationship Management (CRRM)

Old CRM Model (left above):

  1. Relies on historical data and analytics to determine what customers need, want, etc. by the analysis of sales history, types of products purchased, categories of products purchased, views on websites, stores visited, etc.
  2. Customer activity information is a proxy to what customers really want and need. Example, you will seldom learn that a customer hates an in-store or web experience through this proxy for what they are wanting, feeling, needing, disliking, etc.
  3. Companies are unlikely to gain insights into the impact that any future company decisions will have on customer loyalty, retention, acquisition.

New CRRM Model (right above):

  1. Takes a more direct approach with customers and utilizes a systemic querying method to ascertain exactly what customer want/need/prefer/etc.
  2. Embraces customer councils, customer forums, customer voting to drive future content, interactions, product/service offerings, etc.
  3. Activity solicits ratings from customers on many aspects (marketing materials, web experience, in-store experience, product usability, quality of customer service, etc.) regarding the health of the overall customer relationship and continually asks “How well are we managing our relationship”

3)               Example of CRM Model Gaps

To illustrate how companies are struggling to really determine the real needs of their customers, I took selected comments from interactions with senior CRM executives from major US Corporations based on consulting engagements, job interviews, speaking to them in passing, etc. The following charts are their actual verbatim comments as well as my read on their CRM gap that prevents them from developing world-class relationships with their customers.

Traditional CRM Programs:

  1. Organizational culture, operations, and go-to-market strategy does not put the customer and real customer insights into the center of CRM operations
  2. Relies on data, analytics, and customer history to drive on-going customer interactions.
  3. Puts the organization at extreme risk of missing the boat from a customer’s perspective – real needs, wants, concerns, preferences, experiences, etc.
  4. Companies that rely on this model are at-risk of customer defections, decreased customer spend/loyalty, etc.

New CRRM Model – with Customers In The Center of Customer Operations

New CRRM Program:

  1. The organizational culture, operations, and go-to-market strategy puts the customer and real customer insights into the center of CRM operations rather than rely on the proxies of what customers want, i.e. data, analytics, and customer history.
  2. The customer becomes the actual judge, ‘rater’ of whether you are delivering quality, value and a good relationship to them.
  3. The customer is put in charge of CRM operations and enables a bi-directional and on-going dialog with the customer whereby they tell you their real needs, wants, concerns, preferences, experiences, etc.
  4. Companies that rely on this model are more likely to develop products, services, offers, communications that delight the customer and whereby they are more loyal, greater brand advocates, and likely to refer your company to their friends as a company who listens, cares and empowers their customers.

6)             Companies That ‘Get ‘CRRM

The following are samples of companies that, in my opinion, get the CRRM model and details how/why each of them get this new go-to-market customer model.

Companies That ‘Get’ CRRM – 1 of 2

Companies That Get CRRM – 2 of 2

Phrases That Describe Companies who ‘Get’ the New CRRM Model

  1. We don’t hide behind data and analytics to drive our customer & CRM operations, but rather we ask our customers what they want.
  2. We are eager to ask our most disgruntled customers how we can improve our relationship with them and to determine who to improve our go-to-market strategy
  3. Before we make any major market-facing decisions, we ask a cross-segment of our customers what they think about each of our proposed decisions and then ask them how to improve upon how these changes are implemented so we ensure a continued delighted customer base.

The bottom line of this post is that, if your company relies less on historical data and analytics to determine what customer want and actually builds methods, processes, and systems to put the customer in charge of rating CRM operations in order to provide you with ongoing and valuable real insights (needs, wants, likes dislikes, preferences, concerns, etc.), the customers will feel more valued and connected with your brands. The benefit of adopting this new CRRM model will be more loyal, empowered and delighted customers who will be brand advocates and brand referrers that will increase shareholder and company value.

As I have now built this new CRRM model for several major US brands, my next blog post will be on ‘how to’ develop this capability at the enterprise level.

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