“CX” Customer Experience – The latest buzz word or here to stay?

Prior to 2009, we can’t find any meaningful references to Customer Experience as a practice area or segment within the business community. Certainly, the term “CX” hadn’t evolved to refer to the latest, and very rapidly growing, field of Customer Experience until much more recently. While the study of Customer Experience and the rise of several businesses to help companies, understand, measure, deliver, and monitor CX did not evolve until recently (at least in a formal and organized fashion – with its own moniker), there is no denying the “buzz” that is currently surrounding the segment.

We have spent quite a bit of time working with and tracking companies that are growing at significant rates as they help their customers better understand CX. These companies offer consulting services, software, digital CX analysis, training, physical CX measurement, and compliance & brand related solutions. In addition, we are seeing the rise of the Customer Experience Professionals Association (CXPA) and many Fortune 500 corporations are starting to add “C” level executives to focus on this new and important endeavor – The Chief Customer Officer or Chief Customer Experience Officer. There is even a new certification one can receive as a CCXP – Certified Customer Experience Professional.

With all of the new technologies and the intense focus on winning and keeping customers in this ultra competitive and customer driven marketplace in which we live, we expect the CX fad to not be a fad at all. The impact of getting the “CX” thing right is a monumental win for many of the globe’s largest brands. Estimates suggest that it can ultimately result in a 20-30% improvement in profitability. We believe that if well run large corporates can benefit from this renewed and more analytical focus on customer experience and brand, that small and mid-sized business can experience even greater results from leveraging tools to address their own CX.

Those companies that are vending the tools & services to the market to better understand and win the CX mandate are extraordinarily well-positioned to experience rapid growth over the coming years. As such, we expect the private equity capital flows and M&A activity in the CX space to accelerate as this segment starts to mature and demonstrate the power of their solutions.