Professional Documents
Culture Documents
CC XD The State of Customer Experience in 2023 (Experience Dynamic)
CC XD The State of Customer Experience in 2023 (Experience Dynamic)
The State
of Customer
Experience
Understanding the Hidden Drivers
and Expectations of Today’s Consumers
from Generation Z to Baby Boomers
experiencedynamic.com
The State of
Customer Experience
Table of Contents
2
Welcome From the
National Study’s Authors
2023
While all these interactions (and expectations!) are coming Jason Dorsey
Behavioral Researcher,
at businesses faster than ever, at the same time that product Author, and Speaker
innovation is quickly copied, digital transformation is the
never-ending norm, and true efficiencies are increasingly
challenging to maintain. What is a senior leader to do? Great
question! That is exactly why we led this unique national study.
3
Welcome From the National Study’s Authors
2023
We all know that one of the best options for a sustainable competitive
advantage is developing loyalty, advocacy, and frequency through superior
customer experience. But what does that mean and look like today?
4
Welcome From the National Study’s Authors
2023
WHAT CAUSES
CUSTOMERS TO WHICH ASPECT OF THE WHICH CUSTOMER
REMEMBER GOOD CUSTOMER EXPERIENCE IS EXPERIENCE FACTORS
AND BAD CUSTOMER MOST LIKELY TO THREATEN ARE MOST IMPORTANT
EXPERIENCES? CUSTOMER SATISFACTION, TO CUSTOMERS?
TRUST, AND LOYALTY?
5
Welcome From the National Study’s Authors
2023
“Now is the time for business and organization leaders to recognize that
customer experience is about meeting each generation and customer
where they are through the lens of what matters to them. And to do that,
you have to know their expectations.”
Our best,
JASON DORSEY
Founder of The Center for Generational Kinetics
CHRIS JOHNSON
CEO of Experience Dynamic
6
National Study
Overview
Who We Spoke To
This first-of-its-kind State of Customer Experience national study included
1,000 U.S. participants ages 16-75 weighted to the 2020 U.S. Census
for age, gender, geography, and ethnicity. This a powerful, statistically
accurate “snapshot of America” that is missing from too many customer
experience conversations. To add even more insights to the study, we
included an oversample of 250 Gen Z participants (ages 16-26) and an
oversample of 250 affluent participants (annual household income of
$100,000 or more) so we could go even deeper into the data.
What makes this study unique is the areas we focused on and the sample
groups we spoke with. The study explored what each generation most
wanted from customer experience, what improved customer experience
Younger
vs. what crushed it, along with the tangible outcomes that delivering great
generations have
customer experience can provide. The goal was to ask the questions that
had significantly
we as customer experience leaders—and you as a senior leader at an more memorable
organization—would love to have answered but can’t find anywhere else. customer
experiences than
older generations in
a given month.
7
National Study
Overview
8
The Secret Ingredient
for Challenger Brands
of All Sizes
85%
SAY CUSTOMER
EXPERIENCE CAN ARE CHALLENGER BRANDS
MAKE A SMALL STEALING MARKET SHARE
COMPANY WIN THEIR FROM YOU WITHOUT YOU
BUSINESS FROM A
KNOWING IT?
LARGE COMPANY.
9
The Secret Ingredient for
Challenger Brands of All Sizes
Boomers ages 58 - 75
1. Resolving the problem or issue - 51%
2. Expertise, knowledge, or competence - 44%
3. The product meeting my expectations - 39%
10
A Huge, Hidden Gap Exists Between What
Gen Z Expects From Customer Experience
and What is Being Delivered Today
The urgency to address this satisfaction gap is growing with each passing day. Gen Z is most
dissatisfied with getting a question answered, solving a problem with a product/service, purchasing
something online, and shipping/delivery.
1 1
54% 73%
PURCHASING PURCHASING
SOMETHING SOMETHING
IN-PERSON IN-PERSON
2 3 2 3
54% 52% 71% 70%
11
Gen Z Is Increasingly Influencing the
Behavior Of Older Generations
12
Uncovering What Makes
a Good Customer
Experience Memorable
Making customer experience memorable also increases the ROI for an investment in
customer experience, because it drives greater long-term value for the organization.
In short, a memorable customer experience is a win for the organization and for the
customer being served.
1 2 3 4
62% 61% 50% 48%
13
The Top Drivers of Meaningful
Customer Experiences
14
Affluent Americans Unique Expectations
Around CX
15
Consumers Say CX Should Affect…
CEO Pay!
72%
Elevating CX To Highest Levels
of Organization
An eye-popping 72% of Americans say CEOs should have
their pay affected based on customer experience. 72%!
Wow. That is a huge number and very telling of not only
the importance of customer experience to consumers,
but also the underlying feeling that the customer
experience should be elevated in terms of importance,
value, and accountability to the very highest levels of
OF AMERICANS SAY CEOS
an organization. Interestingly, the question was asked
SHOULD HAVE THEIR PAY
to create the opportunity for the impact to be positive
AFFECTED BASED ON
or negative. Americans aren’t saying that customer
CUSTOMER EXPERIENCE.
experience should only be punitive for CEOs, but rather
that customer experience is so important it should
positively or negatively affect CEO compensation to
make sure it has the right level of attention and urgency
within an organization.
16
Making CX a Priority in the
Executive Suite
17
How a Bad Customer
Experience Leaves a
Lasting Impression
The national study explored the emotion and perceptions behind bad
customer experiences. Across America, the study found that three specific
emotions most create memorable bad customer experiences—the kind
that absolutely must be avoided:
(By total; ranked #1/#2/#3)
#
1
INEFFICIENT OR
#
2
INTERACTION
#
3
LACK OF
THAT LEAVES THEM ATTENTION TO
UNRESOLVED ISSUE
FEELING WORSE DETAIL
SAY AN INEFFICIENTLY OR
of Gen Z of Boomers
19
Paths For Resolving
CX Issues –
Generational Differences
Telephone 62%
OLDER GENERATIONS ARE
In-person 58% SIGNIFICANTLY MORE LIKELY THAN
YOUNGER GENERATIONS TO PREFER
TO RESOLVE A CUSTOMER EXPERIENCE
Email 57% ISSUE VIA TELEPHONE, IN PERSON, OR
EMAIL BEFORE MAKING A PURCHASE.
Online-chat 47%
YOUNGER GENERATIONS ARE SIGNIFICANTLY
Text 36% MORE LIKELY THAN OLDER GENERATIONS TO
PREFER TO RESOLVE A CUSTOMER EXPERIENCE
Mobile ISSUE VIA ONLINE CHAT, TEXTING, OR SOCIAL
app 23% MEDIA BEFORE MAKING A PURCHASE.
Social
media 16%
21
The Different Paths to Resolve Issues -
Communication Channels
72 %
OF MILLENNIALS SAY IF COMPANIES MADE
IT EASIER, THEY’D RATHER HANDLE A
CUSTOMER SERVICE ISSUE WITHOUT HAVING
TO INTERACT WITH A PERSON, THE HIGHEST
OF ANY GENERATION.
22
Paths For Resolving CX Issues -
The Gender Disparity
The national study found that men are significantly more likely than women to
prefer to solve a customer experience issue in person before making a purchase.
However, women are significantly more likely than men to prefer to solve a customer
experience issue via online chat before making a purchase. What does this mean to
CX leaders focused on pre-purchase questions, concerns, interactions, and delighting
customers? It means that you have to offer both in-person and online chat if you want
to meet and exceed the expectations of the different genders that you serve.
Men Women
1 1
63% 60%
TELEPHONE TELEPHONE
CALL CALL
2 3 2 3
62% 57% 58% 51%
1 2 3
57% 51% 50%
1 1
33%
SELECTING A BUYING
HEALTHCARE A CAR
PROVIDER
2 3 2 3
34% 40%
25
The Gateway to Word-of-Mouth
Recommendations
26
Paying Significantly More for
Immediate Service
Our data found that 47% of Americans would be willing to pay up to 30% more if immediate
service was guaranteed. That is almost half of America saying they are willing to pay materially
more for guaranteed immediate service. Wow! It gets even more interesting when the data is
analyzed by household income. The same question revealed that 50% of non-affluent households
were willing to pay up to 30% more for immediate service. In fact, the $50,000 to $74,000 annual
income bracket was the group most likely to pay up to 30% more for immediate service, with over
52% of them in the study saying so! But clearly, affluent households also love immediate service.
We found that 44% of affluent households, those earning $100,000 per year or more, were willing to
pay up to 30% more if immediate service was guaranteed. That is a big number, especially when
you consider their annual income. All of these unexpected insights speak to the shift in customer
mindset and value of immediate service across the US and economic groups.
of Americans would be
willing to pay more for
a product or service if
immediate service is
guaranteed, with Gen Z
being the highest consumers would pay 20% or more.
generation at 78%.
27
Paying Significantly More for Immediate
Service - Gen Z Leads the Way
28
The Impact of Online Ratings
and Reviews
We first dug into the importance of rating and review sites by asking America how much online
ratings and reviews influence their view of a business, product, or service they have not tried. The
study found that Millennials, significantly more than any other generation, most valued online
ratings and reviews of businesses, products, and services they have not yet tried. However, in a
surprising twist, there were two generations that valued them less than the others: Gen Z and…Baby
Boomers. Yes, the bookend generations both currently value online ratings and reviews less than
Millennials and Gen X. This could be due to Gen Z still emerging as consumers and Baby Boomers
not coming of age with the Internet, but either way, it is an interesting twist for companies seeking
to leverage ratings and reviews, particularly in reaching Gen Z as they emerge.
of Younger of Gen Z
Millennials
29
The Impact of Online Ratings
and Reviews
30
Exploring The Views Of Customer
Loyalty Programs
The national study found that the customer reward and loyalty programs that
Americans are most satisfied with vary dramatically by generation. Gen Z is
significantly more satisfied than other generations with quick service and fast casual
loyalty programs (Chick-fil-A, Chipotle, etc.) and beauty reward programs (Sephora,
Ulta, etc.). While Millennials also rank quick service and fast casual loyalty programs
as tops for them, they are also significantly more satisfied with coffee rewards
programs than other generations. This presents an interesting dynamic where the
younger generations overlap in the top two types of reward and loyalty programs, yet
they each rate them very differently from one another!
Gen Z Millennials
1 1
39% 29%
2 3 2 3
27%
21% 16% 13%
(By generation)
31
Exploring The Views Of Customer
Loyalty Programs
20%
This analysis is important, as the value of Gen Z and
Other
Millennial consumers continues to grow as they
mature and enter higher earning years, as well as for 14%
customer experience leaders whose product or service Airline loyalty
focuses on different income brackets. The better
leaders can understand the current state of customer
13%
loyalty and rewards programs, the sooner they can Hospitality loyalty
begin innovating on them through generational and
other lenses to drive greater satisfaction, loyalty, and 12%
lifetime value. Beauty rewards
9%
32
Aligning Brand Purpose
With Values
“Gen Z are the ultimate day traders. They trade up and down. Strong
brands win with this cohort. Values are often a tipping point factor that
allows Gen Zers to lean into their values by purchasing brands they
believe in and trust.”
- Jeff Fromm,
Senior Advisor & Author,
Marketing to Gen Z and The Purpose Advantage 2.0
76
WOW!
CUSTOMER’S
%
EXPERIENCE IN
76% of Americans would be
ALIGNMENT WITH more likely to be loyal to a brand,
YOUR AUDIENCE’S service or company whose
SOCIAL VALUES? purpose or mission aligns with
their values.
33
National Study
Conclusions
The national study also revealed that very specific emotions and actions
create the most positive memories that lead to repeat purchases and
brand advocacy—as well as what customer experiences to avoid! Getting
customer experience right not only drives a clear return on investment
for organizations, but as the study found, Americans think it should also
directly impact CEO pay!
34
Five Actions
You Can Take
#
1
Understand the customers you serve.
While this study took a broad look at generational differences in CX
expectations, your unique makeup of customers will surely have
more specific needs. Take a deep look at the generations that are
represented in your customer base. Through customer research,
you can identify your most important customer segments and their
generational trends, and understand what truly matters to them.
2
Start listening to your customers.
#
No brand is perfect, and neither is yours. Feedback from those who
matter most: the customers who are living your experiences are
some of the most impactful data you can leverage to improve CX.
Implementing a thorough voice of the customer program and
developing feedback-based action plans will quickly address hot
issues with your customers.
#
3
Take an honest look at your current customer experience.
Perform an audit on your own or hire a CX expert to take a
comprehensive look at all of your customer touchpoints. Having a
holistic view of your CX will help create priorities and a go-forward
plan for addressing critical needs and strategic changes over time.
#
4
Get your digital customer experience in order.
78% of Americans will become advocates for your brand solely based
on the experience they have with your digital CX. Upgrades here can
be done quickly, create a sustainable competitive advantage, and
will have a significant impact on customer advocacy and loyalty.
#
5
Create a long-term CX roadmap that strongly considers Gen Z.
This national study clearly identifies Generation Z as the generation
least satisfied with the current state of CX. Creating a long-term plan
that evolves your CX to best meet their needs will not only capture a
new generation entering the marketplace but will improve experiences
for older generations as well.
35
Meet The
Co-Authors
36
Meet The
Contributing Authors
Daniel Lemin
Sr. Strategist, Convince & Convert
Author and Keynote Speaker
Sunny Hunt
Strategist, Convince & Convert
Author and Keynote Speaker
Jeff Fromm led the first public study of Millennials through a research
partnership with the Boston Consulting Group. That research informed his first
book “Marketing to Millennials” (2013). He has since co-authored five books –
his most recent “The Purpose Advantage 2.0” (2021). Jeff speaks professionally
all over the world, has written 500 articles at Forbes, served on the board of
directors and invested in high-performance companies including Service
Management Group (SMG.com), TicketSolutions.com, Three Dog Bakery &
more. Brands whose market capitalization (combined) has increased from
Jeff Fromm under $25M to over $600M.
5X Author, Speaker, Strategist
at LaneTerralever
37
Meet The
Contributing Authors
Andy Parnell
President at LaneTerralever
38
About Experience
Dynamic
Experience Dynamic (XD) is a collective of companies committed to customer experience. From the first
touchpoint through the full life of your customer, Experience Dynamic helps solve complex problems to fuel
meaningful engagements that drive results for your brand. With both LaneTerralever (Marketing & Digital
Experience) and Convince & Convert (Content Marketing & CX Strategy) as part of the collective, Experience
Dynamic guides clients through transformational CX change.
Experience Dynamic services encompass CX strategy, change management consulting, customer journey
mapping, digital experiences, content marketing and growth marketing, to help companies build loyalty
and generate more revenue through targeted customer interactions.
The Center for Generational Kinetics, LLC (CGK) is the leading research, speaking, and retained advisory firm
focused on generational change, key emerging trends, and behavioral insights. We have led more than 100
custom research studies for clients around the world.
CGK’s team leads original research to solve important consumer, employee, technology, and emerging
trend challenges. The firm uncovers new and unexpected, statistically accurate insights for innovative,
market-leading clients. CGK’s team has worked with over 700 companies around the world, from the
biggest global brands to financial services, technology pioneers, retailers, banks, hotels, and automotive
manufacturers. The firm’s latest bestselling book is Zconomy: How Gen Z Will Change the Future of Business.
CGK’s team and discoveries have been featured on more than 200 TV shows and hundreds more media
outlets globally. Learn more about CGK’s pioneering research at GenHQ.com.
39
National Study
Methodology
1,500
NATIONAL STUDY OF 1,500 U.S.
PARTICIPANTS AGES 16-75 PARTICIPANTS WEIGHTED
TO THE 2020 US CENSUS FOR
AGE, GENDER, GEOGRAPHY,
AND ETHNICITY.
+/- OVERSAMPLE
OVERSAMPLE OF 250 OF 250 GEN Z
MARGIN OF ERROR PARTICIPANTS WITH PARTICIPANTS
+/- 2.53 ANNUAL HOUSEHOLD
PERCENTAGE POINTS INCOME OF $100,000+
40
Copyright and
Allowed Usage
41