Ask CXperts

Customer experience – or CX – has spawned its own industry. But which brands are walking the talk and is investment in customer experience driving growth? Mi3 asked three brands and a specialist CX agency for the lowdown on what's moving the needle.

Key points:

• Australia’s superannuation funds are in a fight to survive post Royal Commission, says Aware Super’s Anita Ayres. Innovation and CX are now Darwinian table stakes.
• You can have the best CX in the world, but if the product and price is wrong, you’re probably toast, says Budget Direct CMO, Jonathan Kerr.
• Kerr also thinks in-house teams are best placed to deliver CX, provided organisations can de-silo sales, customer service and marketing.
• NRMA’s Harris Hutkin says doing the basics well and embedding customer satisfaction on scorecards “has had a serious impact the behaviour of the whole business in focusing on customer experience.”
• CX Lavender's Damian Sharpley agrees there is a major opportunity for brands to close the gap between what they promise, and what they deliver. 
• He sees a post-Covid "social reset" playing out, where brands get back to "believable" basics - and must deliver.

Jonathan Kerr, CMO, Budget Direct

Budget Direct CMO, Jonathan Kerr, thinks marketers are occasionally guilty of becoming caught up in their own bubbles, too far removed from the man, woman or non-binary person on the street.

When it comes to CX, he says, there is no secret recipe – and it isn’t anything new.

“The customer will do what the customer wants to do. Our job is to make it easier for them to do it with us easier than anyone else.” CX may have spawned a marketing industry in its own right, he says “but it's really just as simple as making things work well, all the time.”

As such, there is no magic potion or business transformation formula to CX nirvana, he suggests. “Customers don’t start the process thinking ‘I’m going to evaluate your online journey.’ They just go through it – and it’s either good, or it’s not.”

Equally, Kerr says brands can strive for customer experience excellence, but if product and price is wrong, it won’t do them much good. All three must work in harmony – and when brands get the balance right, they deliver more than the sum of those parts.

Give customers control, cut costs, lower prices, grow

Kerr says Budget Direct delivers award-winning products at market-leading prices by ceding control to customers – which in turn lowers prices, which in turn drives growth.

“One of the biggest impacts to date has been handing over control of the customer journey to the customer – giving them the tools and trusting them to get things right,” says Kerr.

“We're giving them trust by letting them get into the bowels of the product and change things, make modifications,” and generally do things that at most insurers require a phone call. “So just having faith in the customer and giving them the tools to be able to manage their own destiny, that's been really massive for us,” he adds.

“It’s a win-win because it costs us less to serve them. We pass that on in better pricing, then we grow, then we have scale and then we can make a bigger difference.”

Be the customer organisationally

As CX should not be more complex than needs be, so should organisational structures reflect that simplicity, says Kerr, who believes removing internal silos is fundamental to smoother customer journeys – and crucially, higher sales and revenue.

He thinks that lends itself more to in-house sales and marketing models than outsourcing – Budget Direct runs an in-house team of 70.

“Customers don't expect the customer journey to be disjointed around weird structures in your business where the left hand doesn't speak to the right,” says Kerr. Internal handovers must instead be slick and seamless.

“The customer journey is like a relay race between different areas. So what we call marketing, media and acquisition is all under one house and all the digital is under one house,” he says.

“That means we are responsible for generating the lead, and then the next bit, and then the next bit. So you actually live the customer journey within your structure – and therefore you have great empathy and spot very quickly where you're dropping the ball.

“So if you're just as concerned about getting the lead as you are in servicing the lead, you take responsibility for that lead throughout, because you're part of the relay team,” says Kerr. “No one cares about your money, your time, your effort or your customers more than you do. That's why we have such an in-house model – and we've really made it work.”

He thinks that approach lends itself to continuous improvement, which in turn negates the need for big ‘transformation’ programmes – the likes of which he has not yet seen during 15 years at Budget Direct’s parent brand, Auto & General.

“If you optimise every day,” says Kerr, “you never have to transform.”

The philosophy seems to be working. In recent years Budget Direct has consistently notched 20% year on year growth – and last year nudged 25%.

Repeating the trick is never easy, but Kerr is confident right product at best price will keep delivering growth – particularly post-Covid.

“With insurance, you're buying a promise and then you're buying delivery. And part of the only thing you can count on between those two parts is the experience of buying and servicing your products - and we're really good at that,” he says.

“We have an amazing team of people across the business that gave us a product that is never more poignant than now: You don't want to give up on your cover level, but you want to save money … And we've been doing that really well.”

Anita Ayres, Head of Innovation, Aware Super

Hired last year to set-up the innovation function for $100 billion superannuation fund, Aware Super (formerly First State Super), Anita Ayres says the once “lazy” sector must innovate or die – and CX will be equally critical to survival. 

“Superannuation is a 2.9 trillion dollar industry. It hasn't been very customer-focused traditionally, but that is about to change,” says Ayres.

The challenge is that super is rarely top of mind for people under 45, and is viewed by many as an enforced retirement plan. As a result, engagement has been low and the industry had grown fat from easy pickings handed to them by default schemes.

“Funds mostly compete on fees and returns. So up to now, there hasn't been much change in terms of the proposition that would make funds distinct from one another,” says Ayres.

“Traditionally, the way that super funds have grown is through industrial agreements. So securing default status was the way that a super fund would basically drive growth.”

Low engagement meant most people would just tick the default box when starting a new job, says Ayres. But that created problems, because people switching jobs then have multiple accounts, which means paying multiple fees, which erode their savings.  The Federal Government eventually clocked the scale of the problem and took action, in the latest budget adopting one of the recommendations of the Royal Commission so that customers will now keep paying into their existing super fund when they move jobs.

“That is what they call ‘stapling on’ members to an existing account,” says Ayres.

“It changes the dynamic in the market of how super funds are competing and the drivers for growth. It changes the game. It’s now much more about choice – and super funds need to make themselves more attractive.”

Customer experience and product innovation are therefore coming to the fore.

“Our focus has been on building propositions that create competitive advantage … because if people didn’t chose you in the first place, but came by default, why should they stay?” says Ayres.

Making superannuation more relevant for the non-engaged is therefore central to its innovation strategy. The latest example of its approach is a rewards scheme.

“We have just launched a partnership with a start-up called Super Rewards. Basically that enables people through the everyday shopping to get a kickback from retailers into the super fund,” says Ayres. “So it's a way that people can increase their contributions without having to put their hands in their pocket.”

To drive engagement and build competitive advantage for the fund, Aware Super is now embarking on a transformation project – its second in three years.

“The market is changing so rapidly and the technology is advancing so quickly that by the time you finish your transformation program, you almost have to do another one just to catch up,” says Ayres.

But she says cultural change is perhaps more critical.

“By far the hardest thing to do is actually how do you enable your employees to develop, to deliver the experience that you want? And sometimes that takes a change of mindset, ways of working, and restructures that are very hard to establish.”

But the superannuation industry cannot afford to fail, she says.

“All of the funds are having to change quite rapidly to be able to survive, because the ones that don't will just get acquired. There is heavy consolidation in the industry. So they won't be able to survive because they won't be competitive.”

Harris Hutkin, GM, Digital & Data, NRMA

NRMA’s 33 parks and resorts businesses are seeing a significant increase in bookings in post-Covid Australia. Given the nature of the business, customer service has always been a major focus, says Hutkin, but in the last couple of years it has placed more emphasis on “layering in science” to the art of service.

“When I talk about ‘science’, it's … just a program of work: What are the things that we're going to improve and measuring the impact of those changes,” says Hutkin.

“The first part of that was bringing to life a touchpoint NPS programme … and then starting to hold our employees accountable for that customer experience,” he explains.

With employees key to delivering strategy across the resorts and parks, “one of my learnings has been you can't just assume that people are going to be able to deliver a great customer experience just because you asked them to”, says Hutkin.

Staff must be given the tools for the job – which means carefully planning technology upgrades to avoid creating more problems then you solves, he adds. NRMA, for example, has invested in digital technologies post-Covid to deliver as much as possible in a contactless manner within the parks and resorts.

“It won’t be a greenfield … you are often adding to the existing tech stack, so you need to think strategically about that. When you're trying to sequence these things, that's a critical element - you can't just buy everything at once,” says Hutkin.

“You need to think about how you're going to organise these things to ensure that the piece of kit that you put in is not going to create some sort of upstream blocker that means you end up spending a whole bunch of money trying to fix it all.”

Regardless of tech, Hutkin suggests doing the basics – and measuring them – is at the heart of good CX.

Damian Sharpley, Strategy partner, CX Lavender

Sharpley agrees that brands must work on the basics to succeed in CX. Too many, he says, think they are providing a great experience – yet are not.

The big opportunity for brands is therefore to close the gap between what they promise and what they deliver.

“Inherent in that is firstly looking and focusing on the products and services that we actually have in market - and looking for opportunities to improve,” says Sharpley.

He sees a post-Covid “social reset on what is valuable to us” playing out, which will drive brands to “slowly creep back down to what is actually essential, what is valued and what's believable within their respective categories - and I think that in of itself brings it closer to what is, you know, a real and tangible brand customer experience today”.

Mind the gaps

In straitened times, Sharpley says it will become even more critical for brands to stop customers falling through the cracks.

“I see a lot of organisations racing to create 'connected customer experiences'”, says Sharpley. That is, to be there and in consideration across the piste, wherever customers are and able to “anticipate what the next question might be”.

“Every time that there's a break in that ecosystem, people fall out and then they find other brands and that's missed opportunity,” says Sharpley.

“So being really, really conscious of that ecosystem and making sure that your brand is present at the right times with the right information to guide people through to a conclusion is extremely valuable.”