Research Outline and Literature Review for Customer Journey Improvement

Research Outline and Literature Review for Customer Journey Improvement

Andras Bori

University of Phoenix

Research Outline and Literature Review for Customer Journey Improvement

Research Question

My main interest is how do we use a model to identify customer pain points, and build a customer journey that results in a delightful experience while incrementally and systematically improving the journey. The proposed model will help to identify new problems to solve, incrementally find solutions to the problems discovered, build a feedback loop that helps to validate that the change resulted in an improved customer experience, and create an operational model that helps to balance small tactical goals with long term major changes. The overarching research question is: How can we use customer journey evaluation models to build a strategic roadmap?

Problem Statement

Companies currently do not have a model that would enable a quantitative evaluation of the customer journey in order to identify which steps of the journey should be changed to improve conversion and retention rates.

Background

More and more companies are selling their goods and services using a subscription model, where customer pay a recurring monthly or annual fee for using particular services. Within this model for companies that offer such services it is paramount to enable customers to quickly find the product that meets their needs and get through the purchasing process, download the software and start using it. In addition, customers need to receive continuous value to keep using the product for a long time. The customer journey can be conducted using online and offline channels as well. Within this customer journey there are different models proposed in the literature that would enable the measurement of the effectiveness of each components of the journey. However, there is a gap in the literature in how to prioritize which steps in the journey to improve in order to maximize the value that can be delivered to shareholders. In order to prioritize the investment, the model has to take into account the conversion and retention rate improvements that can be achieved by improving each step in the journey.

Specific Problem to be Studied

The problem will be studied at Adobe Systems, and will be focused on the Creative Cloud Individual Customer base. The Creative Cloud have approximately six million subscribers, and the business is growing at about 20% year over year. I am planning to focus my research on the single app customer journey focused on the illustrator product. The estimated sample size of Illustrator customers is about 200 thousand. The plan is to create a model that follows the different components of the customer journey. Create an analytical data model that tracks the customer’s interactions and measure where customers fall out. Follow the drop off points and analyze the different areas to calculate the business impact of lost opportunity. Prioritize the areas in order of business opportunity lost to focus where to invest resources for improvement.

Purpose Statement

The purpose of the proposed quantitative descriptive research study is to identify existing opportunities and to create additional opportunities to improve the effectiveness of how information is presented to customers to enable them to evaluate, understand, purchase, install, use our products as well as receive support and manage, maintain and renew their account.

The goal of the proposed research study is to improve the effectiveness of the customer journey to increase conversion and retention metrics.

Strategies and Techniques for Gathering and Analyzing Empirical Data

There are different areas where I need to gather data; I need to work on identifying the journeys the different type of customers go through from the time they decide to buy a product all the way to where they launch the app. I will measure the number of clicks a customer has to take and the amount of time it takes for the user to get to value. The other two metrics I will need to measure is the impact of any changes made to the customer journey on the conversion and retention rates.

To gauge the number of clicks and time to value, I will be working on identifying a good sample size of the different type of customers and observe what they do and how many clicks they take as well as how long it takes them to get through their journey. Based on the collected data I will be identifying areas where I can eliminate clicks or reduce the time required to get to value. After changes implemented, I will go back and perform another round of iteration with the customers to measure if the changes help to get the user to get through the journey with fewer clicks as well as in less time.

I will also be working on building analytical instrumentation around how the customer's conversion and retention change over time. Based on the changes implemented we will always be measuring how the conversion rate, as well as retention rate, changes as we make an adjustment to the customer journey. I will then implement a scoring system on what are the changes in conversion and retention that would allow for an improvement to stay in place and when we would need to revert to the previous experience due to movement in conversion and retention rates to the undesired direction.

Literature Review

Within this literature review, I will be reviewing and comparing four different articles focused on the journey that the clients take while purchasing products through various sales channels. The primary purpose of the research is to identify how the previously conducted investigations apply to companies that primarily sell desktop software, mobile, and web apps through online channels. I am evaluating the articles on how they each define the customer journey, how the researchers measure the customer satisfaction, and what recommendations the researchers have to improve continuously and adapt the client experience depending on changing market conditions and product offering.

Analysis

Keyser, Schepers, and Konus (2015) claimed that “segmentation of customers is critical in developing a multichannel customer management strategy” (p.453.). The researchers collected survey data from 314 Dutch telecom customers. Dutch Telecom implemented a three channel method of selling in brick and mortar, online and through a call center. The researchers analyzed the collected data and came to the conclusion that understanding the customer usage of the different channels and their covariates throughout the client's journey can help in designing the marketing strategy. Keyser, Schepers, and Konus did not explicitly define the customer journey. However, Keyser, Schepers, and Konus (2015) provided a model to measure and understand customer preferences while taking into account certain covariates such as innovativeness, perceived risk, age, gender, loyalty, etc. The researchers used the pragmatic paradigm as its basis to try to solve the practical problem of how to come up with a marketing strategy.

Mangiaracina, Brugnoli, and Perego (2009) argued that business to customer eCommerce channel is becoming more relevant; however, online customer channels still have a long way to take over more sales from other retail channels. Mangiaracina, Brugnoli, and Perego also argued that providing a high-quality experience throughout the customer journey must become the primary focus to accomplish a breakthrough. Due to a lack of contribution so far there is not a model in place that would enable a quantitative comparison of one eCommerce customer journey to competitors. Mangiaracina, Brugnoli, and Perego’s goal for the paper is to propose a model that allows a quantitative comparison of the different eCommerce websites to each other.

According to Mangiaracina, Brugnoli, and Perego (2009), the customer journey has five stages that starts with the customers entering the site and goes through discovering the product catalogue, selecting a product, using the shopping cart and finally going through the checkout process. In addition to the five stages, Mangiaracina, Brugnoli, and Perego identified 10-30 different parameters in each stage combining for about 170 total parameters evaluated. Then, the assessment was outlined as a two-step process. First, Mangiaracina, Brugnoli, and Perego assessed the single features in each phase, and next, they calculated an average of all elements within a stage to determine the score for each stage. The Mangiaracina, Brugnoli, and Perego model helps to improve the customer journey is by contributing to pinpoint the areas within the eCommerce experience that are lagging compared to other websites. The limitation of the research is that it only explores a fraction of the customer journey. It does not include factors like post purchase support, branding and pricing or product delivery. The researchers in my opinion use the pragmatic paradigm with a quantitative method.

Klaus (2013) focused on conceptualizing the online customer service experience. Klaus also uses the pragmatic research paradigm and a qualitative research method, where he conducted 62 semi-structured interviews with samples from three different countries. Klaus then used the emerging consensus technique to derive behavioral aggregation. According to Klaus (2013), the “customers evaluate the online customer service experience at an overall level, a dimensional level, constituting functionality and psychological factors, and a sub-dimensional level, encompassing nine dimensions, namely usability, product presence, communication, social presence, interactivity, context familiarity, trust, and value for money” (p.457). Klaus divided the customer journey into five stages: search for information, evaluation of information, choice, transaction, evaluation of outcome, and aligned the different customer needs to these phases.

Tax, McCutcheon, and Wilkinson (2013) introduced the service delivery network concepts. Tax, McCutcheon, and Wilkinson argued that researchers should view the client's experience from the perspective of what outcome the customer is trying to accomplish. Compared to the previous dyadic model where companies observed the relationship in terms of a buyer and a seller, Tax, McCutcheon, and Wilkinson argued that often the customer needs to deal with a network of providers to accomplish what is needed. Tax, McCutcheon, and Wilkinson argued through a variety of case studies including u-Haul and IDEO that the customer experience is much broader than the interaction between one service provider and the customer. The client's experience is a network of providers who play a role in delivering an overall service. Tax, McCutcheon, and Wilkinson also used the pragmatic paradigm with qualitative research methods.

Klaus, as well as Tax, McCutcheon and Wilkinson, used case studies and qualitative methods to research the customer journey. Each research team agreed that providing a comprehensive, high-quality customer experience is critical to companies’ success. Klaus (2013) focused on the online customer experience whereas Tax, McCutcheon, and Wilkinson (2013) argued that the experience should be looked at more holistically in the context of a service delivery network.

Keyser, Schepers, Konus (2015), and Mangiaracina, Brugnoli, Perego (2009) have selected a quantitative research method to help marketing professionals to create a model that enables them to evaluate their efforts of utilizing different sales channels. Mangiaracina, Brugnoli, Perago primarily focused on the importance of eCommerce websites whereas Keyser, Schepers, and Konus focused on how to enhance the customer experience based on a multichannel approach.

Mangiaracina, Brugnoli, Perago and Klaus focused on an eCommerce experience and proposed a model to evaluate the customer journey; they selected different methods. Klaus interviewed 62 representative consumers, whereas the model that Mangiaracina, Brugnoli and Perago recommends is that researchers replicate the perceived customer journey and evaluate each step based on scoring criteria.

The difference in the ideas of Tax, McCutcheon, and Wilkinson (2013) compared to the other researchers is that the others restricted the scope of the customer journey to the relationship between one provided and the customer. On the other hand, Tax, McCutcheon, and Wilkinson (2013) argued that the service experience for customers is a result of interactions with multiple providers and that the relationship and coordination between providers plays an important role.

Another significant difference in the articles is the scope of the customer journey researched was different as well as what was perceived to be important was different also. Klaus (2013) focused on functional attributes that enable the customer to feel comfortable on the other hand Mangiaracina, Brugnoli, Perago focused on the various features of the website. Focusing on what is a fundamental shift from a product-focused approach to a customer-centric view.

All four authors agreed that online channel is becoming an increasingly more popular marketing channel. The online experience of customers plays a core role in how successful business is selling goods and services. So understanding the user journey and be able to measure the strength and weaknesses of the experience provided should be a core capability of every business. To gain an understanding of the capabilities, the different authors proposed various models for measuring the experience. Based on the research the following analytical framework could be offered. Understanding the different customers and segmenting them into different channels based on their buying preference can increase conversion. The user experience is becoming more involved, and it should be analyzed and improved in its entirety including other vendors that play a part in the journey. The primary emerging sales channel is online sales. Researchers should design a framework to measure and continually improve the online customer journey. The proposed model should include the evaluation of features and personalization of the experience. The framework should focus on how to make customers more comfortable purchasing online.

Limitations I have found in the reviewed literature could include that the research does not include the delivery of products as well as the use of the goods after purchase. Also, most of the research focuses on selling physical products online. However, there is an emerging market for selling software as a service, where customer retention becomes a critical challenge as well. So I would recommend extending the research to the post-purchase experience, and focus on how the online customer experience impact subscription based services from a retention perspective.

Critical Evaluation

Within my evaluation of what scholarly articles to pick my criteria included having the articles peer-reviewed and published in a journal. I also wanted to see that the writers have conducted research of other literature, and they cited their references. I looked for two reports that have done quantitative research and another two that did qualitative research. At the same time, I wanted to get a broad view of the customer journey, including as the primary focus the online channel or as the online channel as part of a multichannel marketing strategy.

My conclusion then is that the online customer journey will continue to evolve to become the leading marketing channel and people will get more and more comfortable buying online. With that said, providing a seamless, personalized online journey is going to be essential for every company moving forward. So creating a model that enables companies to evaluate the experience they provided so they can continually improve it as well as be able to compare that customer journey to key competitors to ensure that they stay ahead of the competition will be mission critical going forward.

Alternative views could include to implement a personalized experience and continue to customize the customer journey based on individual behaviors and preferences. Companies should continue to learn about their user base and understand how to personalize the experience based on data collected using machine learning techniques. We need to create a model that enables companies to react to changes in customer dynamics as well as preferences in near real-time based on information and feedback provided by customers.

References

Keyser, A. D., Schepers, J., & Konus, U. (2015). Multichannel customer segmentation: Does the after-sales channel matter? A replication and extension. International Journal of Research in Marketing, 32, 453-456. Retrieved from http://www.elsevier.com/locate/ijresmar

Klaus, P. (2013). The case of Amazon.com: towards a conceptual framework of online customer service experience (OCSE) using the emerging consensus (ECT). Journal of Services Marketing, 27(6), 443-457.

Mangiaracina, R., Brugnoli, G., & Perego, A. (12/2009). The eCommerce Customer Journey: A Model to Assess and Compare the User Experience of the eCommerce Websites. Journal of Internet Banking and Commerce, 14(3), 1-10.

Tax, S. S., McCutcheon, D., & Wilkinson, I. F. (2013). The Service Delivery Network (SDN): A Customer-Centric Perspective fo the Customer Journey. Journal of Service Research, 16(4), 454-470.

Kuhn, T. S. (2012). The Structure of Scientific Revolutions (4th ed.). Chicago, IL: The University of Chicago Press.

Jaccard, J., & Jacoby, J. (2010). Theory construction and model-building skills. New York, NY: The Guilford Press.

Glesne, C. (2011). Becoming qualitative researchers: an introduction (4th ed.). Boston, MA: Pearson Education Inc.

Babbie, E. (2016). The Practice of Social Research (14th ed.). Boston, MA: Cengage Learning.