This is the second in a three-part series that explores critical questions CX leaders should be asking – and able to answer. There’s some overlap between B2C, B2B, and B2B2C issues, but I want to address each audience individually. Last week, I covered B2C; next week I’ll address B2B2C leaders.
I’ve talked with hundreds of B2B leaders over the years and found, like B2C leaders, they also often seem to have little knowledge about the health of the business, and how executives measure and monitor it.
Below are ten questions (plus one freebie, because we’re always about adding value!) that you need to be able to answer – and reference – for your CX program to create real business impact.
Which dashboards are most commonly viewed by business leadership?
Rather than starting with a specific metric, it’s most important to find the source of metrics used by other B2B leaders. Are there a handful of shared dashboards? Does each department have its own?
Understanding the sources of truth for the existing data will help you answer many of these other questions and ensure you’re aligned with the audiences you’re looking to win over.
What is the current level of churn?
You’ll want to break it down by region and level of distinction (customer segments) to truly understand how it’s trending over time. This area will be central to your value proposition as you look to drive change, so it should be one of the first metrics you get acquainted with.
What is the average length of customer retention?
Related to the level of churn is the length of time customers stay with you. This metric can allow you to show progress quicker, as length of retention may be more sensitive to churn levels. You’ll also want to break this down in the same ways as churn to track any changes over time.
One additional area to isolate is the average retention for the 10% who have been with you the longest and the 10% who churn the quickest. This helps you see the differences in the retention extremes.
What is the average level of cross-sell?
Most B2B firms rely on cross-sell for both additional revenue and to become stickier, though cross-sell is measured differently by various business types.
Manufacturers and distributors will often look at the level of cross-sell across categories; large manufacturers such as Dow or Cargill have multiple businesses and will look at the level of cross-sell between these.
Meanwhile, software companies will look at their ability to cross-sell different products. Some (but definitely not all) will look at the ability to cross-sell services. Consultancies and other service companies will look for the ability to sell multiple lines of business.
CX work that increases the level of cross-sell will resonate strongly with leadership.
What is the profitability by average customer?
This is a tricky one for B2B, as average profitability can vary wildly between customers. So it may be more appropriate to look at the range, zeroing in on the top 10% vs. the bottom 10%, as the latter may actually be costing you money!
Understanding where your profit comes from enables you to build experiences that reward your best customers for their loyalty.
Bonus Q: Do we have a customer lifetime value score?
I put this as an extra question, because while every firm has profitability and complaints, not everyone has a customer lifetime value score. If you don’t, this should be one of your initial efforts, as this score encapsulates both retention and cross-sell.
What is the average number of complaints or service issues by client?
You should also see a large variance, so be sure to discover the top and bottom 10% here, as well. Look for how this varies. Do customers with certain products call more often? Do newer or more established customers call more?
Reducing costs by preventing the need to call (as opposed to making it harder to call) satisfies both the business and your customers – as a matter of fact, it’s often the quickest way to show CX impact. Related to this, be sure to ask:
How much does the average service issue cost us?
This is often more difficult to answer for B2B companies than B2C, since a service issue typically involves multiple parts of the organization here, which also increases the cost.
While B2C calls often cost around $10 each, B2B may be $25, $50, or even more. Given that, learning this value will obviously help your business case as you work to reduce the number of issues.
What are the top reasons for complaints?
Unlike some B2C companies, B2B usually has a good handle on the reasons for service issues. The information is out there, so make sure to familiarize yourself with it.
How do we measure customer sentiment?
What are the key survey questions and when are they asked? Do we incorporate the voice of the business through operational and behavioral data?
Most CX leaders start here. But the survey questions won’t provide much value without clearly understanding the business first.
Are my survey questions validated?
That may sound confusing since market researchers use a survey to validate their qualitative research – so why do we need to validate the quantitative data? In this case, the validation is that your survey questions correlate to and predict something important, typically one of the metrics you discovered by answering the previous questions.
If you’re new, beginning your conversations with other organizational leaders by asking about survey questions might feel awkward, since your internal customers may not know (or care much) about surveys. So starting with these 10 questions not only results in important learnings for you, it clearly demonstrates your concern for building a healthy business that serves its customers well.
When I ran this list of questions by some of our B2B clients, Andrea Krohnberg of Kelly Services asked for an even deeper prioritization that would home in on where to start if you only have time for five.
If that’s the situation you’re in, I’d look at:
- Dashboards. Learn what other leaders care about.
- Churn levels. This helps you triage issues and is commonly available in many organizations.
- Complaints by client. This will give you invaluable feedback on the current state of the experience.
- Cost per complaint.
- Top reasons for complaints.
I chose these because they’ll help you understand the current state and target the top two most common starting points for CX – reducing churn (which leads to revenue) and reducing complaints (which leads to cost savings, but also likely impacts churn).