CX Spotlight by Fifth Quadrant

3 Key Areas In Which CX Leaders Leave Laggards Behind

With technology rapidly advancing, it's never been more important for companies to meet evolving customer expectations. But companies need to start by understanding their customers and the total Customer Experience (CX) before introducing new technologies. An emerging trend is that the gap between CX leaders and laggards is widening – and will continue to widen – as the companies with a clear CX execution strategy enjoy greater growth than those who haven't yet set a clear path forward. In this article, we’ll take a look at 3 key areas that differentiate Leaders from Laggards. 

Recent research by Dimension Data shows that CX innovators lead laggards in growth by a factor of 51. Laggard companies, Dimension found, are less likely to recognise the importance of mapping the customer journey and the myriad interactions and pain points that occur along the way. 

Fifth Quadrant’s research paints a similar picture. Based on two pieces of regional research conducted for Oracle, the gap between Leaders and Laggards is growing. Surveying 160 CX decision makers across ASEAN, Fifth Quadrant was able to segment them into three groups: Leaders (8%), Followers (70%) and Laggards (23%). Almost half (40%) of the decision makers in the Leaders and Followers categories were able to achieve above average revenue, as opposed to less than a quarter of Laggards (23%). 

The ANZ research which asked the same questions as the ASEAN study above is even more compelling. It surveyed 262 CX decision makers across Australia and New Zealand and segmented them as follows: Leaders (22%), Followers (52%), and Laggards (26%). Those businesses more advanced on the CX maturity scale were also more able to achieve above average revenue (62% of CX Leaders compared to 26% of CX Laggards).

Fifth Quadrant found that the Leaders are creating value for their customers through the implementation of CX elements such as personalisation, the omni-channel, and the ‘connected customer’.  

A large majority of Leaders (over 80% ASEAN and 97% ANZ) are delivering a more predictive and personalised CX which combines data from multiple sources to create accurate, individualised profiles for each customer. Meanwhile less than 40% of ASEAN Laggards are doing the same compared with less than 15% of ANZ Laggards.  

With regards to the omni-channel, significantly more Leaders showed a focus on providing a more seamless and integrated CX and in the case of the connected customer, they are also more advanced in their trial and implementation of emerging technologies such as AI and IoT devices.  

“The research shows that CX Leaders look to be winning the battle for the heart as well as the mind of the customer through their focus on personalisation and connectivity to ultimately drive customer loyalty and revenues,” according to Fifth Quadrant. 

Having established that the gap is real, widening, and having an impact on revenue and growth, we need to consider what differentiates Leaders from Laggards. Here are three key areas that show how Leaders are separating themselves from Laggards, based on findings from Forrester’s annual US CX Index. 

#1 Understanding 

Whereas Laggards tend to be siloed, Leaders are in the trenches and have an understanding of their CX. Thanks to journey mapping, Leaders understand their customers and listen to their needs and adjust accordingly. Since Laggards lack this understanding, they don’t have the ability to identify and execute improvements.  

Leaders also tend to have larger amounts of customer data and a better idea of how to use it. On the other hand, Laggards might just grab any data that is available, resulting in shallow insights that don’t actually improve CX. 

#2 Focus 

Great CX has to come from the top. One only needs to look at Amazon and Apple – both Jeff Bezos and the late Steve Jobs have near mythical reputations for being totally CX obsessed. The focus on CX needs to permeate the company moving down through the leadership to the frontline staff. Leaders have a strong focus not just on CX but also on the employee experience. Whereas Leaders will invest in the development of their key staff, Laggards are more likely to place less focus on human resources. 

This focus extends to when customers have a problem that needs solving. Leaders know that customer loyalty is paramount so they will hire the right people and give them the right tools to interact with customers. In contrast Laggards’ employees will tend to lack the training, motivation and tools to ensure a premium CX. The focus is on how CX originates from within. 

#3 Implementation 

When it comes to implementing new tools, such as chatbots in a contact centre for example, Leaders will take a measured approach that will see the technology deployed in an optimal way. They tend to be early adopters who are better equipped to connect the tool with its need and are able to successfully oversee the testing and deployment of it. Meanwhile, Laggards may adopt something just in order to ‘keep up’, resulting in a more chaotic and ultimately unproductive work environment.   

Because Leaders take a top down approach, their companies understand that it will be the power of the collective that delivers optimal CX. Laggards’ siloed approach tends to lead to organisational politics that hinders implementation and stymies growth. They also mistakenly believe that CX is only about the customer, forgetting that it’s the company that must create and curate the experience. 

Fifth Quadrant Takeaway   

Research shows that the gap between CX Leaders and Laggers is widening and impacting company revenue and growth. By improving in the three key areas of Understanding, Focus and Implementation, companies will be better equipped to reduce the gap and thus the risk of being left behind. 

Fifth Quadrant conducts Customer Experience research that empower companies to improve their CX and can help turn a Laggard into a Leader. To learn more about how Fifth Quadrant can assist your organisation, contact us today. 

Ready to talk CX? 


Brad Arsenault

Written by Brad Arsenault

Brad is the Head of Marketing at Fifth Quadrant. For over 16 years he's worked across digital marketing and content production. He actively publishes content on LinkedIn and Medium.

Topics: Customer experience personalisation CX Articles & Insights

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