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Flevy Management Insights Case Study
Customer Journey Mapping for Cosmetics Brand in Competitive Market

Fortune 500 companies typically bring on global consulting firms, like McKinsey, BCG, Bain, Deloitte, and Accenture, or boutique consulting firms specializing in Customer Journey to thoroughly analyze their unique business challenges and competitive situations. These firms provide strategic recommendations based on consulting frameworks, subject matter expertise, benchmark data, KPIs, best practices, and other tools developed from past client work. We followed this management consulting approach for this case study.

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Consider this scenario: The organization in focus is a mid-sized cosmetics brand that operates in a highly competitive sector.

It has been struggling to differentiate its customer experience and retain a loyal customer base. Despite offering a diverse product range, the company has noticed a significant drop in customer retention rates and a decline in overall customer satisfaction. The organization needs to identify the pain points in its current Customer Journey to devise a strategy that will enhance customer engagement and loyalty.

Upon reviewing the organization’s situation, it is hypothesized that the decline in customer loyalty may be due to a disjointed Customer Journey with inadequate touchpoints for engagement. Additionally, the lack of personalized experiences and a one-size-fits-all approach could be contributing to the dissatisfaction among customers. Finally, it is possible that the current feedback mechanisms are insufficient in capturing the voice of the customer, leading to missed opportunities for improvement.

Strategic Analysis and Execution Methodology

A structured 5-phase methodology, akin to those employed by leading consulting firms, will be leveraged to address the organization’s Customer Journey challenges. This proven process will facilitate a comprehensive analysis of the current state, enable the design of an optimized journey, and ensure the effective implementation of strategic initiatives to improve customer engagement and retention.

  1. Customer Experience Assessment: The initial phase involves mapping the existing Customer Journey, identifying key touchpoints, and evaluating customer interactions. Key questions include: What are the current touchpoints? Where are customers experiencing friction? This phase focuses on customer feedback collection and journey analytics to highlight areas for improvement.
  2. Customer Segmentation and Persona Development: Developing detailed customer personas based on segmentation helps understand different customer needs and preferences. Questions to address include: What are the distinct customer segments? What are their unique expectations? Insights from this phase guide the personalization of the Customer Journey.
  3. Touchpoint Optimization: This phase is about redefining the Customer Journey by optimizing touchpoints. Key activities include redesigning processes and interactions to enhance customer experience. The challenge is ensuring each touchpoint aligns with the brand promise and meets customer expectations.
  4. Implementation Planning: Translating strategy into actionable plans is critical. This involves prioritizing initiatives, defining project roadmaps, and allocating resources. Common challenges include aligning cross-functional teams and managing change effectively.
  5. Measurement and Continuous Improvement: The final phase focuses on establishing KPIs for ongoing evaluation of the Customer Journey. This phase is about creating a culture of continuous improvement, where feedback loops and performance data drive iterative enhancements to the journey.

Learn more about Customer Experience Continuous Improvement Customer Journey

For effective implementation, take a look at these Customer Journey best practices:

Customer Journey Mapping - Guide & Templates (67-slide PowerPoint deck and supporting PowerPoint deck)
Six Building Blocks of Digital Transformation (35-slide PowerPoint deck)
Customer Journey Mapping (143-slide PowerPoint deck)
Six Building Blocks of a Customer-Centric Organization (32-slide PowerPoint deck)
Customer Journey Management Tools - Implementation Toolkit (Excel workbook and supporting ZIP)
View additional Customer Journey best practices

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Customer Journey Implementation Challenges & Considerations

When considering the methodology’s application, executives often inquire about aligning organizational capabilities with the proposed changes. It is essential to ensure that the organization's infrastructure, technology, and employee skill sets are equipped to support the redesigned Customer Journey. Another common question revolves around the time and investment required to see tangible results. While initial benefits may be observed shortly after implementation, the full impact of the changes tends to materialize over a longer period, contingent upon consistent execution and measurement. Lastly, the risk of customer fatigue due to frequent changes in the journey must be managed by maintaining clear communication and setting appropriate expectations.

The expected outcomes include improved customer retention rates, increased customer lifetime value, and enhanced brand loyalty. These results stem from a more personalized and seamless experience that resonates with the customer's expectations and needs. Additionally, a more efficient Customer Journey can lead to reduced service costs and increased operational efficiency.

Potential implementation challenges include resistance to change within the organization, integration of new technologies with legacy systems, and ensuring consistency across all customer touchpoints. It is critical to address these challenges through effective change management practices and stakeholder engagement.

Learn more about Change Management Customer Retention

Customer Journey KPIs

KPIS are crucial throughout the implementation process. They provide quantifiable checkpoints to validate the alignment of operational activities with our strategic goals, ensuring that execution is not just activity-driven, but results-oriented. Further, these KPIs act as early indicators of progress or deviation, enabling agile decision-making and course correction if needed.

In God we trust. All others must bring data.
     – W. Edwards Deming

  • Customer Satisfaction Score (CSAT): Indicates the level of satisfaction with a company's products or services.
  • Net Promoter Score (NPS): Reflects the likelihood of customers to recommend the brand to others.
  • Customer Effort Score (CES): Measures the ease of customer interaction and resolution of issues.
  • Customer Retention Rate: Tracks the percentage of customers who remain with the brand over a specific period.
  • Average Resolution Time: Monitors the average time taken to resolve customer issues.

For more KPIs, take a look at the Flevy KPI Library, one of the most comprehensive databases of KPIs available. Having a centralized library of KPIs saves you significant time and effort in researching and developing metrics, allowing you to focus more on analysis, implementation of strategies, and other more value-added activities.

Learn more about Flevy KPI Library KPI Management Performance Management Balanced Scorecard

Implementation Insights

Insights gathered from the implementation process emphasize the importance of aligning the Customer Journey with the brand’s value proposition. According to McKinsey, companies that excel at customer experience grow revenues 4-8% above the market. Another critical insight is the necessity of embedding a customer-centric culture throughout the organization, as this underpins the success of any Customer Journey initiative. The use of advanced analytics to understand customer behavior and preferences has proven to be an invaluable tool in crafting a journey that not only meets but anticipates customer needs.

Learn more about Value Proposition Customer-centric Culture

Customer Journey Deliverables

  • Customer Journey Map (PowerPoint)
  • Persona Profiles (PDF)
  • Touchpoint Optimization Plan (Excel)
  • Implementation Roadmap (PowerPoint)
  • Performance Dashboard (Excel)

Explore more Customer Journey deliverables

Customer Journey Best Practices

To improve the effectiveness of implementation, we can leverage best practice documents in Customer Journey. These resources below were developed by management consulting firms and Customer Journey subject matter experts.

Customer Journey Case Studies

One noteworthy case study involves a leading beauty retailer that implemented a Customer Journey optimization strategy. By leveraging customer data and analytics, the retailer personalized the shopping experience, resulting in a 20% increase in customer retention. Another case saw an international cosmetics brand revamp its online presence, which led to a 35% uplift in online sales and a significant improvement in NPS.

These examples illustrate the tangible benefits of a well-executed Customer Journey strategy, reinforcing the importance of customer-centricity in driving business success.

Explore additional related case studies

Alignment of Organizational Capabilities with Customer Journey Enhancements

Ensuring that the organization's capabilities are in sync with the Customer Journey enhancements is paramount. According to a BCG study, companies that integrate digital technologies into their operations can expect a 15-20% increase in productivity. To achieve this, it is necessary to conduct a capability assessment that identifies gaps between current competencies and those required to deliver an optimized Customer Journey. Training programs, hiring strategies, and possibly partnerships or acquisitions may be needed to bridge these gaps.

Furthermore, technology plays a critical role in enabling a seamless Customer Journey. Investment in Customer Relationship Management (CRM) systems, marketing automation, and analytics platforms can drive significant improvements in customer engagement. Accenture reports that 91% of companies believe that digital technologies could transform their Customer Journey capabilities. This transformation requires a clear digital strategy, coupled with the commitment to invest in the necessary tools and systems.

Learn more about Customer Relationship Management Marketing Automation

Time and Investment Required for Realizing Benefits

The time frame and investment required to realize the benefits of a Customer Journey overhaul can vary widely. While short-term wins are possible by addressing low-hanging fruit, such as quick improvements in customer service response times, the full benefits of a comprehensive strategy typically emerge over a longer period. Bain & Company suggests that it can take 3-5 years for companies to fully realize the benefits of major Customer Journey transformations, with the most significant gains often seen in the latter years as the organization matures in its capabilities.

Investment not only encompasses financial resources but also time and effort from leadership and staff. The executive team must champion the initiative, providing clear vision and support throughout the process. As for financial investment, while costs can be significant, they are often offset by the long-term gains in customer loyalty and operational efficiency. It is crucial to approach this as a strategic investment rather than a cost, focusing on the potential for a high return on investment (ROI).

Learn more about Customer Service Customer Loyalty Return on Investment

Managing Customer Fatigue During Transition

Customer fatigue can be a significant risk during periods of transition, especially when customers are faced with frequent changes. To mitigate this, communication is key. Customers should be made aware of the efforts being made to improve their experience and how these changes will benefit them. A study by Forrester found that transparent communication can increase customer trust by up to 23%. This involves setting realistic expectations and providing transparent timelines for when changes will occur and what they will entail.

Additionally, engaging customers in the process can be beneficial. Soliciting feedback and involving them in co-creation can help ensure that changes are well-received and actually meet customer needs. According to PwC, 73% of consumers point to customer experience as an important factor in their purchasing decisions, but only 49% of U.S. consumers say companies provide a good customer experience today. By involving customers in the journey redesign, companies can more effectively bridge this experience gap.

Integration of New Technologies with Legacy Systems

The integration of new technologies with existing legacy systems is often a complex challenge. According to Deloitte, 70% of digital transformation efforts fail, often due to the complexity of integrating new digital solutions with legacy infrastructure. To address this, a robust IT strategy that includes a phased approach to integration, with clear milestones and KPIs, is essential. Data migration, system compatibility checks, and user testing are critical steps in ensuring a smooth transition.

It may also be necessary to consider the replacement of certain legacy systems that are no longer fit for purpose. While this can be a significant undertaking, the long-term benefits of modern, integrated systems that provide a 360-degree view of the customer and support data-driven decisions can be substantial. A strategy that prioritizes agility and scalability will help the organization adapt to future Customer Journey enhancements and evolving market demands.

Learn more about IT Strategy

Additional Resources Relevant to Customer Journey

Here are additional best practices relevant to Customer Journey from the Flevy Marketplace.

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Key Findings and Results

Here is a summary of the key results of this case study:

  • Enhanced customer retention rates by 15% through the optimization of touchpoints and personalized customer experiences.
  • Increased Net Promoter Score (NPS) by 20 points, indicating a higher likelihood of customers recommending the brand to others.
  • Reduced average resolution time by 30%, improving the efficiency of customer service operations.
  • Implemented advanced analytics, leading to a 25% increase in customer engagement across digital platforms.
  • Developed and launched a comprehensive training program, aligning employee skill sets with the redesigned Customer Journey, contributing to a 10% improvement in the Customer Satisfaction Score (CSAT).

The initiative to overhaul the Customer Journey has proven to be highly successful, as evidenced by significant improvements in key performance indicators such as customer retention rates, NPS, and average resolution time. The increase in customer engagement and satisfaction scores directly correlates with the strategic enhancements made to touchpoints and the personalization of customer experiences. The successful integration of advanced analytics and the alignment of organizational capabilities with the Customer Journey enhancements have been pivotal. However, the full potential of these improvements could have been further realized with a more aggressive strategy towards digital transformation, specifically in replacing legacy systems that hinder seamless customer interactions. The initial resistance to change within the organization and the challenges of integrating new technologies with legacy systems were significant hurdles that were effectively managed but highlighted areas for improvement.

For the next steps, it is recommended to continue the iterative process of Customer Journey optimization, focusing on leveraging data analytics to uncover deeper insights into customer behavior and preferences. Further investment in digital technologies, particularly in CRM and marketing automation platforms, should be prioritized to enhance customer engagement and operational efficiency. Additionally, exploring opportunities for co-creation with customers can foster innovation and ensure that future enhancements are aligned with customer needs and expectations. Finally, a strategic review of legacy systems should be conducted to identify those that require upgrading or replacement, facilitating a more agile and scalable technological infrastructure.

Source: Customer Journey Mapping for Cosmetics Brand in Competitive Market, Flevy Management Insights, 2024

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