Market Perspectives

ISG Research is happy to share insights gleaned from our latest Buyers Guide, an assessment of how well software providers’ offerings meet buyers’ requirements. The Customer Experience Management: ISG Research Buyers Guide is the distillation of a year of market and product research by ISG Research.

For many organizations, managing the customer experience (CX) has not been a centralized operation nor the responsibility of one leader who governs and optimizes the CX across every channel of interaction. But organizations are now making use of more integrated software and platforms that tie together customer relationship management (CRM) and contact center activity to processes managed across other parts of the organization. This can include marketing, sales, commerce, field service and locations where customers convene for purchases or services.

This evolution of CX is bringing about a shift in how organizations purchase and deploy technology related to customer activities, and how software providers package their products to meet the needs of the workforce. When the focus is on interaction handling, contact centers typically are the focus of the technology discussion and the defined set of requirements. But when the focus shifts to questions about how an organization should be using customer data, or how to proactively orchestrate interactions and influence customer behavior in any channel or department, broader sets of roles and their specific requirements become essential.

CXM is definitionally a suite of applications built on a common platform that facilitates an interdepartmental view of customer activity and provides mechanisms for controlling that activity.

Customer Experience Management (CXM) is a relatively new software category created out of the combination of business applications and tools across departments that impact customer outcomes. CXM is definitionally a suite of applications built on a common platform that facilitates an interdepartmental view of customer activity and provides mechanisms for controlling that activity. Some elements come from the contact center, notably interaction handling and engagement optimization. Others are derived from marketing technology, like customer data platforms (CDPs) or journey management tools. The precise mix of applications in a software provider’s suite depends on the background expertise of the software provider. Whether a provider originates in marketing technology, contact center, CRM or data management deeply influences the components that are front-and-center for that software provider.

The evolution of CXM addresses the shortcoming of the decades-old CRM software category that has had a more departmental and application-centric approach. Instead, we now see an approach that organizes based on the customer journey and the interactions a customer may have with the organization across any channel. That breadth of scope and expertise explains why the mix of components, users and use cases has been so diverse across CXM products. The broad outlines are clear: a CXM suite is a product family composed of applications that are collectively organized to optimize customer interactions, experiences and profitability.

A customer experience suite should be judged based on these criteria:

• How well it facilitates managing and measuring customer behavior across multiple stages of the customer lifecycle.
• How well it serves the needs of both the key purchasing team (e.g., contact center operations) and other relevant stakeholders within the organization (e.g., IT or marketing).
• How well it presents senior leadership with a coherent picture of the customer base that they can use to understand direction and make plans or decisions.
• How open it is to expansion laterally into adjacent software segments related to other CX departments. In other words, if you are judging a marketing automation suite for CX, how well does it serve (or integrate into) contact center applications? Or, if you are judging contact center platforms, how integrable are the marketing, advertising, sales or IT applications?

It can be difficult for buyers to effectively compare similar or overlapping portfolios from providers that, in many cases, do not directly compete against one another.

Because software providers stem from different legacy origin points, it can be difficult for buyers to effectively compare similar or overlapping portfolios from providers that, in many cases, do not directly compete against one another. A toolset that comes from a contact center provider might focus on communications; one from a marketing technology provider on audiences and analytics; one from an IT-centric company on service management or integration.

With that in mind, we constructed a working definition of CXM, based on the above criteria, that includes five core areas of functionality across departments. The first is interaction handling, consisting of the traditional voice-centric activities of contact centers, but also including modern digital channels of customer contact. In the context of interaction handling, a CXM suite should also be able to manage the data or context surrounding the interaction. In any customer journey, a contact or touchpoint is intimately influenced by what has happened in the past, either long past (purchase histories) or the recent past (hopping from one channel to another in search of answers or results).

The second core area that a suite can take on is operational resource management. “Resources” include people, as in the contact center agents who respond to customers, or the knowledge workers who supply them with information. However, the resources most in need of management these days are knowledge and data resources and digital content. The pressure to deploy AI technology is especially urgent in CXM. The specific tools and use cases most directly affected by AI are those built around automating (and anticipating) customer activity, and so are also largely the domain of a CXM suite. So a CXM suite could include elements akin to a CRM or CDP, a digital asset management component, knowledge management and content creation tools.

Third, CXM should control those processes noted above, and should enable users to optimize automation across departments, and the workflows that touch different components of the suite and the teams working with customers. Because CXM is knitting together (and replacing) isolated point solutions, it needs an underlying platform that can integrate its wide spread of tools and users. It needs to be able to function across data silos and create workflow automations that deliver the specific information and work where it is needed at the moment it is needed.

The development of applications based on AI and machine learning fall into this category, including real-time agent guidance assistance and intelligent self-service engines. Other functions dependent on a strong platform include processing transactions, fulfilling service requests, segmenting customers into audiences, developing website offers and tracking customer behavior.

One of the great values of bringing all CX applications and tools into a single platform is that it establishes consistency and continuity around data collection and metrics.

The fourth element to consider is the toolset’s capabilities in providing insights and analysis to users across the enterprise, including reporting, visualizations and dashboards, and predictions and planning. A system that collects information about customers, interactions and behavior, and then analyzes it, should be able to present its findings in forms relevant to a spectrum of different users. Ground-level workers need awareness of the specifics around particular customers, for example, but executives need overviews of performance, outcomes and revenue. Every department involved in CX has its own set of KPIs and relevant metrics separate from every other. One of the great values of bringing all CX applications and tools into a single platform is that it establishes consistency and continuity around data collection and metrics. It creates the big picture that otherwise would be lost in departmental minutia.

The fifth and last core capability set is customer journey management. This is key to the further development of the entire category of software, as it turns the passive act of responding to service calls into a deliberate, organized effort at optimizing customer experiences, and through that, relationships. When an enterprise can map the journey or lifecycle, it can potentially identify moments of influence that can be used to drive added business or turn customers into advocates. Customer journey management contains software for orchestrating interactions, personalizing them to individual (or group) preferences, and managing proactive communication efforts by marketing and sales teams.

Put together, these five areas add up to an enterprise software solution of great utility and variety. CXM software is just at the beginning of its development maturity, and it is rare to find a single offering that fits into all five. Many software providers start out with an emphasis on their areas of origin and build out from there. Marketing technology software providers, for example, start with audience building and segmentation, but have little or nothing to do with interaction handling. On the flip side, contact center providers, who excel at the interactions, often have very little capacity to manage journeys, knowledge or advanced analytics. Over time, we expect suites from across the landscape to converge on these five areas through acquisition, partnership and organic development. By 2028, enterprises will replace many CX point solutions with broad, interdepartmental, multifunction suites.

This research evaluates the following software providers that offer products that deliver Customer Experience Management suites as we define them: Adobe, eGain, Emplifi, Freshworks, Genesys, HubSpot, Microsoft, Nextiva, NICE, Oracle, Qualtrics, Salesforce, SAP, ServiceNow, Sprinklr, SugarCRM, Verint, Zendesk and Zoho.

This research-based index evaluates the full business and information technology value of customer experience software offerings. I encourage you to learn more about our Buyers Guide and its effectiveness as a provider selection and RFI/RFP tool.

We urge enterprises to do a thorough job of evaluating customer experience management offerings in this Buyers Guide as both the results of our in-depth analysis of these software providers and as an evaluation methodology. The Buyers Guide can be used to evaluate existing suppliers, plus provides evaluation criteria for new projects. Using it can shorten the cycle time for an RFP and the definition of an RFI.

The Buyers Guide for Customer Experience Management in 2024 finds Oracle first on the list, followed by Salesforce and Verint.

Providers that rated in the top three of any category ﹘ including the product and customer experience dimensions ﹘ earn the designation of Leader.

The Leaders in Product Experience are:

• Oracle
• Salesforce
• Verint

The Leaders in Customer Experience are:

• Salesforce
• Verint
• NICE

The Leaders across any of the seven categories are:

• Salesforce, which has achieved this rating in seven of the seven categories.
• Oracle in six categories.
• NICE, SAP and Verint in two categories.
• Adobe and Zoho in one category.

The overall performance chart provides a visual representation of how providers rate across product and customer experience. Software providers with products scoring higher in a weighted rating of the five product experience categories place farther to the right. The combination of ratings for the two customer experience categories determines their placement on the vertical axis. As a result, providers that place closer to the upper-right are “exemplary” and rated higher than those closer to the lower-left and identified as providers of “merit.” Software providers that excelled at customer experience over product experience have an “assurance” rating, and those excelling instead in product experience have an “innovative” rating.

Note that close provider scores should not be taken to imply that the packages evaluated are functionally identical or equally well-suited for use by every enterprise or process. Although there is a high degree of commonality in how enterprises handle customer experience management, there are many idiosyncrasies and differences that can make one provider’s offering a better fit than another.

ISG Research has made every effort to encompass in this Buyers Guide the overall product and customer experience from our customer experience management blueprint, which we believe reflects what a well-crafted RFP should contain. Even so, there may be additional areas that affect which software provider and products best fit an enterprise’s particular requirements. Therefore, while this research is complete as it stands, utilizing it in your own organizational context is critical to ensure that products deliver the highest level of support for your projects.

You can find more details on our community as well as on our expertise in the research for this Buyers Guide.