Qualtrics Tei Study PDF

A Forrester Total Economic Impact™
Study Commissioned By Qualtrics

August 2017
The Total Economic

Impact™ Of Experience
Management With
Qualtrics
Table Of Contents
Executive Summary 1
Key Findings 1
TEI Framework And Methodology 3
The Voice Of The Market 4
The Current State Of Customer And Employee Feedback 4
The Qualtrics Customer Journey 10
Interviewed Organizations 10
Key Challenges 10
Key Results 11
Composite Organization 13
Financial Analysis 14
Reduced Cost Of Staff Required 14
Reduced Cost Of Customer Engagement And Support 15
Avoided Cost Of Delivering Inferior Products To Market 16
Avoided Cost Of Previously Purchased Tools 17
Unquantified Benefits 18
Flexibility 19
Cost Of Qualtrics 20
Financial Summary 22
Qualtrics: Overview 23
ABOUT FORRESTER CONSULTING

Forrester Consulting provides independent and objective research-based
Project Director: consulting to help leaders succeed in their organizations. Ranging in scope from a
Dean Davison short strategy session to custom projects, Forrester’s Consulting services connect
you directly with research analysts who apply expert insight to your specific
business challenges. For more information, visit forrester.com/consulting.
© 2017, Forrester Research, Inc. All rights reserved. Unauthorized reproduction

is strictly prohibited. Information is based on best available resources.
Opinions reflect judgment at the time and are subject to change. Forrester®,
Technographics®, Forrester Wave, RoleView, TechRadar, and Total Economic
Impact are trademarks of Forrester Research, Inc. All other trademarks are the
property of their respective companies. For additional information, go to
forrester.com.
Executive Summary
Benefits And Costs Qualtrics provides an experience management platform that helps its
customers predict, deliver, measure, and respond to customer, employee,
product, and brand experiences. Qualtrics commissioned Forrester
Consulting to conduct a Total Economic Impact™ (TEI) study and examine
the potential return on investment (ROI) enterprises may realize by
deploying its experience management platform. The purpose of this study
is to provide readers with a framework to evaluate the potential financial
Avoided cost of staff required to impact of the Qualtrics Experience Management, or XM Platform™, on
do the same work without their organizations.
Qualtrics: To better understand the benefits, costs, and risks associated with this
$470,015 investment, Forrester interviewed 10 executives at eight customers with
experience using Qualtrics. Forrester also conducted a survey that
assessed the similarity of the challenges and objectives of the broader
marketplace with the insights from the discovery interviews.
In addition, Forrester conducted an online survey of 100 US respondents
to evaluate their attitudes and feelings related to customer experience
(CX), employee experience (EX), product experience (PX), and brand
experience (BX) processes. The results show the current challenges of
Reduced cost of customer
insight professionals and identify the ways in which Qualtrics helps
support:
advance the pivotal role of data and insights within an organization.
$358,107 Qualtrics users can drive business outcomes using both operational data
(or O-data) and experience data (or X-data). Qualtrics enables
organizations to collect data about the customer, employee, product, and
brand experiences and combine their X and O data via a single system of
record.
Prior to using Qualtrics, the customers used a fragmented set of tools to
gather X-data that ranged from disparate online vendors to using paper
surveys or nothing at all. Conducting experience management research
required a team of analysts and statisticians who operated behind the
Cost of Qualtrics: scenes and provided reports and insights to company decision makers. As
$148,589 a result, executives made decisions using limited information, siloed
results, and data that was often obsolete because it took too long to get it
back to the right parties
After using Qualtrics, the organizations gained a common platform to
manage the experiences of their customers, employees, products, and
brands. In addition, the flexible platform enabled rapid yet robust research
that drove meaningful action. Qualtrics also provided enhanced analytics
that made data easier to use for both decision makers and frontline
employees, which increased the speed, accuracy, and usefulness of data.
As one executive told Forrester about his use of Qualtrics, “When we
switched to Qualtrics, we gained visibility into our products and opened up
a new world into what was happening.”
Key Findings
Quantified benefits. The following risk-adjusted quantified benefits are
representative of those experienced by the companies interviewed:
› Reduced cost of staff required for the same work of $470,015. The
interviewed organizations told Forrester that they would need
significantly more staff to get the same results using other tools in the
market. The organizations reported improved efficiency at deploying,
analyzing, and giving analysis tools to executives directly.
1 | The Total Economic Impact™ Of Experience Management With Qualtrics

› Reduced cost of customer engagement and support of $358,107.
The ability to deploy experience management software and analyze
ROI results within hours or days rather than weeks or even months enabled
674% organizations to respond rapidly to customer needs. The cost savings
came from reduced costs of contact centers and shifting customer
support to lower cost channels.
› Avoided cost of failed product launches by $219,557. Using real XM
Benefits PV data instead of management opinions or executive guesses helped
$1.1 million organizations deliver superior products. It also helped refine solutions
over the lifetime of an offering and adapt to customer needs.
› Avoided cost of previously purchased tools of $102,307. Each of the
organizations experienced a rapid adoption of Qualtrics throughout the
rest of the company as additional groups saw its capabilities. As more
NPV groups used Qualtrics, the organization avoided renewing licenses for
$1 million previously purchased tools.
Unquantified benefits. The interviewed organizations experienced the
following benefits. Although unquantified, many of these benefits were as
important to the interviewed organizations as those quantified above. The
Payback benefits include:
<6 months › Creating a culture of accountability. Having data that was reliable,
predictable, and widely accepted as being accurate, executives could
implement a culture of accountability by using data to measure,
motivate, and reward business units and individual teams.
› Understanding a customer’s entire journey. Qualtrics provided the
tools and the guidance for understanding a customer’s end-to-end
journey as they evaluate, purchase, consume, and reflect on the specific
products and services provided.
› Increasing reputation of the customer experience team. Research
executives shared a journey within their organizations as data evolved
into a trusted source of information about the voice of the customer.
Costs. The interviewed organizations experienced the following risk-
adjusted costs:
› Cost of Qualtrics of $148,589. This includes Qualtrics costs and fees
over three years. The organization started with a focused use of
Qualtrics, but many departments adopted Qualtrics after seeing its
capabilities.
Forrester’s interviews with eight existing customers and subsequent
financial analysis found that an organization based on these interviewed
organizations experienced benefits of more than $1.1 million over three
years versus costs of $148,589, adding up to a net present value (NPV) of
more than $1 million and an ROI of 674%.

Financial Summary Benefits (Three-Year)
$470.0K
Total benefits $358.1K

Payback:
<6 months PV, $1.1M
$219.6K
Total costs $102.3K

PV, $149K
Initial Year 1 Year 2 Year 3 Reduced cost of Reduced cost of Avoided cost of Avoided cost of
staff required customer delivering inferior previously
engagement and products to purchased tools
support market

TEI Framework And Methodology
From the information provided in the interviews, Forrester has constructed
a Total Economic Impact™ (TEI) framework for those organizations
considering using Qualtrics.
The objective of the framework is to identify the cost, benefit, flexibility, and
risk factors that affect the investment decision. Forrester took a multistep
approach to evaluate the impact that using Qualtrics can have on an
organization:
The TEI methodology DUE DILIGENCE

Interviewed Qualtrics stakeholders and Forrester analysts to gather
helps companies verifiable data relative to Qualtrics in the areas of customer, employee,
brand, and product experience.
demonstrate, justify,
and realize the CUSTOMER INTERVIEWS
Interviewed 10 executives representing eight organizations using
tangible value of IT Qualtrics to obtain data with respect to costs, benefits, and risks.
initiatives to both COMPOSITE ORGANIZATION

senior management Designed a composite organization based on characteristics of the
interviewed organizations. Forrester also surveyed 100 organizations to
and other key identify the challenges and objectives of organizations.
business FINANCIAL MODEL FRAMEWORK

stakeholders. Constructed a financial model representative of the interviews using the
TEI methodology and risk-adjusted the financial model based on issues
and concerns of the interviewed organizations.
CASE STUDY
Employed four fundamental elements of TEI in modeling Qualtrics’ impact:
benefits, costs, flexibility, and risks. Given the increasing sophistication
that enterprises have regarding ROI analyses related to IT investments,
Forrester’s TEI methodology serves to provide a complete picture of the
total economic impact of purchase decisions. Please see Appendix A for
additional information on the TEI methodology.
DISCLOSURES
Readers should be aware of the following:
This study is commissioned by Qualtrics and delivered by Forrester Consulting.

It is not meant to be used as a competitive analysis.
Forrester makes no assumptions as to the potential ROI that other

organizations will receive. Forrester strongly advises that readers use their own
estimates within the framework provided in the report to determine the
appropriateness of an investment in Qualtrics.
Qualtrics reviewed and provided feedback to Forrester, but Forrester maintains

editorial control over the study and its findings and does not accept changes to
the study that contradict Forrester’s findings or obscure the meaning of the
study.
Qualtrics provided the customer names for the interviews but did not participate
in the interviews.

The Voice Of The Market
The Current State Of Experience Management
In order to better understand the current state of experience management, Forrester conducted an online
survey of 100 US respondents to evaluate their attitudes and feelings related to CX, EX, PX, and BX. The
study focused on organizations’ perceptions of barriers to integrating different data sets and their belief in
the benefits of different types of data and data integration solutions to aid decision making. From the
survey, we uncovered the following key demographics:
› The majority of respondents represented firms with 5,000 or more employees, and 47% of respondents
came from firms with more than 20,000. Respondents represented a broad swath of industries, with no
single industry having more than 14% (financial services and insurance) of the total.
› Customer service (34%) and advertising/marketing (28%) were the two most common departments for
respondents: 10 respondents from customer experience, eight from HR, and eight from market
research.
› Most respondents (55%) indicated they had “some influence” over decisions on CX/EX/PX/BX
processes, as opposed to “significant input” for 40% of respondents; just five respondents identified
themselves as primary decision makers.
From the survey, Forrester discovered that the 100 respondents are:
› Challenged by reactive processes, organizational silos, and lack of visibility into necessary
research domains. When we asked CX/EX/PX/BX decision makers about challenges they faced with
current processes and workflows, the top challenges they cited confirmed that respondents struggle to
build unified data sets that enable proactive, timely decision making.
Specifically, 49% of respondents cited processes that are reactive instead of predictive as a challenge.
Thirty-seven percent indicated that organizational silos make it difficult to connect disparate data to
gather timely insights. Thirty-five percent said that lack of visibility into all research domains is a
challenge. All of those most common challenges point back to the overarching issue of disconnected
data and the resulting experience gaps. See Figure 1 below for the full set of challenges respondents
experience today.

"What challenges are you experiencing within your customer experience, employee
experience, and/or market research processes and workflows today?"
Processes that are reactive instead of predictive 49%
Organizational silos make it difficult to connect disparate

37%
data to gather timely insights
Lack of visibility into all necessary research domains
(e.g., customer experience, employee experience, brand 35%
research, product research)
Difficult for leaders to quickly access and take action on
31%
the most important customer and operational topics
Inability to extract actionable insights from the data

26%
collected
Rigid and outdated technologies require experts and
services, making business and program changes painful 26%
and slow
My tools allow me to monitor and analyze my data, but
24%
not to easily act on feedback
No easy way of connecting experience data with

24%
operational data
Difficult to connect with customers and/or employees at

22%
meaningful touchpoints
Compliance and security concerns around customer or

21%
employee data
None of the above 5%

› Not satisfied with their firms’ efforts to provide a consolidated view into all important data and to capture
emotions, beliefs, and sentiments in an unobtrusive way. We asked respondents to tell us how satisfied
they were with their organizations’ efforts across a number of important CX/EX/PX/BX capabilities.
Three areas stood out in which a majority of all respondents reported a neutral or worse opinion of their
firms’ efforts. Fewer than half of respondents said they were even somewhat satisfied with efforts to
provide a consolidated view into all important data. This data point is consistent with the high number of
respondents citing the challenge of organizational silos and lack of data visibility in the earlier question.
Fewer than half of respondents indicated they were at least somewhat satisfied with their firms’ efforts
to capture emotions, beliefs, and sentiments from stakeholders in an unobtrusive way. This indicates
that companies are looking for tools that make the collection of these important elements less onerous
for stakeholders. Finally, fewer than half of respondents from firms with 20,000 or more employees are
at least somewhat satisfied with their efforts to predict market needs and opinions. See Figure 2 below
for the areas in which fewer than half of total respondents and half of 20,000+ respondents were
satisfied with their organizations’ efforts.
"How satisfied are you with your organization’s efforts in the

following areas today?"
Very dissatisfied Somewhat dissatisfied Neutral Somewhat satisfied Very satisfied
Providing a consolidated view into all important data

(such as customer, market, employee, and 3% 28% 24% 31% 13%
operational data)
Capturing emotions, beliefs, and sentiments from

5% 26% 19% 32% 16%
stakeholders in an unobtrusive way
Predicting market needs and opinions 32% 26% 26% 17%

› Interested in the value a single platform for multiple data sources would offer. When asked how
helpful a connected view of customer and employee experience would be, 91% of respondents said at
least somewhat helpful. Fifty-five percent of large company respondents thought it would be extremely
helpful. Fifty-five percent of all respondents thought that the ability to influence corporate strategy by
leveraging insights from multiple sources would be extremely helpful. And 84% of respondents thought
it would be at least somewhat helpful to have one platform that combines customer, market, employee,
and operational data to give a complete view. Once again, 55% of large company respondents thought
this would be extremely helpful. See Figure 3 below for the full breakdown of how helpful respondents
thought each of the elements would be.
"How helpful are/would each of the following be to your organization?"
Somewhat helpful Extremely helpful
A connected view of your customer and employee

42% 49%
experience
Influencing corporate strategy by leveraging insights

31% 55%
from multiple sources, beyond just customer feedback
One platform that combines customer, market,

employee, and operational data to give you a complete
38% 46%
view of your stakeholder experience and company
performance

› Most interested in ease of use and ability to reach targeted respondents when selecting a
platform. Sixty-seven percent of respondents said that ease of use was very important to their
organization when considering a platform for managing CX/EX/PX/BX. Sixty-one percent indicated that
the ability to reach targeted respondents was very important. A majority of respondents, 52%, said the
ability to take quick action on feedback with customers or employees was very important. These and
the importance of other platform selection criteria are shown below in Figure 4. Forrester found that
elements that the most respondents considered very important lined up with what we heard during our
conversations with companies currently using Qualtrics for CX/EX/PX/BX data collection, highlighted
later in the case study.
"How important are each of the following factors to your organization when
considering a platform for managing customer experience, employee experience,
and/or market research?"
Unimportant/Neutral Somewhat important Very important
Ease of use 7% 25% 67%
Ability to reach targeted respondents through many

9% 29% 61%
channels and at relevant touchpoints
Analytics that automatically predict which activities and

strategies will best improve desired experience 12% 44% 42%
outcomes
Agility and ability to implement fast-paced changes 14% 36% 50%
Reporting and analytics that connect and correlate CX,

15% 38% 46%
EX, and Market Research (MR) data
Ability to quickly take action on feedback with

16% 32% 52%
customers or employees
Role-based dashboards to ensure our employees have

18% 44% 36%
the most impactful data for their role
Flexible integration into existing systems, such as CRM

20% 35% 41%
systems, ERP systems, and analytics platforms
Using a single platform to manage and administrate

26% 37% 36%
CX, EX, and/or MR programs

› Looking to understand the impact engaged employees have on customer loyalty. A majority of
respondents, 54%, completely agree that understanding the impact of engaged employees on customer
loyalty is important. Respondents from companies with 20,000 or more employees were even more
likely to completely agree with the statement. Most respondents from large companies also completely
agreed that having a thorough understanding of their market would enable them to deliver ahead of
customer expectations and acquire more customers. See figure 5 below, which shows that four in five
respondents agreed at least somewhat with each of the statements.
"How much do you agree with the following statements?"
Somewhat agree Completely agree
Understanding the impact engaged employees have

30% 54%
on customer loyalty is important to me
If I have a thorough understanding of my market, I can

deliver ahead of customer expectations and/or acquire 32% 47%
more customers
Minimizing the number of platforms that my company

36% 46%
has to use is important to me
A platform that provides a holistic view into customer,

market, employee, and operational data will enable 40% 45%
me to do my job better
Having a wide variety of feedback channels (in-store,

online, mobile, etc.) and integrations would enable me 38% 42%
to better understand my customers and employees

The Qualtrics Customer Journey
BEFORE AND AFTER THE QUALTRICS INVESTMENT
Interviewed Organizations
For this study, Forrester conducted 10 interviews with executives at eight
companies using Qualtrics. Interviewed customers include the following
companies:
INDUSTRY TITLE REGION USAGE AREAS

Insurance Manager, customer insights North America CX, EX, PX, and BX
Hospitality and
Director, customer insights Global CX, EX, PX, and BX
entertainment
Travel Manager, customer insights Global CX, EX, PX, and BX
Director, strategic product

Consumer goods Asia/Global CX, PX, and BX
planning
Head of transformation;
Telecommunications Manager, employee Europe CX and EX
experience
Food and hospitality Director, customer research North America CX and PX
Manager, team member

Financial services North America CX
Experience
Online news and
Director, research North America CX
entertainment provider
Key Challenges
The organizations told Forrester that before using Qualtrics, they struggled
with effectively gathering intelligence and being able to synthesize and
leverage data quickly. Most organizations engaged Qualtrics without a
corporate vision for XM. As they first engaged, Qualtrics not only provided
superior tools for current market research activities but often helped define
a vision within the organization for CX, EX, PX, and BX. Specifically, the “We would get data that said
organizations told Forrester that before using Qualtrics, they: we had a 70% satisfaction
rate, but we didn’t know what
› Struggled with disparate and antiquated market research tools.
that meant. Why isn’t it 80%?
One manager told Forrester: “The digital tools we were using were just
Why isn’t it 90%? What levers
not meant to scale. For example, one of our tools had to be reset every
do we need to pull to drive
time it reached 7,000 responses. As a result, we collected a lot of data,
but the data wasn’t in any kind of form that allowed us get the value out change in these numbers?”
of it.” Manager, customer insights,
insurance industry
› Needed a tool that was flexible in technical features. One director
said: “Our previous tool was slowing us down in terms of technical
ability. We needed more in terms of JavaScript and CSS.” Another
executive added: “When I arrived, we were still using paper. Getting
the data from paper into a usable format was a journey in itself. On top
of that, we pride ourselves on being technologically savvy, which
created a real problem when customers had to give us input by
responding to a paper survey.” A third customer said: “Our process was
entirely manual, and from paper to reporting, the results required six
months of work by our team.”

› Had limited data and an inability to integrate data across
disciplines. A director said: “We simply had fewer data points. I often
refer to our old data situation as conducting surgery with a butter
knife.” Another person added: “We would get data that said we had a
70% satisfaction rate, but we didn’t know what that meant. Why isn’t it
80%? Why isn’t it 90%? What levers do we need to pull to drive
change in these numbers?”
Moreover, even when an organization had a vision for CX, the internal
team fought an uphill battle at times to get executive adoption or to
establish data as the definitive and authoritative source for company
decisions. Before engaging with Qualtrics, they:
› Found that metrics such as net promoter score (NPS) and CX
were considered marketing “stuff.” A director said: “Culturally, we’ve
moved the dial so that executives understand the various customer
journeys that we’ve outlined and appreciate the NPS scores for each.
Previously, we struggled in translating NPS from being a ‘fluffy
marketing measure’ into something that executives understand and
that is based on ‘scientific rigor.’” Similarly, another executive added:
“NPS used to be a relatively amorphous number, but now we are able
to connect improvements in specific activities directly to improvements
in NPS. We can see a direct relationship that increases company
“Last year, we had a big drop in
revenue.”
customer satisfaction for one
› Struggled to identify an authoritative voice of the customer. An type of interaction. It wasn’t a
executive said: “As I immersed myself in this industry, I was surprised subtle drop; it was a nose
by the number of people who were running voice of the customer dive. We raised the alarm,
programs and were having trouble getting upper management to pulled up the dashboard,
understand the impact. A friend told me about how he provided a looked at text analytics, and
compelling set of data to his upper management, and the CEO found a specific answer. We
responded, ‘Yeah, the data is good, but I just talked with a friend who resolved the issue in two to
told me something different.’ The friend’s opinion had more weight than three days. A few months
all the data.”
later, the same problem
emerged on a broader scale
Key Results within the company, and we
already had the answer. The
The interviews revealed that key results related to their market research
generally and to CX direction specifically include the ability to: net impact in our estimation
was a six- to eight-point
› Respond quickly to customer concerns. An executive told Forrester: impact on customer
“Last year, we had a big drop in customer satisfaction for one type of satisfaction.”
interaction. It wasn’t a subtle drop; it was a nose dive. We raised the
Manager, customer insights,
alarm, pulled up the dashboard, looked at text analytics, and found a
specific answer. We resolved the issue in two to three days. A few insurance industry
months later, the same problem emerged on a broader scale within the
company, and we already had the answer. The net impact in our
estimation was a six- to eight-point impact on customer satisfaction.”
› Provide data that is accurate, timely, and actionable. One manager
said: “Qualtrics provided a digital platform that gave us data that was
timely and digestible and that we could feed into various systems. We
could get data out to people on the front lines.” Another executive said:
“We used Qualtrics to do A/B testing on different messaging. We
gained a lot of insight into customer perceptions about our products
and services.”

› Reduce the training required for employees. A director said:
“Qualtrics allowed us to streamline and use one system, which makes
it a whole lot easier. We have a number of analysts. We have a tech
team that is jumping into the data. We have many interviewers. Having
a single platform for training purposes reduced a lot of busy work
required just to use different platforms.”
› Trust in Qualtrics as a partner to help drive change. An interviewee
said: “Qualtrics was very good at pushing, inquiring, and identifying
potential ‘banana skins’ in our CX journey. My advice to others
beginning this journey is to take the time and understand the DNA of
the organization. Understand the levers that motivate employees and
inform executive decisions. Our first year was more like a game of
‘Snakes and Ladders,’ and it was very painful at times. Qualtrics
helped us find direction.”
› Improve the quality of internal decision making. An executive said:
“When our system is inundated or functionality isn’t working as
anticipated, we have a feedback loop that shows what is happening to
the customer experience and how it’s driving a huge number of calls to “This might be a bit unique, but
our customer contact centers, which is in turn increasing our staffing we used Qualtrics to drive
requirements. We can show the cost of overtime for call center staff in some personalization features
contrast to the cost of fixing the root problem. Having data simplifies on our website. Sometimes
making such decisions because it fuels compelling financial decisions.” when a customer selects to
complete a short survey, it
Some organizations realized benefits that were specific to using Qualtrics
also leads them to product
PX to manage products. PX tools enabled the organizations to identify
offering that was otherwise
products desired by customers, finetune product features, and adapt to
changing customer needs. The organizations told Forrester how they used unavailable.”
Qualtrics to: Director, strategic product
planning, consumer goods
› Build products that resonated with customers. One executive said:
industry
“As we build out new offerings that range from hotel rooms to theme
parks, we are continuously asking customers questions about
preferences — not only for the strategic elements, but down to details
such as bathrooms.” Another executive also said: “This might be a bit
unique, but we used Qualtrics to drive some personalization features
on our website. Sometimes when a customer selects to complete a
short survey, it also leads them to product offering that was otherwise
unavailable.”
› Building stronger, more engaged customer panels. One executive
told Forrester: “We are planning how we’ll manage the ‘panel member
journey’ through providing input. In the past, we honestly abused our
panel members because our questions were disjointed and out of
context. We want to improve the quality of our questions, and we hope
that the quality of input from our panels will also improve significantly.”
In addition to managing products, some of the interviewed organizations

used Qualtrics to measure and manage BX. This value included:
› Increase the quality, speed, and value while lowering costs. One
interviewee told Forrester: “We started slowly by responding to
requests with people, ‘We can do a quick five-minute question,’ which
evolved into quasi-tracking studies that evolved into segmentation
studies that evolved into some fairly complex studies. We’ve done a
segmentation study for one-fifth of the price of what we paid in 2009.”
Another executive added: “As soon as the survey closed, we could
provide results to our business partners and leadership teams.”

› Consolidating disparate survey activities and improving quality.
One director said: “One of my priorities was to consolidate the number
of survey instruments that we used and streamline them across the
company. We also introduced a closed loop review process to review
the surveys and improve the results and impact. A lot of people rallied
to participate and help with the project, which shows how appreciated
it’s become across the company.”
Employees are critical to delivering on a company’s brand promise,
especially for services companies such as travel, hospitality, or financial “My advice to others beginning
services. The companies that used Qualtrics to measure and guide their this journey is to take the time
EX told Forrester that they: and understand the DNA of
the organization. Understand
› Connected employee behavior to customer experience. One
interviewee said: “We’ve done basic analysis about the impact that the levers that motivate
employees have on our brand. We want to bring it down to the employees and inform
individual level so that every customer service agent has data about executive decisions. Our first
their level of engagement and satisfaction of their customers.” An year was more like a game of
executive in telecommunications told Forrester: “Our goal is for every ‘Snakes and Ladders,’ and it
employee to understand the NPS related to their work and know what was very painful at times.
it means. I want an engineer building a base station to know the NPS Qualtrics helped us find
for his territory and understand how it fits into the customer journey.” direction.”
› Measured the transfer of culture to new employees. A human Head of transformation,
resources executive told Forrester: “Using Qualtrics gives us some telecommunications industry
great tools and insights for the employee engagement team working
with employees. We have very long employee retention. It speaks to
our culture and to our proactive tracking that we are able to measure
and ensure that we are creating an environment where employees
want to stay long term.”
Composite Organization
Based on the interviews, Forrester constructed a TEI framework, a
composite company, and an associated ROI analysis that illustrates the
areas financially affected. The composite organization is representative
of the eight companies that Forrester interviewed and is used to present
the aggregate financial analysis in the next section. The composite
organization that Forrester synthesized from the customer interviews has
the following characteristics:
› Has 1,000 employees.
› Evolves in its use of Qualtrics over three years to:
› Begin using Qualtrics to replace existing tools.
› Define and socialize a vision for customer experience within and
across the organization with measured but methodical adoption by
executives companywide.
› Expand use of Qualtrics to measure elements of brand, product, and
employee experience. It uses Qualtrics for 50% of these initiatives in
the second year and 100% of research in the third year.
Although the composite and many of the eight interviewed companies
evolved and expanded their use of Qualtrics over time, other
organizations have chosen to implement the full experience management
offering to measure CX, EX, BX, and PX at once.

Financial Analysis
QUANTIFIED BENEFIT AND COST DATA AS APPLIED TO THE COMPOSITE
Total Benefits
PRESENT
REF. BENEFIT YEAR 1 YEAR 2 YEAR 3 TOTAL VALUE
Atr Reduced cost of staff required $189,000 $189,000 $189,000 $567,000 $470,015
Reduced cost of customer

Btr $144,000 $144,000 $144,000 $432,000 $358,107
engagement and support
Avoided cost of delivering
Ctr $153,000 $51,000 $51,000 $255,000 $219,557
inferior products to market
Avoided cost of previously
Dtr $21,874 $46,811 $58,211 $126,896 $102,307
purchased tools
Total benefits (risk-adjusted) $507,874 $430,811 $442,211 $1,380,896 $1,149,986
Reduced Cost Of Staff Required The table above shows the total of all
Each of the organizations that Forrester interviewed: benefits across the areas listed below,
as well as present values (PVs)
› Experienced a significant increase in the productivity or value discounted at 10%. Over three years,
generated from using Qualtrics compared with other tools on the the composite organization expects
market. risk-adjusted total benefits to be a PV
of more than $1.1 million.
› Measured the impact differently, and many could only estimate the
impact because the value came from increased functionality. One
organization said that a 20x productivity improvement attributed to
Qualtrics would be “conservative.”
› Estimated the number of staff that they would require using other tools
to get the same impact as they do with Qualtrics. $470,015 41%
› Realized a different level of impact based on the size of the three-year

benefit PV
organization. During interviews, this usually equated to a 35% to 50%
reduction in staff requirements. (As mentioned frequently in this study,
the size of the organization and the maturity of its data collection teams
varied widely, which also impacted the cost and benefits of using
Qualtrics.)
Based on a company with 1,000 employees and a moderate-to-low level
of maturity, Forrester calculates that the organization avoided the cost of The reduced cost of
hiring two additional employees. Readers should determine the number staff required: 41% of
of staff that is applicable to their operations. To account for this total benefits
variability, Forrester risk-adjusted this benefit downward by 10%, yielding
a three-year risk-adjusted total PV of $470,015.

Reduced Cost Of Staff Required: Calculation Table
REF. METRIC CALC. YEAR 1 YEAR 2 YEAR 3
Reduced number of staff required to manage

A1 Qualtrics compared with working with other From interviews 2 2 2
tools
A2 Average burdened salary Assumption $105,000 $105,000 $105,000
At Reduced cost of staff required A1*A2 $210,000 $210,000 $210,000
Risk adjustment ↓10%
Reduced cost of staff required

Atr $189,000 $189,000 $189,000
(risk-adjusted)
Reduced Cost Of Customer Engagement And Support

Related to a reduced cost in customer support, organizations reported that
insights from Qualtrics enabled them to:
› Identify 250 unique customer insights that resulted in more than 150
specific process changes or operational improvements.
$358,107
› Reduce the number of incoming calls from customers by identifying
problems quickly and resolving the problem much faster. One company three-year
told Forrester that they resolved problems in two to three days that benefit PV
they expect would previously require up to six weeks to identify and
remedy.
› Shift the channels used for supporting customer engagements. While 31%
the cost differs widely based on the industry and customer, shifting
from phone calls to chat, email, or self-service can easily save
organizations more than $10 per interaction. Using Qualtrics provided The reduced cost of
more insights at a faster pace than previous tools.
customer engagement
One organization attributed a number of operational improvements,
including customer engagement, to data gathered through Qualtrics; the and support: 31% of
executive valued these improvements at more than $1.2 million. total benefits
Forrester used a cost savings value from the interviews of $160,000. Due
to the varying types of customer interactions, Forrester risk-adjusted this
benefit downward by 10%, yielding a three-year risk-adjusted total PV of
$358,107.
Reduced Cost Of Customer Engagement And Support: Calculation Table

Enabling insights to shift customer
B1 From interviews $160,000 $160,000 $160,000
engagement to lower cost channels
Reduced cost of customer engagement
Bt B1 $160,000 $160,000 $160,000
and support
Reduced cost of customer engagement

Btr $144,000 $144,000 $144,000
and support (risk-adjusted)

Avoided Cost Of Delivering Inferior Products To Market
A key theme throughout the interviews was the ability to improve products
taken to market or to refine and improve products to better meet customer
expectations. The scope of “products” includes consumer goods,
entertainment and travel, financial services, and telecommunications.
In terms of product development, one executive said, “It’s not the decisions $219,557
on products that you build; it’s the decisions on the products that you don’t 19%
three-year
build that are important.” As such, this executive indicated that for his benefit PV
consumer goods company, releasing an inferior product or even a product
that falls short of consumer expectations would be a multimillion-dollar
mistake. In his own words, “As we debated specific features, Qualtrics
enabled us to quickly launch customer-facing surveys and get factual
answers to our questions. In the past, we would make decisions based on
our best guesses.”
Improving products over time is also important, especially for services The avoided cost of
companies without discrete, physical products. Those organizations also delivering inferior
shared experiences about rapidly identifying and changing the features products to market:
of their services in a way that improves the customer experience.
19% of total benefits
In the financial model, Forrester extracted both types of benefits and
adjusted them to the scale of the composite organization. As such, the
composite organization:
Impact risk is the risk that the
› Saved $180,000 in building and taking a new product to market in business or technology needs of the
the first year of the financial mode. organization may not be met by the
investment, resulting in lower overall
› Avoided $60,000 in costs in both the second and third years when it total benefits. The greater the
would previously have been modifying or updating product features. uncertainty, the wider the potential
range of outcomes for benefit
Because this benefit will vary based on the types of products and estimates.
services, Forrester risk-adjusted this benefit downward by 15%,
yielding a three-year risk-adjusted total PV of $219,557.
Avoided Cost Of Delivering Inferior Products To Market: Calculation Table

C1 Avoided cost of building inferior products From interviews $180,000
Reduced costs of responding to customer

C2 From interviews $60,000 $60,000
preferences and adapting products
Avoided cost of delivering inferior products to
Ct C1+C2 $180,000 $60,000 $60,000
market
Avoided cost of delivering inferior products to

Ctr $153,000 $51,000 $51,000
market (risk-adjusted)

Avoided Cost Of Previously Purchased Tools
A benefit that was constant across all the interviewed organizations was
a tendency for more and more of the company to adopt Qualtrics as
analysts and decision makers alike observed the improved capabilities
over the existing tools.
As the organization replaced its previous tools with Qualtrics, it was able
to avoid the license fees for those tools.
Because the benefit was common across the interviews, Forrester risk-
adjusted this benefit downward by only 5%, yielding a three-year
risk-adjusted total PV of $102,307.
Avoided Cost Of Previously Purchased Tools: Calculation Table

50%Y1; 75%Y2;
D1 Avoided cost of licensing other tools $23,025 $49,275 $61,275
and 100%Y3
Dt Avoided cost of previously purchased tools =D1 $23,025 $49,275 $61,275
Avoided cost of previously purchased tools

Dtr $21,874 $46,811 $58,211
(risk-adjusted)

Unquantified Benefits
In addition to the benefits outlined above, the organizations shared
additional benefits that Forrester did not quantify in the financial model.
Usually, these are benefits that are still developing or that are difficult to
pinpoint financially but still deliver value to Qualtrics customers. The
study showed the Qualtrics helped organizations to:
› Create a culture of accountability. One executive said: “Our CEO
latched on to the capabilities using Qualtrics. We hold business units Switching to Qualtrics
accountable for performance. Every quarter, we sit down, and if
somebody’s numbers go down, they’re on the spot to explain what helped organizations gain
went on and how it’s going to be fixed. As a result, we’ve seen visibility into products and
continuous improvement.”
opened a new world into
A different manager told Forrester: “We fundamentally changed our what was happening with
customer experience. In the last calendar year. We generated 250
unique insights that drove 150 changes to business processes. We customers and
can’t take credit for all the actual improvements implemented, but we employees.
know that we gave decision makers inputs that contributed to
successful company strategy.”
› Understand a customer’s entire journey, literally. A travel industry
executive told Forrester: “We are able to understand the entire
customer experience when a customer travels from point A to point B.
“Through the first couple of
We understand what happens when they book travel; the experience
years with Qualtrics, we
at airports; the experience onboard the flight, including in-flight
systems, helpfulness of crewmembers, and so on until they pick up weighted all customer
their luggage. Before using Qualtrics, our insights were limited to the journeys equally. With the
general customer experience, but now we are able to branch out and added insights, we developed
do more traditional market research, including brand tracking and a weighted insight for each
conjoint studies. We are providing insights to advertising teams that journey. This gives us a clear
find it very useful in getting our message out to the market.” insight into the proportional
representation of each
› Increase the reputation of the customer experience team. One customer journey.”
manager said: “Overall, when we switched to Qualtrics, we gained
visibility into our products and opened up a new world into what was Head of transformation,
happening with customers and employees. More and more, executives telecommunications industry
came to us with questions. The success built more momentum, and
tons of projects came our way. At this point, we have no more free
time. We are definitely a team that is in demand internally since we
went over to Qualtrics.”

Flexibility
The value of flexibility is clearly unique to each customer, and the
measure of its value varies from organization to organization. There are
multiple scenarios in which a customer might choose to implement
Qualtrics and later realize additional uses and business opportunities,
including:
In Forrester’s survey,
› Creating weighted distribution of customer journeys. One
executive said: “Through the first couple of years with Qualtrics, we 52% of respondents
weighted all customer journeys equally. With the added insights, we said the ability to take
developed a weighted insight for each journey. This gives us a clear
insight into the proportional representation of each customer journey. quick action on
We are able to put investments into products and services that make feedback with
the most impact to customers, and that has significantly impacted the
return on investment that we get. We could not have reached this point customers or
without the sophisticated tools from Qualtrics.” employees was very
› Measuring the lifetime value of customers. One director said: “We important.
have a separate team that works to identify and measure the lifetime
value of customers. We tie the customer experience to changes in
NPS and the corresponding revenue from specific customer segments.
After several years, we can clearly identify the experience of core
customers, repeat business, and long-term revenue.”
› Gaining executive understanding and support. An airline
executive said: “I am very grateful to have a CEO who is always Flexibility, as defined by TEI,
thinking about customers first. Every minute of my job is spent represents an investment in additional
obsessing about customer experience because I have an executive capacity or capability that could be
committee that walks the walk and isn’t just talk. I hear stories from turned into business benefit for a
a lot of peers who are always working to remind executives or even future additional investment. This
to convince them that customer experience is important.” provides an organization with the
"right" or the ability to engage in future
Flexibility is quantified when evaluated as part of a specific project initiatives but not the obligation to do
(described in more detail in Appendix A). so.

Total Costs
PRESENT
REF. COST INITIAL YEAR 1 YEAR 2 YEAR 3 TOTAL VALUE
Etr Cost of Qualtrics $5,000 $30,700 $65,700 $81,700 $183,100 $148,589
Total costs (risk-adjusted) $5,000 $30,700 $65,700 $81,700 $183,100 $148,589
Cost Of Qualtrics
Determining the price for Qualtrics in this study was complicated because
of many variables that drive pricing, including the:
› Scale of existing research activities.
The table above shows the total
› Maturity of the organization in leveraging research. of all costs across the areas
listed below, as well as present
› Types of analysis and output required by the organization. values (PVs) discounted at 10%.
› Modules to be used, including CX, BX, PX, and EX. Over three years, the composite
organization expects risk-
Readers should realize that the pricing in this study is representative of the adjusted total costs to be a PV of
composite organization. $148,589.
During interviews, the organizations frequently shared their experience as

one that “evolved” from using Qualtrics initially from some research, but
expanding rapidly because other organizations quickly migrated when they
experienced the full capabilities of Qualtrics. In the financial model,
Forrester assumes that:
› In Year 1, the organization pays implementation costs and license fees
for the CX module.
› In Year 2, the organization rolls out additional modules. The exact
modules will vary, but Forrester assumes that the organization
replaces only 50% of its combined BX, PX, and EX tools with Qualtrics. Implementation risk is the risk
that a proposed investment may
› In Year 3, the organization pays 100% of the license fees for the deviate from the original or
additional modules. expected requirements, resulting
in higher costs than anticipated.
› The composite organization opted for additional services. Although not The greater the uncertainty, the
required, many of the organizations chose to pay Qualtrics for advisory wider the potential range of
services to help them get ahead of the learning curve and build a more outcomes for cost estimates.
comprehensive, internal strategy for leveraging data.
Forrester did not risk-adjust this cost. Over three years the total PV cost
was $148,589.

Cost Of Qualtrics: Calculation Table
REF. METRIC CALC. INITIAL YEAR 1 YEAR 2 YEAR 3
E1 Implementation costs $5,000 $6,000
E2 Cost of Qualtrics CX module $23,700 $23,700 $23,700
Cost of Qualtrics BX, PX, and EX 50%Y2,

E3 $22,000 $44,000
modules 100%Y3
E4 Cost of Qualtrics advisory services $7,000 $14,000 $14,000
Et Cost of Qualtrics E1+E2+E3+E4 $5,000 $30,700 $65,700 $81,700
Risk adjustment 0%
Etr Cost of Qualtrics (risk-adjusted) $5,000 $30,700 $65,700 $81,700

Financial Summary
CONSOLIDATED THREE-YEAR RISK-ADJUSTED METRICS
Cash Flow Chart (Risk-Adjusted) The financial results calculated in the

Benefits and Costs sections can be
used to determine the ROI, NPV, and
Total costs payback period for the composite
Total benefits organization’s investment. Forrester
assumes a yearly discount rate of
Cumulative net benefits 10% for this analysis.
Cash $1.4 M
flows
$1.2 M
$1.0 M
$0.8 M
$0.6 M These risk-adjusted ROI,

NPV, and payback period
$0.4 M
values are determined by
$0.2 M applying risk-adjustment
factors to the unadjusted
results in each Benefit and
-$0.2 M Cost section.
Initial Year 1 Year 2 Year 3
Cash Flow Table (Risk-Adjusted)
PRESENT
INITIAL YEAR 1 YEAR 2 YEAR 3 TOTAL VALUE
Total costs ($5,000) ($30,700) ($65,700) ($81,700) ($183,100) ($148,589)
Total benefits $0 $507,874 $430,811 $442,211 $1,380,896 $1,149,986
Net benefits ($5,000) $477,174 $365,111 $360,511 $1,197,796 $1,001,397
ROI 674%
Payback period <6 months

Qualtrics: Overview
The following information is provided by Qualtrics. Forrester has not validated any claims and does not endorse
Qualtrics or its offerings.
Qualtrics is the only technology capable of measuring, prioritizing, and optimizing the four foundational
experiences of business—customer, product, employee and brand experiences—on a single platform.
In a Bain and Co study, 80% of CEO’s surveyed expressed a belief that their organizations deliver superior
experience to their customers. However, only 8% of their customers agreed that these organizations were actually
delivering superior experiences. This misalignment is called the experience gap, and has led to the emergence of
a new business discipline called experience management.
Experience management is about closing the gap between the experience an organization thinks it is delivering
and what it actually delivers. To do this, organizations must focus on the four foundational areas of business:
customer, employee, product, and brand experience. Market leaders optimize all four of these experiences and
understand that they are highly interdependent. They realize that experience is the 21st century competitive
advantage.
The Qualtrics XM Platform™ is a single system of record for all experience data, also called X-data™. The
platform offers purpose-built applications for each experience, driving actionable insights that impact financial
outcomes. All solutions are built upon the same scalable technology that offers best-of-breed data collection,
analysis, prediction and action engines. The ease and simplicity of the interface helps drive widespread adoption
inside of companies. It is continuously updated and has an open architecture that allows for seamless integration
with other systems and data in the enterprise.

Appendix A: Total Economic Impact
Total Economic Impact is a methodology developed by Forrester
Research that enhances a company’s technology decision-making
processes and assists vendors in communicating the value proposition PRESENT
of their products and services to clients. The TEI methodology helps VALUE (PV)
companies demonstrate, justify, and realize the tangible value of IT
initiatives to both senior management and other key business The present or current value of
stakeholders. (discounted) cost and benefit
estimates given at an interest rate
(the discount rate). The PV of costs
and benefits feed into the total NPV
Total Economic Impact Approach of cash flows.
Benefits represent the value delivered to the business by the product.
The TEI methodology places equal weight on the measure of
benefits and the measure of costs, allowing for a full NET PRESENT
examination of the effect of the technology on the entire VALUE (NPV)
organization.
The present or current value of
(discounted) future net cash flows
given an interest rate (the discount
Costs consider all expenses necessary to deliver the rate). A positive project NPV
proposed value, or benefits, of the product. The cost category normally indicates that the
within TEI captures incremental costs over the existing investment should be made, unless
other projects have higher NPVs.
environment for ongoing costs associated with the solution.
RETURN ON
INVESTMENT (ROI)
Flexibility represents the strategic value that can be
obtained for some future additional investment building on
A project’s expected return in
top of the initial investment already made. Having the ability percentage terms. ROI is
to capture that benefit has a PV that can be estimated. calculated by dividing net benefits
(benefits less costs) by costs.
Risks measure the uncertainty of benefit and cost DISCOUNT

RATE
estimates given: 1) the likelihood that estimates will meet
original projections and 2) the likelihood that estimates will
The interest rate used in cash flow
be tracked over time. TEI risk factors are based on
analysis to take into account the
“triangular distribution.” time value of money. Organizations
typically use discount rates
between 8% and 16%.
The initial investment column contains costs incurred at “time 0” or at the

beginning of Year 1 that are not discounted. All other cash flows are discounted PAYBACK
using the discount rate at the end of the year. PV calculations are calculated for PERIOD
each total cost and benefit estimate. NPV calculations in the summary tables are
the sum of the initial investment and the discounted cash flows in each year. The breakeven point for an
Sums and present value calculations of the Total Benefits, Total Costs, and investment. This is the point in time
Cash Flow tables may not exactly add up, as some rounding may occur. at which net benefits (benefits
minus costs) equal initial
investment or cost.

Qualtrics Tei Study PDF

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Qualtrics Tei Study PDF

Uploaded by

Copyright:

Available Formats

A Forrester Total Economic Impact™

Study Commissioned By Qualtrics

The Total Economic

ABOUT FORRESTER CONSULTING

© 2017, Forrester Research, Inc. All rights reserved. Unauthorized reproduction

1 | The Total Economic Impact™ Of Experience Management With Qualtrics

2 | The Total Economic Impact™ Of Experience Management With Qualtrics

Total benefits $358.1K

Total costs $102.3K

2 | The Total Economic Impact™ Of Experience Management With Qualtrics

The TEI methodology DUE DILIGENCE

initiatives to both COMPOSITE ORGANIZATION

business FINANCIAL MODEL FRAMEWORK

This study is commissioned by Qualtrics and delivered by Forrester Consulting.

Forrester makes no assumptions as to the potential ROI that other

Qualtrics reviewed and provided feedback to Forrester, but Forrester maintains

3 | The Total Economic Impact™ Of Experience Management With Qualtrics

4 | The Total Economic Impact™ Of Experience Management With Qualtrics

Processes that are reactive instead of predictive 49%

Organizational silos make it difficult to connect disparate

Inability to extract actionable insights from the data

No easy way of connecting experience data with

Difficult to connect with customers and/or employees at

Compliance and security concerns around customer or

None of the above 5%

5 | The Total Economic Impact™ Of Experience Management With Qualtrics

"How satisfied are you with your organization’s efforts in the

Very dissatisfied Somewhat dissatisfied Neutral Somewhat satisfied Very satisfied

Providing a consolidated view into all important data

Capturing emotions, beliefs, and sentiments from

Predicting market needs and opinions 32% 26% 26% 17%

6 | The Total Economic Impact™ Of Experience Management With Qualtrics

"How helpful are/would each of the following be to your organization?"

Somewhat helpful Extremely helpful

A connected view of your customer and employee

Influencing corporate strategy by leveraging insights

One platform that combines customer, market,

7 | The Total Economic Impact™ Of Experience Management With Qualtrics

Unimportant/Neutral Somewhat important Very important

Ease of use 7% 25% 67%

Ability to reach targeted respondents through many

Analytics that automatically predict which activities and

Agility and ability to implement fast-paced changes 14% 36% 50%

Reporting and analytics that connect and correlate CX,

Ability to quickly take action on feedback with

Role-based dashboards to ensure our employees have

Flexible integration into existing systems, such as CRM

Using a single platform to manage and administrate

8 | The Total Economic Impact™ Of Experience Management With Qualtrics

"How much do you agree with the following statements?"

Somewhat agree Completely agree

Understanding the impact engaged employees have

If I have a thorough understanding of my market, I can

Minimizing the number of platforms that my company

A platform that provides a holistic view into customer,

Having a wide variety of feedback channels (in-store,

9 | The Total Economic Impact™ Of Experience Management With Qualtrics

INDUSTRY TITLE REGION USAGE AREAS

Travel Manager, customer insights Global CX, EX, PX, and BX

Director, strategic product

Food and hospitality Director, customer research North America CX and PX

Manager, team member

10 | The Total Economic Impact™ Of Experience Management With Qualtrics