Learn what is customer experience strategy and how to implement it in 2023.
Why CX Matters?
The customer experience (CX) has become one of the hottest topics in business today, and we can see why when you look at the statistics. Global spending on CX solutions will reach $15 billion by 2020, up from $11 billion in 2015, making it one of the fastest-growing industries in the world. Why does CX matter? It’s not just about providing better customer service or being more efficient – it’s about your customers and how they interact with your brand, product, or service throughout their experience with you.
The Importance of Customer Experience
While there’s no single definition of what customer experience (CX) means, customer experience professionals usually agree that CX refers to any interaction your customers have with your business. CX includes what you do to delight them (your brand), as well as how they interact with your products, services, or employees. In fact, according to Gartner’s research, 70% of a customer’s overall experience is determined by internal touchpoints within your company.
When it comes to what’s most important in CX, however, customer service tops our list. If you don’t know that already, take a look at a few of these stats: In 2017, 82% of customers were willing to spend more money with companies that offer excellent customer service; but 88% of customers will abandon a purchase if they encounter poor customer service.
And, in fact, according to data from True Voice Research, customers spend less than three minutes deciding if they’ll stay with a company after a negative experience. That’s right—just three minutes!
These statistics are just a few examples of why CX matters to your bottom line. With that in mind, let’s look at three essential ways you can use CX to make more money for your business
Why Customer Experience Is Important in Today’s Business World
As a business owner, you are a customer’s first point of contact. You can have awesome products or services, but if customers aren’t treated well when they interact with your brand, they won’t come back. Thus, you must understand why CX matters for your business. There are two main reasons why CX matters in today’s business world: it influences conversions and retention. But first…the basics.
There are two main reasons why CX matters in today’s business world: it influences conversions and retention. But first…the basics.
First, a customer’s perception of your brand’s CX can influence conversion rates. That’s because how you treat customers will impact whether they share their experience with others or make a purchase at all.
If a customer’s experience with your brand isn’t memorable, he or she won’t think to share it. Instead, they’ll likely move on to your competitor where they can receive better treatment, which will lead to conversions. That’s why it’s so important that you focus on creating outstanding CX from day one.
Onboarding a new customer, as it’s called, also impacts your retention rate. When customers have an excellent experience with your brand from day one, they’re more likely to come back for repeat purchases. If their first interaction with you is positive, they’ll be drawn back in because of how you made them feel.
Examples of Negative CX Experiences
-Ticketmaster: Waiting in line for an hour, only to be informed that tickets were all sold out -Starbucks: Having your card declined because of insufficient funds when you know there are hundreds of dollars in your account -Delta Airlines: Having one too many flight delays, causing you to miss an important meeting and lose a potential client… or worse.
For companies, negative customer experiences can lead to revenue loss as customers leave for other brands. A recent study found that one out of every five unhappy customers tells nine or more people about their bad experience. This means that one poor customer experience can cause a business to lose 20% of its potential customers!
According to a recent study by Bain & Company, a successful customer experience strategy is correlated with a 26% increase in revenue per customer. For B2B companies, that number jumps to 38%. With these kinds of numbers, it’s clear that creating positive customer experiences matters. Without them, you’re hurting your bottom line. And in today’s competitive market, how can you afford not to put more effort into improving CX?
The difference between a good customer experience and a bad one can be measured in seconds. And because of that, it’s crucial to have mechanisms in place that allow you to listen to customers instantly and take immediate action when necessary. By listening to your customers, you can also identify problems before they escalate into full-blown crises.
Examples of Positive CX Experiences
The best customer experience happens when you don’t notice it. For example, you might go to a bank to deposit a check or withdraw cash from an ATM—but you probably won’t have any interaction with another person. You just get in and out quickly, without complications.
Positive CX means businesses can resolve issues quickly, and when you get a representative on the phone, you don’t feel like you’re talking to someone reading from a script. The operative word here is positive. A positive customer experience happens when customers leave feeling good about their experiences.
Good customer service is a simple concept: Your business should make it easy for customers to interact with you. Respond to questions and concerns promptly, provide useful information, and solve problems quickly—that’s what makes customers happy. If you can accomplish that feat, you’ll build trust among your existing customer base. Then when they experience an issue with your product or service, they’ll be more likely to resolve it directly with you rather than through negative reviews or complaints.
How to Improve Customer Experience and Engagement
More than ever, customers are in control of their experience with your brand. If you’re not thinking about customer experience as a primary driver of your business strategy, you’re behind. Thankfully, there are many ways to step up your CX game—here are some simple things every brand can do today to improve it.
What better way to improve customer experience than to start by truly understanding who your customers are. You can use big data tools to look at where your customers are coming from, which devices they’re using, how often they come back to your site or app, and what page on your site or app they visited before engaging with you in some way (like making a purchase), and much more.
One simple way to engage with your customers is to ask for their feedback. Whether it’s a customer survey or just soliciting direct feedback on social media, customers appreciate being listened to—and you can use that information to improve your products or services.
Common Challenges for Companies with Low CX Scores
If you’re finding that customers are unhappy, or are at least not as happy as they could be, there may be several reasons why. For one thing, you may have too many processes in place to make customers feel like they can’t talk to a human. If a customer has a problem or concern that needs solving right away, they mustn’t get shuffled off to someone else before they can speak with someone who can help them.
What are some of the common challenges companies face with low CX scores? For one thing, it’s important that customers feel like they can talk to someone immediately. If there are too many processes in place or you require callers to press so many buttons before they can get through to a live person, it’s hard for your company to build strong relationships with customers.
Overall, it’s important to remember that CX should be about more than just customer satisfaction scores. As a business owner, you want your customers to enjoy their experience with your company enough that they’ll come back—but you also want them to have a good time while they’re using your product or service.
What do low CX scores mean for a business? Ultimately, it can cost you, customers. If people are unhappy with their experiences with your company, they’re more likely to switch to someone else. Additionally, if customers have a hard time getting in touch or feel like they can’t get their questions answered when they need them answered, they’ll be much less likely to return or recommend your business to others.
Conclusions about the Importance of Good Customer Experience
Nearly everyone today has a smartphone. These are devices we carry with us everywhere we go, and many of us use them as our primary source of information while making purchasing decisions. 71% of consumers admit that they rely on their phones when deciding which store to visit or what business to patronize.
Smartphone usage has given rise to a new industry: location-based marketing. This means businesses can target people based on where they are – or, more specifically, where their smartphones are. Location-based marketing also gives way to push messages that promote products or services based on proximity. For example, if you pull into your local grocery store’s parking lot and open up an app like Yelp!, you might receive a notification about local deals from nearby restaurants; perhaps you’ll even be told how many free ounces of Ben & Jerry’s you can get by downloading their app and showing it at check out.
If your business wants to tap into location-based marketing, you’ll need to connect with a company that specializes in geofencing. These services use GPS signals from smartphones to create virtual fences around physical locations – like businesses or movie theaters – so messages can be sent out to individuals who enter those spaces.
In addition to your business’s physical location, you can use geofencing to encourage consumers to take action based on their proximity to a particular product. For example, you might offer an exclusive 10% discount for shoppers who are near your brick-and-mortar store but only have a limited amount of time to claim it.