Companies that design exceptional customer experiences consistently outpace competitors.
Customers are increasingly choosing products and services based on the quality of their overall experience – rather than comparing features or price. The need for companies to establish a superior Customer Experience, across all channels, has never been stronger.
What is Customer Experience?
Simply put, Customer Experience is a customer’s perception of their interactions with a company. These can be measured by three core elements: success, effort, and emotion.
Everything a company does contributes to customer perception. This includes marketing efforts, website interactions, physical documents, the quality of your products or service, the sales process and even what happens after the sale.
Companies must also consider internal factors such as the interworking of the company, its leadership, its culture and the engineering of the product or service.
Even if a company may have strengths in some areas but struggle in others, the overall impression could still lead to a poor experience. Customer perception is very fragile and can rapidly change with each interaction, so maintaining a consistently strong Customer Experience is of utmost importance.
How is Customer Experience different than Customer Service?
Customer service, sometimes known as “customer support”, is often a single department that manages questions, complaints or concerns.
While customer service is an important part of Customer Experience, it represents only one type of interaction in a larger customer journey. Done correctly, an incredible overall Customer Experience can actually decrease the need for customer service departments.
Why should companies care about Customer Experience?
Since the digital landscape can easily provide customers with a multitude of options and competing experiences, driving loyalty to your brand has never been more important.
Companies collectively spend billions of dollars each year on new experiences intended to attract, serve, and retain their customers – websites, mobile apps, physical locations, call centres, and social media campaigns.
When companies plan, develop and maintain each of these new experiences separately, they struggle to understand how each will impact the broader customer journey and overall experience. However, what affects brand adoption and loyalty the most is a customer’s experience over time across multiple touchpoints and multiple channels.
“Smart organizations have realized that a lack of interconnectedness is a major competitive risk.”
— Brandon Schauer, CEO, Adaptive Path
The advantage of focusing on Customer Experience
When a customer is satisfied with a company, they are not only lower in cost to serve, but also have a much higher potential to be loyal customers in the future. Self-generating revenue opportunities increase when customers become so delighted with their overall experience that they organically promote it amongst their friends and colleagues.
In 2018, the Temkin Group modelled how a modest improvement in Customer Experience would impact the revenue of a typical $1 billion company (across 20 industries). The results of their study were that companies could gain, on average, $775 million in revenue over three years from their original modest investment.
In addition, there is an undeniable link between employee experience and Customer Experience. Companies that lead in Customer Experience show up to 60% more engaged employees.
Training employees on the impact of their role on Customer Experience helps them become advocates for customer needs. In turn, employees are more likely to become active problem-solvers. Employee efforts to improve Customer Experience become even more successful when connected to their compensation.
Does this affect only B2C companies?
Many discussions on Customer Experience strategy begin with the flawed assumption that end-consumers should be the primary focus of corporate efforts.
However, the impact of digitization is establishing new standards across all industries. Understanding this impact means that a customer-centric mindset in the B2B space can also deliver impressive results.
“…benefits to the bottom line can include “stickier” customer loyalty, which can also accrue more quickly than is typically seen in B2C settings.”
— McKinsey, Improving the B2B Customer Experience
How does a company begin to measure and improve their Customer Experience?
The goal of Customer Experience design is to make the entire journey as frictionless and clear as possible for every type of customer. The process begins by understanding your current situation, recognizing opportunities and defining a strategic vision.
It is important to consider every stage and interaction for each customer journey – from brand discovery to the sales process and through support or administrative needs. This work happens through a variety of activities including research, interviews, mapping and assessments.
A third party, such as a consultancy that specializes in Customer Experience, can provide an unbiased analysis and recommendations for how to strategically approach the journey. Contact us today for a free consultation.
References:
Seeing the World as Customers Do – McKinsey
Report: ROI of Customer Experience, 2018 – Timken Group
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