Why Customer Experience Matters

Do you know why 80% of leaders plan to increase customer service budgets over the next year? It's because of two mighty important letters: CX.

More specifically, that means Customer Experience, which is your customers' perception of their interactions with your company. It's not just about providing good service; it's about creating a positive experience that keeps customers coming back and recommending you to others.

Competition is fierce nowadays, and if customers are not happy with how you treat them, they'll find someone else who will meet their expectations. Business is a two-way relationship that needs to be nurtured.

The problem is many companies don't know how to approach CX, much less how to measure it. We're here to help.

This blog post explores why customer experience is crucial for business success.

Understanding customer experience

Customer experience sounds like a buzzword, but it's so much more than that. Let's give a concrete definition so we're on the same page. CX encompasses every interaction a customer has with your business across all channels and touchpoints. Indeed, there is now an entire discipline responsible for CX, called Customer Experience Management.

If you remember Business 101, these include awareness, discovery, education, purchases, use, service, and advocacy. As such, the cumulative impact of all these customer touchpoints makes up their overall experience.

For example, imagine you're buying a new phone. Your customer experience starts when you first see an ad for the phone. It continues as you browse the company's website, chat with a sales rep, make your purchase, unbox the phone, and use it for the first time. Even when you need help and call customer support, that's part of your experience, too!

The impact of customer experience on brand perception

A company's brand reputation means everything. You want potential and existing customers to see your brand in a positive light because with that reputation comes trust. Positive customer experiences make people see your company as reliable, responsive, and caring. Like you are a quality brand offering a quality product or service.

Customers will also believe you share their values. In fact, 82% of shoppers want a brand's values to align with theirs.

If you showcase values like transparency, respect, and a dedication to customer satisfaction in your CX approach, that will positively reflect on your brand image. Customers will see you as an authentic company that keeps its word. In turn, overall customer engagement will improve.

After that, the consistency of positive CX plays a massive role in shaping customer trust and loyalty over time. It's not a one-and-done thing. You must implement a customer-focused mindset within your company centred on delivering great CX across all interactions.

The consequences of poor CX

If the benefits aren't convincing enough, the consequences of poor customer experience should be considered. Negative experiences can severely damage a brand's reputation. If customers have bad experiences and feel mistreated, they'll vent online for all to see. Their negative reviews and complaints on social media will influence other people's perceptions of your brand.

Poor CX also erodes customer trust in your company. Once trust is broken, it's tough to regain. Without trust, customers have no reason to remain loyal or recommend you to others.

Customer experience and customer loyalty

With fierce competition looming, earning customer loyalty is more important than ever. You want customers to keep returning and growing their lifetime value with your brand. In fact, 88% of online shoppers say they are more likely to continue shopping on a retailer website that offers a personalised experience.

That's the powerful connection between great CX and repeat business. You foster meaningful emotional connections by crafting positive end-to-end experiences tailored to customers' needs and preferences. Customers feel valued, which makes them more likely to buy from you again.

Loyal, satisfied customers also contribute to business growth through word-of-mouth referrals. They become genuine brand ambassadors who happily recommend you within their networks. So, in many ways, CX excellence fuels growth by generating more sales and lowering acquisition costs.

The influence of customer experience on revenue

Likewise, multiple studies reveal a direct correlation between customer satisfaction and increased sales revenue. McKinsey found that companies that grow faster drive 40% more of their revenue from personalisation than their slower-growing counterparts. That's massive!

Remember, a company's primary goal is to turn a profit. With this data in mind, it's clear that investing in CX is a wise decision for business growth. It just makes good business sense.

The role of feedback in enhancing customer experience

Here's where things get really interesting. Most companies try to guess what their customers want. But truthfully, no one knows CX better than, well, actual customers. Customer feedback provides insider intelligence to shape winning CX strategies.

It's a three-step process. First, you gather feedback through various channels such as surveys, reviews, and social media. Second, you analyse this feedback to identify patterns and areas for improvement. And third, you implement changes based on the feedback received.

Let's look at some ways you can gather this golden feedback.

Surveys

Customer experience surveys are the most popular and effective method for gathering targeted CX insights from customers. One significant advantage of surveys is that you can control the types of questions you ask. You can ask about specific parts of the customer experience that interest you. You can use both open and closed questions.

For example, you can survey customers on your website's ease of use, product quality, delivery times, pricing perception, likelihood to recommend, and more. Closed-ended rating scale questions provide clear metrics for tracking. While open-ended questions give customers room to elaborate on frustrations and share suggestions.

Online survey tools like SmartSurvey make it easy to embed surveys across digital channels - your website, emails, and more. Valuable features like question logic, anonymous responses, and conditional branching further enhance data quality. We even have customer survey templates to help you get started.

Tracking survey responses over time gives you an accurate pulse on how customers perceive your CX initiatives. The quantified feedback helps you double down on what's working well and rapidly improve areas that need attention. Tools like SmartSurvey can even provide a customer experience dashboard to make it easier to track all your survey feedback in one place.

Social media

You're also bound to get much feedback on social media if people are talking about your brand. Keep an eye on your social media chatter with tools like Hootsuite and Buffer. It can help you track mentions of your brand across different platforms. You can track sentiment, identify recurring themes, and respond right from the dashboard.

The downside with social media feedback is that it's not always directly about CX. People may comment on a new logo, pricing change, or a specific product. For specific CX insights, surveys remain ideal as you can customise questions to understand touchpoint satisfaction.

Reviews

Customer reviews on sites like Yelp and Google Business Profile offer another proper feedback channel. Your website and order follow-ups should also invite reviews. This qualitative feedback builds social proof for new visitors.

Monitoring reviews helps identify recurring complaints and opportunities for CX improvement. More importantly, responding publicly to reviews - both positive and negative - shows customers you value their voice.

The relationship between employee experience and customer experience

This may seem surprising, but the connection exists. Employee experience has a direct impact on customer experience across service interactions. Simply put, happy employees equal happy customers.

When employees feel empowered, recognised, and supported internally, they have higher job satisfaction. This motivates them to go above and beyond to deliver excellent CX.

Strategies like investing in employee training, incentive programs, and internal feedback loops help align employee experience with CX goals.

Personalisation as a key driver of customer experience

It's no wonder 3 out of 4 CEOs believe personalisation is essential to competitiveness. From the customer's perspective, generic experiences just don't cut it anymore. They want to feel known and understood, not like another invoice number.

Luckily, data and technology make it easier than ever to deliver personalised CX across digital touchpoints. AI-powered solutions can segment customers based on attributes like demographics, purchase history and browsing behaviour. You can then customise content, offers, product recommendations, and communication channels accordingly.

Customer experience in the digital age

There is no denying the massive shift to online shopping and digital brand interactions accelerated by the pandemic.

While digital channels introduce new opportunities to enrich CX, they also pose fresh challenges. Technical issues, navigation difficulties, information overload and privacy concerns can quickly derail the experience on websites and apps.

That's why a sharp focus on UX design and omni-channel alignment is vital. Smoothing out friction across digital journeys prevents drop-offs.

Measuring the success of customer experience initiatives

With all this talk of CX investments, you need to accurately measure success. Here are some key metrics you can use to measure customer experience:

• Net Promoter Score: NPS gauges customer loyalty and likelihood to recommend your brand (aim for scores higher than 50)
• Customer Satisfaction Score: CSAT quantifies overall post-purchase satisfaction on a scale of 1-10 or 1-5 (benchmark against your industry)
• Customer Effort Score: CES measures ease of using your product, service, or customer service (scored on a scale from 1-7)‍
• Customer Lifetime Value: CLV tracks repeat sales to quantify loyalty (useful for personalisation campaigns)

Wrapping up

Customer experience matters. A lot. In today's competitive world, it's not enough to have a great product or service. Brands can no longer get by offering mediocre, one-size-fits-all experiences. You need to demonstrate genuine care for customers to earn their loyalty.

The team at SmartSurvey is ready to be your CX partner in this mission. Our platform provides the tools and guidance needed to easily gather actionable customer insights.

Key takeaways

Customer experience (CX) vs customer service: CX encompasses every interaction a customer has with a business across all channels, while customer service is just one component of CX. Companies must focus on providing consistently positive experiences across all customer touchpoints, not just in customer service.

Impact on brand perception: Positive customer experiences significantly enhance brand reputation, fostering trust and loyalty. A brand that demonstrates values like transparency and customer satisfaction through its CX is more likely to be viewed positively by customers.

Consequences of poor CX: Negative customer experiences can severely damage a brand’s reputation and erode trust. This can lead to a loss of customer loyalty, with dissatisfied customers sharing their negative experiences online, influencing others' perceptions of the brand.

Customer loyalty and revenue growth: Excellent CX fosters customer loyalty, leading to repeat business and increased customer lifetime value. Loyal customers are more likely to make repeat purchases and recommend the brand to others, contributing to business growth through word-of-mouth referrals.

Importance of feedback in enhancing CX: Gathering and analysing customer feedback is crucial for improving CX. Surveys, social media monitoring, and reviews are effective ways to gather insights, allowing companies to identify areas for improvement and implement changes based on customer input.

Personalisation and digital CX: Personalisation is a key driver of CX, with customers expecting tailored experiences that make them feel valued. The shift to digital interactions requires a focus on user experience design and omni-channel alignment to ensure a smooth and positive CX across all digital touchpoints.