Customer experience sounds intuitive: look after the customer, foster a relationship with them, and enjoy their repeat business and total commitment to your company.
Right?
What’s interesting is that proactive customer experience efforts are a pretty new phenomenon. The first real effort at testing and improving advertising came back in the 1920’s with market research, but this is a different beast entirely.
Customer experience today is really fuelled by the fact that, with very few exceptions, another business out there is offering a similar product or service, of a similar quality, at a similar price to your own. And since it’s 2019, they’re ultra-accessible through the internet.
So how do companies stand out in such saturated markets? How do you generate repeat business when every customer has a dozen options and the slightest error might scare them off?
Nailing your customer experience might just be the answer.
Customer service, success, and experience: The Evolution of CX.
The internet age is also the age of synonyms and empty buzzwords. You’d be forgiven for thinking customer service, customer success, and customer experience were all misguided attempts at selling the same thing – but they are distinctly different.
Customer success is about helping your customers get maximum value out of your product or service. The more ‘successful’ the customer is, the better their Lifetime Value (CLTV) to your company. Within larger businesses, customer success teams work with sales and marketing to make sure customers achieve their desired outcome using your product.
Customer service is quite different; it’s about the advice and assistance you offer in order to satisfy customers. Usually customer service is post-purchase, and it frequently involves troubleshooting, returns, and general queries about the product. By offering this assistance freely and responsively, you improve customer success and customer experience.
Clearly, these two are interlinked to some degree. Customer service can contribute to customer success. However, these both fall under the umbrella of customer experience.
Customer experience is the entire journey of a customer’s interactions with a brand: from first discovering a product, through research, purchasing, using, and reviewing it. Customer experience is a measure of how customers feel, overall, about a specific brand, based on every touchpoint they’ve ever had.
In a saturated and ultra-competitive marketplace, great companies differentiate themselves through customer experience.
The customer-focus transformation
Brand loyalty has become more fickle than ever before. On the one hand, when modern buyers find a solution that works, at an affordable price, from a brand they trust, they will sing the praises of that brand. At the same time, with the slightest issue you could lose that customer in an instant – gone to your nearest competitor without a backwards glance.
In 2019, customers are better-informed and more interconnected than ever. They’re also more self-centered and don’t react well to perceived poor service. Customers want it personalized, friendly, exceedingly helpful, and they want it now.
Businesses have become completely customer-focused because, quite simply, customers are running the show. If you don’t meet your customers’ needs, someone else will – and they’re only a click away.
Are customers demanding more from businesses?
If I’m unhappy with a company (defective product, poor communication, whatever) and they aren’t proactive about setting it to rights, I’m unimpressed.
It might not be reasonable (it might not even be their fault) but I expect to be cared about like an old friend. It’s not really a conscious thing. I know that some companies (say Amazon) offer me a tremendous customer experience every time I visit or purchase, and it seems I then apply those expectations to other companies.
Since customers have more power than ever before, we are definitely making more demands and forcing companies to skate perpetually on thin ice. One bad customer experience can result in a vitriolic social media rage which then blows up among your community and hamstrings the whole business: public perception, share value, customer trust – the disruption can be boundless.
Consumers care profoundly about customer experience. If they think your business is making a big effort to cater to them, you’ll likely be rewarded with their business.
What does great customer experience look like today?
Customers can now interact with your business using a ton of different channels; phone, mobile, online, social media, live chat, in store – the list goes on. Delivering excellent CX means having a consistent persona across all of these channels.
If your weekly emails are sharp, on-the-edge humor pieces, then you can’t have dull and rambling Facebook posts, or clunky non-native live chat support. It just doesn’t add up; it dissolves the trust built up between you and your customer. Just as important, you need to deliver consistent quality of service at all times.
While customer expectations are higher than ever, a recent survey found that 86% of buyers would pay more for the same product, but with better service. Brand loyalty is now truly about the brand, not the product. Customers want to feel valued and looked after throughout the customer journey, and it’s great customer experience which makes that happen.
Looking forward, data is going to play a major role in reaching customers before they react to you. Personalization is already enormous – and it’s only getting more important.
The role of data in curating customer experience
Big data is another trendy catch phrase, but its impact in just the past few years has been incredible. Business users have access to unprecedented amounts of data, from virtually unlimited sources. What this means is that it’s now possible to build up highly accurate user profiles and tailor the customer experience to each individual customer.
There are a number of powerful machine learning and AI-powered systems which, if your data is all organized and stored in one central location, can derive real-time insights to help guide your decision making. You can get more personal than you ever have before, something which modern consumers crave. You can respond faster to customer interactions.
Big data analysis offers unlimited scope for improving your customers’ experience. However, finding the right systems to leverage all that data is the hard part. In the next few years, the role of data is going to become more and more prevalent.
ROI: Does investment in CX always work?
A quality experience is crucial for a majority of buyers in 2019 – or is it? KPMG found that failing to meet customer expectations has twice the negative impact as delighting them has a positive impact. In other words, is there a minimum standard of CX where businesses can sit comfortably, without the requirement to invest above-and-beyond what’s financially necessary?
Poor customer experience will mean customers turning their backs on your brand, but an exceptional experience might not provide economic value to your business.
The key is to invest wisely in customer experience, not blindly. Solutions to improve CX are coming under increasing pressure to demonstrate tangible ROI to investing businesses. Without a clear correlation between CX and key financial measures, businesses could be spending huge sums for, in the end, no monetary gain.
Does better CX mean higher profits?
I think we can hedge our bets here and say “not necessarily” – it depends where your customer experience is at right now. If the majority of your customers are happy interacting with your brand, then costly CX improvements might only provide small financial gains – if any.
But for companies whose customer experience is average, or even poor, improvements are almost certainly going to impact your bottom line. Imagine a company which sells a top quality product and a suitable price: they have quite steady business because the product is top notch, but the customer experience is average.
By making positive changes to delight customers at every turn, that company is likely to see a tangible boost in its bottom line. So if you’re looking at your own customer experience, try asking yourself: Where is their experience at today? The results might surprise you.
The future of customer experience
The horizon is dominated by the impending impact of data on customer experience. Big data will (and already is) allowing marketers to deliver more sophisticated CX than ever before, and the tools and systems are only getting more powerful.
Another technological aspect of modern customer experience is the chat bot. The algorithms keep on improving, and there’s quiet optimism that chat bots might just secure a valuable role in the customer service hierarchy: they won’t replace human operators, but they can serve admirably in high-volume, low-complexity roles.
Customer experience has changed so significantly in the past 2-3 years that it’s impossible to predict what the future might look like. The next 5 years we can speculate on, but 30 years? 50?
We can assume that technology will allow us to gain now-unimaginable insight into the lives, habits, emotions, and actions of potential customers – but will the consumers allow it? Highly accurate user profiles and predictive analytics have unnerved more than a few people in the last few years, and we’re fascinated to see how it develops in the years to come.
