What is Customer Experience (CX)?

What is customer experience? How is customer experience important for your business? How can you measure customer experience? You will have so many such questions relating to customer experience. All your CX questions will be answered here.

 

woman holding fork in front table

There has been a great buzz around the growth of Customer Experience (CX) as the key differentiator. Here are some key facts that prove the customer experience has fast become a top priority. 

81% of companies view customer experience as a competitive differentiator.

84% of companies that work to improve their customer experience report an increase in their revenue.

Brands with superior customer experience bring in 5.7 times more revenue than competitors that lag in customer experience.

But, what exactly is customer experience? 

Customer experience is a combination of a lot of elements, but it’s predominantly the perception a customer has of your brand. You might think that your brand is offering an exceptional customer experience, but if the customer perceives it as something different then that is the actual customer experience according to your customers. 

The customer experience (CX) emphasizes the relationship between a business and its customers. It encompasses each and every interaction irrespective of how long or short the interaction is, and whether it will lead to a purchase or not.

Customer Experience (CX) Definition

Gartner defines customer experience as, “Customer’s perceptions and related feelings caused by the one-off and cumulative effect of interactions with a supplier’s employees, systems, channels or products.”

Customer experience is the outcome of an interaction that a customer has with your business. It starts from the time customers navigate your website, talks to your executives, buys the product, and uses the product. 

Customer experience covers every component of a company’s offering, including ads, packaging, product and service functionality, ease of use, and reliability, among others. However, few of the people in charge of those items have given much thought to how their individual actions impact customer experience. To the degree that they consider it, they all have different perspectives.

So clearly, customer experience is a combination of two important elements:

What is Customer Perception and Customer Interaction?

i) Customer Perception

The customer collects information about a product and interprets the information to make a meaningful image about a particular product. This is called customer perception

ii) Customer Interaction

Customer interactions with a brand relate to all the touchpoints starting from browsing your website, searching for your product information, talking to customer care executives, and goes all the way up to buying and post-purchase support. 

To summarize, Customer Experience (CX) is the overall perception of a brand created as a result of the numerous touchpoints that a customer has with a brand.  

In today’s technological world, customers are well-read and well-connected than ever before. With an increasing number of outlets to express their experience, customers are openly providing their feedback about brands like never before. 

During a customer journey, touchpoints are connections between companies and customers. These moments have a big impact on the customer experience and brand perception. By highlighting the key touchpoints on a map, businesses can take advantage of timely opportunities to optimize the customer journeys.

The touchpoints might be slightly different for each industry. 

Customer Experience – Touchpoints by Industry

a) D2C Brand

A D2C brand can sell directly on its own brick-and-mortar store or an eCommerce website. For a D2C brand, their first touchpoint is engaging consumers through content by building unique brand-centric information that educates, informs, and inspires shoppers. For example, Patron serves creative cocktail recipes that are based on personal preferences, educates and inspire consumers to try new things while keeping Patron top of mind. 

The next important touchpoint for a D2C brand is a fully functioning e-commerce website. The website should be able to offer an assortment of company products while providing convenience for shoppers who want to purchase directly. For example, Nespresso’s digital store offers a great coffee shopping experience. Shoppers can see and select Nespresso’s full range of coffee products, coffee machines, and other accessories. Not just products, it also offers educational content on care tips for their Nespresso products. 

b) Banking 

Banking touchpoints are particularly different due to their highly private and formal nature. In a banking environment, customers interact either in person or using a mobile application, or via a website. The call center is the most common touchpoint in a bank as many still prefer to talk with a support team to get quick information. Online banking systems such as the website and mobile banking apps enable customers to receive online support any time they need it.

c) Hotel Industry 

Hotel industry touchpoints are entirely different from other industries. The touchpoints start from the time of contact for the hotel as a prospective guest.  The touchpoints for customers start right from visiting the website, sending emails, check-in and checkout, and all the way up to promotions and discounts.

d) Utility Services

Utility services such as telecom, power, and water need to understand the complete customer lifecycle with its associated touchpoints. Of the many touchpoints, the most important ones are product search, product selection, billing and payments, renewals, reporting incidents, and customer service.  

e) Automotive and Transport Industry

These industries engage with customers in many different ways. Consumers are increasingly expecting a seamless experience across both digital and physical touchpoints. Customers interact using mobile and tablet applications, emails, online chat, kiosks, physical showroom, personalized contact with salesperson, wearable virtual reality device, among other means. 

Taking advantage of the growing communication channels, many brands are turning towards customer experience platforms to tap into the customer experience insights, thereby getting an opportunity to improve customer experience.

Why is Customer Experience (CX) Important for Your Business?

“Achieving customer love is the single most important criteria for business success,” says Howard Tiersky, the bestselling author of Winning Digital Customers.

Customer experience is fast becoming a top priority for businesses. But, why are so many brands focusing on the customer experience, and what happens to companies that choose to ignore it? 

In the past brands were competing on product quality and pricing front but now customer experience has taken over as the key differentiator. When customers are not delighted, they easily switch brands and move to a brand that offers a better customer experience. This makes customer experience far more crucial for businesses. 

Brands that get this fast and right will go on to create long-lasting customer relationships.  

Today, customers want brands to move one step forward and anticipate their needs. Customers look for delightful and memorable experiences when they shop online from their favorite devices.  

In fact, 50% of customers are ready to switch to a competitor brand immediately after just one bad experience. But when there is more than one bad experience, the number magnifies to 80%!!

A single bad customer experience has the capability to damage a brand and ultimately it can impact its bottom line. Therefore, businesses are making all efforts to improve customer experience.  

Brands have come to learn that customer experience matters in many ways: 

  • Increases revenues
  • Strengthens brand preference
  • Deepens customer loyalty
  • Lowers costs by reducing customer churn

No doubt, customer experience is the new path to go.  

And more so because – 73% of companies with above-average customer experience perform better financially than their competitors.  

Top 10 Reasons Why Customer Experience Is Important to Your Business 

1. Great Customer Experience Builds Great Reputation

According to a study, After having a positive experience with a company, 77% of customers would recommend it to a friend. 

Consider how pleased a client would be with your brand if they get outstanding support. As a result, the consumer will spread the word of their positive experience to their friends and families.  

90% of people are more likely to trust and buy from a brand recommended by a friend. People trust when it comes from known people, and are more likely to buy.  

It’s no surprise that word-of-mouth is the most effective marketing tool. You can transform your customers into your best and most cost-effective means of word-of-mouth ads – but only if you have excellent customer experience.  

“Word of mouth will never go out of style. It is, and will remain, the #1 way people make choices about brands.” Jamie Turner, Author, Speaker, and CEO of the 60 Second Marketer.  

customer experience

A great example of this is the Carolina Panthers online shop. To improve the customer experience they redesigned their website to look amazing and be easy to use across all devices. 

They started getting positive feedback for their new website. Based on word of mouth, they saw an 83% increase in mobile conversions.  

2. Customer Experience Improves Customer Retention

 Are you aware of the significance of customer experience in retaining customers?  

75% of customers will stick to a business that provides outstanding support. 

Getting a new client can be five times more expensive than keeping a current one. Selling to an existing client has a 60-70 percent success rate, whereas selling to a potential customer has a 5-20 percent success rate.  

Customer satisfaction is the product of an excellent customer experience. Strong customer care, on the other hand, stops people from going to the competition. Customer experience, not a brand’s exclusive quality or service, keeps them coming again.   

JP Morgan Chase is living by this trend by introducing the “Everyday Express” branches. Here customers have access to a “Digital Advice Bar” to receive financial advice.  

customer experience

In these express branches, customers get to access simple services such as opening an account, video conferencing with the bank’s specialized staff to resolve some complicated customer issues. This was a super hit as it offered an excellent customer experience for a whole lot of customers who use online transactions but yet need advice when it comes to more complicated financial issues.  

3. Exceptional Customer Experience Boosts Revenues 

Bain & Co reports that “Companies with superior Customer experience grew revenue 5 times faster on average than their competitors with inferior customer experience.”  

The golden key to a profitable company is excellent customer service. Customer service is essential in addition to having a fantastic product or service that can boost revenue.  

Jon V. Ferrara is an American entrepreneur, and the founder of Nimble LLC, says, “Improve customer service, increase sales.” 

Better customer service = improved bottom line.  

AO.com wanted to expand into the AV category. It started by acknowledging that they want to put the user experience at the heart of the new offer.   

The starting point was the consumer insights that demonstrated AV consumers wanted to view the product from any device and wanted the site to perform equally as well across all devices.   

When AO.Com reviewed the AV market, it concluded that it was tired, static, and really not meeting the needs of the consumer. Consumers were tired of the overcomplicated offers, jargons, and the ranges that were hard to distinguish. 

The band swung into action and started supporting the consumer journey by demystifying the jargons, explaining technologies, 360-degree visuals to recreate a showroom experience online, videos explaining the features, offering curated collections to help them buy the right TV for their individual viewing needs.   

The results were astonishing. Their average order value moved up by £50 higher than the market average.  

4. Excellent Customer Experience Drives Customer Lifetime Value (CLV)

 CLV definition – Profit a company can make of one customer over time. The longer a brand can keep a customer, the greater is the CLV. To grow the CLV, your customers should shop more frequently. Your customers should spend more money on your business.  

So what is the secret to getting consumers to buy and pay more? 

Highly engaged customers buy 90% more frequently, spend 60% more per transaction, and have 3 times the annual value compared to other customers. Customers who had better previous experiences spent 140 percent more than customers who had worse previous experiences. 

Customers are happy because they have a positive shopping service, which leads to more sales. 

For example, see how One customer in Turkey ordered from ‘Amazon Germany’ and was surprised when he saw the estimated delivery time and shared a tweet.  

customer experience One of the Amazon employees replied to the tweet saying even she was curious to know if the product will be delivered in one day and she did sign her name at the end of the tweet which is quite unknown among other brands.   

When the customer received it within one day, he again tweeted with disbelief that he had indeed received the package as promised by Amazon.   

This went viral as the customer experience here was exceptional. A company like Amazon offers exceptional customer experience which makes shoppers come back again and again. 

5. Customer Experience Develops Competitive Advantage

 Customer experience excellence is one of the most important ways for a company to set itself apart from the competition. A customer’s decision to return to you or to go to a rival is dependent on their previous encounter with you. 

 According to research, – “57% of customers have switched to a competitor to get a better experience.” 

 As a result, positive consumer engagement is critical to the company’s growth. Businesses must begin setting the groundwork for delivering outstanding customer service now and in.

customer experience

Sainsbury’s, a UK supermarket chain,  received a letter from three-and-a-half-year-old Lily Robinson. Their “tiger bread,” Lily thought, didn’t imitate a tiger’s stripes at all, but rather a giraffe’s style. Sainsbury’s decided to completely rebrand one of their brands. It agreed with the little girl and created new brands to spread Lily’s wisdom with other customers.   

Takeaway – Lily and her mother were probably surprised by the response they received. Sainsbury’s was able to take a customer recommendation and deliver on it quickly and significantly. 

Based on a research report, 67% of churn in customers is preventable.  

When the problems of the customer are solved during their first interaction, they become happy. Besides, if you provide excellent customer service, you will retain your customers. Furthermore, you will acquire your competitors’ customers, as well.  

6. Customer Experience Establishes Greater Brand Awareness 

It is no longer enough to create successful goods and services to compete in today’s business world. The importance of a positive customer experience cannot be overstated.  

“A brand is no longer what we tell the consumer it is — it is what consumers tell each other it is.”- Scott David Cook, Director of eBay and Procter & Gamble.   

Consumers don’t know your existence there is no brand awareness, hence they can’t purchase your product or service. When a customer remembers your brand from a previous encounter with it, brand identity is born. That might be anything as simple as seeing your badge or hearing from any of your new customers. You will increase brand value by providing a positive customer experience.  

You will be surprised to know that 85% of consumers trust reviews as much as personal recommendations.  A study showed that people read as many as 10 reviews before making a purchase. Consumers wish to learn from other people’s experiences before trusting a product enough to do the same.  

For example, see how the bright orange stars on a product review, the ratings, and the number of reviews establishes greater brand awareness to search users. 

The customer experience of your customers helps you stand out from every other listing and build trust early on in the funnel even before shoppers visit your website.   

customer experience

 

The 5 star rating becomes even more impressive when you consider the number of reviews received which is about 3K reviews for Natural Baby Shower. 

7. Great Customer Experience Brings About Reduction in Marketing Costs

From studies it is evident that businesses that invest wisely in improving customer experience will help you cut costs and expand, particularly in industries like insurance, oil, telecoms, and banking. 

That’s particularly true when it comes to creating a great customer experience journey—those set of interactions a customer has with a brand to get something done. If something seems to be too amazing to be real, the evidence proves it.  

We know that brands that can boost the consumer journey can see a 10 to 15% rise in sales while still lowering their cost to serve by 15 to 20%.  

Is it really possible? The truth is that there are major inefficiencies throughout the average consumer experience, which also entails several touchpoints handled by several departments within a company (website, sales, call center, etc.).  

For example, a call center may respond to a consumer complaint but fail to find the root cause, which ensures that other customers may continue to complain about the same problem. Alternatively, a frustrated customer could be forced to repeat information already delivered. And, as consumer experiences get more complicated as a result of the introduction of emerging technology and platforms, inefficiencies become more likely.  

Procedures are often duplicated, inadequate standardization causes inconsistency and slows down the overall operation, and entrenched patterns make progress difficult. Who is the one who suffers? Not only the consumer, but the business as a whole, in the form of expensive waste.  

Creating efficiencies that can create a fantastic consumer journey experience is an important driver of development at the same time.   

As per research, when consumer service success is just average, core metrics like “likelihood to remain/renew” or “likelihood to purchase another commodity” are 5 to 10% lower per year in industries. But improving customer experience from average to “wow” is worth 30 to 50 percent more in those same industries. 

Therefore, when it comes to customer experience, brands are too often rooted in an either/or mentality. In order to achieve success and cost efficiency, businesses must have a wider perspective of the advantages of delivering outstanding consumer journeys.  

8. Customer Experience Builds Brand Loyalty 

Customer loyalty happens when a customer comes back to purchase your product irrespective of the situational factors around your brand. Psychological studies have proved that brand loyalty is intrinsic to the behavior of the human mind. Brand loyalty retains with the customers due to the great customer experience that accumulates using various products.  

A study reveals that 52% of consumers continue to use a brand even after finding a cheaper deal elsewhere. Such is the strength of great customer experience.  

SuperValu stores have a unique approach to gathering customer input to ensure that our consumers really get the “WOW” element. So, what did SuperValu do?  

SuperValu held interviews with 12 consumers twice a month to determine the true worth of their goods. They were sent questionnaires about the product’s price and cost, service levels, and ad promotions.  

The constructive customer feedback was registered and used to test the store managers in order to improve their planning process.  

Listening to customers will get you customer loyalty. It makes it easier to match your program to their needs. 

9. Customer Experience Creates a Point of Differentiation 

What differentiates your business from the competition? Most people consider differentiation to be a function of their product. However, differentiating yourself from offering the right goods or the best pricing is no longer a feasible tactic.  

Your competitors are also doing the same by positioning themselves — offering products and services, and pricing commodities. But as Gartner VP Jake Sorofman said,  

“As competition and buyer empowerment compounds, customer experience itself is proving to be the only truly durable competitive advantage.” 

Customer experience is quickly becoming a top priority for nearly all companies. An identical product is offered by two firms – What criteria will consumers use to choose one of them? It can sway a person’s decision if friends and family have suggested one of the two. The choice is almost always based on a positive consumer experience.  

customer experience

For example, Oscar Health Insurance uses simplicity to differentiate itself in the healthcare marketplace. For a common person, healthcare is rather a daunting subject. Keeping this in mind, Oscar wanted to make medical coverage personable and easy to understand. Oscar Health Insurance designed a user experience (UX) that allows customers to browse their website and learn about various plans for which they’re paying, help to buy their desired plan, and extend support by a doctor to customize their products. This differentiation offered by the brand makes the company truly shine in its market. 

Companies that have an exceptional customer experience foster a culture of customer champions. This would result in a complete circle of customer loyalty. Customers not only promote the brand, but they still return for more. Great customer service allows you to keep tabs on your existing clients while still serving as a point of distinction for potential new customers.  

10. Customer Experience Adds Value to Your Products and Services 

A high-quality product or service is just half the battle when it comes to drawing consumers to your business. So, how can you convince them to pick you over hundreds of other deals of equal or lower prices?  

You can bring a lot of value to goods and services by providing different types of customer service depending on the amount of money the customer is likely to pay, how much they shop, or how influential they are.  

Most people are indeed happily willing to pay more for the same product or service only when it comes to great customer experience. Good customer service can justify a higher price tag on your product or service.  

85% of consumers are ready to pay 25% more for better customer experience, says a research study.  

Thus Customer experience has become very important for all brands for customer retention, to build customer loyalty, to develop competitive advantage and a host of other benefits.   

Casper, a small startup sells mattresses and sleep-related items, as well as hosting a one-year conference on sleeping in just 40 minutes. Casper’s sleep specialists developed the Insomnobot3000 chatbot specially for people who have trouble sleeping (insomnias). 

customer experience

How did Insomnobot3000 function? The chatbot was available for customers between 11 pm and 5 am, and anyone who wanted to chat had to just text Insomnobot3000 from their smartphone. The chatbot kept company by giving some advice and also initiating an interesting conversation. This provided an excellent customer experience for Casper customers.

Conclusion

An outstanding customer experience is indispensable for the continued growth of a business. When customers are happy and pleased with the interactions they have with your business, it leads to positive customer experience which thereby promotes customer loyalty, repeat customers, retains customers, and encourages brand advocacy.

What Is The Difference Between Customer Experience And Customer Service?

customer experience 

We often see people using the term ‘customer service’ and ‘customer experience’ interchangeably, whereas in reality, they both are not the same, but yes, they are related.

What is Customer Experience?

Customer experience is the perception based on the interactions at different points of the customer journey. Whereas customer service is just a small portion of the entire customer experience. Customer service is a specific touchpoint from among multiple touchpoints where a customer interacts with the brand.

What is Customer Service?

Customer service refers to the help provided to customers both before and after they buy something. Simply put, customer service is a component of a total customer experience. Customer service refers to a single instance during which a customer seeks assistance and support. For example, when a customer contacts the call center asking for assistance in purchase returns.

Differences Between Customer Service & Customer Experience

Customer experience and customer service are equally critical to your company’s success. You can’t do one well without the other, which is why understanding what they are and how they vary is crucial.

After understanding what customer service and customer experience are, let’s try to understand the difference between them:

i. Holistic vs Interaction

Customer Experience: The whole customer journey is referred to as the customer experience. This includes everything from initial exploration and knowledge of a company to initial purchase and post-purchase treatment, with the goal of repeat purchases. As a consequence, it requires several touchpoints and necessitates the involvement of several departments in order to have a positive customer experience. Each customer journey will be unique, but they will all include several interactions with a company.

Customer Service is a part of the customer journey: it’s one of the steps. Some customers may not need customer service, whereas others will need many interactions during their journey. Customer service’s job is to assist customers by resolving their problems, thereby improving their overall customer experience. This usually requires just one or two touchpoints and involves the work of customer-facing departments. Customer service, in this sense, refers to a specific customer relationship with a company.

ii. Reactive vs Proactive

Customer Experience: In customer experience, it’s all about anticipating the customer’s needs. Businesses constantly work to enhance the customer experience to ensure consumers don’t run into problems by mapping out customer journeys, analyzing funnel drop-off points and website metrics, and soliciting customer reviews. This may include directing customers to start a customer service conversation if necessary. This makes customer experience proactive and not waiting for the problems to occur.

Customer Service: The customer is almost always the one who initiates customer service. When a customer has a complaint, they contact a company’s customer service department through their preferred methods, such as phone, email, social media, or live chat. Customer service is reactive in this way.

iii. Ongoing vs One-time

Customer experience is a continuous relationship. Consumer experience refers to a customer’s engagement with a company. It is difficult to measure or assign to a single event or interaction. If a customer returns to the company, their customer experience continues.

Customer service refers to a single incident, such as a customer seeking assistance or filing a complaint. A variety of metrics, such as first-time resolution rate and average response time, can be used to determine the incident as a whole. In this way, customer care is a discrete, quantifiable case.

To sum up, Customer service is the assistance given to a customer on communication and any other problems faced by customers so that customers get the best out of your service.

Customer experience is the overall impression that you leave customers in every stage of the customer journey.

What is a Good Customer Experience?

Consider the last time you had a truly exceptional customer experience, and consider how you felt afterward. Do the same thing about the last time you had a bad customer experience.

Customer experience

So what is a good customer experience? What really makes for an excellent customer experience? 

Simply put an exceptional customer experience is something that keeps customers coming back again and again, while they continue to spread the word about the good customer experience that had with you. Good customer experiences trigger an emotional bonding with your business.

A positive customer experience is critical to your company’s success because a satisfied customer is more likely to become a loyal one who can help you increase revenue. A customer who is loyal to your company promotes your business through word-of-mouth marketing, and advocates for your brand and product or service is the best marketing money can buy.

When customers meet the goal of using the product or service of a company effortlessly, then it results in a good customer experience. Customer experience is all those small ‘wow’ moments that excite customers and make a lasting impression.

An exceptional customer experience is your advantage over your competition!

Examples of Good Customer Experience

Emotions are at the core of a good customer experience.

According to the Journal of Market Science, more than 50% of an experience is based on emotion. Customers become loyal because they are emotionally invested in the business.

Friends asking friends about their own personal customer service encounters is no longer the only way to spread the word. Word of mouth has changed significantly as a result of the internet and social media, with small-town news often becoming national headlines overnight.

Many shared activities and even staged marketing campaigns showcasing outstanding customer service examples have been held, and the results have been phenomenal for the organizations involved.

People seem to like being witnesses to a good customer experience tale, whether it’s through marketing campaigns or individual examples of excellent customer service. People share these moments, resulting in fantastic publicity for brands, which helps them both in reputation and in customer loyalty.

As a result, we’ve decided to share some of our favorite customer service success stories with you. Some were staged advertisements, and others were one-off acts of outstanding customer experience.

Take a page from these companies’ playbooks and have an unforgettable customer experience that will transform your customers into your most ardent supporters.

Take a look at these examples of good customer experience and how you can apply what you’ve learned to get your customers talking

a) Zappos

Zappos provides one of the best examples of creating an emotional connection.

Owing to the death of her mother, a customer was late in returning a pair of shoes. When Zappos learned of the situation, they handled the return shipment and had a courier pick up the shoes for free.

Zappos, on the other hand, did not stop there. The customer returned home the next day to find a bouquet of flowers and a letter from the Zappos Customer Success team expressing their condolences.

b) Glossier

Glossier tapped into its millennial female audience through its growing social media platforms to learn more about what they wanted and why they came to Glossier. Glossier catered to women looking for low-maintenance makeup rituals.

When asked about Glossier’s performance, Weiss told Entrepreneur, “Conversations are really important. What choice do you have but to ask your customer what they want?”

You can create wonderful customer experiences just by listening to customer conversations.

c) Ritz-Carlton

Ritz-Carlton’s customer service practices are so well-known that consumer testimonials have also been published in books, such as this one.

When John DiJulius left his charger in his hotel room, he says,

“I left The Ritz-Carlton Sarasota in such a rush for the airport that I forgot my laptop charger in my room. I planned to call when I got back into my office, but before I could, I received a next-day air package from The Ritz-Carlton Sarasota. In it was my charger, with a note saying, ‘Mr. DiJulius, I wanted to make sure we got this to you right away. I am sure you need it, and, just in case, I sent you an extra charger for your laptop.” 

The note was signed by Larry K. Kinney, in Loss Prevention.’

Importance of Customer Verbatim

Customer verbatim expresses deep feelings of positivity or negativity upon using a product or a service. 

Analyzing customer verbatim helps brands to better understand your customers’ sentiments while offering a new perspective on feedback. 

For example, the below verbatim collected by Clootrack as part of its research on US TOP hotels highlight the good customer experience encountered by the customers.

 “Great location right next to WTC and oculus and close to Brooklyn bridge, si ferry”

“It’s on the edge of Little Tokyo”

“Located centrally on the strip and with a direct connection to planet Hollywood”

“The location was perfect and accessible both to convention center and downtown”

“Convenient location with quick access to public transport”

“Close to boat rides & walking distance to many restaurants”

“All staff are friendly & very hardworking

“Comfortable rooms , excellent customer service”

These customer verbatim give a clear picture of what factors made them happy and gave a pleasant customer experience.

What Is Customer Experience Strategy?

Customer Experience Strategy 

A clear action or a plan taken in order to improve customer experience calls itself a customer experience strategy.  CX strategy is a road map to achieve, deliver, and measure the progress of all customer experience activities of the business.

A customer experience strategy should be able to guide you to decide on the steps to be taken to deliver a remarkable customer experience across all the customer touchpoints.

When a brand designs the right CX strategy and employs an effective customer experience platform, it not only helps to measure and improve customer experience it also reduces cost and allows you to gather the much-needed edge to stand out from your competition.

5 Ways to Create a Customer Experience Strategy

Let’s take a look at 5 ways to design a great customer experience strategy.

1. Define your Ideal Customer Experience

You must have the end goal in order to know what to create. Steve Jobs expresses himself in this manner.  

Steve Jobs said – “beginning with the customer experience and working backward to the technology.”

Designing a simple customer experience strategy is the first step in customer experience management. It is essential for a company to clearly convey its desired experience to the entire organization once it has been identified.

Creating a series of statements that function as guiding principles is the easiest way to describe this ideal strategy. Assist staff in understanding the various levels of the customer experience. Determine the chances for the workers to make a good impact. 

We focus on making sure we have a great service-focused culture. If you get the culture right, then a lot of really amazing things happen on their own.” – Tony Hsieh, Former CEO @ Zappos

Customer experienceZappos’ customer service strategy comes down to staying true to one key principle – To live and deliver WOW.

Just to quote one example of their great focus on customer experience, Zappos had designed a new hire boot camp for 4 weeks. Here Zappos go over company history, their focus on customer service, and the company’s long-term vision. They even arranged the new hire on the phone for two weeks in the call center to take calls from the customers so that they know how much the company is tuned into customer service.

2. Know Your Customers 

You’ve already nailed down your perfect customer experience. The following move is to get to know and understand your clients. Only by really understanding your customers’ needs and desires would you be able to communicate and empathize with them.

Making buyer personas is a good place to start. It’s a type of audience profile that lets you figure out who your customers are. These buyer personas are designed to help you get into your customers’ heads and gain a better understanding of who they are.

For example, you will be able to craft a clear buyer persona as below:

  • Woman between 25 to 45 years, who lives in the US, and works in the fashion industry.
  • Interests are health and fitness, weight management, fashion clothes.
  • Driven towards healthy living, healthy products, organic products
  • Reasons for not buying are price and quality

The buyer persona is sufficiently detailed to comprehend the different characteristics of your ideal customer.

This is how the buyer personas were created and used in the Spotify campaign. When enough information about the target group was available, personalized messaging was used to build a sense of familiarity.

Customer Experience Strategy

See how PepsiMax used personas to advertise on Spotify. Pepsi discovered that when the weather gets hot, consumers are more likely to drink Pepsi. They quickly formed a relationship with a business to fund summer activities. They used over 650 audio spots to raise awareness, with the aim of reaching people aged 18 to 49. Each audio spot was designed to concentrate on a specific summer.

3. Measure Customer Experience 

You’ve devised an excellent customer service plan. Can you say if your customers had a WOW moment, though? Unless you measure it, you won’t know.

“Companies are increasingly using customer analytics techniques like customer satisfaction analysis, customer engagement analysis, and customer journey analytics to understand and improve CX.” — Forrester, The State Of Customer Analytics 2017

Since customer experience is becoming more important, many large companies are using more than 50 CX metrics. The metrics are either owned by the organization or outsourced to third-party organizations to administer.

Here are 5 types of metrics to measure customer experience:

I. Customer satisfaction (CSAT)

The conventional way of gathering customer feedback is through customer satisfaction surveys (CSATs). One approach is to use survey questions that inquire about satisfaction to gather feedback. Another option is to inquire indirectly through product reviews or shopping ratings.

II. Customer loyalty metrics

Customers are polled on their experience with the product and their chances of staying with the brand in this measure. Customers are often questioned on their shopping preferences and pace, as well as their preferred buying outlets, loyalty card reviews, and so on.

III. NPS or Advocacy or Endorse metric 

  1. The aim of this metric is to gather input from consumers about how likely they are to recommend your products to their friends and family. It can be collected in a variety of forms, including social media ratings, web forums, price sensitivity, confidence ratings, opinion scores, and more.

IV. Quality metric

All measurements should prioritize product or service efficiency. Naturally, the consumer experience would be low if the product does not meet the quality standards. As a result, product satisfaction must be measured alongside all other measurements. Furthermore, capturing all other consumer service metrics is pointless without this measure.

V. Employee engagement

What is the relationship between employee engagement and customer experience?

Employee involvement was described as a key predictor of consumer loyalty in a survey. Employee engagement is rated equal to or higher than other customer experience tactics by 86 percent of organizations. As a result, gauging employee commitment becomes a crucial feature of the customer experience.

There are several other metrics that can be used to measure consumer satisfaction. However, below are some of the most important ones that can not be overlooked.

Rather than relying only on the CSAT, pay attention to all of the metrics. Consolidating input from related indicators and turning it into a CX dashboard would be perfect. This will be distributed to all departments, allowing the whole organization to benefit.

4. Customer Experience Gap Analysis Using Tools and Techniques

Now it’s time to move on to the next step: gap review.

The CX dashboards are already in place. You may be faced with any unforeseen or surprising CX results.

According to a survey, 80 percent of firms claim they are offering outstanding customer support, but only 8% of consumers approve. 

This is a startling statistic!! If you thought you were providing a fantastic consumer service, think differently!

When you don’t look at the specifics, you might end up with a tragedy. This is precisely what happened to K-mart. They were certainly calculating CX, but not in the proper place. They took a survey to determine total happiness, and everything seemed to be in order. What they didn’t see was the significance. Customers who were happy did not spend more money, while those who had invested the most money were disappointed. . They failed to notice anything in the big picture.

Is this something you’ve learned before? In any situation, you’ll need to perform a consumer experience gap analysis.

A gap analysis is a technique of analyzing your present output in order to determine the inconsistencies between the current and ideal level of customer experience. This is mainly achieved by concentrating on three questions:

  • How is our current Customer experience?
  • What is our actual goal?
  • What are the plans to close the gap?

Social networking listening, customer reviews through polls, Customer Relationship Management Systems, customer tickets, online user forums, and other tools and techniques can be used to gather customer experience.

Customer experience can be measured and segmented using the methods and strategies, and then addressed using a CX approach. Since the consumer problems can vary, each section of the customer experience will necessitate a separate approach. As a consequence, it’s vital to create personalized messages for consumers in order to capture their hearts.

5. Improve Customer Experience Strategy

This is the final step of the customer experience management process before it loops back around.

You should have ample information on whether consumers are pleased or dissatisfied with your goods and services by now.

Create a good customer experience approach focusing on what matters to the customers based on customer experience insight. True CX management is assessing the actual state of the offering in comparison to what consumers expect. Companies who build on current plans will emerge as winners as desires and wishes change often. 

Customer Experience Strategy 

Uber is a perfect example of how to improve customer experience. The wait time was identified as Uber’s main consumer pressure point. Customers were judging their overall consumer experience based on how long they had to wait. This meant that they needed to repair this big-ticket item in order to have an outstanding customer experience. Uber looked at the holes in the industry and devised a strategy to plug them.

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