CX champions often face challenges if they start new initiatives around customer services. It often isn’t as easy to see the value of customer experience as it is to see the ROI of other investments. However, customer experience is incredibly valuable. Executives often won’t invest in customer experience without “proof,” even if the writing is on the wall. Here is actual proof you can share with your teams. Without a customer focus, companies simply won’t be able to survive. We are living in a time where we face the commodity trap. Too many of our products and services are the same. To stand out in a sea of sameness, CX is the only way to do that. These statistics prove the value of customer experience and show why all companies need to get on board.

Companies with a customer experience mindset drive revenue 4-8% higher than the rest of their industries.

Companies that lead in customer experience outperform laggards by nearly 80%.

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

73% of companies with above-average customer experience perform better financially than their competitors.

96% of customers say customer service is important in their choice of loyalty to a brand.

83% of companies that believe it’s important to make customers happy also experience growing revenue.

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

73% of consumers say a good experience is key in influencing their brand loyalties.

Customer-centric companies are 60% more profitable than companies that don’t focus on customers.

Loyal customers are five times more likely to purchase again and four times more likely to refer a friend to the company.

Companies with initiatives to improve their customer experience see employee engagement increase by 20% on average.

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

68% of customers say the service representative is key to a positive service experience.

The top reason customers switch brands is because they feel unappreciated.

64% of companies with a customer-focused CEO believe they are more profitable than their competitors.

75% of customer experience management executives gave customer experience a top score for being incredibly important to business.

Companies that use tools like customer journey maps reduce their cost of service by 15-20%.

Offering a high-quality customer experience can lower the cost of serving customers by up to 33%.

71% of the companies say the cloud has influenced the customer experience.

Customers are likely to spend 140% more after a positive experience than customers who report negative experiences.

A 2% increase in customer retention is the same to profits as cutting costs by 10%.

Data Source- Forbes

It’s the age of the customer and the world’s biggest brands are duking it out every day for a greater share of our hearts, minds, and wallets. Customers hold more decision power than ever in an era where information about any company’s products and services is just a mobile search away.

Where does the Voice of the Customer (VoC) land in the priorities for your company’s overall strategy? Forrester’s Customer Experience Council survey shows that 79% of all respondents believe that measuring customer experience is a top priority.

Market research shows that the Customer Experience Management (CEM) market is estimated to grow from USD 5.06 Billion in 2016 to USD 13.18 Billion by 2021, at a CAGR of 21.1%.” If you’re not investing in CX, it’s very likely that your competitors are.

The stage has been set – now let’s jump right into the top Reasons to Invest More in Customer Experience (CX):

1. The ROI customer experience

Building customer loyalty and increasing revenue go hand in hand. When compared with customers who had negative experiences, those who had positive experiences were more likely to recommend, trust, try new products or services, purchase more, and forgive your company after a mistake.

2. What gets measured gets done

Measuring customer feedback is the first step to measuring up to your customers’ expectations. Whether you’re an advanced scorecard-driven enterprise or just beginning to think about CX, the most important thing to do is to start actively listening and measuring your customers’ feedback.

3. Time to set new customer experience goals

CX is not as fluffy as it may seem. There is real science and methodology to measuring and improving customer satisfaction (CSAT). There are many metrics to consider as part of your VoC program, but Bain & Company’s Net Promoter System and Forrester’s Customer Experience Index stand out as the gold standard top-line measures in the CX industry.

4. Elevate your operational performance

Operational performance and CSAT are inextricably linked. For example, it’s no coincidence that airlines with the best CX ratings also boast the highest percentage of on-time arrivals. The best CEM programs cause cross-functional customer-centric collaboration, which requires your company to break down organizational silos to be more valuable, efficient, and enjoyable to your customers.

5. Put the customer at the center of every decision

Your customers see you as one whole cohesive brand, regardless of how complex your organization, systems, and processes might be. When your customer interacts with your company, they don’t care about any bureaucracy, different divisions and departments, or roles and hierarchies.

6. Plug-in and empower your employees

Ready to take your CX program to the next level? Tap into your company’s most valuable assets – your people. The more customer-facing employees with access to a real-time view of customer feedback, the more awareness, focus, and unity there is around your company’s CX mission and goals.

Customer satisfaction is the key to customer retention, and it is a critical cog in the wheel for any growing business. That said, there is no real measure of customer satisfaction and what you don’t know could hurt your business.

Satisfied customers are also crucial to any business in more ways than one. First, they are bound to buy more products or services over a shorter period. Second, once you can establish customer loyalty, they will partake in word-of-mouth showing their advocacy. Third, they are bound to bring in referral customers to your business. Thus customer satisfaction adds a lot of value to a business cycle.

It is a known fact that a business will not act on a laundry list of improvements just to satisfy a few customers. However, it is essential to analyze the cause of why the laundry list exists and look for changes or developments that the entire customer group can take advantage of. So, a dedicated customer service team is essential to keep the ball rolling. Similar to the above, there are certain customer satisfaction myths that this piece looks to debunk.

Myth #1: Customer loyalty takes precedence customer satisfaction

This is highly misplaced assumption, and where loyalty is essential, satisfaction brings better results in abundance. Consider that loyalty can always be controlled with price discounts, offers, and freebies while happiness will come only with the use of the product. Pursuing the line of allegiance will perhaps, get more business in the long run but ignoring satisfaction will bring no business in the future.

Loyalty thus can be bought but not customer satisfaction.

Myth #2: Maximise customer satisfaction

Maximising customer satisfaction is not possible, period. Satisfaction is more of a personal vibe with the customer and is not in control of the business. All that the company can do is to optimize it with more features and better service. Any effort to maximize satisfaction through an increment in counters or through such efforts might improve it a niche above but at the cost of profitability.

Put profit above all and stretch only as much as you can to achieve optimal customer satisfaction.

Myth #3: Try and exceed customer expectations

This one is good for the textbooks. Meeting customer expectations is more realistic than exceeding them. On the ground level, how will you reach something that is not tangibly expressed? Customer satisfaction is a tight-rope in the sense that, you can never indeed establish what action will result in meeting the expectations.

The reality is that customer expectations should be met using excellent and friendly business strategies that add to the bottom-line instead of striving to invest in it. Meeting such expectations should be a pleasant accident rather than a calculated move.

Myth #4: Avoid customer dissatisfaction at all costs

If you have been in business for some time you will know that you are making 80% of your money from 20% of your customers. So, going by the 80/20 formula keeping customers who probably don’t add to your bottom-line may seem to be a loss-making proposition. However, this does not mean that you leave those customers out. If you use a good CRM and have customer profiles and data available, handling dissatisfaction from selected customers who add to your profits can be a joy. Customer dissatisfaction will always be there to some extent, eliminating it 100% is not possible or even profitable.

Myth #5: Minimize customer complaints

Businesses do not like complaining customers. However, such complaints must be dealt in a proper manner and not treat them as distractions. Listening intently to complaints can give you insights into your business process that can be bettered. Also, some customers never complain, which again does not mean that they do not have complaints.

Encouraging complaints and resolving them is the way to go. Failure to listen to them is to set yourself for failure.

Myth #6: The percentage of customer satisfaction

Customer satisfaction is a two-faced sword. There are scales – external as well as internal (for some businesses) that measure it on a percentage scale. Honestly, no customer is completely satisfied or dissatisfied. On the one hand, you are looking at a tangible expression of satisfaction, and on the other hand, you measure something that is a complete bundle of emotions and thoughts that are invariably bound to change. A simple scale or a percentage is no measure of satisfaction. It is only an indicator.

At the ground level, simplifying customer satisfaction can result in adverse decisions affecting your business long-term.

Myth #7: Customers are loyal

Customer loyalty is not about brands anymore. They have grown to get ahead of that mindset and are focussing more on customer service. Regarding customer satisfaction, they are happier where they get personalized attention to resolve any issues.

In this scenario, do not think that a customer is satisfied or loyal to you just because you are a well-known brand.

Myth #8: A satisfied customer is a loyal customer

Customer satisfaction is a combined measure of his or her attitude towards the brand, products, and services. Customer loyalty is entirely different and is a combined measure of opinions, behaviors, attitudes, repeat purchases and feelings. Customers can showcase loyal behavior without a loyal view and vice-versa.

So, assuming that a satisfied customer is a loyal customer can be quite misleading.

Myth #9: Customers always look at the lower prices

Many reports have been crafted on the subject, however, as per most surveys, it has been found that the percentage of customers looking for quality is a tad more than those looking for a reasonable price.

Irrespective of what your customers prefer, quality or price, it is always a good policy to consider the value you provide for the price. Focus on offering value for money.

Myth #10: Technology is critical to improving customer loyalty

Technology applied to produce good or services is internal to the organization. However, if you advertise the technology used, which is better than the competition, could be a USP. The focus of investing in technology should be to provide better goods and services rather than advertising it to gain customer loyalty. Also, the technology used for communication with customers should be chosen with care to facilitate more accessible and better customer interaction and not for the sake of it.

End of the day, a customer will look at the quality of goods for monies paid and in a more natural way to get through to you. He or she is not impressed by what you use. They are influenced by how better it gets for them.

Myth #11: Customers will be loyal if they like you

Amidst fierce competition, it will be foolish to assume that customer loyalty depends on how well he or she likes your company. In which case, your competition will make the best efforts to get into their good books. Assuming this end will be dangerous.

Customers are fickle, don’t ever take them for granted.

Myth #12: Loyalty building is expensive

This is the biggest myth of them all. Businesses, small or big need not worry about costs of loyalty building. Offering excellent products and services at the right price will build loyalty automatically.

If you are looking to build customer loyalty, you are on the wrong path, focus on your business and loyalty will come automatically.

Myth #13: To build customer loyalty, you will need personal interactions with customers

Personal interaction goes for a toss when a customer uses your product and finds it faulty or too expensive. Building relationships is a good thing to get more business but never assume that such relationships are going to build the loyalty factor.

Personal relationships and business never did mix, why do you think they are going to come to your aid today?

Myth #14: The more numbers of times you contact a customer, the more loyal he or she will be

Why would want to reach out to a customer, for up-sell or cross-sell? And, how many times a week do you think you will do that? None of your customers would like to be spammed. So, increased contact is not a solution to gaining customer satisfaction or loyalty.

Use the right communication mediums to keep in touch and keep testing your communication frequencies without annoying your customers.

Myth #15: Measuring customer loyalty is only possible through customer satisfaction surveys

Customer satisfaction surveys are great to measure customer satisfaction, however, they are more qualitative. There are specific quantitative methods to measure the customer loyalty. They could include some metrics like purchase frequencies, how much revenue they are bringing and so on. These can be measured through some analytics tools available online.

Myth #16: Retention does not help build better bottom-lines?

To de-myth this, consider that the percentage of selling successfully to an existing customer is around 60-65% while selling to a brand new customer, your chances are anywhere between 5 to 20%. With the vast potential to up-sell and cross-sell, retention does help build better bottom-lines.

Myth #17: Tracking customer loyalty is a challenge

Not true at all, there are so many tools out there like membership cards, rewards, points, unique customer numbers and so on to assign memberships to customers. Once done, you can collect a wealth of data that can be used to analyze and assess customer loyalty levels. Tracking these metrics can a long way is monitoring customer loyalty.

Myth #18: Does customer retention has a real, measurable ROI?

While it is quite tricky to get the hang of ROI for the spend on customer retention, it is not as impossible it sounds. The better method here would be looking at the CLV (Customer Lifetime Value) instead of ROI. The CLV is a projected revenue that a customer will pass to you in his lifetime.

Customer satisfaction is a critically important metric for any business, and it is only advised that you get rid of all those myths that surround the very concept of customer retention and loyalty. It is as important as the new business that you generate and ignore it at your peril.

Customer experience management              Customer satisfaction Customer value