Why Having A Customer Experience Management Strategy Matters

In today’s marketplace your business success is about so much more than purely the quality of your product or your pricing.

In fact, given that 76% of customers now expect companies to recognise their needs and 74% say they will make a purchase based on a good customer experience alone, delivering a high-quality service along with great experiences is probably now the most important thing a business can do.

In addition, when you also consider that happy customers are more likely to stay loyal to you, delivering great experiences is a good business move too, as it can be up to five times more expensive to acquire a new customer than it is to retain one. It’s also worth bearing in mind how keen todays customers are to share their experiences with others, whether that’s through social media platforms, review sites, help forums and more. So, it literally pays to keep your existing customers happy.

So, how can you ensure your customers are contented with the experiences you’re delivering?

Well, that involves having the right tools in place to track, measure and manage these experiences throughout your customer journey including customer feedback data collection tools, surveys and CX metrics.

We will touch on this later in this piece, but before that we need to explain what we mean by customer experience management and why it’s so beneficial.

What is customer experience management?

Essentially, customer experience management (CXM) refers to the marketing strategies and technologies that can be used to better manage customer interactions through their physical or digital touchpoints. The aim being that if you can deliver more personalised, customer-centric experiences you’ll drive increased satisfaction, loyalty and advocacy.

Managing customer experiences is not just focused on customers’ perceptions of your brand, but rather how customers feel when engaging with you. Subsequently, if you can deliver great experiences every time a customer reaches out to you for support, to make a purchase or visit your website, they’ll be more likely to walk away happy and have a positive perception of your brand.

Benefits of customer experience management

At this point it can be helpful to see how specific areas of your business will benefit when you have an effective customer experience management programme in place.

Your customer lifetime value increases

Your customer lifetime value refers to the total amount of money a customer will spend with your business on products or services over a lifetime. Knowing this number is really useful, as it helps you to identify how much to invest in retaining versus acquiring new customers.

When you get repeat business, it demonstrates strong customer loyalty to your brand. It also highlights the quality of your company’s products and services, which is likely to be influenced by the various interactions someone has with your company, from your sales and support teams to your website and self-serve options.

Subsequently, this is where the benefit of customer experience management comes to the fore, as the better you’re able to manage these customer interactions, the higher your customer lifetime value is likely to be.

Your customer churn decreases

Businesses that manage to achieve a higher customer lifetime value, as a result of an effective customer experience management programme, are also likely to benefit from reduced customer churn.

Through regular correspondence such as frequent phone calls and email marketing updates to customer appreciation events and customer account reviews, a brand is more likely to stay at the top of a customer’s mind.

Subsequently, when the time comes to make another purchase or renew their contract, those customers will have an easier decision to make if the business they’ve been dealing with has been attentive to their needs or wants over time.

Your brand equity increases

Brand equity is a term that is typically used to describe a brand’s value in the eyes of the consumer.  However, brand equity has more to do with the emotions a consumer has when thinking about a brand. Therefore, if you can deliver on promises, provide high quality products and services and always keep responsive, you’ll be in a much better position to build positive brand equity.

A company with positive brand equity will have some big fans. These customers will be happy to post positive reviews, share their experiences through word-of-mouth referrals and even participate in customer loyalty programs.

Subsequently, an effective customer experience management programme can influence a positive brand equity and help prevent negative reviews.

Your customer retention improves

Those businesses that experience higher brand equity and reduced churn will also experience higher customer retention, as an increased customer retention rate often correlates to higher customer loyalty. While a customer may only buy from a brand once every few years, the ability to keep that person as a customer is important.

Companies that are quick to resolve issues, reward loyalty, stay in touch, and most importantly thank their customers are more likely to generate the positive perception that is at the root of their overall customer experience. Customer retention also leads to more sales, a higher lifetime value and an easier way to increase ROI from that initial conversion.

You can reduce your costs of service and marketing

Companies that have a customer-centric approach to marketing are able to eliminate a lot of the guesswork relating to what customers want.

Customer experience management requires CX teams to look at each customer individually, identify the products they have bought, what they’re likely to purchase next and their reasons for reaching out to them. CX teams can then use this data to be more proactive and anticipate the needs of those customers.

You can better engage customers

A successful customer experience programme requires organisations to a adopt an omnichannel approach to customer engagement.

In this scenario, CX teams look to identify where each customer is interacting and then go to where they’re interacting most frequently, whether that’s through their company website, in-app or social media channels to email or phone.

Companies must then be more responsive and proactive by frequently checking in, understanding needs and rewarding loyalty. This should result in more return interactions from those customers.

How to measure customer experience

Managing your relationship with customers and the experiences you deliver for them starts before they even walk through your door, or find you online, and then continues after they buy your product or services. This is because you want to ensure that they’re always thinking about your company, whenever they’re talking to their friends, family members or colleagues, and they’re asking them to recommend a company to them.

However, to get to that point you need to know what your customers currently think about your company and the experiences you’re delivering for them, so you know what and how much you need to improve.

Here are some pointers to help you with this:

Using surveys to measure perceptions of your brand

We’ve already talked about the importance of your customers’ perception of your company and brand and knowing how well the experiences you’re delivering are being received by your customers.

Well, a good place to start finding out about this is to run a brand survey of your customers. This should give you a better feel about how your customers feel about you and what you’re delivering, as well as their overall perception of your brand compared to your competitors.

To further support this, you might also like to include a question based on the Net Promoter Score (NPS) ® metric, which is also part of the CX family of metrics. This looks to ask your customers the following question.

‘On a scale of 0 – 10, how likely would you be to recommend our company to a friend or a colleague?

The idea behind NPS is that it can help gauge the loyalty of your customers and therefore provide an indication of how happy they are with the experiences you’re delivering for them, by measuring how likely they are to recommend you to others.

Get your customers’ product feedback

When it comes to developing your products and services, who better to ask how well you’re doing than your customers.

In this case running a market research survey of your customers can help you gather some really useful insight that you can use to ensure your products and services better meet their needs moving forward.

In addition, you might also like to introduce another CX metric into your research, to get an even deeper understanding of your customers’ experiences with your products and services through the customer effort score (CES) question.

By asking your customers the following question…

On a scale of 1 to 5, how much effort did you have to expend to handle your issue?

(where 1 represents very low effort and 5 very high effort)

…you can get a better idea about how easy or hard it was for your customers to interact with your business. The idea here is that the more effortless you can make your customer experience, the more likely your customers will stay loyal and keep buying from you.

Know how well your service and support teams are performing

Whether it’s instore, online or over the phone. The abilities of your customer service and support teams are also major contributors to the overall experience you’re able to deliver for your customers, so you’ll want to ensure they’re performing as well as they can be.

By sending your customers follow up customer satisfaction surveys, you can check whether your service and support team resolved their issues to a satisfactory level. In addition, you can get an even more precise measurement of their contentment levels by asking them the Customer Satisfaction Score (CSAT) question. Another question that belongs to the CX metric family, this is based on asking your customers the following question.

‘How satisfied were you with our (product, service, support interaction)?

Each customer is then invited to rate their satisfaction on a 5-point scale ranging from very dissatisfied to very satisfied.

For more information about how to measure CSAT and the other question types in the CX metric family, why not visit our recent ‘Investigating Customer Experience Metrics That Matter’ blog piece.

Final thoughts

We hope you found this blog helpful and feel better informed about why customer experience management is important to delivering better experiences and building a more successful business.

What is also valuable to point out, is that in addition to using the right surveys and CX metrics, your feedback data collection tools are also vital in making it easier for you engage and collect feedback from your customers. So, whether it’s email, SMS and in-app pops to kiosk or QR codes, these can be deployed at various stages of your customers’ journey to ensure you successfully collect this insight.

By leveraging API technology, you can also create automatic survey triggers, and create feedback loops at the point of experience, so you’re better able to gather data across multiple touch points. This should also allow you to better track, manage and improve your ongoing customer experience.

If you can do this, the more customers you’re likely to retain, the more you’ll be able to sell to them and the more successful your business is likely to be.

Improve the experiences you deliver for customers

Having an effective customer experience management strategy is vital if you’re to deliver better experiences for your customers. But that’s only half of what you need, as it’s crucial to have the right survey tools and metrics too.

Find out more