The world is evolving, and the way consumers interact with companies is changing with it. To succeed, businesses will need to understand and enhance their customer experience to embrace this change. Customer experience is critical to ensuring that customers buy again and remain loyal to the brand.
As we have seen the competition of customer experience thicken over the years, businesses are searching for more ways to improve conversion rates and satisfy customers. As data suggests that customer satisfaction score has a clear impact on ROI.
- Increasing customer retention by 5% increases profit from 25% to 95% (Bain & Company).
- As a group, Millennials are willing to spend up to 21% more for great customer care, only slightly higher than 17% for the general consumer population (Help Scout).
- U.S. companies lost over $62 billion each year due to customer service faux pas (NewVoiceMedia).
- 33% of consumers will tell people about a bad experience with a brand (Smart Insights).
We are living in a time where consumers are changing the way large corporations do business.
Companies have even engaged in philanthropic operations to meet consumer sentiment. Campaigns like Coca-Cola’s round in circles encourage consumers to recycle bottles. These initiatives help consumers engage with the brand beyond the product. Coca-Cola also benefits by learning more about how to operate a sustainable business. Taking part in philanthropic experiences with a company can make consumers feel more comfortable supporting the brand.
How Customer Experience Improves Business Growth
The genesis of the trend to satisfy users beyond the product and create an enhanced consumer/merchant relationship is up for debate. What is sure is that brands are getting better at it every year.
Over 80% of consumers today report that businesses are meeting or exceeding their expectations, compared to only 67% in 2014.
Think about the explosion of streaming services since the inception of Netflix in 2007.
Netflix had a service where people paid for the ability to stream movies and shows.
Soon after, companies realized that the way we consume media was entering a phase of metamorphosis. In today’s market, to stay relevant, you need to offer more.
How many users do you think Netflix would have lost over the years if they lost the place you stopped watching in your favorite show every time you logged out?
Also, imagine how much content you may never have come across if the “Because You Watched” section never existed?
The product is important, but the personal touch attracts and keeps customers.
According to this graphic created by Statista, this enhanced customer service has paid off for Netflix, making it the number one choice for those polled in 2019.
And it’s not just Netflix. Just look around, and you will see the measures brands are taking to ensure that customers enjoy the customer journey they take when they interact with the company.
In addition to brands that provide online services, even ecommerce stores and brands selling physical products implement the same customer experience strategies. Any of these sound familiar?
- Access to 24-hour customer service.
- Website chatbots (automated customer service)
- Being remembered by name and by purchase at our favorite online stores.
- Less friction during the refund process.
- Risk-free money-back guarantees.
- Extended warranties.
- Operational shifts to environmentally friendly practices.
- Two-day delivery on whatever we can dream of purchasing (including same-day shipping in some places by tech giants like Amazon).
And the list goes on and on!
When a company engages with its user base, consumers feel more comfortable using the product. As time goes on, customer experience will continue to transform the way companies do business, driving them to focus more on the experiences that come with doing business with them rather than just the product. Many product sellers have gone on to create informational guides, how-to videos, and monthly webinars/hangouts to continue to engage the consumer post-transaction.
Building trust with your customers has never been more crucial. Kris Nicolau from Brain Box Labs: “We partner with our clients and build that “trust equity” through reliability, honesty, and delivery. Understand their needs through active listening and being genuinely curious about their pain points to deliver the right solution on time and budget.”
So when it comes down to it, businesses should ask themselves these questions:
- How important is it for a company to build an experience around their product?
- How necessary is it for up-and-coming companies to build their platform around customer experience
- How vital is it for established businesses to rebrand themselves and incorporate unforgettable experiences in their marketing strategy?
The quick answer to each? It is paramount. Consider this infographic from Salesforce, highlighting that 80% of customers state that the experience a company provides is as important as its products and services.
This graphic created by salesforce.com illustrates just how important the shift towards better customer service is and how it provides a major competitive edge.
As a society, we are a group of people enamored by instant gratification. We want the things we want now, and we perceive any delay as an inconvenience. When you get down to it, we design technological advancement to mitigate inconveniences.
Exactly How Important is Customer Experience?
Technology also allows us to do things at lightning-fast speeds (and our consumer nature has followed suit). Companies that don’t cater to the fast-paced nature of consumerism in our world will be plagued with slow-growth, or worse, failure.
CX has become so important in modern business that according to the Forbes article, 50 Stats That Prove The Value Of Customer Experience: “Companies that have a customer experience-driven mindset report 4-8 percent higher revenue than competitors in their industries.”
In fact, according to the same article, 73% of companies that boast above-average customer experience often outperform their competitors financially.
Why is this?
It’s simple. Companies that focus on CX build deeper relationships with their customers. From those customer relationships stem customer loyalty. When customer loyalty takes root, a customer is more likely to stay loyal to the brand than to stray to a competitor (even when faced with higher prices or inferior products).
It is not just these 2,000 polled business professionals either. With customer experience, the biggest names in the world are paying attention.
Jeff Bezos, CEO of Amazon, known for his focus on CX in his business ventures, was quoted in this Inc.com article saying:
“If there’s one thing Amazon.com is about, it is an obsessive attention to the customer experience [end-to-end].”
And with Amazon having a total worth of $1.7 trillion, falling behind only Apple, this has paid off immensely for the growth of the company.
What does this continued lean towards Customer Experience mean for Consumers?
People and companies that understand the movement of customer experience stand to benefit in the years to come.
In a post-pandemic environment, consumers will be funneled to online-based businesses, as brands that were not online are now catching up by building an online presence. Consumers are decreasingly relying on in-person retailers for purchases. It would appear the quarantine has sped up the shift from product-based to customer experience-based business plans as getting products in hand is no longer an issue. When we want to purchase something now, there are hundreds of marketplaces (both in-person and virtual) that we can go through to gain it. What will separate one option from the next?
The answer to that is customer experience. The guarantees, the return policies, the tracking on packages, the ability to partner with the brand on philanthropic causes are all a part of this. Also, the personalization component should be a part of the CX strategy. If I go to a site and it remembers what I’ve purchased in the past and I do not have to go searching for it, then I’m happier to complete my transaction. If the site takes those past purchases and provides a section of suggested purchases based on those purchases, then I’ll be ecstatic and even more likely to add to my current (or future) purchases.
When it all comes down to it, CX is the trend of the future. More so, it is also the wave of the present. Brands are focusing on CX now more than ever, and those that do not will be left behind.
The shifts we will see in the future are already being observed. As a whole, it is the consumer that wins when the world of commerce focuses on customer experience. We hold businesses more accountable and get more out of the hard-earned money that we spend.
Is your business’s key focus on ensuring that each customer has an unforgettable experience? If not, we may want to re-think your marketing strategy. While the future is unknown, one thing is clear: enhancing customer experience has never been more important. How will brands react to this shift? Only time will tell.
Wesley Cherisien is a speaker, trainer, entrepreneur and tech investor who has penned hundreds of articles, books and training guides for organizations in the Fortune 500, consultants and authors spanning across multiple industries. Chief Editor of WesleyCherisien.com, Wesley is a creative and highly innovative thinker with 10+ years of experience writing for online publications.