August 17, 2021
Importance of Customer Experience
If you want customers to come back for repeat purchases and spread the word about your brand, you can’t discount the importance of customer experience.
Investing in CX results in higher retention rates, increased revenue, and a loyal customer base. It’s also a competitive advantage—great CX helps brands stand out in a competitive, fast-paced market.
The logic there is pretty straightforward—treating customers right is just plain good business. In this article, we’ll take a closer look at some of the reasons why the importance of CX has taken on a new urgency.
How Customers Interact with Brands is Changing
Today’s consumers expect brands to demonstrate more values-oriented behavior and infuse interactions and content with genuine human empathy. They also want personalized solutions, relevant messaging, and fast, user-friendly experiences.
According to one recent Salesforce report, they want more digital solutions. Researchers found that 88% of customers expect brands to ramp up investments in digital initiatives. These changes have been well underway for years, but the COVID-19 pandemic forced many customers to rethink long-standing habits and embrace new digital ones.
What’s more, these changes are here to stay—no matter what happens once the pandemic finally fades away. Based on McKinsey, 75% of consumers have tried a new shopping behavior since the pandemic began. Researchers also found that availability, convenience, and value are the strongest for convincing shoppers to buy brands new to them, and the behavioral changes don’t stop there.
Focusing on CX allows brands to adapt to these changes by listening to customers. 3Pillar Global’s Sarah Mattingly argues that the importance of CX can be seen in the way customer expectations and behaviors are shaping digital transformation.
She says, “at least within the retail space, it appears that CX is actually driving digital transformation, not the other way around. Technologies are evolving, creating an opportunity to improve CX by improving features and building customized experiences that are tailored to individual buyers.”
Sarah builds on that point, adding, “With greater availability of technologies like AI, ML, advanced analytics/business intelligence platforms, etc., we’re starting to see an iterative process between technology users and technology providers. It’s that constant flow of feedback and data driving new hypotheses that enable brands to test new ideas that yield new or different results. Data is the answer to solving the CX problem.”
Another 3Pillar Global expert, Angel Almada, weighs in by reminding us that “digital transformation is all about providing seamless experiences across all existing products, services, and communications channels to your customers in a digital way.”
He adds, “translating experiences into digital is challenging. It requires a clear identification of the target market, the problem you’re trying to solve, and what users want at every stage in the journey.”
In other words, a good customer experience starts with good data.
Customer Service Role is Evolving
The importance of good customer experience can also be seen in how the customer service role has changed. It wasn’t that long ago when customer service was relegated to entry-level reps paying their dues on the front lines, or it was shipped off to a low-cost outsourcing provider.
Today, brands are rethinking customer service and its impact on the overall experience.
An article published by ZDNet reported that more top-performing companies are investing in service innovation in an effort to drive loyalty and business growth. And, per an Accenture Interactive survey, 77% of CEOs say they’ll fundamentally change how their organization interacts with customers to drive growth.
Because customers can often find the same product from multiple brands, customer service once seen as a commodity—is now a source of differentiation. As 3Pillar Global expert, Mihnea Jeleriu, points out, “you might sell the exact product your customer is looking for. But if the experience is bad, they’ll search for alternative options.”
According to Forrester, CX isn’t just about troubleshooting and client retention anymore. Now, it’s a strategic function involving the entire organization. It plays a critical role in enhancing the prospect experience on both the sales and marketing side.
Analysts recommend that CMOs work with CX, product, and sales leaders to ensure a consistent brand experience across all touchpoints. Customer-facing functions—sales, service, and marketing must operate in sync—no more silos.
Salesforce’s State of Service report found that 76% of consumers say they expect consistent interactions across different departments. Yet 53% reported that they get a sense that sales, service, and marketing teams don’t share information with each other.
A 2020 Gartner report states another key issue where organizations often follow a reactive approach at the transaction level. This then puts the burden on the customers, who must then put in the effort of tracking the brand down on different service channels to solve their problem. As a result, service centers receive a high number of incoming calls and customer satisfaction decreases.
Ultimately, both issues underscore the need for good data and connected channels.
The Gartner report shares that many customers switch channels to find answers to questions or contact support—often unsuccessfully. Instead, it argues, brands must focus on delivering personalized, proactive support via connected channels and self-service options. 85% of customers who received proactive support felt that their experience was “valuable.”
Importance of CX: Reputation & Brand Perception
Customers have countless channels they can use to amplify their feedback—good or bad—in front of millions of eyeballs. And whether what they say about your brand is true or not, ratings, reviews, and @ mentions shape customer perception.
Great CX is the foundation for building an excellent reputation. It’s an asset that “accumulates” over time, setting the stage for word-of-mouth recommendations and brand advocacy that brings in new business without any intervention from the business.
Positive experiences also play a critical role in building trust. According to Zendesk, 79% of customers trust online reviews as much as a recommendation from an IRL friend. Another report from Sprout Social found that the average customer reads ten positive reviews before they feel that they can trust a business.
This becomes especially important as an estimated 84% of customers no longer feel they can trust advertisements or sales copy coming directly from the brand. Instead, they prefer to rely on reviews, comments, and recommendations from real people to inform which products they purchase and who they buy from. Data from the latest Sprout Social Index revealed that about a third of customers find new brands to follow on social media via word-of-mouth recommendations.
By focusing on delivering exceptional experiences and solving customer problems, chances are, at least some of the people you’ve helped will tell their followers about it—thus bringing more potential customers to your site.
It’s time to start looking at it as an operational cost and, instead, treat it like the competitive advantage it is. No more passing the buck to entry-level employees or outsourcing firms and hoping for the best. Products, services, and content must be informed by customer feedback and solve real-world needs, rather than relying on untested assumptions.
Bottom line, the importance of CX can be felt at every level of the business.
3Pillar Global’s customer-first Product Mindset, fast-paced Agile practice, and laser focus on outcomes helps clients turn CX investments into valuable revenue streams. Click here to learn more about how we can help.
Special thanks to these members of FORCE, 3Pillar’s expert network, for their contributions to this article.
FORCE is 3Pillar Global’s Thought Leadership Team comprised of technologists and industry experts offering their knowledge on important trends and topics in digital product development.