Customer experience has overtaken price and product as the key brand differentiator in 2021.
But apparently, not enough companies invest in customer experience.
We live in a world where the customer experience is the be-all and end-all for a company. The customer is now the king and most brands and brand leaders are looking for reasons to invest in customer experience. The customer now holds more decision-making power than they had a few years ago.
We are now living in a world where information regarding a company, its products, services, and even the owners are just a click away. Where does a customer’s voice stand in such a rapidly fickle world?
At the moment, investing in the customer experience and making them feel like they are the top priority is the way to go. A customer who had a bad experience would be reluctant to associate themselves with the company a second time. It is common knowledge that building customer loyalty and increasing the revenue of a company always go hand in hand.
Investing in Customer Experience is not something any company should take with a pinch of salt. It has been proven time and again; a good Customer Experience can help a company reach better heights while a bad one can easily tarnish it. So, what’s the big deal with it? Why invest in customer experience, you ask? Here are a few reasons why top companies need to invest in customer experience.
1. Brings About Better Growth
A study conducted by Watermark Consulting came up with an interesting conclusion in 2015. According to studies, companies that systematically lead in customer experience have received far better results comparatively in terms of growth and profitability. In addition to this, their value also increased when compared to those considered as dawdlers. Another research by Forrester Research has also come to the conclusion that in the coming years, the difference between leaders and dawdlers will be even more obvious. This means that not investing in Customer Experience is bound to destroy the financial result of a company.
2. Deepens Customer Relationships
In addition to bringing growth, a good customer experience can also lengthen the customer’s relationship with the company. The customer will prefer staying with the firm rather than switching to its competitor. According to studies and researches, a customer who is satisfied with a product or a service of a brand would rarely prefer to switch to a different one. This is why most companies have started to invest in customer experience so that the possibility of losing a potential long-term customer would be next to nil.
3. Encourages Positive Word-of-mouth from the Customer
To state a simple fact, if a customer is satisfied with the product or service, then they will be willing to pay more for the same experience irrespective of the cost. Startling as it may seem, the reasons for a customer’s insistence to pay more for a high-quality product or service is hardly surprising. Perhaps the age-old adage that something good comes with a higher price would apply to the situation here.
Customers will pay a higher price as long as they get the same or better experience with the product. In addition to this, researchers have also noted that a good customer experience leads to the customer’s tendency to recommend your company to a third party. It is quite obvious that a customer who has had a good experience with your company would surely be willing to recommend it to a third party.
4. Decreases Negative Impact
Picture this, a customer who has had a terrible experience with your company, or was treated poorly by your staff would not just shun your company the next time, they would also cost you more, directly or indirectly. The worst that can happen after a terrible customer experience is that the customer would be reluctant to return to the company. If a company is unable to rectify the reason for the poor customer experience, then it would lead to more customers being unhappy with the company. If more customers take the same route, it would lead to stunted growth for the company.
A research stated that if a customer has a bad experience with a product or a company, then their interactions would cease. It must be noted that these customers would be more willing to share the reason for their negative experience with another customer or potential customer than the company itself. This leads to stunted growth of the company. This will adversely affect the firm unless it takes steps to rectify it
5. Shares Positivity among the Staff
Take the example of a restaurant or a café.
If the customers have a poor experience, then they might show their displeasure to the waiting staff or the management. A negative review regarding the services or even poor waiting staff is bound to affect the morale of the staff. When a customer’s experience with a product or service is bad, it sure does affect the morale of the staff. When the customer experience is well-planned, positive and brings credit to the staff, evidently the staff’s morale will be better. The employees in the company become proud that they have produced a good experience. As a result, they will continue to bring about the best in terms of customer service.
Research shows that nearly 80% of customer satisfaction and customer loyalty depend on the employees. This is indeed true, especially in areas such as hospitality or banking. A customer will almost never return to a bank if he has a poor experience. The same can be stated when it comes to restaurants as well. Make the staff aware of the fact that good customer experience depends on their keenness on their job.
6. Brings about Innovation and Better Branding
It is common knowledge that a good customer experience also helps in improving the brand. The reason is quite obvious. A customer who has had a good experience with a company or a product will surely recommend it to others. This will lead to an improvement in product branding, leading to the popularity of the product. Also, remember that a good customer experience increases the company’s ability to be more innovative. It is fairly ridiculous to think that planning and innovation of the customer experience can be done in a lab.
Companies must be open to embracing an open innovation model to improve customer experience. You can find the inspiration for this anywhere, even outside the company. The process can help the entire company in changing the way in which innovation is brought about.
If customer experience is not the focus of your company, then you are too late to bring growth. Research shows that a number of companies have made improving customer experience a part of their agenda. Many have already invested heavily in actually improving it. Sadly, companies that do not prioritize improving customer experience end up losing out.
7. Builds the Foundation of Trust
Customers tend to have interactions with a brand that treats them fairly and values every touchpoint they have with the organization. Being transparent with your customers is also part of providing a good experience to them. When so much is done, you gain their trust and in turn, your customers become loyal to your organization.
Here are some of the best practices to build customer’s trust:
- Listen to every query or complaint your customers have
- Empathize with your customers
- Address their questions
- Deliver instant solutions
- Apologize and specify the cause when an issue arises
- Specify the purpose and other details before you survey your customers.
- Show product ratings
When you give your dedicated attention to customers trust follows suit.
Why Invest in Customer Experience?
A company that is willing to invest in Customer Experience is more likely to witness a fair amount of growth when compared to a company that doesn’t take it seriously. Always ensure that you remember one key aspect. Your customer does not just see you as a part of the company. They see you as one whole cohesive brand, even if your organization has a complex working structure with other procedures and systems.
When your customer interacts with the company, there is a significant chance that they do not care about the bureaucracy, the different divisions, roles, or even hierarchies for that matter. Undoubtedly, the customer has a key role in making or breaking the company. After all, the customer is the king!
Recognize the value of a customer and take steps to improve customer experience. Win the customer’s heart and contribute to the welfare of your company. And when you do, you are never going to ask yourselves ‘Why invest in customer experience’.