Customer experience is key to the growth of successful business. We passionately believe that the focus on customer experience is essential – with research showing that companies that put this first outperform their competitors by three times.
Here at SightMill, we talk to hundreds of businesses about how they can focus on their customer experience and from these discussions, we’ve put together our list of ten reasons why you should be seriously considering investing in your customer experience — particularly if you’re looking to maximise growth over the next decade.
I’m sure you know many of the ten topics we’ll cover – and you have probably implemented most; but you might find some new ideas here to help improve your customer’s journey and so continue to improve the customer satisfaction. And if you have alternatives or tips that have worked for you, let us know and we’ll continue to add to this document.
What is customer experience?
Before we go on, let’s sort out the terminology (there’s a lot of it around, so we also have a useful glossary here!).
A common misunderstanding is to mistake customer experience as simply really, really good customer service. And whilst good customer service certainly is an important element in building a good customer experience, customer experience (or CX as it’s often abbreviated) goes a lot further than that.
Customer service is often passive and reacts to issues; it’s can also be a narrow term referring to issue resolution for existing customers.
We consider customer experience to cover the whole planning and design stages that build a great experience for customers at every touch point with your business.
The impression your customers are left with after interacting with your business across all channels and all products.
There’s an explicitly emotional element to this too. A good customer experience doesn’t just leave customers satisfied — it leaves them happier. It adds something to their day that wasn’t there previously. They tell their friends and colleagues about it. It draws them back to you.
If you think that sounds like very, very good news indeed for your business, you’re right on the money as we explain in the first of our 10 top reasons to focus on customers.
1. Customer experience leaders outperform the market
The proof is in the pudding, as the saying goes:
According to a study conducted by Watermark Consulting, companies ahead of the trend on customer experience outperformed those slow off the mark by a factor of three over an eleven year period.
What’s more, the companies identified as falling behind customer experience delivered a total shareholder return that was less than half that of the S&P 500 Market Index. So not only does investing in customer experience pay off significantly, but failings in this area really start to hit your financial performance.
And whilst a strong customer experience doesn’t guarantee you success or make you immune from failure by itself, it is absolutely a key building block for growth companies in the current environment.
We’d venture to say that if you don’t place enough emphasis on customer experience, you’re not going to grow to the best of your potential over the next decade — and you’ll have to work harder for any results you do achieve.
2. CX is an easy way to stand out from the crowd
Every successful company stands out from its competitors in some way. Make a fantastic customer experience your stand-out feature.
To get ahead here, you’re going to have to quick off the blocks because lots of companies are just starting to wake up to the benefits of a customer focus.
In an age where it’s increasingly difficult to stand out — particularly online, as more and more companies invest in extensive social media strategies, eye-catching content and expert SEO teams — positive customer experiences make an impact, even in crowded fields.
It’s likely you have experienced this yourself. You might have been struck by a particularly knowledgeable sales team in a bricks and mortar store. You may have phoned a call centre for the first time and found the experience unexpectedly hassle-free. You might have been so impressed with how your complaint was handled that the company won you back round.
The similarity of all these situations? They stick in your head — and will do for thousands of other customers as well.
3. It’s easy to get started
Avoid thinking of customer experience as a big change which involves a sudden departure from your normal way of operating - like a large software installation or process change or office move.
Instead, see it as a phased shift in approach which you can start implementing almost immediately.
Start by tracking a simple business metric (it’s what SightMill provides) and helps many successful businesses align their teams to an easy-to-understand number.
Ask your customers for feedback - what can you do better? It easy to implement this and route the feedback out to the right teams so they can start to make improvements.
If you send out updates to your mailing list about improvements you’ve made to your product, make sure you incorporate customer feedback into your latest updates.
Of course, once you’ve tackled the easier steps the next changes might take more time and effort — but there are plenty of things you can do whilst you gear up to that, or if you can’t commit the time, budget or effort in during the early stages.
4. You get a lot out of a small upfront investment
Similarly, you can start improving the customer experience you offer without splashing out tens of thousands on new hires and new tools.
Use customer satisfaction software to understand what drives your customers; make sure you connect it to your analytics software so you can see if there are particular user journeys, visitor segments or actions that are causing particularly good (or not so good) feedback.
This feedback could easily uncover small bugs that need fixing, or minor customer service issues and small ideas for improvement that will make your customers’ lives much easier without having to spend a lot of time or money.
Again, there are instances in which you’re looking at a more extensive investment (like the example we used above of extending your support hours and channels) once you get going — but because you don’t need to splurge immediately, it’s less of a barrier to entry.
5. It establishes a loyal customer base early on
If you’re a growth company, your early adopters are everything. They are both your first revenue stream and your first cheerleaders. They could turn into your first shareholders. Their enthusiasm about your product is almost certainly a gateway to more opportunities, more press and, lest we forget to mention it, more funding.
You can gain this kind of loyalty by offering an amazing, out-of-this-world, never-seen-before product that will be the landmark invention. Or, more realistically for the majority of businesses, it’s likely to be more about the experience.
In a market full of startups, you’re going to have to work harder to create a solid, loyal customer base that you can build off, and offering a second-to-none customer experience to the first people through your door is an excellent way to do that.
A new startup with an interesting product is one thing. A new startup with an interesting product and a commitment to first-class customer service in a way no-one has seen before is quite another and likely to accelerate faster.
6. Trusted relationships are important in uncertain times
We live in uncertain times. With current global issues to navigate, businesses are being very careful about what and where they invest to help grow (or sometimes survive then grow).
So it’s likely trust may become one of the biggest drivers of buying behaviour — because when you’re trying to navigate things like sustainability, or rethinking your entire manufacturing process around a more circular economy, or figuring out how to see your hospitality business through the initial COVID-19 aftermath, you need suppliers you know you can trust.
How can you demonstrate that you can be trusted? An unrivalled customer experience will help you stand out. It’s the small things that add up here: responding to queries quickly, sorting out issues and complaints promptly, letting customers know if there’s anything that might inconvenience them in advance (store closures, site maintenance etc) and any other number of small, day-to-day interactions lay the foundation for something bigger.
7. Customer experience is a strong marketing tool
As well as being key tools for improving the customer experience you offer, key business metrics like NPS (Net Promoter Score) or CSAT (Customer Satisfaction score) are a great addition to your marketing campaigns or press release or company financial statement.
You’ll see companies using the NPS business metric as a headliner on their websites. NPS measures customer loyalty by asking customers how much they would recommend your product or service on a scale of zero to ten. High NPS scores are like gold dust to marketing teams because it taps into a concept called ‘social proof’ — people are more likely to make a purchase from someone their peers recommend.
The same can be said for external review site ratings. Companies pour effort into TrustPilot, Which and TripAdvisor scores for a reason, and that’s because they can help generate significant referrals and revenue.
8. A good customer experience improves customer retention
One thing that a good customer experience strengthens is trust between companies and their customers.
When you offer a great experience to your customer base, they’ll trust you to be transparent, sort out any issues as promptly as possible and provide honest information on what the best course of action is in various situations.
In other words, they start to see you as a prospect for a long-term relationship, rather than simply the people they send money to every now and again. It goes beyond the transactional, and your product or service starts to become a valued part of their lives, in some way or another.
There’s no bigger draw for customers coming back time and again - and this can have a huge effect on your company’s revenues.
And, it’s a fantastic feeling knowing that you’ve achieved that elusive product + service + trust combination that so many other companies struggle with. This sense of personal achievement isn’t the most talked about thing on this list, but it’s definitely worth acknowledging.
9. Customer experience improves cross-selling and up-selling
As well as encouraging your customers to keep buying from you, a focus on customer experience makes it more likely that these same customers will buy more from you.
They’ll keep coming back, and when they do they’ll potentially make higher-value purchases, be more willing to upgrade to a more expensive subscription package or branch out into your other products.
Why? You’ve made it easy for them. You’ve demonstrated that their needs are central to everything you do, and that you’re trustworthy and responsive, as well as already offering products that fit their needs.
There’s always an element of risk involved in switching vendors - whether it’s as simple as someone switching supermarkets for their weekly shop or as high-risk as an enterprise software purchase worth tens of thousands. The more you have demonstrated a commitment to their needs, the less tempting taking that risk becomes.
And, because they trust you, they’ll be more receptive to your suggestions that they might be due an upgrade or benefit from your other products too.
10. Free advocacy
Some of the latest disruptors operate to transform industries that have become stale through poor customer satisfaction. A few years’ ago, few people would be enthusiastic about their bank but the sector’s been totally transformed by customer-first disruptors such as Monzo and Starling. This is true across a whole range of sectors where a new generation of companies came along and understood that a happy, engaged customer base also deferred significant marketing benefits alongside generating revenue.
As well as the benefits on mouth-to-mouth recommendations, this will spill over into positive online reviews — and given that a whopping 72% of shoppers won’t make a purchase without reading these, these are absolutely essential for revenue growth.
We’ve covered our top ten reasons all businesses should look at how they deal with their customers.
Put your customers first and work across your teams to improve the satisfaction and overall experience at every touch-point and you’ll increase trust and create a loyal group of customers who start to act as your company’s advocates referring new customers and growing your business.