Customer experience management is arguably the most critical area of focus for any business
Customers are the lifeline of any business. The success of a business depends much more on customer experience than on product or service quality and even pricing. Studies on consumer attitudes have confirmed that 72% of customers will do business with companies that have a reputation for offering excellent customer service. The same study also mentions that 97% of customers are likely to tell others about great customer experience. Furthermore, a research study conducted by American Express reveals that 60% of their customers are willing to pay more for better customer experience.
These figures go to show how important customers are to a business. Fortunately, most companies realize this fact. As per the Digital Marketing Trends Report 2017, 22% of all companies that were surveyed stated that customer experience was the most exciting opportunity for their organization. This has happened for the third time in a row now.
Customer experience is arguably the most critical focus area for any business. Executing a proper and well-defined customer experience management strategy can improve customer satisfaction dramatically. This, in turn, can help a business reduce its churn and grow its revenues.
Before we take a look at some effective customer experience management strategies, let’s understand the term customer experience management in a little more detail.
What is Customer Experience Management?
Customer Experience Management (CXM or CEM) refers to the processes that a company uses to track and organize all interactions that happen with customers, throughout the entire customer lifecycle. Customer experience management is a crucial part of Customer Relationship Management (CRM).
The idea behind customer experience management is to optimize the interactions that a company has with its customers. Proper customer experience management fosters customer loyalty towards a company. Companies should follow a customer-centric strategy to manage the customer experience, by optimizing all interactions from the customer’s perspective.
How is Customer Experience different from User Experience or Customer Service?
User experience and customer service are only a small part of many elements that make up customer management experience. While user experience refers to the interactions that a customer has with a business, customer service refers to the support that a company provides to customers when they face issues.
On the other hand, customer experience management encompasses all interactions that customers have with a business. This includes all types of interactions ranging from brand awareness to company discovery, cultivation to advocacy and purchases to service. In today’s world, top businesses make use of a variety of customer experience management techniques to sell and market to customers in a personalized manner.
Benefits of Customer Experience Management
Implementing a proper customer experience management strategy can offer several benefits to business – both externally as well as internally.
The external benefits are positive word-of-mouth marketing that satisfied customers provide. While this generates customer loyalty, it also boosts profitability. Also, because customer experience management encompasses every team and every department of a company, it encourages better collaboration and alignment of company objectives. A customer experience management strategy provides a business with standard metrics that can be used to benchmark progress.
Here are some of the more specific benefits that customer experience management can offer to a business:
- Makes customer feedback important and useful
- Increases customer engagement and customer retention
- Provides valuable insight on customers on a regular basis
- Allows organizations to deliver omnichannel customer experiences
- Allows organizations to address customer concerns and issues in real time
- Helps measure and improve customer loyalty
- Helps empower and motivate frontline staff
- Aligns an organization towards its customers
With a proper customer experience management strategy in place, an organization can reduce the costs of its service and achieve far greater brand equity.
How to Provide a Great Customer Experience?
To provide a great customer experience, companies must have a 360° view of their customers at all times by making use of integrated, up-to-date and relevant customer data.
Organizations should follow these steps to create a successful customer experience management strategy:
- Understand customers: The first and foremost step in creating a successful customer experience management strategy is to understand the needs and behaviours of customers. Once this is done, companies should segment customer based on their needs and behaviors.
- Create customer vision: After identifying and segmenting the target audience, companies should look to define a customer journey map. This map will help a company identify customer touchpoints, which in turn helps an organization anticipate how customers will interact at these touchpoints. By creating a customer vision, organizations can increase customer retention significantly.
- Develop emotional connections: Once the customer journey map has been defined, organizations should work on creating a brand personality that develops emotional connections with customers. This helps establish a relationship between customers and companies.
- Capture customer feedback: Finally, for a customer experience management strategy to be truly effective, organizations must capture customer satisfaction in real time. This customer feedback can help track the perception of customers, enable monitoring of quality and measure the overall success of a company’s customer experience management strategy.
Effective Customer Experience Management Strategies
There are many customer experience management strategies that companies can use. Here are some of the most effective customer experience management strategies used by top businesses.
Define a clear vision of customer experience
The first step in creating an effective customer experience is to define a clear, customer-focused vision that can be communicated across the entire organization. The best way to do so is to create guiding principles that must be followed.
For instance, several family-owned businesses are based on core values that are embedded in the company culture. Through such core values, businesses can deliver exceptional service, be humble towards customers and be open towards change.
Defining the customer experience vision should also drive the behavior of an organization. Every employee across every team and department should understand these guiding principles and follow them at all times. Organizations should also look to include these guiding principles across all areas of training and development.
Understand the customers and create buyer personas
To provide the best possible customer experience, organizations should first understand who their customers are and what their motivations and concerns are. Organizations should look to understand customers at a deep level and empathize with them.
To do this, organizations should
- Profile the different types of customers that interact with their company. This is one of the best ways an organization can understand the needs, motivations and concerns of customers.
- Use marketing analytics tools such as Facebook analytics, AdWords, Google Analytics and Mixpanel to gather relevant data on customer groups. These tools provide an organization data about customer demographics, customer interests and their purchase behavior.
After an organization collects enough information on customers, it should look to create buyer personas. An effective buyer persona should be a representation of a real customer as this allows companies to develop an emotional connection with customers.
Investing in the right infrastructure
A customer experience management strategy is only as good as the physical and the technical infrastructure that backs it. Because of this, organizations should always invest in the right infrastructure that allows accurate and seamless tracking and analyzing customer interactions.
Creating a solid infrastructure backing for customer experience management eliminates the need of guessing and provides more clarity when it comes to creating and studying buyer personas. The right physical and technical infrastructure will allow an organization to capture the right customer information effortlessly across every single touchpoint.
Developing an omnichannel approach
In today’s world, the power lies in the hands of the consumer and not in the hands of an organization. What this means is that modern-day customers get to choose when and how to interact with a company. Moreover, today’s consumers are more informed and more demanding than ever. This is because modern day customers constantly interact with brands across multiple touchpoints.
Today’s customers expect a consistent and seamless experience, regardless of how they are interacting with a company. Because of this, organizations must adopt an omnichannel approach to customer experience management. While an omni-channel approach can open up new ways to interact with customers, it also reduces the effort from a customer’s perspective. This helps customers engage effortlessly with an organization and experience the same quality of service across all channels.
Examine business objectives
For a customer experience management strategy to be successful, businesses must first examine their objectives closely. Proper and deep analysis of company mission, vision and business processes allows organizations to align their customer experience management strategies. This, in turn, will also help a company improve its business processes and achieve business goals based on customer experience.
Organizations should ask themselves these core questions to analyze business objectives,
- What people, business processes or technology are required to fulfill company objectives in-line with customer experience?
- Where do the gaps exist between customer expectations and customer experience?
- How good is an organization’s internal process when it comes to offering outstanding customer support?
- While new tools and technologies can be used to provide a better experience to customers?
By reviewing business strategies closely, organizations can answer these questions and develop a solid customer experience management strategy.
Work backwards from the experience that is to be delivered
One of the most popular customer experience management strategies is to work backwards from the experience that is to be delivered to customers. Apple is one of the best examples of a company to have successfully followed this strategy. Steve Jobs, the founder of Apple famously advocated the principle of beginning with customer experience first and then working backwards to create the technology.
To create a customer experience and work backwards, organizations should:
- List their brand’s customer experience stages where it is possible to make a positive impression. At such points, a company should showcase its USP.
- Focus on solving real problems that customers face rather than focusing on features or other superficial elements. Even a development that solves a small customer problem can have a bigger impact than delivering a new feature
Working backwards is one of the easiest and most effective ways of developing a robust customer experience management strategy.
Pay attention to customer needs and make use of feedback loops
According to Bain & Company, 80% of companies that believe they provide great customer service have only 8% of customers who agree with them. This goes to show that a significant percentage of companies are not paying attention to the needs of their customers.
This is why organizations should make use of feedback loops to determine customer needs. To do so, organizations should:
- Use real-time, post-interaction surveys to collect feedback from customers. If required, organizations should also follow-up surveys to gather detailed information from customers.
- Pay close attention to what customers say about the brand on social media. Customers are usually the most honest on social media.
By paying attention to customers, companies can receive actionable feedback on exactly what customers want.
Measure the success of delivering a great customer experience
Finally, an organization should measure the success of its customer experience management strategy to determine if things are paying off. The best way to measure success is by measuring business results.
Measuring customer experience can prove to be tricky, and because of this, businesses make use of certain metrics and benchmarks. In addition to this, businesses also look at their ROI to determine whether their investments in customer experience management are delivering results.
No business can exist without its customers. That’s why every business must focus on providing an excellent customer experience. Business leaders must be willing to explore new tools and technologies that enable better customer experience. Customer experience is an area that requires constant care and nurturing. Only by delivering a positive customer experience can companies realize a positive impact on customer loyalty, which in turn leads to higher retention and revenue growth.