Customer experience (CX) is defined as the overall experience of a customer with a company, based on all interactions before, during and after the purchase of a product or service.
In this article, we explain what customer experience is, how to design it through journey mapping, customer experience management, and best practices, with the top customer experience (CX) trends to watch out for in 2020!
Table of Contents
- What is Customer Experience (CX)?
- Importance of Customer Experience: 3 Key Business Advantages
- Customer Experience Design: Mapping Customer Journeys
- How To Measure Customer Experience (CX)?
- What is Customer Experience Management? With 5 Best Practices to Deliver Great CX
What is Customer Experience (CX)?
Customer experience (CX) is the overall experience of a customer with a company, based on all interactions before, during and after the purchase of a product or service.
In other words, CX is the overall perception of a company held by customers, that is based on all points interactions and engagements – including digital experience.
For example, below is a typical urban customer’s journey for purchasing a laptop today:
- Customer searches online for the top options for a laptop within his/ her required specifications and budget.
- Shortlists laptops perhaps watch the official video of the products, checks out more 3rd part reviews.
- May be goes to the store to test the actual laptop and interacts with the in-store agents.
- Makes the purchase online / from the store.
- Contact customer care for post-sales help / technical support from time to time.
- Depending on the product use and experience till now, it may or may not make additional purchases from the same brand.
So from the above example, we arrive at the following 5 key customer experience touchpoints:
- Brand discovery/ access experience: How easy was it to find the product’s website/listing? How was the website navigation experience? How well was the official product video put together? etc.
- Testing and final decision-making experience: How was the in-store experience? How were the customer reviews and 3rd party demonstration videos? Did the marketing team put enough helpfiles / FAQs about the product to answer common questions? etc.
- Purchase experience: How was the purchase experience (whether done online or in-store)? Was it simple and self-explanatory or did the user need more help? If the customer needed help with the purchase process, how well and fast was assistance delivered?
- Use experience: Above all – how well does the actual product fare Vs competitors in the same budget?
- Post-sales experience: How was the post-sales experience with the brand (for technical support/hardware or software issues? Does the company offer special loyalty rewards for more purchases? Did the company ask for customer experience and satisfaction feedback from the customer after a certain period of time?
A good customer experience with a brand is when customer expectations are satisfactorily met across all physical and digital points of interaction. Subjectively, great customer experience is when delivery exceeds expectations.
This also means that a positive customer experience delivery is not a goal that can be delivered by just one central team – instead, great experiences are a result of democratizing customer-centric focus at an organizational level such that it includes product development teams, sales, and support, marketing, etc. When a customer interacts with your product, opens a newsletter, reads a feature-update blog on your site, interacts with the service team and so on – the impact of these interactions are not soiled into team-specific perceptions, rather they all come together to form the holistic brand image.
If the overall experience delivered is consistently good – and across the board, the takeaway perception is a positive customer experience that the customer associates with the entire organization.
Importance of Customer Experience: 3 Key Business Advantages
Way back in 2011, Oracle had conducted a historic study that found 86% of customers were willing to pay more for better customer experience, but only 1% said that companies met their expectations. Its a key factor to understand why iPhone prices have risen by at least 10% each year since 2011 while managing to continue to break its own sales record year-after-year.
While many successful companies have come a long way in delivering great customer experiences, here are the 3 key reasons why any business, invariant of size and revenue, needs to care about customer experience:
1. Higher conversions and better campaign ROI
According to American Express, more than half of customers abandon a purchase due to bad service, which is a result of poor customer experience planning and execution.
Orchestrated and managed experiences lead to an improved buying experience throughout the journey – which in turn leads to higher conversions and customer acquisition through both physical and digital points of sale.
2. Increased revenue from existing customers
Another research by PWC found that companies that provide great customer experiences are able to charge a 15% premium, without losing customers.
Not only are companies able to generate more revenue by investing to deliver good experiences, but satisfied customers are also much more likely to continue with the same brand and even upsell to a higher value deal/product license.
This is not news, even back in 2015, a report published in ARC Journals, showed that 69% of surveyed customers ‘strongly agreed’ on the strong correlation between their retention and their satisfactory experience with the brand/company.
3. Increased customer recommendations
Here is a thumb rule that most of us can relate to as consumers (because we have all done it): when we like something, we tell people about it. When we don’t like it, we tell even more people about it.
This fact is the basis for Net Promoter Score (NPS) measurement, which is a customer survey asking people on their likelihood of recommending brands based on their experience.
In 2017, a Tempkin Group study found that 77% of customers who had a positive experience with a product/company – recommended it to a friend or family member.
Therefore, investing in delivering good customer experience leads to increased customer accounts through direct recommendations.
How To Measure Customer Experience (CX)?
Customer experience (CX) measurement is the process of surveying customers to collect data on their satisfaction levels across key points of interaction with the company.
This data is then analyzed to arrive at a collective understanding of the state of customer experience across geographic locations, products, departments, etc, and appropriate data-oriented action items are drawn to improve/ enhance the experience.
Customer experience is measured using 3 important surveys and their scoring:
1. Customer Satisfaction (CSAT) Score Survey: The CSAT score survey asks this question to its customers –
‘How satisfied were you with your experience with us today?‘
This question comes with a response option of 1 to 7, 1 indicating lowest satisfaction and 7 indicating highest satisfaction.
2. Net Promoter Score (NPS) Survey: The NPS Survey is one of the industry’s most trusted and straight forward experience measurement surveys. It is designed to probe customer satisfaction and brand loyalty at the same time. It asked customers the following survey question –
‘Considering your complete experience with our company, how likely are you to recommend us to a friend or family member?’
The response options range from 0-10, with 0 being least likely and 10 being most likely. Based on the response, customers are further bifurcated as brand promoters, passives or detractors. Responses from 0-6 are classified as detractors or potential detractors, 7-8 are passive and 9-10 are promoters.
3. Customer Effort Score (CES) Survey: The CES survey is typically administered to customers after an interaction with the company’s service or support teams. This survey asks the following question –
‘How easy was it for you to solve your problem with us today?’
The 5 response options for this question are: Very easy, Easy, Neutral, Difficult, Very Difficult. During aggregate calculation, Neutral response has 0 value, while all 4 remaining options carry 1 value each.
CES = %(Very easy + Easy responses) – %(Difficult + Very Difficult responses)
Customer Experience Design: Mapping Customer Journeys
Customer journey mapping is defined as a comprehensive, diagrammatic map of all possible stages and points of interaction between a customer and the company, starting from brand discovery to post-sale servicing.
This customer experience design also includes action items for delivering good experiences each point of interaction – to navigate customers to perform the next desirable action in their buying journey and throughout their lifecycle as a customer.
For example, in digital customer journey mapping, if a consumer visits the product feature page on your website, what is the next ideal step you would like him/her to take? Is it applying for a free license? If they are an existing user, should you offer a compelling discount to upgrade the existing license? How will this offer change based on geographic location?
All such questions, variations, and exceptions need to be taken into account during the journey mapping stage in as much detail as possible, with ideal outcomes for each interaction and a plan to encourage customers to perform desired actions.
Of course, given the variety of customers, this is not possible manually, and there are many customer journey design and management platforms in the market today to help marketers map customer journeys at scale.
What Is Customer Experience Management? With 5 Best Practices To Deliver Great CX
Customer experience management is defined as the overall process of designing, allocating resources and tracking the goal of delivering good customer experiences, such that it meets their business goals.
For example, an ecommerce business takes steps to improve website design in such a way that it increases customer interest in its products, reduces the effort required to discover or find products, eases checkouts and payment process, etc. The complete operations and processes required to deliver the optimized customer experience – website design and development execution, textual, graphic and video content, effective online and offline customer support, post-delivery feedback and follow up, etc – together is the customer experience management for this ecommerce business.
Here are the 5 best practices to manage and deliver a great customer experience (CX):
1. Be customer-centric
Every business has its constraints – it could be resources, revenue model, flexibility and so on. In order to deliver an optimal customer experience, you will need to prioritize based on customer’s needs – in other words, design from the outside-in, rather than from inside-out. For example, if you are a software product company, what is the preferred buyer journey? What channels and platforms do your best customers prefer to search, explore, and discover products on? How do they prefer to pay? What are their most important priorities in terms of features and capabilities? Many marketers tend to be channel-centric or even worse, technology-centric- i.e. building customer experiences around the channels or technologies they may already be invested in, versus focusing on being customer-centric.
2. Leverage technology to drive CX at scale
Tracking customer behavior to arrive at patterns of habits and preferences can happen at several levels, based on how advanced you are with customer data management. Whether you track customers at an individual level (unique tracking of each individual customer), device level (you can track user behavior and interests specific to a device), account level (tracking and targeting a business account as a single entity) etc., the more comprehensive your understanding of customers based on the data, the more tailored and personalized your customer experience approach can be. This means, not only do you need to invest in technology to track customers/prospects at scale, you need the right technology to deliver more relevant and personalized customer experiences. A typical set of technology platforms needed would include a customer data management platform such as customer data platform (CDP)Opens a new window or data management platform DMP to manage first and third-party data, some form of a data analytics platform, customer management platforms such as CRM, and of course the range of marketing technology platforms for marketing automation of email, social media, and all other channels.
Learn more: Top 10 CDP companies for 2020
3. Integrate your martech stack for seamless CX strategy-execution-analysis and optimization
Today, customers live and operate in a world that straddles multiple channels (online channels like email, social, mobile messaging and offline channels), multiple platforms (from Facebook to LinkedIn) and multiple devices (they switch multiple times a day between phone, desktop, laptop, and other smart devices). They may choose to interact with the brand at any stage, and the brand is expected to be ready, with the right message at the right time. Also, marketers cannot duplicate messages or send contradictory messages on different channels or platforms.
Just building the infrastructure to give you a unified view of the customer is not enough to build customer-centric CX strategies. The data then needs to be used – or activated – across multiple channels in an orchestrated manner to deliver what the customer will experience as a seamless interaction, irrespective of the device, channel or platform where the interaction happens. This needs marketers to think about removing silos between different marketing channels and technologies, finding ways to connect them. Integrating an intelligent analytics platform across the stack is also crucial to ensure performance metrics and insights are looped back for real-time campaign optimization.
4. Provide consistent experiences
According to the 2018 Gladly survey, 71% of customers said that they expect consistent experiences from brands invariant of a channel of contact, while only 29% said that they actually experience this consistency.
Therefore, companies that invest in delivering orchestrated and consistent omnichannel experiences will hold a critical business edge over the competition – this verdict is already out!
5. Create and deliver differentiated experiences
This sounds obvious and even archaic, but it is still a critical part of delivering the overall customer experience today. Customers today don’t just expect personalization for the sake of it- they also expect brands to be relevant, contextual, and above all, authentic. Anything that feels like its coming from a machine is automatically filtered out by today’s digital natives. The irony is that the more we use intelligent technologies such as AI to deliver CX, the more ‘human and authentic’ interactions are expected to feel! Brands need to build their own unique, differentiated voice and positioning – but most of all, they need to build differentiated experiences.
Learn more: Top 7 Customer Experience (CX) Trends for 2020