Every company provides some level of customer experience, whether they create it consciously or not. The question your brand needs to be asking is: Are you investing enough in your CX initiatives? In most cases, the answer is “no.”
There are dozens of reasons why your brand should be investing in customer experience. As a matter of fact, McKinsey & Company, notes that “Optimizing the customer experience typically achieve(s) revenue growth of 5-15% and cost reductions of 15-25% in just 2-3 years.” So why do so many brands choose not to invest, or invest enough, in customer experience?
We’ll dive into four of the most common reasons why many businesses put off investing in a CX program until it’s too late.
1. “I’m not sure how to prove ROI.”
Many businesses struggle to identify the ROI of a CX program and they use that as a reason to justify forgoing CX initiatives, and it is not an illegitimate concern. The ROI of CX can be hard to establish because it is not usually a single number. Measuring the ROI of CX is possible, it just requires a different approach.
The way your company measures ROI can depend on how the program is structured and whether a specific team owns it, or whether it’s a cross-functional endeavor. Some key items that can determine ROI are things like increasing lifetime customer value, reducing customer churn, increasing employee retention or reducing operational costs.
For more information on how to hone in on the ROI of CX, you can check out our eBook, The Five Steps to an ROI-Focused CX Program.
2. “It seems expensive.”
Doing business is expensive and spending even more money on customer experience can seem like just another extraneous expense. However not taking the time or spending the money to understand your customers, however, is even more expensive. By operating without the full context of your brand’s customer experience, your organization might be focusing on improving experiences that are not important to the customers, or that might not contribute economic benefits to the company..
By putting the customer first and understanding the experience from their point of view, brands are able to identify key areas for improvement and are better able to prioritize those that will have the most financial impact. When managed properly, most CX programs will pay for themselves.
According to Jocelyn Wieser, senior retail business intelligence analyst for Cabela’s, “Through the implementation of ….technology and best practices, we’ve tripled our feedback rate, created a more customer-friendly and effective survey, responded to nearly 9,000 customer concerns, and realized almost $9 million in new revenue. In under six months, the program paid for itself many times over.”
3. “I can’t please everybody, so I won’t rock the boat.”
The reasoning behind this excuse is based on the assumption that customers as a whole are hard to please. This leads to unfortunate idea that if not everyone can be pleased, why spend the extra money and make the effort?
Contrary to this idea, our 2017 CX trends report, “The Power of Emotion and Personalization,” uncovered that—regardless of industry or country—customer expectations are reasonable. Our research found that 38% of consumers worldwide ranked “satisfied” as the number one emotion they associated with positive brand experiences. However, this number doesn’t do the actual requirements for a positive experience justice.
Contrary to popular belief, consumers are generally pretty easy to please. The opportunity is there to create positive interactions with your brand. With such reasonable expectations, your organization can’t afford to do the bare minimum—or nothing at all. There is so much more to gain from investing in a CX initiative. To ignore the obvious benefits of these is to refuse the possibility to turn customers to brand advocates.
4. “CX doesn’t appear critical.”
The impact of a negative experience can ripple through any organization and have an adverse impact on your brand’s bottom line. Studies have found that it takes 12 positive experiences to make up for one unresolved customer experience. CX programs help to single out those negative experiences and close the loop with your customers, stopping the negative ripple effect in its tracks.
By using a dedicated program and advanced technology to measure the customer experience, businesses are able to realize the value of putting the customer first. Understanding that there is more to the customer story than just being satisfied or unsatisfied is the first step in creating a truly robust CX strategy that will ultimately impact business performance.
If you are considering investing in customer experience, you’re probably considering all sides of the decision. And though negative reasons (such as the ones listed above) do exist, they are more often a result of misunderstanding or a lack of information. A strategic, comprehensive CX program can clarify perspective to reveal the obvious answer: It is always beneficial for brands to spend their time and money on improving their customer’s experience.