Customer experience (CX) is the sum total of customers' perceptions and feelings resulting from interactions with a brand's products and services. CX spans the lifetime of customers' relationships with a brand, starting before a purchase is made, continuing through active use and to renewal or repeat purchase.
Any brand that has customers provides customer experience whether the brand realizes it or not. As the term implies, CX is based on the perceptions and opinions of customers. A brand may claim to sell a superior product or provide outstanding customer service, but customers are the ultimate arbiter.
Customer experience can be hard for brands to control because customers act, respond and react in unpredictable ways. The best approach for brands is to assess and optimize each customer touchpoint to maximize the likelihood of customer satisfaction.
Customer experience encompasses all the touchpoints customers have with a brand. Examples of touchpoints include researching product offerings, buying the product online or in person, opening a product's packaging, reading the instruction manual, speaking to a customer service agent, having the product repaired and exchanging the product for a different model.
Customers experience feelings and emotions at each touchpoint, which causes them to form judgments. Feelings can range from joy to apathy, disappointment and even anger. Judgments can range from positive, such as viewing the company as helpful when a customer is efficiently assisted, to negative, such as seeing the company as incompetent when dealing with slow and frustrating customer service. The emotions and judgments can vary wildly from one touchpoint to the next.
Positive customer experience can lead to customer retention. Gartner research in 2020 found an 82% average probability that a customer would stay with an organization when given the opportunity to switch after a value-enhancing service interaction compared with 61% probability after a regular interaction.
Great customer experience is one of the most important factors for business success. Brands that provide a poor customer experience take a hit financially and, in some cases, don't survive.
Providing excellent CX results in satisfied customers who become loyal customers who do repeat business. This is a more effective way to grow a business than relying solely on generating new customers. Many brands use customer experience as a competitive advantage, taking market share by providing a superior customer experience compared to competitors.
Happy customers also can become brand ambassadors. These are advocates who recommend a business's products and services to friends, associates and colleagues via word of mouth and social media.
Creating great customer experience requires a customer-centric approach, as well as a deep understanding of customer needs and expectations. Key initiatives to improving CX include the following.
A well-defined CX strategy serves as a roadmap for delivering exceptional customer interactions. It involves understanding the target audience, defining a brand promise and aligning business goals with customer expectations. A CX strategy should guide all customer-facing interactions and initiatives.
Digital transformation enables businesses to deliver personalized, real-time digital experiences that cater to customers' preferences and needs. This includes providing seamless omnichannel experiences, optimizing websites and mobile apps for user experience, and using new technologies, such as artificial intelligence (AI), to enhance self-service options.
Employees can provide the best and most personalized support when they're equipped with the necessary tools, training and authority to resolve customer issues. Empowered employees feel valued and motivated, leading to positive interactions with customers and, ultimately, enhancing customer experience.
Customer journey mapping helps businesses understand end-to-end CX and identify pain points and areas for improvement. By mapping each touchpoint and customer interaction, businesses gain insight into critical customer interactions and make informed decisions to enhance the experience. Additionally, customer journey mapping details a customer's goals and motivations at each one of those touchpoints.
Personalization is key to driving customer engagement and creating great customer experience. Using customer data and insights, businesses can tailor their interactions to meet individual preferences and needs. Personalization can range from addressing customers by their names to offering personalized recommendations based on their past purchases or preferences.
Creating a customer-centric culture starts from the top and permeates throughout the organization. It involves ensuring that every employee understands the importance of customer experience and is committed to delivering exceptional customer service. A culture of customer centricity encourages collaboration, innovation and accountability in interacting with customers.
Customer expectations and preferences evolve over time, so organizations must continuously monitor and adapt their CX initiatives. They should regularly review customer feedback on websites and social media, analyze customer behavior and stay updated on industry trends to identify areas for improvement and innovation. Customer feedback is essential to business, and companies should be willing to make changes to align with customer needs.
The latest technologies and automation can streamline processes, reduce customer effort and enhance overall CX. Implementing self-service options, chatbots and AI-powered tools can provide quick and efficient answers to customer queries and improve response times. However, it's essential to strike a balance between automation and human touch to maintain a personalized experience.
The most successful customer experiences can turn customers into brand ambassadors and advocates. Organizations should encourage and incentivize customers to share their positive experiences through testimonials, online reviews and word-of-mouth recommendations. Customer advocacy can significantly impact brand reputation and attract new customers.
Customer experience and customer service are similar, related terms, but they aren't interchangeable. Customer service is a facet of customer experience that requires specific skills, while customer experience refers to a broader spectrum of the customer journey.
Customer experience describes the emotions, judgments and reactions that a customer has throughout the process of interacting with the business. These steps include researching the product, making the purchase, getting help when there's a problem, reviewing the product and service, and potentially recommending it to others.
Customer service, on the other hand, is limited to interactions a customer has with a business's employees -- often customer support representatives -- before, during and after a purchase. These interactions can occur through communication channels, such as live chat, social media, phone calls, chatbots and email. Customer service can focus on helping a customer choose the right product and troubleshoot problems.
Companies can use processes to track, oversee and organize customer touchpoints through customer experience management (CXM/CEM). With CXM, the organization can evaluate and improve every interaction between a customer and the company throughout the customer lifecycle.
In a small business, such as a bakery, produce market or dry cleaner, only a few individuals provide customer experience. In larger companies that sell complex products and services, numerous groups and departments contribute to CX, some directly and others indirectly. Sales and customer support interact directly with customers, while engineering, marketing, finance and legal create products, services and processes that affect and influence customers but might not interact directly with them.
For more complex products and businesses, excellent customer service requires close coordination across groups among other best practices. For example, sales and customer support can provide customer feedback to product engineers so they can consider creating a new feature to address a product deficiency. Engineering then coordinates with marketing, which takes the lead in developing messaging about the new feature and communicating it to the market. Without such coordination, the product's shortcoming would go unaddressed and perpetuate poor customer experience.
Positive customer experience often revolves around listening to customer feedback and turning that into actionable insights. The following are some examples of CX strategies:
The quality of a customer's experience can make or break a company. Take the example of a company that sells an innovative, award-winning product. However, when customers ask for assistance, their calls aren't returned, and their issues go unresolved. In this example, the poor quality of customer service defines customer experience, undercutting the value of the company's innovative product.
CX strategies fail because of a variety of factors, such as the following:
There are a variety of metrics to measure customer experience. The most effective include the following:
It can be helpful for brands to assess the overall customer experience they provide through CEM. Companies can use several techniques and technologies, including:
Customer experience plays a part in retaining customers and driving revenue and profit. Master the top 10 customer success key performance indicators and metrics you should be tracking.
17 Aug 2023