Not every business makes customer experience a priority, but they should
There’s a sound business case for the importance of customer experience in today’s business environment. Whether it’s online, in-store or over the phone, customer interactions are at the heart of every business. More so than product quality and price, memorable experience is the No 1 factor that drives consumer choices such as repeat purchases and continued loyalty. Studies suggest that in just a few years 89% of businesses will compete mainly on customer experience and 90% of customer experience decision makers say that a good experience is critical to their success.
1. Customers Buy on Value, Not Price
It’s estimated that by 2020, customer experience will eclipse price as the main product differentiator. In just three years, providing a personalized customer experience across all channels will be vital for businesses hoping to maintain market share. Experience is the magic sauce made up of quality, availability and emotional engagement. Mixed correctly, this recipe will win over customers EVEN WHEN they are faced with a less expensive product or service. The only way to determine the Knowledge Rhino mix, of course, is to understand what your customers value. When you think you need to lower your prices, or “trade on price,” first look at your customer experience. What kind of feedback are you getting? Do you measure this and analyze it regularly?
3 in 5 Americans (59 percent) would try a new brand or company for a better service experience (Source: American Express Survey, 2011).
2. You Can Avoid Problems
Companies that deliver stellar customer experience (Disney is consistently at the top of this list) don’t have to spend as much time, energy and money fixing problems. Although every problem is not 100 percent avoidable, providing consistent quality customer experience can ensure friction doesn’t become an issue. And when you treat your customers well – like gold, family or royalty – you reduce overall problems, making customers feel comfortable doing business with you. Treat them poorly, on the other hand, and you can almost guarantee you’ll run into problems.
3. Good CX Retains Customers
Even the most customer experience averse recognizes that it costs businesses significantly more to attract new customers than to retain current ones. On average, loyal customers are worth up to ten times as much as their first purchase, but that doesn’t add up to anything if you don’t prioritize customer experience. Keeping this audience happy – by proving personalized, Omni channel experiences – is obviously a no-brainer.
The probability of selling to a new prospect is 5-20 percent, while the probability of selling to an existing customer is 60-70 percent.
4. Stop Serving the Competition
By ignoring the value and importance of customer experience, you are essentially serving your customers up to the competition on a silver platter lined with cash. Today’s marketplace is vast, and if you don’t make doing business with you easy, it’s not difficult to find a competitor who does. By providing the best in customer service, you can increase trust, which can mean the difference between customers who are loyal and those who are gone.
An American Express survey found that 78 percent of consumers have backed out of a transaction or failed to make an intended purchase because of sub-par customer service.
5. The best Marketing Tool
“If you don’t have anything nice to say, don’t say anything at all” has been replaced by, “If you don’t have anything nice to say, take to social media to air your grievances.” Word-of-mouth is more important today than ever, and the best – and fastest – way to positively drive it is by providing stellar customer service. When you do this, people talk about you, remember your brand and even recommend you to others! Start by advertising your customer satisfaction standards and using customer testimonials and happiness ratings to show potential customers just how much you do.
Not every business lives by the “customer is always right” credo. Not every business makes customer experience a priority. Then again, not every business survives to live another day. The choice is yours, and it rests squarely in your understanding of the role of customer experience.
Knowledge Rhino connects small and mid-sized businesses with the tools and solutions that drive customer experience results for optimal success.