Five Reasons why Customer Experience Matters
Customer experience is a term which incorporates understanding the experience a customer has with a brand across all touch points – throughout the purchasing journey and post-purchase engagement. Customer experience is critically important to the sustained growth of a business to drive brand loyalty and advocacy. Here we explore five reasons why all businesses should pay attention to their customer experience and some key areas that can drive improvements.
1. The digital revolution has swung power back towards the consumer
Technological advances have meant customers enjoy a far wider choice and are able to compare and switch between companies with relative ease. In his book, The Ten Principles Behind Great Customer Experiences, Matt Watkinson states “Our exposure to affordable, quality design has raised our expectations, and it’s no longer enough for a product to satisfy our functional requirements, it needs to be intuitive to use, fit into our lives effortlessly and please the senses”
PWC found 32% of people would ditch a brand which gave them a bad experience – this is made so much simpler in a digital world. Switching from one e-commerce shop to another can be done relatively instantly compared to in the physical world where customers may have to walk across town to pick up the same product.
Online, the user experience is integral to whether a prospect converts to a sale or not. We therefore need to ensure all touch points are positive experiences – the process should be smooth, easy and quick and it should be simple for customers to engage with you. Control is also fundamentally important. Customers want to control the experience in their own time and own way. This removes frustrations and stress and the experience becomes predictably reliable.
2. Growth driven through word-of-mouth
It costs you eight times more to acquire a new customer than it does to retain an existing one. By focusing on delighting your customers during their experience with you, profit should be a well-earned by-product. Acquisition campaigns can be expensive (dependent on the media.) By focusing on both marketing and designing a positive customer experience, customers will be more likely to continue doing business with you but also, critically, they are more likely to advocate your brand. This allows you to acquire new customers with minimal or no cost.
According to a Nielsen, 92% of consumers rely on recommendations from their friends and families to make decisions on product & services. Recommend a friend campaigns can be leveraged to drive word of mouth through marketing. However, by recommending a product or service, a customer is putting their reputation on the line and they will only be happy to recommend if they truly believe their friend will enjoy and get value from interacting with the brand.
Negating a negative customer experience is just as important to ensure prospects aren’t turned off from a brand. Deloitte found customers tell an average of nine people about a positive experience with a brand, but they tell 16 people about a negative experience.
3. User-generated content is now a key component of the research and decision-making process
Over 50% of customers research a product prior to purchase. Reviews, social media and forums provide customers a platform where they can give honest feedback for all to see.
In his book Who Cares Wins, David Jones states that “Brands are defined by what consumers say to each other about them, not what a brand says to consumers.”
This open access to information means both the product or service and the customer experience are all up for discussion in the open world. Whether your business thrives or not will be largely determined by the positive sentiment shown (or not!) No amount of marketing will be able to counteract large swathes of criticism.
4. Creating meaningful experiences will give brands a competitive advantage
Reducing stress is a key component of experience design and providing a stress-free experience is a great starting point. For example, reducing the number of choices a customer has to make, identifying areas where customers might make mistakes and providing the ability for customers to provide feedback.
However, customer expectations have been raised through technological advances. It is no longer just a case of creating a functional, reliable and usable experience. To create a clear competitive advantage, brands now need to be focusing on creating more pleasurable experiences which have personal meaning to each individual customer. Outstanding customer service can leave a lasting impression on a customer and adding a personal touch to the experience will almost certainly be well-received. Even if your business is online-only, finding a way to create connections and build a personal relationship is a great way of retaining business.
5. Emotion plays a critical role in purchasing behaviour
Our beliefs and values affect how we behave so brands need to understand those higher objectives and engage accordingly. Brands that resonate with our personal brand values leave us feeling good about our decisions and those that clearly stand for something engender much greater loyalty. Therefore, it’s important to pay particular attention to your brand’s image and how its advertising communicates its values and beliefs to customers. Your brand image can provide a real differentiation to your business and an avenue for deeper engagement with your customers.
In addition, many purchases are not made rationally. How many times have you thought “I don’t really need that new dress,” but you bought it anyway? Evaluating how emotion plays a role in your customer experience allows you to tap into additional insight that can lead to new ideas to inspire and delight the customer throughout the purchasing journey.
Need some help?
If the above has piqued your interest and you want to find out more about customer experience and how we can help you improve yours, we’d love to talk! Our services include customer journey mapping, customer experience measurement, brand development, user experience design and more. To get in touch, contact us here.
References:
The Ten Principles Behind Great Customer Experiences, Matt Watkinson
Who Cares Wins, David Jones
http://www.nielsen.com/us/en/insights/news/2012/consumer-trust-in-online-social-and-mobile-advertising-grows.html
