Today, we offer a guest post examining customer experience from a digital marketing perspective. This post was penned by Maya Nix, Marketing Content Producer for ClickTale.
A recent Gartner survey found that 89% of companies plan to compete primarily on the basis of customer experience (CX) by 2016. With 2016 budgets and marketing plan deadlines around the corner, many digital marketing professionals are finding themselves scrambling to understand more about CX and how they can use it to rise above their competitors in the coming year.
1. Defining Customer Experience
Many of us are grappling with the fundamental principle of defining what customer experience actually is. Some think it is the intersection of Customer Service and User Experience, but this is an inaccurate and rudimentary definition.
CX can be defined as the way customers perceive all interactions with a company through all stages of the customer journey. It includes digital touch points and personal ones, pre-sale and post.
An interesting quality of CX is that the customers’ perception might be very different from the company’s perception of the experiences they provide. This subjective perception makes CX optimization evasive, ambiguous, and challenging to measure and benchmark.
Nonetheless, optimization is a critically important metric that we must quantify and strive to improve.
2. The Economics of Customer Experience
Do you know your customer acquisition cost (CAC)? For most marketers, it is quite a significant amount. Simply put, getting new customers is expensive. But optimizing CX can help reduce CAC and increase company profits in several ways:
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First (and most importantly for most digital marketing professionals), optimizing CX increases conversions. With a good CX strategy, more prospects will become leads and more leads will become customers. If you can gain more customers from the same traffic base, you’ll lower CAC.
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Secondly, CX increases customer loyalty and retention. When customers are retained for longer periods of time (or partake in upsells and additional products, seats, licenses, etc.), their lifetime value increases. According to Andrew Chen, companies strive for a CAC that is lower than the customer’s lifetime value. Getting a customer has to cost less than the revenue generated by the customer.
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Finally, customer loyalty increases with an effective CX strategy because it turns customers into brand advocates. Brand advocates give positive reviews, share content, and tell their friends and associates about products they like. This acts as a sort of growth hack to increase customers with little (or no) further investment.
With strategic CX improvements, the reduction of the CAC creates exponentially more profit for companies, especially when they can increase lifetime value and generate additional sales from their traffic base.
Forrester Research analyst Megan Burns writes, “the news is good for companies hoping to get a financial boost from their efforts to improve customer experience… the revenue benefits of a better customer experience range from $31 million for retailers to around $1.3 billion for hotels and wireless service providers.”
3. Managing Customer Experience Comes From Measuring Customer Experience
If you understand what CX is and how it can improve your bottom lines, then you see the importance of managing and optimizing it. However, to enhance your CX, you must first measure and benchmark it. Only then can you strategize about how to improve those results.
The first step is to truly understand the audience. This comes from creating in-depth personas, as well as understanding their psychological personality types. Once you understand your audience, you need to map their touch points – both online and offline, before the sale and afterwards. These can include content pieces they view or download online, signup forms, outgoing emails from sales, incoming phone calls to support, social media interactions, and more. You then need to understand their expectations for each of these touch points in order to measure their perception of the experience.
With the audience profiled and their touch points mapped, you can begin to measure the CX for each of the following factors:
Reliability
Especially for online businesses, whose anonymity may be their Achilles’ heel, customers need to feel confident in their perception of the organization’s trustworthiness and reliability. Constant media coverage of online scams and fraudulent activities makes customers seek reliability through trust seals, socially-verified customer testimonials, security assurances, and satisfaction guarantees.
- Do your customers perceive your business to be one that keeps its promises?
- How can you enrich this perception both online and off?
Value
Digital marketing professionals are already well aware that value is not the same as cost. Regardless of what your product actually costs, the measurement that is important when it comes to CX is the perception of value. A 99-cent mobile app may have a lower perception than a $999 SaaS suite.
- How do your customers, leads, and prospects view the value you provide?
- How can you improve this perception? Does it require changing the cost?
Response Times
When customers (or prospects) call your support number, how long are they on hold? According to Dave Chaffey, 53 percent of customers expect their calls to be answered within 3 minutes. Buffer and other great companies have a goal of replying to emails within an hour.
- What are your customers’ expectations for phone calls? Emails? Live chats?
- What are your current results?
- How can you improve the perception?
Customer Service
Quite simply, are your customers satisfied with your service?
- Are issues handled professionally in a timely manner?
- At every touch point, from early research stages through the sale and any issues that arise thereafter, aim for a high customer service perception.
Quality
Looking at the perception of quality is not just a product-centric endeavor. At ClickTale, we strive to provide high-quality products (or at least those that are perceived as such), but the perception of quality must be present throughout the customer journey.
- When viewing a product highlight video, do visitors perceive your product to be a good one?
- Even when they encounter problems with your product, when they reach out to support services, do they feel like they are dealing with a quality product and company?
Measuring these five elements (and any additional ones that apply to your business goals) at every touch point will enable you to benchmark them and strategize for ways to improve your customer experience.
Interested in Customer Experience? Know This…
Customer experience sets great companies apart from mediocre ones. To successfully compete, you must continuously optimize your CX for every step of the customer journey. This will undoubtedly result in increased financial rewards.
About the Author
Maya Nix is the Marketing Content Producer for ClickTale, a technology evangelist in the growing field of digital customer experience. Maya applies her strong background in crafting a variety of content deliverables for the online industry to develop ClickTale’s thought leadership content. Maya holds a B.A. degree in Political Science from Tel-Aviv University and LL.B degree from Dalhousie University in Canada.
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