Customer experience is one of the new frontiers of marketing. Customers, in the market powered by industry 4.0, are more interested in the experience than in the product itself. In fact, according to a research held by Momentum Worldwide in 2019, 76% of the participants declared to prefer experiences over things.
This is closer to our own lives than you might think. Have you ever felt so well treated by a company that you eventually became their client for life? Or that a salesperson seemed to know your needs so well that you made an impulse purchase right on the spot?
On the other hand, have you ever found it so hard to navigate a website that you couldn’t find or buy what you wanted? Or had to wait so long for technical support on a product or service you bought that you never used that company again, nor recommended it to anyone?
All of those situations have to do with the same business aspect: Customer Experience. Miles away from that simple and old idea of mere customer service, it is one of the biggest marketing trends today. And it involves reconfiguring your whole business around the idea of providing a customer with what he wants and needs, before he or she even knows they might need it.
Want to know more of how that works? Don’t worry, we got a simple and complete guide to help you improve your “CX” in no time.
What is Customer Experience and Why is it Important?
Customer Experience, also known as CX, is the summary of every physical or virtual interaction a customer has with your business. It is the sum of what defines his or her perception of your brand, starting from the very first contact up to their level of satisfaction at the end of their experience.
Simply put, CX is one of the most fundamental parts of Customer Relationship Management (CRM) because it is what will decide if any individual that comes in contact with your business will become a repeat and loyal customer.
From your website usability to how your employee treated them, and how satisfied they were with your product, every piece of the puzzle will define how happy your brand made them – and, most importantly, if they are willing to come back.
In addition, a happy customer is not only a loyal one. Oracle conducted a global study in which 74% of senior executives stated a good experience will make customers become advocates for your business.
Not only will they come back, but they will talk about you with their friends, family, coworkers. They will recommend you, defend you, and bring you new business. They will become your marketing tool.
The importance of CX can be summed up in a simple idea: without customers, you don’t have a business. And an American Express research found that 86% of customers are willing to pay more for a better experience. This is why your main focus should be on investing in that experience, so you retain the ones you have, while also attracting new ones.
Why should your business focus on CX?
In an ever more scattered and competitive market, Customer Experience is set to be the defining factor that makes someone opt for your brand, and not another. A third of customers will quit buying from a business after their first bad experience. On the other hand, half of them are likely to splurge on an impulse purchase if they receive a personalized treatment from an employee, or even an online interface.
And if a customer rates your company 10/10 on a satisfaction level, he or she will probably spend more than twice as much on your brand. Their loyalty may last for over five years. When you are happy with a product or a service, you don’t quit them.
Talking in money figures, according to a study by the Temkin Group, businesses that make US$1 billion a year can increase that number by US$ 700 million in three years, simply by investing in CX. The reason is, by doing that, they attain higher customer satisfaction rates, reduced customer churn and, consequently, increased revenues.
If you want to make that kind of money, that means you cannot ignore your customer needs, their emails, feedback, queries, and expectations. You have to listen, understand, and act based on what they tell you.
That is why a Bloomberg Businessweek survey revealed that great customer experience is a top strategic objective right now for any kind of company. It is the most effective way to beat your competitors, and get your customer to not only come back and spend more, but to become your marketing tool, through word-of-mouth, positive online reviews, and recommendations to their friends and acquaintances.
Is customer experience the same thing as customer service?
Absolutely not! Customer service is when a potential client interacts with one of your employees, in a store, online, or on the phone, for example. And that is just one part of the customer experience.
If you go to a restaurant, and your order is served quickly, and tastes delicious, that is good customer service. But if you become a regular at that particular restaurant, the chef knows that you are allergic to onions, and does not use them in your food without you even having to ask, that is great customer service.
Because that is the heart, the central element, of CX: seeing and treating your customer as a human, an individual, and not a simple source of money. Customer experience is all about providing a human and authentic connection, one that does not feel run-of-the-mill, nor a script from a production line. It feels unique and personal.
Technology today, such as a CRM software, has made it possible for that individual experience to be executed in many different ways. Predicting future purchases and needs based on the customer’s history, or delivering targeted email marketing campaigns are good examples. However, it is still about seeing each one of them as an individual, listening to them, and anticipating their expectations and needs.
That does not mean customer service is not important. On the contrary. Providing assistance, answering every email, complaint, or question – and quickly – is more imperative than ever. But that is only one part of your customer experience, that has to start positively from the homepage of your website and last long after a purchase is made.
What makes for a good customer experience?
Exactly because good CX must feel personal and unique, there are no automatic formulas or guaranteed recipes. The one key element that is at the beginning of every good customer experience is: listen.
Know how to listen
Listening to what your customers are saying to your business, and about your business, must be your top priority. Every feedback, email, technical support call, or online review must not only be dealt with quickly, but also used as raw material to create a strategy in reducing friction and providing better and more personalized service for your customers.
Have a good system
In order to do that, a system that puts all that feedback and information together, and analyzes it, is essential. The logic is simple: create channels that make it possible for your customer to tell you what he/she wants, likes, or does not like, acknowledge and understand their demands; then act on them.
If you are not doing that, the alternative result is quite clear. Your complaint and purchase lines are clogged, and your customer is frustrated with long waiting times – which is the number one cause of bad customer experience.
The dialogue does not flow organically because your employee does not understand what your customer needs – which may make your employee’s frustration come off as rude or angry. Consequently, your client support is left with many unresolved issues and complaints. And your customer is dissatisfied with automated responses, and the lack of a personal, human, component. Those are all the roots of bad, or terrible, CX.
Mock up your typical consumer
Know, though, that it’s not easy. Most companies still don’t provide good or excellent customer service. In order to change that, your CX policy must come from the top of the chain, expressed in clear and public guidelines, available and known by everyone in your business.
For example, create personas, so your employees know whom they will be dealing with. Provide training for those same workers. And listen to their feedback, too. They are the ones on the frontline, so they are in an ideal position to see and feel what your company might be doing right or wrong – and how to improve it.
Always ask questions
Finally, never hesitate to ask questions. Use your chat platforms to better know your customers and their current experience with your brand. Follow those conversations up with emails. If necessary, outbound calls are not off the table.
And remember: it’s all about empathy. Emotions play a huge part in customer experience. It is precisely the emotions that will determine if your customer wants to remain in business with you or not.
But how do I measure if all of this is working?
Measuring and analyzing is one of the most challenging parts of customer experience. That is why a number of different metrics and tools were created to assess the quality level of CX in a particular company.
With them, it is possible to evaluate the effectiveness of specific strategies, as well as how they improve or not the customer’s perception of, and relationship with, your brand. The four CX measuring tools that are most used in the market today are listed in the following topics.
Customer Effort Score (CES)
It measures how easy, or difficult, a consumer’s experience with one of your products or services was. Here’s how it works: a customer made a purchase on your website, for example, and you wish to know how easy it was for him or her to navigate the e-commerce platform.
So you send a CES survey after they are finished, asking questions like “How easy was it to complete your online purchase”, or “to navigate our website”, with a rating scale from ‘1: very difficult’ to ‘7: very easy’. Pretty straightforward.
Net Promoter Score (NPS)
We all have answered a Net Promoter Score survey before. It measures a customer’s loyalty score, by asking a variation of the “On a scale from 0 to 10, how likely are you to recommend this product/company to a friend or colleague?” question.
In addition to being very simple and straightforward, that numerical score is a quite good assessment of customer experience. That is why the metric, created by Rob Markey and Fred Reichheld at Bain and Company, is favored by many boards and executive committees, being one of the most used by businesses in the world today.
Customer Satisfaction Score (CSAT)
While Net Promoter Score evaluates the satisfaction with the whole brand, CSAT surveys the customer’s experience with a specific product or service. The metric system, though, is pretty much the same, usually providing a scale from 1 to 5 or 7 – where 1 is very unsatisfied, and 5/7 is very satisfied. A yes or no answer may also be used, however.
Due to its specificity, and for how it makes possible to analyze each different point in the customer experience chain separately, most CX leaders in the world choose CSAT as their top metric.
Time to resolution (TTR)
One of the main sources of customer frustration, and bad experience, is waiting a long time to get a response. For that reason, TTR is a very important metric. It measures, in average, how long it takes for a customer’s issue or ticket to be solved by a company’s brand after it’s been open.
The result may be provided in days or business hours, being the product of the whole sum of time spent in resolution divided by how many tickets and issues were solved. The logic here is pretty obvious: shorten your TTR as much as possible, if you want to increase the likability of having return business from a customer.
CX trends
Good Customer Experience results all over the world have come from companies who have been following a certain set of practices. The first one is that they are customer-centric, instead of profit-centric.
That means their top priority is providing an outstanding experience, focusing more on retaining and satisfying their current customers than on attracting new ones at any cost. Second is that good CX usually comes from old school methods. Yes, again: human interaction.
Companies that privilege one-on-one personal conversations over chatbots, market research (such as customer calls) over predictive analytics and social media, as well as investing in talent on board, often present the best customer experience results. It is not about being state of the art, or overtly technological, but about the willingness to provide good, satisfying service.
Number 3 is something we have already said, but can never overstate: these companies are listening. The base for their CX strategies is the feedback from their customers. Not only they collect it, but they have put systems in place to properly analyze it, and turn the conclusions into action.
Next, they acknowledged the importance of their employees in implementing good customer experience. Not only did they provide specific and individual training, based on different departments’ and workers’ needs, but they also got all their workforce involved in their CX strategy effort.
Finally, no matter how well they are doing, Customer Experience leaders in the globe keep increasing their investment on CX initiatives.
Examples of Customer Experience
- Personalized Service: Imagine a customer receiving tailored product recommendations based on their previous purchases. It’s like having a personal shopper who knows exactly what they need.
- Seamless Online Shopping: A website that loads quickly, is easy to navigate, and offers a smooth checkout process makes shopping a breeze.
- Effective Customer Support: Quick responses to inquiries through live chat or email can turn a frustrated customer into a loyal one.
Types of Customer Experience
Navigating the world of customer experience can feel like walking through a maze. But breaking it down into types can help you focus your efforts where they matter most. Whether your business is primarily online, brick-and-mortar, or a mix of both, understanding these types can guide your strategy.
Digital Customer Experience
In an era where digital reigns supreme, your online presence is crucial. Digital customer experience involves every interaction customers have on your website or mobile app. It’s about creating an intuitive interface, providing relevant content, and ensuring a hassle-free checkout.
- Online Interactions: Customers expect fast-loading pages and easy navigation. A slow website can lead to abandoned carts and lost sales.
- Mobile App Usability: With more people shopping on their phones, a user-friendly app is essential. It should offer the same features as your website, if not more.
In-Store Customer Experience
For those with physical locations, the in-store experience is just as important. It’s about creating an inviting atmosphere and offering exceptional service.
- Physical Store Ambiance: A well-designed store layout and friendly staff can enhance the shopping experience.
- Staff-Customer Interactions: Knowledgeable and approachable staff can make all the difference. They should be able to assist customers and make recommendations.
Hybrid Customer Experience
Combining online and offline experiences offers a comprehensive approach. It allows customers to engage with your brand in multiple ways, providing flexibility and convenience.
- Combination of Online and Offline Experiences: Offering options like buy online, pick up in-store (BOPIS) can enhance convenience.
- Multi-Channel Engagement: Customers can interact with your brand through various channels, ensuring a consistent experience.
Benefits of Enhancing Customer Experience
Why should you care about improving customer experience? Because it directly impacts your bottom line. Happy customers mean repeat business, and in a world where competition is fierce, that’s invaluable.
Increased Customer Loyalty
Loyal customers are the lifeblood of any business. They not only buy more but also spread the word about your brand.
- Repeat Purchases: When customers have a positive experience, they’re more likely to return.
- Brand Advocacy: Satisfied customers often become brand ambassadors, sharing their experiences with friends and family.
Higher Customer Satisfaction
A seamless customer experience leads to satisfied customers. And satisfied customers are less likely to churn.
- Positive Reviews: Happy customers leave glowing reviews, attracting new business.
- Reduced Churn Rate: When customers are satisfied, they’re less likely to switch to competitors.
Improved Brand Reputation
Your brand’s reputation can make or break your business. A strong reputation attracts new customers and retains existing ones.
- Word-of-Mouth Referrals: Customers who love your brand will recommend it to others.
- Enhanced Public Perception: A positive customer experience builds trust and credibility.
How Does Arena Improve Customer Experience?
Struggling to keep up with customer demands? Arena offers innovative solutions to elevate your customer experience game. With our tools, you can engage customers in real-time, personalize their journey, and build a community around your brand.
Real-Time Engagement
In today’s digital world, customers expect instant responses. Arena’s real-time engagement tools ensure you’re always there when they need you.
- Live Chat for Instant Support: Address customer queries instantly, reducing frustration and increasing satisfaction.
- Live Blog for Up-to-Date Information: Keep customers informed with the latest updates and news.
AI-Powered Personalization
Personalization is key to a memorable customer experience. Arena’s AI tools help tailor interactions to each customer’s preferences.
- Commerce AI Recommendations: Suggest products based on browsing history and past purchases.
- Tailored Content Delivery: Provide content that resonates with each customer, enhancing their experience.
Community Building
Creating a community around your brand fosters loyalty and engagement. Arena’s tools help you build and nurture these connections.
- Interactive Polls and Quizzes: Engage customers with fun and interactive content.
- Community Spaces for Engagement: Offer a platform for customers to connect and share their experiences.
How to Implement Customer Experience Strategies
Feeling the pressure to deliver top-notch customer experiences but unsure where to start? Implementing effective strategies doesn’t have to be overwhelming. Focus on these key areas to create a seamless journey for your customers.
Analyze Customer Feedback
Your customers are your best source of insight. Listen to what they have to say and use that data to make informed decisions.
- Collect and Assess Feedback: Use surveys, reviews, and direct feedback to gather insights. Tools like Arena’s real-time chat can help capture valuable customer input.
- Implement Improvements Based on Insights: Prioritize changes that address common pain points and enhance the overall experience.
Use Technology
Technology is your ally in creating personalized and efficient customer interactions.
- Integrate AI Tools for Personalization: Use AI to tailor experiences to individual preferences. Arena’s Commerce AI offers personalized product recommendations that enhance satisfaction.
- Utilize Data Analytics for Insights: Analyze customer data to identify trends and opportunities for improvement.
Train Staff
Your team plays a crucial role in delivering exceptional experiences. Equip them with the tools and knowledge they need to succeed.
- Equip Staff with Tools for Better Service: Provide training on customer service best practices and technology use.
- Focus on Customer-Centric Approaches: Encourage empathy and active listening in all customer interactions.
5 Strategies to Enhance Customer Experience
Want to stand out in a crowded market? These strategies can help you create memorable experiences that keep customers coming back for more.
Build a Customer-Centric Culture
Your company culture should reflect a commitment to customer satisfaction. Make it a core value.
- Align Company Values with Customer Needs: Ensure every team member understands the importance of putting customers first.
Use Data for Personalization
Personalized experiences make customers feel valued and understood. Leverage data to deliver these experiences effectively.
- Tailor Experiences Based on Customer Data: Use insights to offer relevant content, products, and services.
Optimize Digital Touchpoints
Your website and app are often the first points of contact with customers. Make sure they’re up to par.
- Improve Website and App Usability: Ensure fast load times, easy navigation, and seamless checkout processes.
Engage Through Omnichannel
Customers interact with your brand across various platforms. Provide a consistent experience wherever they choose to engage.
- Seamless Experience Across All Platforms: Ensure your brand’s voice and quality of service are consistent across all channels.
Gather and Act on Feedback
Continuous improvement is key to maintaining a high standard of customer experience.
- Continuous Improvement Through Feedback Loops: Regularly seek feedback and make necessary adjustments to your strategies.
If you want to start testing some of the tools that will allow your brand to offer an even better customer experience, here’s what you can do: create an account at Arena and implement our freemium version of the live blog and live chat!
