The Importance of Customer Experience in Brand Differentiation

The past year has certainly been an eye-opener for companies on the importance of customer experience (CX). While customer journeys grow in complexity, customer expectations have never been higher. Today’s customers, empowered with technology, expect efficient, convenient and personalized interactions across every channel.

Brand loyalty is no longer based on price and the quality of the product or service. In fact, it’s quickly being overtaken by CX as the key brand differentiator. But competition is fierce, with more than two-thirds of businesses already competing primarily on the basis of CX (Gartner).

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The good news is, there is a tremendous opportunity for companies to innovate across the customer experience journey and distance themselves from their competitors. In the US, for example, 75% of consumers view CX as an important factor in their purchasing decisions, yet only 49% of them say companies provide a good one (PwC). 

So, what’s the difference between those that are excelling in CX and those that are falling short? Let’s explore the importance of customer experience and what you, as a business leader, can do to meet those customer experience expectations.

The Importance of Customer Experience

Loyalty is everything

The connection between positive customer experience and customer loyalty is staggering, and the benefits are very real. A recent study by Qualtrics XM Institute showed that CX strongly influences how likely customers are to:

  • Recommend a company
  • Repurchase from company
  • Trust a company
  • Forgive a company
  • Try new offerings right away

The result: customers who gave a company a very good CX rating were 5 times more likely to perform these behaviours with that company.

Get that extra revenue

Evidently, the increased loyalty translates to a higher customer lifetime value. In fact, companies that excel in CX tend to drive revenue 4-8% above their market (Bain & Company). 

If that doesn’t convince you of the importance of the customer experience, then consider this: 86% of buyers are willing to pay more – up to a 17% premium – for a positive CX (PwC).

Competition is only a few clicks away

With CX expectations on the rise, the margin of error across the customer experience journey is considerably reduced. Consumers can easily find information on price, find reviews and make informed decisions. If they don’t feel like you value their business, they’ll quickly go elsewhere. In the US alone, 59% of consumers will walk away after several bad experiences with a brand, and 17% after just one (PwC).

Be sure to check out this blog for a more on the importance of customer experience.

Ways to Improve Customer Experience

Break the silos

While 76% of customers expect a seamless experience across all departments, 54% of them feel like they don’t share information with one another (Salesforce). To offer a frictionless customer experience, you’ll need to develop a knowledge-sharing culture within your organization and empower your employees to perform at a higher level. 

By centralizing all of your customer information and making it readily accessible across all departments, you enable your employees to provide more consistent, repeatable interactions at any touchpoint in the customer journey. 

high five fresh off the boat GIF by HULU

Marketing teams, for example, may collect data on the latest market trends, but if they don’t share that information, other employees, such as sales representatives, may lose an opportunity to better connect with current or potential customers.

Similarly, your customer service team may obtain valuable customer feedback that can help your product development team improve a product.

Personalized interactions

A personalized customer experience is critical to create an emotional connection with your customers and exceed CX expectations. With so many brands to choose from, how and when you interact with customers will determine their level of engagement with your brand.  

Utilize technology 

As you’re looking to share information between departments and personalize your interactions, technology and automation are there to help. A CRM cloud solution, for example, centralizes your customer data and makes it accessible from anywhere, at any time. What’s more, the data can provide valuable insights to personalize the interactions throughout the customer journey.

When implemented correctly, technology and automation can also increase speed and convenience for your customers. A chatbot, for instance, can provide 24/7 customer service and handle multiple requests simultaneously.

Develop an omni-channel strategy

Consumers today not only expect to be reached at the right time, on the right channels, they demand a consistent, seamless cross-channel experience. 

Developing an omni-channel strategy can help you organize your customer journeys and bridge the gap between online and offline channels. Naturally, this requires a deep understanding of your customers, where they are and how they like to engage. 

But the benefits of an omni-channel strategy go well beyond the convenience to the consumer. Brands that use three or more channels in their marketing campaigns have 250% higher engagement and purchase rates than single-channel campaigns (Omnisend).  

Prioritize security and privacy

The security and privacy of personal data can be a very sensitive topic. Statistics show that 85% of consumers will not do business with a company if they have concerns about its security practices (PwC). 

Accordingly, you need to convince your customers that you’re making their data protection a top priority. For instance, many companies are now using a two-step verification process at account creation or when changing a password.

Conclusion

The shift from price and product towards customer experience as the key brand differentiator is well underway. The impacts of a CX mindset on brand loyalty and revenue are undeniable, but getting it right requires agility and innovation.

In the end, organizations who recognize the importance of customer experience and take action to exceed CX expectations are the ones who will move – or stay – ahead of the competition. 

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Jenny Jones

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MasterSolve is a business and technology consultancy with offices in Toronto, Ontario, and St. Louis, Missouri.  We are your trusted business partner with expertise in Customer Relationship Management (CRM) and Marketing Technology (Martech) solutions. We live and breathe CRM we use a combination of best practices and common sense to help you implement and support, the software and technology you need to run your business and meet your goals.

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