The industry analyst Gartner says that, based on their research, the customer experience (CX) is now the top priority for 89% of business executives. As I wrote in one of my recent blogs, there is research that shows this focus is good for business. Improving your CX directly leads to an increase in revenue regardless of the type of business you are running, but CX investment can also be a defensive strategy too.
What do I mean? Well any manager asking for budget for a project usually has to demonstrate a Return on Investment (ROI). If we invest X in the plan, then we will get Y within Z months – this basic formula allows business decisions to be undertaken. Sometimes the outcome is a reduction in cost, sometimes it may be that the investment will increase revenue, but sometimes a defensive investment is needed because the cost of not investing is what is a danger for the business.
The IT Company Vision Critical found that if a customer has just two bad experiences with a single brand then almost half (42%) of those customers would never use that brand again. Think about this. Customers want their experience with your brand to be great. Let them down just a couple of times and you will never get any business from them again.
While investment in CX to boost your revenue sounds more exciting, it is this defensive investment that can be even more important. It’s hard to find new customers so you need to ensure the ones you already have are well looked after and are not boycotting your brand just because of bad experiences.
This is all complicated by the fact that customer expectations are evolving. Not only do customers have a more sophisticated view of the service they expect, channels available, times to respond, and so on, but also there is an evolving change in how customers relate to brands. Engagement is less transactional and more focused on a continued relationship that builds slowly over time, but can be quickly ruined by poor experiences.
If you thought the recent data I shared on how valuable CX investment can be for your revenue was interesting then I believe this need to look after the customers you already have is equally important and needs to be on the board agenda.
Photo by Garett Yoshimura licensed under Creative Commons.