Competition in the business world is so high that companies are striving to stand out in a crowded marketplace. One of the popular methods they use is investing record amounts into enhancing their customer experience. The idea that in business, the customer is king, is a no-brainer. But, how much is the customer experience worth to your business?
In today’s world, customers have access to everything (or almost everything) due to the technological advancements, particularly, the internet. This also means customers have a lot of options to choose from when looking for a service, good or product. As an organization, one way to truly standout from competition, and to keep your business on the minds of these flexible and gullible customers is through having a superior ‘customer experience’. And, this is why companies are starting to pay more attention to the ‘Voice of Customers (VOC)’.
One of the most important things, if not the most important, in business is ’Customer Satisfaction’. And customer satisfaction can only be achieved by providing the best experience to the customer.
In an organization, failing to meet your customer’s expectations or failing to achieve customer satisfaction can have serious negative consequences. This is because falling short on expectations directly impacts customer retention and repurchase behaviors, which can result in lower profits and decreased market share. Simply put, if your customers are not satisfied, your sales would decrease, profits would decrease, and the value of the business would eventually diminish. So, as a company, the need to invest in customer satisfaction cannot be over emphasized.
This is one of the many questions facing organizations today. Head of Global Customer Center of Excellence KPMG in the US, Julio Hernandez in his book, ‘How much is Customer Experience Worth’ hit on the things companies should do. The most important ones are:
Even when organizations and companies develop business cases for customer experience, many fail to ground their investment plans on financial/customer measures with a clear linkage to value generation. Managing by metrics simply entails, investing properly on customer experience, developing a business case to guide the investment decision, ensure investments to meet customer expectations are tied to metrics with proven association to customer experience, and moderating assessments of value generation from investments designed to delight customers.
Simply put, organizations should generate an accurate estimation of the benefit potential possible from customer experience. This can be done by taking note of customer feedbacks and having all the necessary customer data needed to accurately estimate the potential upside from customer experience.
Customer experience is expected to overtake price and product as the number one brand differentiator over the next five years. Almost nine out of ten organizations say they expect to be competing primarily on the basis of how they interact with customers.
As customer experience rises in importance, organizations have to understand the value the experience brings to the customer and to the organization. For many organizations, investments in improving the customer experience doesn’t generate enough value or provide an acceptable return on investment (ROI).