Customer Experience Is the New Competitive Advantage

It takes a personalized, customer-centric approach to capture the modern consumer's attention. That's why customer experience is the next frontier.


Jana Barrett

October 10, 2016

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In a modern marketplace, consumers have endless options. Low prices and smart advertising aren’t enough to win their business. It takes a personalized, customer-centric approach to build brand loyalty. That’s why customer experience is the next frontier for companies hoping to maintain a competitive edge.

Data from Gartner indicates that as many as 89% of businesses will compete mainly on customer experience by as soon as 2017. Walker backs this claim, predicting that customer experience will overtake price and product as the key brand differentiator for B2B by 2020.

Soon enough, businesses will be pouring resources into customer experience in order to build an early advantage. In fact, Gartner suggests that 50% of consumer product investments will be redirected to CX initiatives by next year.

To compete well, companies need a deeper understanding of customer experience. In this post, we’ll look at how customer experience fits alongside three other key concepts: customer satisfaction, customer retention, and customer engagement.

Customer Experience: The Modern Battleground for Business

Customer Satisfaction & Customer Experience

Thanks to social media, it’s now extremely easy for unhappy customers to share their stories online. In just a few clicks, a bad experience can become a brand disaster. According to Zendesk, 95% of dissatisfied customers tell people about their experiences. What’s more, 76% of consumers see customer service as the true test of how much a company values them.

A mediocre customer experience isn’t enough. The expectations of the modern consumer are rising. That’s why even the most traditional industries are shifting toward customer-centric philosophies—some by choice, some by competitive necessity.

These days, nearly every industry measures customer satisfaction. Online retailers email post-purchase surveys to customers. Service providers use CSAT surveys to monitor support and sales interactions. Doctors’ offices send patient satisfaction surveys after visits.

Along with other less tangible factors, these touch points make up the customer experience. Companies measure customer satisfaction at these key moments to tap into the customer mindset and generate customer satisfaction metrics that help guide strategy.

Customer satisfaction surveys reveal the strengths and weaknesses in the customer journey. Using the feedback they collect, companies can design an experience their customers want.

Customer Retention & Customer Experience

Customer success is one of the hottest professional fields today, particularly in Software-as-a-Service (SaaS) tech. Companies with subscription-based models rely on renewals, so it makes sense for them to prioritize customer retention. They need to keep customers coming back.

Churn may be enemy #1 for these subscription-model companies, but it’s hardly unique to them. Customer churn is a major profit-killer for any company that counts on repeat business. So how can companies design a customer experience that boosts retention rates? Personalized messaging is a start.

Studies show that customers want a personalized experience from the companies they buy from, so marketers are responding with personalized customer journeys that deliver relevant content to customers when they want it most. Personalization is effective because it speaks to the individual, not the masses. Rather than receiving one-size-fits-all messaging, personalized campaigns take the recipient’s interests and purchase history into account. This establishes a more profound connection between company and customer that leads to increased customer loyalty.

As consumers look to the web for their needs more and more, companies that provide consistent service across channels stand to profit too. In fact, Aberdeen found that companies with a social care program experienced a 7.5% year over year increase in customer retention, while those without one only saw a change of 2.9%.

Bottom line: companies have to be where their customers are in order to keep them around. When the cross-channel experience is seamless and personalized, the choice to stay becomes much simpler.

Customer Engagement & Customer Experience

Last but not least, customer engagement is a big component of customer experience. Engagement literally means how customers are engaging with a brand across channels (website, mobile platforms, support resources, etc.). If the experience is lacking in one place, customers are bound to be disappointed.

Consider data from WOW, which shows that 52% of customers—more than half—are less likely to engage with a company because of a bad mobile experience. Companies often have a tough time grasping this. They’re looking at the bigger picture. Our website is good enough, they might think. Small improvements won’t make a difference. But a mobile user sees a clunky, unoptimized site and forms a negative opinion fast. Even worse, that one experience could become their lasting impression.

Of course, offering a mobile-friendly experience isn’t the only way to boost customer engagement. Websites can drive customer satisfaction and efficiency by making it easy for customers to find answers themselves. CRM Magazine found that 45% of companies offering web or mobile self-service saw an increase in site traffic and a reduction in support phone calls. By helping customers solve problems on their own, these companies reduced their operational costs and provided a better overall experience.

The lesson here? Think about the channel as much as the content. Customers engage with your company on their phones, on the go, when they’re busy. As a result, their mobile experience heavily impacts their overall customer experience. Make it easy and pleasant for customers to engage with your brand, wherever they may be.


Customer experience is a broad concept that we’re only just beginning to understand. What we do know is that customers expect outstanding experiences more than ever before. Every customer interaction contributes to their overall brand perception, which they’re likely to share online and offline.

Do you know how your customers feel about your products and services? For a good deal of companies, the answer is no. Online surveys help measure customer experience, turning those critical touch points into tangible data. Armed with customer feedback, companies can design a customer experience that keeps people engaged and on board.

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