Customer experience is not a new concept. We heard by now that the battleground for business growth lies in your ability to provide a better customer experience than any of your competitors.
According to the CX Network’s Global CX report, more than 60% of the organizations surveyed planned to have established or advanced CX practices by the end of 2018. And yet, whilst many organizations measure their CX in some form or another, the majority still have no idea about the actual value their CX initiatives bring.
It’s really hard to justify a CX budget or initiatives to the Executive team or Board when you can’t demonstrate the huge ROI awaiting the organization….if you could only get these initiatives signed off!
It’s even harder when you don’t have business buy-in.
But justifying the value of CX is actually easier than you realize!
The following sections come from Kapiche’s eBook: What’s the Real Value of Customer Experience? How to Justify the Case for CX in Your Organization (and Prove the ROI!).
Why your leadership should care about CX
Customers care more about experiences than ever before
Customers no longer just want a great experience, they demand it.
One survey found that 54% of customers will never do business with a company again after a single negative experience. Scary, right?! That means that any time you deliver a less-than-satisfactory experience, one out of two of your customers will leave you for a competitor.
To remain competitive in a market like this, businesses must compete on customer experience. As the strategic importance of having a strong customer experience becomes increasingly apparent, more and more businesses are eagerly looking for ways to improve their current CX strategy.
The happier your customers are, the faster you’ll grow
Traditionally, businesses are used to seeing a direct correlation between their overall growth and how much they invest in their marketing and sales. With a shift toward customer happiness, however, it’s clear that customer experience is the new engine that drives business growth.
In a study by HubSpot that surveyed over 1,600 C-suite executives and customer service representatives worldwide, it was found that growing companies were 70% more likely to prioritize their customer’s happiness over companies with stagnant or declining revenue.
The study found that the most successful companies made the customer experience a priority throughout all departments. They understood that every single aspect of the business–no matter how seemingly insignificant–plays an important role in determining a customer’s overall satisfaction and happiness.
It’s the only path to growth and success
According to Harvard Business Review, 73% of businesses agree that being able to deliver a reliable and positive customer experience is absolutely critical to their growth and success today, and nearly all (93%) organizations agreed that it will be their key differentiator by 2020.
The good news for you is that only 13% of organizations have the infrastructure in place to facilitate a CX strategy.
Right now there is a mad rush for every forward-thinking business out there to take advantage of new and existing CX technologies. 70% of enterprises have begun to significantly increase their investment into customer analytics solutions in order to properly evaluate their CX metrics such as Net Promoter Scores® (NPS®) and Customer Satisfaction Scores (CSAT).
These organizations have recognized that it is only through gathering and analyzing CX data that they can truly improve their customer’s experience, with deep actionable insights gathered from this data.
Image via Kapiche
Proving the ROI of your CX initiatives
CX Network’s global CX report found that one of the top priorities for CX practitioners in 2018 was linking CX initiatives to ROI, with 30% of respondents listing it as their main focus.
These results show that it is no longer enough to simply collect data about customer experience–or attempt to improve it–unless you’re able to accurately demonstrate the value of your CX initiatives and measure the ROI of your customer experience efforts.
Whilst many executives would agree that they need a customer experience strategy, most would not be able to point out the exact financial outcomes of their customer experience efforts. This is a huge issue as the inability to create a quantifiable link between customer experience and the bottom line would mean that the outcomes of customer experience strategies are muddled at best.
Not having an established link can lead to issues such as:
Investing in tactics that produce little to no effect on the bottom line.
A misunderstanding of how the customer experience provides business value.
Derailing customer experience strategies before they even begin.
To establish a link, organizations need deeper insight into the initiatives that will have the biggest impact on customer experience, so that they can prioritize and drive those initiatives that matter most to customers. Read more on this here.
Final thoughts on proving the value of your CX strategy
Demonstrating a clear link between CX initiatives and ROI is no longer a guessing game. Using CX data to prove a direct link between your CX strategy and measurable business results to your Exec team and Board, you will successfully keep your CX strategy a high priority.
Ultimately, it is this support from the top that will cultivate an entire organization that is hyper-focused on customer experience.
Need more justification for your CX strategy?
We show you how to clearly tie your CX initiatives to ROI by figuring out the amount of revenue each issue is worth to the business in our eBook. Download your copy here.
Editor’s note: This article reflects the opinions of our guest author.
About our guest author
Ryan Stuart in the co-founder and CEO of Kapiche, a text analysis solution that allows organizations to quickly understand what’s driving customer satisfaction with the deep insights needed to make impactful change to customer experience strategy. Use Kapiche with all customer feedback data including NPS®, CSAT, customer survey, and product reviews! Kapiche integrates with GetFeedback!