Why Every Company Needs Proper Customer Experience Management?

89% of companies believe that they will primarily compete on customer experience going forward. Still, very few companies are able to systematically manage their customers’ experience. For a reason or another, they consider the customer experience to be out of their control.

Companies are obviously different, and they have very different reasons why they are not able to take things into control in this field. Some of the most often occurring reasons include:

  • Some companies just don’t have the technical skills and know-how of the modern tools to deal with customer data properly.

  • Some companies lack the leadership commitment. They do things but not on a level with high enough impact.

  • Some companies decide to prioritize other things. They might be not profitable and the cost cutting is the only way to survive. Unfortunately, the less they focus on customers, the less likely a turnaround will be.

  • Some companies have an established process in place. Theoretically, they do all the right things. But they don’t do those things right. They read the feedback and respond to customers. They might spend tons on money on increasing customer understanding. But there is very little action based on that. Or they do all the right things but the process is too slow to have any real positive impact on their customer experience.

The reasons for ineffective processes are unique in every company. But they lead to very similar consequences: the company has higher churn, higher costs and it loses sales opportunities as a result.

To any company out there, listen: it is super important to start managing your customer experience in a systematic manner. The process in itself is quite simple. We often use the following illustration to describe the steps. The process of CX management

The process includes the target setting, feedback gathering and analytics, action planning and the required improvement action. Finally, it also includes closing the loop with the customers. The critical thing to ensure is that all of this is done properly.  And by properly, I mean that you do the basic process in a fast, focused and actionable manner.

And why is that? Below are some of the typical ways an ineffective customer experience management process hurts your business:

Increased churn

If you are slow in generating insights (e.g. you analyze and read the feedback manually once per month for reporting purposes or you have an external service provider doing that for you once per quarter), you are always late to respond to any issues your customers have. By the time you have your feedback analyzed and actions planned, your unhappy customers have already churned.

Lost sales

If your insight creation and action planning process takes too much time, you miss upsell and cross-sell opportunities. You are not able to reach out to the customer at the time they would be most likely to buy more of your products. Additionally, you are not able to capitalize on your happy customers’ likelihood to recommend you.

Lower ROI of improvement activities

Prioritizing improvement actions is difficult without the proper understanding of the importance of customer experience drivers. If your analytics process doesn’t bring you focused insights that help you to immediately make decisions and plan actions, you are highly likely to spread your resources too thinly, focus on the wrong things or focus on too many things at the same time. If you make improvements with a shotgun approach, the ROI of the investment you make will be low.

Higher costs

Finally, if you use ineffective tools and manual processing of data, your costs will be too high and you waste money. Having your analysts do very basic excel analysis is also wasting money if they could be spending their time more on more advanced analytics and driving improvement actions instead.

Be smart when designing your customer experience management process. And be smart when choosing the tools to use. Many things can be automated in an easy manner and artificial intelligence can help in generating insights into your decision-making process. You should be focusing on improving the customer experience and running your business – not on fiddling with data and trying to make sense out of it.