Giving your customers the best experience when interacting with your brand is key to improving customer loyalty and retention. A happy customer will always come back and send other potential customers your way.
Key Takeaway - Customer experience management (CXM) is improving your brand outlook from the customer’s perspective. CXM strategy is a framework that ensures your business process flow is in tune with what your customers want and demand in quality service.
When it comes to customer experience management, two facts hold. One, customers are the center of any business. Whether you run a D2C restaurant business or a B2B eCommerce wholesale distribution business doesn't matter.
Two, customers will always have a impression of your brand, positive or negative. Choosing to define that impression and make it work to your advantage or leaving it to chance and random circumstances, is up to you. Using customer experience best practices will promote the positive side of your brand.
Let’s look at why you need a customer experience management strategy. First, what is customer experience management?
What is Customer Experience Management?
Customer experience management (CEM or CXM) is the set of strategies a business employs to monitor, control, and arrange customer interactions. CXM, whether omnichannel customer experience or multichannel customer experience, sets the tone for the experience a customer has with a business throughout the customer lifecycle. This can be better optimized with a customer experience management software.
Several considerations and plans go into delivering excellent customer experiences at each stage of the customer journey. The customer experience strategy outlines the executable plans put in place to offer a satisfying, meaningful experience throughout pre- and post-sales interactions.
A customer’s journey does not end after they make a successful purchase of your high-demand products. With a positive experience from your brand, that customer becomes loyal, refers your business to other prospects, and improves your profitability.
Building an effective customer experience strategy will positively impact what prospective and existing customers think about your brand. As a result, you get better sales-qualified leads and higher customer satisfaction and retention.
Giving customers the best experience is the number one brand differentiation strategy and can be part of your brand’s unique selling proposition. Let’s look at some statistical figures:
- After only one negative experience, one in three customers will stop buying from a business they love.
- By having a positive customer experience, customers are willing to spend an additional price of up to 13% (and even up to 18%) for luxury and indulgence services.
- Following a more personalized customer experience, 49% of shoppers made spontaneous purchases.
So, why is CXM important? Let’s find out!
Why is Customer Experience Management Important? 5 Reasons for CXM
No business can survive without its customers. Customer experience management helps businesses to get new customers and retain existing ones.
Here are five reasons to invest in customer experience management:
- Better Customer Retention
The key to a loyal customer is giving that customer the best experience and service with your brand. Customers who feel seen, heard, and valued are more likely to become loyal to your brand.
Customer experience management strategies are designed to keep customers happy every time they interact with your business. For instance, responding promptly to challenges and staying in touch after a sales journey are excellent customer retention strategies.
The good perception that lies at the heart of the total customer experience will be strengthened when businesses recognize loyalty and, most importantly, thank their customers. Remember, customer experience management does not end.
According to studies, a 5% increase in customer retention can result in a 25% increase in profit. Retaining customers results in greater sales, a higher lifetime value, and a simpler approach to boost ROI from the first conversion.
- Higher Customer Lifetime Value
Customer lifetime value is the sum of all the money a customer will spend with a business on goods or services throughout the lifetime. Knowing your customer's lifetime value will determine whether you will spend more money on customer acquisition campaigns or focus on retaining existing customers.
CXM strategy ensures that the customer lifetime value increases. With a better experience, a customer comes back to do business with you. From sending notifications and birthday messages to launching a loyalty program, the customer will surely buy more products from your brand.
- Reduced Customer Churn
A higher lifetime value means that your business is enjoying reduced customer churn and turnover. Customers will prefer to do business with a brand that makes them feel special and attends to their needs.
You should not wait till it’s time for a customer to renew their subscription payment or recurring payment before sending a follow-up message. Customers are more likely to remember a brand if they receive frequent touchpoints from it, such as frequent phone calls, email updates, customer appreciation events, and sales.
- Reduced Marketing Costs
With a customer-centric marketing approach, businesses can easily understand what customers want from their brand and manage customer relationships. This will invariably lead to the launching of streamlined eCommerce marketing campaigns.
Analytics and reports from your customer relationship management software can give you a better view of your customer's purchasing behavior. You can use this customer data to improve your marketing efforts and reduce the costs of marketing.
- Better Customer Engagement
Customer engagement, customer relationship management, and customer experience go hand-in-hand. When you improve the way customers feel about your business, they will engage with you more across all your communication channels.
Better customer engagement means customers can drop positive feedback about your brand. This will lead to better social proof and customer reviews of your business. Making it easier for prospects to partner with you.
Frequently Asked Questions About Customer Experience Management Strategy
Designing an excellent customer experience strategy is easier said than done. The first step to creating the perfect customer experience strategy is understanding customers’ expectations.
Let’s answer a few simple questions about customer experience management strategy.
What are the Components of CX?
There are five components of a customer experience strategy. They include:
- Qualitative and quantitative customer research
- Customer journey mapping
- Team training
- Customer feedback loop
- Software integration
What Is the Difference Between Customer Service and Customer Experience?
Customer experience is the entire interaction a customer has with your business, from first being aware of it to after-purchase support. Customer service describes a single instance when a customer asks for assistance or support.
What are Touchpoints in Customer Experience?
Customer touchpoints are the different occasions when a customer will interact with your brand, either directly or indirectly. The customer journey is made up of many touchpoints, which are crucial in determining how the customer will feel.
Keep the Customers Happy
Customer experience management is a long-term process. It involves a series of trials and errors to get the perfect strategy for your business and ideal customers.
Using customer experience management software will make it easy to manage your customer experience. However, remember that customers are human beings, and adding some emotion to your CXM strategies will make a huge difference.