Customer Experience is life force of every business!

Core purpose of any business is to create and retain customers. In today’s competitive environment, retaining customers is even more important than creating new ones for every business regardless of the industry. Reason being, it costs five to six times more to acquire a new customer on an average than it does to retain an existing one.

We have witnessed in last few decades that almost all the industries have transformed to sell their products in the form of services. Front runners have even revolutionized their futuristic products and platforms through “as-a-service” business models.

Repeat business is the life force for any organization, a source of energy essential for its existence. Customer loyalty is going to be the cutting edge of service industry in this information and technology era. Profitable organizations have already understood customer centricity as a way of doing business that provides a positive customer experience every time the customer interacts with them, irrespective of online or in person. Customer centric approach results in repeat business and customer loyalty, which eventually leads to higher profitability.

The digital advantage

Because of the opportunities that arise from using modern technologies, customers often rate organizations on their digital customer experience. Digitization, automation and evolving technologies have caused a shift in customer expectations and has disrupted the customer behavior in a big way. To add to the complexity, Covid-19 pandemic has drifted the loyalty of customers to those businesses which offer safe and reliable services.

In today’s world, anything without intervention of technology is incomplete. Evolving technology is helping many of the well-established brands, new players and startups to grow exponentially as most of those have orchestrated the way to create a delightful digital customer experience through the usage of technology.

They create user friendly design of their websites and mobile applications which not only supports to market their products or services but also makes it very easy for customers to make online purchases which is further topped up by speedy and contactless deliveries. They adopt omnichannel approach which provide seamless shopping experience to customers whether they are using a desktop, mobile phone, tablet or even a smart TV, giving a hard time to the physical stores.

To provide a delightful customer experience, technology companies are taking advantage from Artificial Intelligence, machine learning, robotization, big data, analytics, virtual reality, augmented reality and various other advancements to influence the customer behavior. Digital personalization helps to provide virtual experience of trying the products or services before buying. It could be a dress, jewelry, hair style, painting or wall covering of your home, virtual tour of a house you are evaluating to buy, specific model of a car with the color of your choice and much more without even physical presence of product or service in front of you.

Companies also use AI enabled tools for collecting and processing customer data, which helps them to do customer profiling and suggesting the products or services as per customer’s preferences. Although, customer data is collected for the purpose of providing better experience to the customers, at the same time, organizations must stay away from annoying customers by invading into their personal lives.

Satisfaction = Perception – Expectation

The customers of today are more demanding than ever before and more importantly, they have multiple choices. It is important to understand that customers have expectations, whenever they buy any product or service. The experience of buying and using the product or service creates a perceived value for them which could be positive or negative. So, the need of the hour is to deliver the services one step ahead of the customers’ expectations.

Based on various studies conducted in the field of customer behavior, we can equate customer satisfaction as difference between their perception and expectations, means Satisfaction = Perception – Expectation. This equation helps us determine if we are creating a positive or a negative experience for our customers based on their level of satisfaction, which is the main influencing factor behind customer loyalty. Due to this reason, it becomes important to monitor the customer experience at every point of interaction of customers with the business.

As per this simple equation, if perceived value from the interaction is lesser than the expectation, then it gives a feeling of displeasure to customers. This not only repels the customer for future interactions but also create further losses to the business when they share their bad experience with others either in-person or through online reviews. Hence, negative customer experience leads to immediate loss of business and damages overall brand value of the organization.

If perceived value from the entire cycle of buying and using is equal to the expectation, it results in a satisfied customer. In today’s competitive environment a merely adequate service remains invisible and large number of customers may still go to competition as they want to try something better. The lack of wow factor also results in business reduction as higher cost is required to be spent to acquire new customers.

On the other side, if perceived value exceeds customer’s expectations, it results in delightful customer experience. Now this customer will be motivated to come back again and again seeking repeated instances of great experience. Such customers will also be willing to pay higher premium for those products or services of the organizations which makes them feel good at every interaction. We need not forget that only excellent service gets noticed. Delighted customers will be motivated to share their positive experiences with others through in-person or online reviews. Feeling of great experience not only generates loyal customers, but also converts them into unpaid marketing agents.

Win-win situation through great Employee Experience

While we talk about customer experience, we can’t ignore the experience of internal customers. Internal customers are those on whom we depend for delivery of our services or products to external customers. Employees, co-workers, subordinates and employees of suppliers and service providers are examples of internal customers.

Profitable organizations realize the value of internal customers and they focus heavily on great Employee Experience as they do for wonderful customer experience. The employees of such organizations are made to feel important and receives great amount of respect through every internal policy and interactions with the top management.

 Thus, positive experience of employees not only helps to build a strong brand value, it also helps to generate positive experience for the organization’s customers who often come in contact with it’s employees.

On the other side, if perceived value of employees is lesser than expectation, then employees are unhappy and frustrated. Internal friction leads to external, so disappointed employees of an organization will find it difficult to create a positive experience for its customers.

How you deliver, it matters!

You must focus on creating an experience where customers would want to come back rather than going elsewhere next time in anticipation of better experience. For creating a delightful customer experience, “how” you are delivering the service is as important as the “what” you are delivering. So, we can also say that, the way we deliver our product or service is equally or sometimes even more important than the service itself.

Customer expectations are dynamic

No organization can afford to relax because it is already successful. Changes in market conditions, technology evolutions and other factors like Covid-19 pandemic can influence customer behavior and reverse the past success very quickly. There are multiple examples around where even global leading organizations have vanished. Leaders need to preserve and consolidate their position through innovative strategies and practices keeping customer experience at the center. Above all, no business can afford to take customer for granted. You may have a great product, you may be a market leader in your segment, but if your competitor serves customer better than you, then you will lose everything. That’s the power of customer experience.

It's a journey and not a one-time affair

Expectations of customers are often influenced by similar industries or occasionally even by unrelated industries. Customer perception is fragile and can change with each interaction. Customer perception is one of the most important aspects required to be handled very carefully by any organization. Managing customer perception must be the top priority and the responsibility of every single person in any growth-oriented organization.

Customer experience is the sum of customers’ perceptions and feelings resulting from interactions with a brand’s products and services. Constantly maintaining a strong customer experience is of utmost importance. Customer experience matters the most to all those who want to stay in their job or business.

Customer needs to feel welcomed, understood, comfortable, appreciated, important and respected. Customer desires friendliness, empathy, fairness, participation, alternatives and information.

Small steps in improving the customer experience pays back in higher magnitudes. Resolving customer complaints immediately results in highest level of customer retention. Companies can boost their profitability extensively by only retaining a small percentage of their customers.

Customer Experience is not a mere FOMO!

The organizations, which are focusing on creating a delightful customer experience at every point of customer interaction are observing a multi fold increase in their sales and are on the path of profitable growth. Are you?