Nowadays, the concept of customer experience is present everywhere. In fact, some experts say that focusing on customer experience has become the most important factor which allows a company to succeed, creating a significant competitive advantage.
But what exactly is the customer experience? How is it different from customer service? And why is the customer experience so important to companies these days?
What is a Customer Experience?
Customer experience is the sum of all customer interactions with the company, its products and services. This is generally the perception of the company by the customer. According to Forrester, customer experience (CX) means “how customers perceive their interactions with the company.”
The difference between customer experience and customer service
Customer service is only part of the customer experience. This is illustrated by the following equation:
Perception of the company by the customer
Customer interaction with the company (customer service)
Remembering of the entire purchasing process, from the beginning to the end, at all contact points.
From this equation, it follows that “customer service” is only one part of the equation – the actual interaction. The customer’s interaction is influenced by the skills of the customer service employee, ease of use of the website, the functionality of the product / service as well as ease and convenience of the transaction. It should be remembered that the customer experience is not limited to interactions with the company, nor is it a one-time experience. It is rather the sum of experiences gathered at each customer’s contact with the company, measured over the entire life cycle of the customer.
In other words, customer experience goes beyond the customer service itself and is more than any single employee or department. It’s about understanding the customer as a segment and as a person and developing a plan to provide him / her with exceptional experiences and then allowing employees to deliver these unique experiences with every contact of the customer with the company.
The main difference between customer experience and customer service is that customer service is reactive – it comes into play only when a dissatisfied customer contacts the company. A company can only act if something goes wrong, not sooner.
On the other hand customer experience is proactive – the company can take action to optimize customer journey before the customer becomes unhappy. Customer experience is a holistic approach that goes beyond customer service and takes into account the customer’s overall journey by building long-term customer relationships.
According to McKinsey, companies focused on providing better customer experience have achieved a 10-15% increase in revenues and a 20% increase in customer satisfaction.
Top 7 reasons why positive customer experience is so important
- It increases customer satisfaction
- It improves customer’s loyalty and affects more frequent purchases
- It makes customers recommend your company more often to other people
- It lowers customer’s cancelations
- It creates a competitive advantage
- It increases revenues and sales
- It builds stronger relationships with customers
Customer experience is not an empty word. This is a closer look at the customer’s life cycle, which is powerful enough to make the company stand out from the competitors, keep and attract better employees, and significantly increase return on investment, sales and profits, thanks to regular, satisfied customers and a steady flow of new ones.
Unfortunately, there is no shortcut to build customer satisfaction. It is so settled in the company’s processes that everyone in the company must work on customer satisfaction. But for companies which are efficient enough to work on customer experience or for those who are already working on it – the rewards are worth the effort.