As a feedback tool company, people often ask us about customer experience management (CXM).
What is it?
Is it even worth doing?
The answer requires a more in-depth explanation than a yes or no, so we’ve created this comprehensive blog on measuring and managing the customer experience.
But why is there so much focus on customer experience? Because it’s the new battleground for companies.
61% of customers are willing to pay more for a superior customer experience with a brand. Interestingly, almost the same number of customers (63%) are likely to leave a brand after a negative interaction.
Yes, the stakes are that high. We know you don’t want to lose your customers; who does?
So sit back and explore some of the best practices for getting started on customer experience management. We have also added some challenges people face while implementing a CX program in their business and their solutions, so you don’t make them.
So let’s dive in!
What is Customer Experience Management?
In simple terms, customer experience management or CEM definition can basically be stated as a system that businesses use to track, oversee and respond to all the customer interactions. The primary aim of this system is to help companies exceed the expectations of their customers to increase loyalty, advocacy, and overall customer satisfaction.
The definition of customer experience management also outlines that customer goes through several touchpoints in their customer journey, which includes:
- Hearing about your company
- Making the first purchase
- Getting assistance from the company and many more.
This is where the customer experience management system comes into play.
It is responsible for overseeing all the touchpoints in the customer journey (no matter how big or small) and ensuring maximum satisfaction by offering the best possible service.
Shep Hyken, renowned customer service, and experience speaker has also emphasized the importance of CX management and gave the conventional CEM definition a whole new meaning. According to him:
"The best advertising you can have is a loyal customer spreading the word about how incredible your business is."
It is quite a statement because it directly indicates that customer experience is not confined within your purchase point walls. Instead, it is closely tied to marketing and promotional functions as well by having a direct impact on them.
In fact, there are three main components of customer experience that businesses can exploit to deliver better services:
- Success– It determines if the interaction between the business and the customer was successful, as perceived by the customer.
- Effort– It determines the amount of effort the customer had to put in towards the interaction and how easy it was overall to interact with the business.
- Emotion– It determines the emotional outcome of the interaction and how the customer felt after interacting with the business. Emotion can range anywhere from ‘upset’ to ‘delighted’.
These three components will ultimately determine the customer’s overall perception, loyalty, and likeness towards your brand.
However, a lot of companies are still in the dark and don’t understand the importance of practicing effective customer management experience.
But before we jump into the importance of CXM, let’s get a more detailed view of what a customer experience journey is.
What is the Customer Experience Journey?
As we discussed above, customers go through multiple touchpoints as a part of the experience journey with your brand. To accurately find out how a customer experiences your brand, it is essential to understand their interaction at every touchpoint
There are at least four touchpoints in the customer experience journey that include:
- Research– This is where customers discover your company, either on the web or in-person via advertising or from third parties, including friends, colleagues, consultants, etc.
- Comparison– This is where customers find out more about your brand by looking at your competitors and finding out your functions, capabilities, offerings, attributes and how you can fulfill their needs.
- Purchase– This is the part where customers decide about making a purchase and also where customer retention and loyalty building begins.
- Support– In the final phase, the customer support teams come into action, and they put in their best efforts to ensure that every customer grievance is resolved promptly and effortlessly.
By capturing each step of the customer journey, you will get an accurate representation of customers’ wants and needs, which will enable you to create superior products and eventually elevate the customer experience.
This is where customer journey maps will prove important as you can easily visualize the specific progressions of your customer’s journey through maps and uncover critical obstacles and opportunities in the touchpoints.
Related Read- To get a more detailed view of customer journey mapping, take a look at The Ultimate Guide to Customer Journey Map Guide (With Examples & Templates)
Why Customer Experience Management is Important
Business leaders know that it costs as much as five times to attract a new customer than to retain an old one. But the strategies that run behind these actions to offer a positive customer experience are often unknown.
However, when followed with precision, CEM marketing can offer a ton of tangible benefits to your business. Let’s explore a few of them below:
1. Higher customer lifetime value
Customer lifetime value represents the amount of money a customer will spend on the business throughout their lifetime. When brands are able to identify this number, they know how much to invest in retaining customers.
Companies often roll out rewards and loyalty programs and even personally get in touch with the customers as a part of this investment to boost customer experience.
Offering a better customer experience perpetuates strong customer loyalty towards the brand, and customers become a lot more likely to keep on spending in return for an unmatchable experience with the brand.
Also, it goes without saying- the more the customer spends with your business, the higher the profits are.
2. Reduced customer churn
Businesses that focus on elevating the customer experience see higher customer lifetime value and do not experience churn even remotely as much as other brands.
You should always exploit the touchpoints and make an effort to reach out to the customers through phone calls, email updates, or appreciation events to make a permanent space in the customer’s subconscious. So that whenever the time comes to make a purchase, you are always the one influencing it.
3. Increased brand equity
Brand equity primarily refers to the value of the brand in the eyes of the customers.
Things like delivering on promises, offering superior products and services, and always being available for the customers increase the brand’s perceived value. On the other hand, under-delivery, disappointing interactions, time-lag, and inferior products reduce it.
A company with positive brand equity will have a lot of customers talking about it everywhere.
These customers are happy to post their reviews, share their experiences with their friends and family, and also spread positive word of mouth.
And as we know from Shep Hyken, the best form of advertising is positive word of mouth from happy customers.
4. Higher customer retention
When your brand experiences positive brand equity and reduced churn, higher customer retention automatically comes with it.
This is because positive brand equity makes way for high customer loyalty, which correlates to higher customer retention.
All you need to do is to be quick to resolve issues, reward loyalty, and stay in touch with your customers to strengthen the positive perception of your brand. Positive perception is the root of overall customer satisfaction and the key to higher customer retention.
Related Read: Best Customer Feedback Software
5. Better crisis management
Businesses these days are implementing effective customer management experience programs to deal with any future shortcomings or potential crises.
A company’s reputation hangs by a thread, and things as minor as failing to resolve a simple customer request or even a slight mistake from an employee can result in bad PR and negative word of mouth floating around.
When things are as uncertain, companies with effective CEM marketing programs can defend themselves when there’s massive public outrage and humiliation. These programs help company personnel interact directly with the customers and media and own up to their mistakes to build a new foundation of trust, eventually leading to positive experiences.
For instance- American fast-food giant McDonald’s faced a massive backlash when the news about a supplier intentionally selling expired meat to the chain broke out in China.
The shares of both McDonald’s and its competitor Yum Brands fell sharply, as outrage spread among people.
This is when company executives launched an investigation and detained five people in this scandal and also ended up cutting ties with the supplier. They even ensured that food safety and quality control would be improved to never let anything of this magnitude take place again.
6. Reduced cost of service and marketing
If you follow a customer-centric approach to marketing, you eliminate a lot of guesswork and intuition-based product offering and develop products that customers want.
When your CX teams anticipate customers’ needs in advance, they can easily determine what products they will want and the potential problems they can face.
This way, eliminating alternatives beforehand based on data will allow you to stay one step ahead of the customers, which will help reduce the service cost and help spread a positive word of mouth, which will lower the cost of marketing as well.
7. Better customer engagement
A successful customer experience management program will require you to take an omnichannel approach towards customer engagement.
CX teams can accurately determine where customers interact most frequently and position themselves on those platforms to drive engagement.
It can either be through social media, email, or phone, where companies can be proactive in reaching out to the customers and interacting with them on a regular basis to drive engagement.
Most often, this is done using social media polls, surveys, or other promotional activities that users can participate in for complimentary rewards such as discount coupons and gift cards.
Now that there is no doubt in your mind about the importance of effective customer experience management let’s find out how you can create a good customer experience.
6 Features to Look for in a CX Management Platform
Out of tons of features that any customer experience management platform offers, here are a few that should be on your priority list:
Customers use multiple touchpoints and channels along their journey. So, it makes no sense to restrict your focus to only one medium. It won’t give you a complete view of customers’ expectations, issues, and preferences.
So when you are out to look for a CX management platform, check out if it lets you target customers across multiple channels or not.
Modes of Gauging Customer Experience
Next up in line is how you want to collect customer experience data. It will determine where to look for.
- If CX surveys are on your mind, Qualaroo can be a suitable option.
- If you are looking to record user sessions, SessionCam can be your go-to tool.
- If you want to embed a feedback button on the web pages, ProProfs SurveyMaker features a feedback sidebar widget.
Analyze the suitable modes of collecting customer experience insights, and make a list of CX management platforms that offer the solutions.
Data Analysis System
Every CX management platform offers some sort of data analysis system, but you need to look for something to lessen the burden on your teams.
We suggest picking a tool that provides an AI-based analytical system like Qualtrics or Qualaroo because it can:
- Reduce feedback analysis time
- Help spot patterns and trends in the responses
- Compare the CX scores over time
- Predict the impact of CX scores on business KPIs
Reporting and Segmentation
After analysis, let’s move to the reporting section. A CX management tool should have a robust reporting dashboard so you can sort the data as you want. Look for something that offers multiple filter types and sorting options to let you create custom reports. Also, don’t forget to browse the sharing options.
Visual dashboards automatically turn data points into charts and graphs. The biggest benefit of such a system is real-time monitoring capabilities.
You can track CX scores like CSAT and NPS in real time. It gives you an edge over manual data interpretation to easily spot any issues or changes in customer experience.
So find a CX management tool that incorporates a built-in dashboard or offers means to create one.
Integration APIs is something our teams at Qualaroo keep an eye on while adding any tool to our arsenal.
We work on different tools, and it would be time-consuming to manually export and import data between them. It also creates a risk of data mismanagement.
If the CX tool offers built-in integrations, you can quickly connect your workspace tools and automate workflows.
It means you can trigger surveys based on information added to the customer profile in your CRM.
Or if a customer fills out the survey, the data gets automatically updated to the CRM profile.
5 Steps to Establish a Good Customer Experience Management System
There are quite a few ways of creating a good customer experience to improve overall customer satisfaction. Here are some of the most effective ones:
Step 1- Create a clear customer vision
It all starts with creating a clear customer-focused vision that you can effectively communicate with your organization. Here, you need to have a few guiding principles that will steer you in the way of delivering an impeccable customer experience.
For instance- 3M is a global organization with over 90,000 employees that produces innovative technology solutions has a set of few guiding principles that include:
- Acting with uncompromising honesty and integrity.
- Satisfying customers with innovative technology and superior quality.
- Providing investors with attractive returns through sustainable growth and many more.
Similarly, when principles like these are in place for your organization, they will drive the behavior of employees in the right direction, and every member will work keeping in mind the end goal and the right ways of achieving it.
Step 2- Understand who your customers are
The next step of following up with your principles is to bring to light the different types of customers who interact with your brand.
If you truly want to predict your customers’ needs, you have to understand who they are and how they behave.
The most effective way of doing this is by segmenting your customers and creating buyer personas. Try giving those personas a name for better classification. For instance, John is 35 years old, likes innovative technologies, is quite active on social media, and will not need much support in troubleshooting.
Creating personas is the best way to understand who your customers are and a crucial step in being truly customer-centric.
Related Read- To learn more about building buyer personas from scratch, have a look at How to Build Customer Personas: The Complete Guide
Step 3- Create an emotional connection with your customers
You’ve probably heard about the phrase- “It’s not what you say, it’s how you say it”.
The best customer experiences are created when members of your organization form an emotional connection with the customers.
Even the Journal of Consumer Research data states that more than 50% of the experience is based on emotions. Also, emotionally connected businesses outperform competitors by 85% in sales growth.
This is why an emotional connection with the customers cannot be overlooked and is an opportunity that you should always capitalize on.
Step 4- Capture feedback in real-time
How to know if you are delivering a WOW customer experience?
By asking the customers themselves right then and there.
Circulating online surveys is the best way to do that. Tools like Qualaroo specialize in such formats as you can use Qualaroo to deliver contextual surveys to customers using 6+ channels in the form of completely unobtrusive popups.
You can also use Qualaroo to target specific customer segments, which is one of the most important yet unsaid pointers, as it will allow you to gather accurate and relevant data.
Step 5- Act upon the feedback and deliver on experience
The final step is to take the feedback constructively and act upon it by making necessary changes. Most organizations have a very uncertain schedule for collecting feedback and addressing problems.
However, collecting feedback on a regular basis and making regular changes to your offering will allow you to build trust in your customers and always stay up to speed with the rapidly changing trends.
Related Read- Learn how customer feedback is used to deliver excellent customer service from Using Feedback to Fuel a Better Customer Experience
Creating a good customer experience does have a ton of benefits, but it is certainly not easy by chance. There are several challenges as well that CX teams and organizations face in general. Let’s take a look at them:
Challenges of Customer Experience Management
Customer experience doesn’t just include customer satisfaction; it refers to the whole ecosystem of the customer journey. An ecosystem that is tricky to create for the CX teams as they interact with marketing, sales, and every other department that customers might encounter.
Let’s look at some of the most notable customer experience management challenges:
1. Data accessibility
The truth of the matter is that most companies do not have access to the data they need to offer a better customer experience. Even if they do, rarely is any company able to organize and make use of that unstructured data.
You simply cannot improve something if you don’t know what’s wrong in the first place.
Lack of data is one of the most limiting things that CX teams face when it comes to innovating with customer experience. Likewise, you won’t even know if you are getting better without access to the data.
In fact, 57% of the CX leaders report being unsure of how to measure customer experience to know if their CX strategies are getting or not.
Pro Tip: Conducting a ton of research is the key, no matter what role you play in your organization. Both primary and secondary research will uncover insights and open new doors to your CX strategies.
Also, when using online data collection tools, make sure to integrate them with other tools to widen your domain and also have a seamless experience in collecting and storing your data safely.
2. Little investment
80% of the companies today aspire to be a leader in customer experience, but only 1 in 5 companies today are delivering on that promise.
Oftentimes, the reason can be the difficulty in building momentum behind CX strategies that require a lot more effort than usual to get a significant ROI.
But mostly, it is difficult to raise investments for customer experience due to the prevailing lack of awareness and sponsorships that stop companies from innovating and deploying their CX strategies.
Pro Tip: Data is something that everyone understands. Collect all the relevant data about customer experience and prepare a compelling story about why customer experience is necessary.
You can use qualitative metrics to put things into perspective and deliver a more impactful message to the administration. Designating responsibilities is another important thing that you will have to do.
Almost 35% of the people are unsure about delegating or taking responsibilities, which means you will have to do it for them.
New technology that includes AI, chatbots, customer sentiment, and marketing automation has taken over to boost customer experience. However, data suggests that only 19% of the companies have tried such tools in the past five years.
You need to think outside the box if you want to stand out from the crowd.
This is something that innovative technologies have aimed at doing ever since they came into existence. And while you don’t need everything new, a little automation and personalization to shake up your customer’s expectations can go a long way.
Pro Tip: You can deploy a software tool like BigContacts, which is designed to seamlessly manage prospects and customer relationships. With it, you can easily
- capture more leads
- automate your marketing campaigns
- track all your contacts
- nurture more opportunities for the future
Overall, BigContacts is arguably the best alternative to extract data, contact information, and manage your resources all in one place to deliver a more seamless marketing experience to the customers.
Related Read: Checkout these Best Lead Generation Tools List to generate high-quality leads
4. Adapting to experience
Personalized experiences are known to make more sales along with encouraging customers to build and develop trust with the brand over time.
This is how loyal customers are built.
When customers feel that a brand is going out of its way to offer something that is unique to them, they feel more attached to the brand and are compelled to spend more.
However, 42% of the companies report being unable to adapt to experience and deliver experiences that are unique to every customer.
Pro Tip: Personalizing your services is not that hard. Doing something as little as adding your customer’s first name in every interaction will make a huge difference.
Loyalty programs are also quite popular, and you can be spontaneous with your offers to let your customers know that you appreciate their presence.
All-in-all, you should try to humanize the experience, which can be easily done by being available to your customers at all times and making frequent contact with them.
Related Read- If you want to learn how personalization can help boost actionable feedback, have a quick look at Need to boost your actionable feedback? Simple, personalize it!
Once you have overcome these challenges, you will be able to move to the next stage and talk strategies. So let’s do it.
Customer Experience Management Strategies and Techniques
As we discussed earlier, there are tons of benefits of improving customer experience, provided that you accurately follow tips.
Here are some of the most useful tips for you that also answer a commonly asked question – How do you implement customer experience management?
1. Empower your employees
Empowered employees and happy customers share a strong connection between them.
Give it a thought. A customer wants the service agent to provide a small discount. However, the agent is reluctant to make a move and does not want to do anything without the manager’s approval.
The result- customer, ends up leaving disappointed.
Therefore, as a manager, you should always try and find out what is stopping your employees from being decision-makers and delivering excellent customer experience. Conduct an online employee survey to uncover common pain points of the employee experience that hinder them from going the extra mile.
You should also keep your company culture in perspective.
Anything that needs changing for the better should be changed, and customer-centric culture should be built keeping in mind your customer experience management strategy.
2. Use technology to create a better experience
AI and machine learning can create a tailor-made customer experience, and that’s a fact. Functionalities like 24×7 chatbots and automatic language processing are readily available and will help you understand what customers mean in free-form messages.
Adding personalization to customer experience has become more scalable and affordable.
For instance– Domino’s deploys a chatbot on their Facebook messenger that allows their customers to order pizza from the messenger itself.
With AI being so prevalent, there is no doubt you can personalize your customer service with ease and get creative with your products.
3. Embrace an omnichannel mindset
The days of sitting in front of a desktop computer to connect with a brand are long gone. Now that more than 50% of the traffic is generated by mobile phones alone, multiple-device digital journeys are the new standard.
But maintaining customer journeys across different devices is not gonna cut it.
CX leaders today need to understand and adapt to tons of different online and offline platforms that customers use to connect to the brand.
Embracing omnichannel approaches can be the most important transition that you will ever make in your business, but it will certainly give you a more customer-centric approach by prioritizing customer experience.
4. Personalize everything
Customers long for personalized interactions. In fact, several pieces of research over the years have indicated how personalization can make customers more loyal and spend more.
When you personalize the customer experience to adapt based on your customer knowledge, you strengthen the bond between the brand and the customer and make the customer journey smooth.
There are several ways you can implement customization:
- Personalized good survey questions based on the data.
- Offer recommendations based on previous purchases.
- Follow-up personally with survey responses.
- Personalize based on location using geolocation technologies.
5. Use customer journey mapping
Customer journey maps are a visual representation of the entire customer interaction with the brand, which includes needs, perceptions processes, and much more.
You can easily understand all the problems and opportunities in your customer experience if you cross-reference your journey maps with the core metrics like churn rate, level of satisfaction, retention rate, and more.
With your strategies in place, the penultimate step will be to find an appropriate software tool that can implement your customer experience management strategy with maximum efficiency. Let’s have a look at the types of CX management tools.
Must Read: Customer Journey Mapping Tools
Drive Retention With Effective Customer Experience Management
Implementing a customer experience strategy should be the top priority for any organization that wants to stay ahead of the competition.
It’s a combined effort of your marketing and development fronts. Now combine this with the data from your voice of customer (VOC) tools like Qualaroo, and you have all the ingredients to optimize the customer experience across every touchpoint.
Start by building customer personas and journey maps to understand your customers. Visualize the bottlenecks and place the required means to streamline the flow.
You can then use survey tools like Qualaroo to gauge whether your efforts bring the desired results. Finally, tweak the areas of improvement to deliver a seamless customer experience.
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