One of the biggest challenges that we hear from CX professionals is the struggle to convince a sceptic the value of CX. It’s a fairly common problem. In a Forbes survey last year of 400 executives, just 15% said that they classed customer service as a key component of their strategy.
Stakeholders, in particular, can be of the opinion that CX is just a given, a nice to do but in reality it's not a priority for the business.
This is more often than not down to a lack of evidence of the value that CX can bring to an organisation. After all, stakeholders aren’t going to listen to any claims without first seeing the numbers.
So, here’s what you show them.
Customer Lifetime Value (CLV)
Great customer experience doesn’t just make you more valuable to your customers, it makes your customers more valuable to you.
A recent study has found that 51% of people in the UK would happily pay more for a product or service if it meant that they received a better level of service. When you combine this with the knowledge that customers who have the best past experiences tend to spend a lot more money, you might just start to turn around an executive's perspective.
So while thoughtful customer experience encourages greater brand advocacy and loyalty, it also affects their buying behaviour.
A typical restaurant experience is an easy example to illustrate this. If you receive bad service throughout the course of an evening then the chances of you sticking around for a dessert will be quite low. Whereas great customer service will mean you may not only stay for longer but return again soon.
Customer Acquisition Costs (CAC)
Exceptional customer service doesn’t just increase the value of your customers, it actually makes it easier to go out and get new ones.
Creating happy customers through great customer experience will drive up referrals and mean you have to spend less money to win new business, allowing you more time to focus on selling to your existing customers.
This is important because the probability of selling to a new customer is around 5 - 20% whereas the probability of selling to an existing customer is 60 - 70% (Marketing Metrics - Neil T. Bendle).
It’s also been found that on average a happy customer will tell 9 people about their experiences with a company. While at the other end of the spectrum an angry customer is likely to tell at least 16 people.
So if anything, it’s worth investing in CX to avoid the costs of bad customer experience.
Conclusion
At a time where there are lots of disruptors in the marketplace such as Airbnb, Uber and Alibaba, the importance of customer experience couldn’t be greater.
There is more competition and more reasons for your customers to leave you than ever before so you can’t get complacent and assume that they’re going to stay with you forever.
If you’re going to convince a stakeholder to take customer experience seriously and inject it with the investment it needs, you need to go digging for data. Prove that it’s making customers spend more money, prove that customers are staying with you for longer and prove that it’s increasing customer referrals.
Proof is everything. We recommend utilising data from Forrester or even looking at our case studies which demonstrate the return on investment when a business truly steps up their CX game.
