Blog

When asked, “What is the key to sustainable growth?” What is the first thing that comes to mind? Is it:

• Acquiring new customers?  
• Increasing brand awareness?  
• Offering more advanced products and services?

If so, you’re partially correct. Each of these plays an important role in company expansion and success, but the biggest driver of growth is the quality of your customer experience (CX).

Today, we’re going to show you why – but first, let’s define our terms.  

Table of Content

• What is Customer Experience? 
• Impact of Bad Customer Experience
• Higher and Faster Customer Churn
• Damage to Your Brand’s Reputation
• Loss of Revenue
• The Impact of Excellent Customer Experience
• More Repeat Purchases
• Higher Customer Retention Rates
• More Customer Recommendations – Which Could Lead to More Customers
• Improve Your CX with Customer Experience Management from FirstComm

Quality of CX Matters Just as Much as Quality of Service. Eighty percent of customers said that their experience with your company is just as important as the quality of your products and services.

What is Customer Experience?  

Customer experience (CX) is the impression your customers have of your brand based on each interaction they’ve had with your content, your products, your team, and your support staff.

Many use “customer experience” interchangeably with “customer support” and “the customer journey.” This is incorrect. 

The customer journey is the specific steps a potential customer takes when they interact with your company. Though invaluable for your marketing team, it doesn’t encompass how customers feel about your brand during the process.

Customer support is just a part of the customer experience—though a very important part. After all, how you treat your customers after their purchase is just as important as how you treat them before.

Now that we know what CX is, let’s discuss its impact on businesses – especially if it’s less-than-optimal.

Most Companies Struggle with CX. According to a recent report by MuleSoft, 70 percent of companies struggle to provide excellent CX across all touchpoints.

Impact of Bad Customer Experience  

You might assume your CX is top-notch, and you wouldn’t be alone. Most companies share that confidence. In a recent study, 87 percent of companies rated their CX as “excellent” and something that set them apart from the competition. 

Unfortunately, only 11 percent of their customers agreed with their assessment, and that disconnect can have serious consequences.

Poor customer experience – and customer experience management – leads to:

Higher and Faster Customer Churn   

Your customers don’t have the time or patience for CX. The average client will give you three chances – and sometimes even less – to get it right before leaving you for a competitor. Even your loyal customers are at risk! PwC found that almost 60 percent of loyal customers will abandon a brand after several bad experiences and 17 percent after one.

Damage to Your Brand’s Reputation   

When customers leave, they talk about the experience they had with your company. They leave reviews and tell colleagues, warning them that you’re not the best company to do business with. If enough clients churn – and enough negative reviews are left – 92 percent of potential customers will avoid your business. 

Loss of Revenue  

When you start losing customers and credibility, you also start losing revenue. In fact, according to CallMiner’s Churn Index, American companies lose over $30 billion a year because of preventable customer churn. To put that into perspective, that’s about $92 per U.S. citizen each year because of poor customer experience management.

The Result? A Stagnant Business that Will Eventually Fail  

If you put in the work to improve your CX and stay consistent, you’ll experience a world of difference in customer satisfaction and corporate success. This brings us to the other end of the spectrum: the impact of excellent CX on business growth.

It Also Costs More to Get a New Customer Than to Keep an Old One. According to industry statistics, acquiring a new client is 6 to 7 times more expensive than retaining a current one.

The Impact of Excellent Customer Experience  

Once you’ve made the effort to improve your CX, you can expect all kinds of positive ripple effects, like:

More Repeat Purchases   

In a Salesforce study, 88 percent of customers reported that great CX makes them more likely to purchase from that company again. Why? Because you’ve shown them that you’re trustworthy. If you onboard them smoothly and support them well in one product, they’ll assume you’ll do the same with other products, too. 

Higher Customer Retention Rates  

Customers who are satisfied with their experience are more likely to stay loyal to your brand. Even in the face of cheaper alternatives! The more clients you retain, the healthier your profits will be, especially because 65 percent of a company’s sales, on average, come from repeat customers. And you don’t need to retain 20, 15, or even 10 percent more customers. Studies have shown that boosting your retention rates by just five percent can lead to financial gains of 25 to 95 percent.

More Customer Recommendations – Which Could Lead to More Customers  

When customers are satisfied with their experiences, 75 percent (or more) will recommend you to their friends and colleagues. If those people reach out to you and find your CX to be as good as promised, they might make the switch. This kind of organic customer acquisition isn’t fast or simple, but it’s incredibly effective and doesn’t cost you a dime.

Recommendations Are More Valuable Than Advertising. Word-of-mouth recommendations result in 5 times more sales than paid advertisements. 

The result? More significant profit margins, more reliable revenue, and unfettered growth  

When you incorporate customer experience into your growth strategies, you will see an incredible return on your investment. McKinsey & Company reports that CX-led companies:

• Gain five to ten percent customer spending  
• Experience 20-30 percent higher customer satisfaction and engagement  
• See 2x the revenue growth of their industry peers 

So, if you’re looking to expand your horizons in 2024 (and beyond), we suggest you start by making sure your customer experience is exceptional.

Want to learn more about how to make CX more profitable? Check out our FREE eBook! 

Improve Your CX with Customer Experience Management from FirstComm  

A great CX strategy starts with great CX tools and FirstComm offers one of the best. Our contact center platform empowers you to give your customers the support they expect across all channels – without risking agent burnout. Want to see it in action? Reach out today to schedule a free demonstration or chat with one of our team members. We’d be happy to answer any questions you have.