Focus on the Customer Experience to Keep Them Coming Back
Most business executives agree that customer retention is a key strategic objective and is becoming ever more critical in a digital economy. Research tells us that
- Attracting new customers costs a company 6 to 7 times more than keeping an existing customer.
- 80% of a company’s future revenue comes from just 20% of its existing customers.
Yet it seems like many companies place too much emphasis on searching for new customers rather than tending to the ones they already have.
A lot of businesses continue to believe that customer service/satisfaction is the key to customer retention. Customer Service is the advice and assistance given by a company to its customers after buying or using its products or services. The goal of customer service is to increase customer satisfaction by creating lasting relationships with customers and/or correcting problems with a recent transaction. Customer satisfaction is therefore an outgrowth of customer service, but it remains mostly reactive. The business can only act once something goes wrong, and the contact is usually initiated by the customer.
Today, businesses need to look at the bigger picture. Customer Experience is a term used to sum up all of the interactions a customer has with a business and its products or services from initial contact through post-sale support. It is doing all the little things to smooth the bumps in the road of your customer's journey from discovery to purchase, but beyond this it also means
- Taking proactive steps to create a unique experience from the moment the customer enters the store or visits the website.
- Empowering employees to actually fix customer problems on the spot.
- Using tools like NPS surveys, CSATs and mystery shoppers to ensure a delightful experience before a customer ever becomes dissatisfied.
Not long ago, customer service/customer satisfaction was often confused with customer experience. Why? Because providing good customer service meant that a company delivered on its promises, so the customer obviously had a good experience, right?
However, with the increase in the number of social media platforms and frequency of communication between buyer and seller and/or other consumers sharing opinions, things are no longer that simple. Good customer experience today is not just about providing good customer service and fast problem resolution. Customer loyalty is fading. Customer service is merely one part of the total customer experience. It is the customer's perception of how a company values their patronage from end-to-end that will drive success in the digital economy.
Consider the Studio Movie Grill in Scottsdale Arizona. It can't control the quality of the films it shows, but it does change the moviegoer experience with reserved comfortable seating, a full-service lobby bar and in-theater dining with seat-side service during the movie. Or your local ACE Hardware store. You might pay a few cents more for the widget you need to finish that project versus Home Depot, but you'll get personal assistance from the "helpful hardware folks" as opposed to a potentially frustrating find-it-yourself warehouse experience.
Want a deeper dive into this topic? Download the RCN White Paper: Grow Your Business By Shifting From Customer Satisfaction To Customer Experience.Download the White Paper