Why should companies care about CX now more than ever before?

Globally, companies are realizing the impact of a unified CX journey – both on their image and in the bottom-line. During my interactions with clients across six continents, here is what we gathered on this rapidly strengthening trend.

1. Happy customers mean happy balance sheets

A happy and satisfied customer accounts for 2.6 times in revenue as their moderately satisfied counterpart, and about 14 times in revenue as compared to an utterly dissatisfied one. Womply’s research adds that bad reviews have a significant effect on revenues, with a 1-1.5 star rated business reporting 33% less revenue than an average firm in the domain. The scenario is further underscored by the assertion from Forbes that 94% of consumers surveyed tend to avoid a company with bad reviews. The verdict is therefore near unanimous – happy customers mean more moolah.

Again, we should remember here that CX also has a major influence over on-the-spot purchasing decisions, as 49% of the buyers surveyed accepted having made an impulse purchases after receiving a more personalized experience.

2. Building a Loyalty Club will significantly reduce your cost of acquisition

Winning a new customer can be costly – 7x as much as retaining an existing customer . Investments in existing customers is therefore a profitable choice and it is but a short time until one sees positive results. Building customer loyalty through an enhanced CX framework could not only drive revenues through enhanced sales, but also help rationalize costs by driving down costs for acquisition.

The importance of CX here is highlighted by a Walker study, which found that by the end of 2020, CX will have overtaken both price and product as the key brand differentiator.

Did you know that 95% of people who had a bad experience are willing to give the brand another go if they know their issue has been dealt with correctly? * *Source: https://www.questionpro.com/blog/mechanics-of-detractor-recovery/

3. Customers are your biggest marketers

Word of mouth happens to be perhaps the most important marketing channel that a business can pursue today. With 84% of the consumers surveyed not choosing to trust advertisements anymore, it is evident that buyers are now increasingly relying on third-party validations for purchase decisions, especially online ones. A happy customer who is willing to make a recommendation is therefore the best ambassador for any business.

It is interesting to note here that according to Esteban Kolsky, 72% of the customers surveyed were willing to share a positive experience with 6 or more people. On the other hand, if a customer was not happy, there was a distinct possibility of their adverse views reaching 15 or even more compatriots.

4. Reviews Trump Sales Pitches – Every Single Time

Customer feedback is an unmatched tool for driving brand recall and sales. If customers are unable to openly access the experience of other product users, they would tend to look elsewhere to build confidence for their purchase decisions. 88% of the consumers surveyed claimed to have read peer reviews to determine the quality of the firm’s overall CX framework.

Negative reviews are a significant reason in driving away customers from your business to the competitors. Recent research indicates that one negative review can turn away 22% of the prospects, around 30 customers. The percentage of lost customers, therefore, tends to increase in tandem with a rise in negative reviews. Three negative reviews can result in a 59.2% decline, while over four negative reviews pushes the figure to around 70%.

Review ratings also tend to affect the way that a business ranks on search engines. It is now clear that persistent negative ratings can result in business losses as search engines rank the best enterprises for users basis the ratings received.