The Imperative of Customer Experience

Take a moment to consider a sensory experience you’ve had with a brand.

I’ll share one. I once found hairs — yes, multiple — in a sandwich I was halfway through eating at a popular quick service chain. When this was brought to the attention of the manager, he pointed out that my sandwich was almost half eaten and offered me a 10% coupon for my next visit. The experience was more than a decade ago, but I can’t say I’ve been back since. Restaurant chains contend with maintaining standards at hundreds of locations, some franchised, and most likely my experience was an accident — but it doesn’t change the fact that I have a sensory connection between this chain, hairy sandwiches and managers who don’t care.

Poor and even just unremarkable service can be detrimental to any brand. In fact, a recent study found that 33 percent of Americans will consider switching providers after just a single instance of poor service. The same study found that American customers will tell an average of 15 people about a poor service experience, while they may only tell 11 people about a positive experience. These statistics underscore the imperative of getting Customer Experience (CX) right the first time.

That’s why, years ago, there was a new trend toward providing meaningful service through no-questions-asked return policies, satisfaction guarantees, and a focus on “surprise and delight” as a mode of engaging customers with a brand beyond the point of sale and into the land of loyalty.

You might be familiar with the phrase, “If you’re not moving forward, you’re going backward.” This popular wisdom certainly applies to customer service — if you are not intentionally providing a quality customer experience, all it can take is a slip of standards, a bad day, an externality — and you can lose a customer or maybe 15.

Because people share their bad experiences with their friends and family, losing customers can be contagious and difficult to recover from. One 2016 study revealed that 51 percent of customers who leave a brand after one negative experience will never do business with that company again. The same study showed that U.S. companies lose at least $62 billion per year to poor service.  I guarantee you I’ve told my hairy sandwich story more than a few times.

There’s another complicating factor that contributes to the urgency for businesses to focus on providing exceptional and memorable customer experiences — most employees are disengaged. Employees who are disengaged, don’t really care about customers.  Gallup famously found that employees who aren’t engaged in their work are costing U.S. employers $450 billion to $550 billion each year.  It’s easy to believe, because while the hairy sandwich was bad, the casual indifference of the manager was worse.

Employees deliver customer experience. Their engagement is critical to your ability to keep your customers.

Meanwhile, the benefits of engaged and invested employees delivering exceptional service are clear. One recent study discovered that 65 percent of customers would recommend the company to others and 70 percent of U.S. consumers say they have spent more money to do business with companies that deliver great service. Another study by Bain & Company found that increasing retention rates by 5 percent can increase profits from 25 percent to 95 percent.

It’s too much money and risk to leave customer experience on the table. Organizations today can’t afford to focus on the four P’s — product, placement, promotion and price — alone. In fact, 64 percent of people in a recent survey reported that customer experience is more important to them than price.

Focus on service standards alone isn’t enough, either. Delivering lasting positive experiences requires customer and employee engagement. It requires a focus on how people experience your organization — when they go to work, when they make a purchase, when they talk to others about your company. What can your company gain from taking a critical and constructive look at customer experience?

One recent study found that a moderate increase in customer experience can generate an average revenue increase of $274.3 million per year for a company with $1 billion in annual revenues. The grand majority — 84 percent — of organizations who reported they were working to improve CX saw an increase in revenue.

There’s no business imperative of greater importance than addressing the customer experience today. Is your company delivering the best possible experience to customers that it can today?