Is CX a Differentiator? Your Customer Experience FAQs Answered

"What the hell is it?" I hear you ask. "What's a CX? What's customer experience management? What am I doing here? What's going on?" Well, I can answer the first two questions, at least. The last two you're going to have to figure out yourself. 

Listen Kate Mckinnon GIF by Saturday Night Live

Number One: What Is Customer Experience?

Let's start with a definition. Wikipedia describes it like this:

"Customer experience is a totality of cognitive, affective, sensory, and behavioural consumer responses during all stages of the consumption process including pre-purchase, consumption, and post-purchase stages."

Or, in plain English, customer experience is the sum total of a customer's interactions with a few and how they feel about the brand as a result.

Customer experience basically refers to how a business engages with its customers at every point in their buying journey.

This takes in everything - marketing communications, website and app visits, the purchase and delivery process, and any contacts with customer services.

It shouldn't be confused with user experience (UX), which mainly looks at how people interact with websites and apps, and looks to make things as easy to use as possible.

User experience does contribute towards the customer experience though, along with customer service, marketing, and sales.

More and more, consumers have begun to differentiate between brands not based on the specific product features and functions, but the experience of the company.

Why has Netflix taken over Blockbuster? Both are basically peddling the same business model, right? But when customers think about Netflix they think convenience, and barely about the product they arrived there for - the movies themselves. 

Number Two: Is Customer Experience Important?

Yes. Next question.

Okay, okay, a little more detail. Basically, a remarkable customer experience can make or break a business. It is critical to the sustained growth of any organisation, as it helps to develop loyalty and repeat purchase. 

82% of companies agree that retention is cheaper than acquisition. 75% of consumers say they favour companies that offer rewards. 56% of customers stay loyal to brands which “get them.” 65% of a company's business comes from existing customers.

So let's be clear - keeping customers is far more impactful than trying to find new ones. That's why customer experience is so important; it promotes loyalty, keeps people around, and can even inspire brand advocacy. 

How Does Customer Experience Affect Loyalty Behaviors? - Marketing Charts

Remember: "Today, customers have the power, not the sellers", according to HubSpot.

Number Three: Why Does Customer Experience Matter?

Good customer experience, like we've mentioned above, can have a number of positive impacts. But to achieve what is considered 'successful CX', a customer must achieve everything they want to do easily. This could be facilitated by an easy-to-use site, and a smooth delivery etc. etc.

So, what are some of these positive impacts? Well, good CX can help with:

  • Acquisition. New customers are more likely to make a purchase with good CX, or to become potential leads.
  • Conversion. Leads are more likely to become customers if they enjoy the customer experience, or are impressed with the content. 
  • Loyalty. Loyalty can be inspired with a smooth experience, which can increase customer retention rates.
  • Reputation. Customers are likely to recommend a business if their experience was good. This can also include positive reviews, not just recommendations to family and friends. 

Many factors can contribute to customer experience. But one bad part can ruin the entire process. It could be a checkout with too many steps, a rude customer service employee, a failed delivery, etc. 

What is Customer Experience: Strategy, Examples, Tips | Hotjar

These experiences can have several effects, including:

  • Lost sales opportunities
  • Losing customers to competitors
  • Negative reviews

Number Four: What are Customer Experience Principles?

There are a few customer experience principles that can be followed, to create a successful process. This can look like:

Personalising the experience. Creating a personalised experience is pretty much essential. Across all industries, platforms, cases, customers etc. A Personalised experience can provide a much higher ROI, as every customer looks for it, whether they're aware of doing so or not. 

Being able to track and analyse customer data in real-time, therefore, is essential. This can include customer history, current behaviour, and other contextual information. This data is used to make future recommendations about other products, or to create target campaigns to build loyalty and trust.

Knowing your customer. Knowing your customer can result in these personalised and targeted campaigns. A single customer profile is essential to enhancing your CX. With a CX solution in place, customer profiles should be able to be created by any identifier.

Customers are able to decide which channels they prefer, so being able to meet them on that preferred channel, in their preferred manner, can make a big difference. So, it's important to capture their channel and their entire profile, in order to better interact with them. 

Involving the organisation into the CX design process. Once a business has an idea of their CX and customers, it is a good idea to co-create the experience they aim to deliver, at every touch point.

With these touchpoints, it's best to gain insight from the relevant employee, and from who is working to get the business' products in front of the customer. The front line team members know best; from bridging customer experience gaps, to looking for opportunities, to rebuilding from failures. 

Giving a human touch. Making a customer feel acknowledged and heard can make an experience. This could look like an experience which made them feel special, an attention to detail that wasn't overlooked, or an issue which was resolved well.

These will make the customers remember a positive 'feeling' when interacting with your brand in the future. These positive interactions are the human touch - interactions form the base for a successful customer experience. 

Looking Beyond Net Promoter Score to Measure Customer Experience -  SmartSurvey

Investing in innovative technology. Investing in the right technology can optimise the experience. CX tech should complement your existing systems without ripping and replacing current technology. Plus, a hyper-focused CX solution should use a simple UI to make sure the process is as easy as possible, and to ease the orchestration. 

Ensuring your team is utilising the data they collect to optimise the experience is key. It is becoming more and more possible to track, analyse, and measure each customer action. So, ensuring your organisation is leveraging the best possible ways to deliver an enhanced customer experience can solidify your place as an industry leader.

Number Five: What is Customer Experience Management?

Customer experience management, or CXM, or CEM, is a system which utilises strategies and technologies which focus on CX, from engagement, satisfaction, to experience. 

CXM is all about going beyond just marketing tools and software however. This approach to customer relationships is all about using digital transformation to put customers at the centre of the business.

Businesses focused on customer experience management prioritises the orchestration and personalisation of the entire end-to-end customer experience, and helps to do it at scale, on any channel, in real time. 

Number Six: How to measure customer experience. 

According to HubSpot, there are a few metrics you can use to measure your customer experience. These can include:

  1. Calculate the net promoter score. According to Sophia Bernazzani, the head of content marketing at Owl Labs and former editor of the HubSpot Service Blog, net promoter score is "a customer satisfaction benchmark that measures how likely your customers are to recommend your business to a friend."
  2. Analyse customer journey analytics.
  3. Conduct customer surveys.
  4. Determine customer churn rate.
  5. Interpret customer support ticket trends.
  6. Measure customer satisfaction scores.

But why measure CX? Well, why measure anything? Measurement is the foundation of everything, according to Thanassis Thomopoulos, Head of Global Marketing & Commercial Analytics at eBay. Nothing can really be improved without measuring them first. 

Thanassis gave us a quick explanation for the evolution of business KPIs and how they've evolved, in his #MarTechFest Dial Up (Mini) websesh .

He started with revenue, or margin (and always some kind of combination of the both), it was then suggested that these are too concrete and too hard as KPIs. Instead, marketers need to move to metrics which indicate higher aspiration, such as brand love.

After all, it's seven times more expensive to acquire customers than to retain them. 

Then what happened? Well, in most businesses, this brand loyalty began to decrease in terms of effect, to the benefit of CX. If you have customers who have loyalty to the brand, but are constantly bombarded with poor customer experience, they will eventually churn away to your competitors.

So, CX is the ultimate thing you need to measure. 

Number Seven: How can customer experience differentiate a brand?

Differentiating a brand nowadays can require going beyond the basics. This can look like expanding brand management from a traditional focus - product, place, price, promotion - to a focus on experience, too.

A brand can stand out if it delivers its brand and customer promise in the context of the full customer experience. From this, a brand will be able to keep customers, gain new ones, increase customer wallet share, and forge bonds. 

So, in order to achieve this success, a brand must be managed in a way which prioritises a specific brand promise - one which focuses on the way customer experience affects customer behaviour. The delivery of this must be both unique and consistent against the specific touch points that drive customer behaviour. 

Number Eight: What is an example of the best customer experience?

One specific example is Netflix, who's customer experience is built around the value of personalisation.

An experience which is personalised is a better one for the customer. It makes processes and tasks easier for them, as it understands their needs and preferences, and it increases the effectiveness of communications by making them more relevant. 

For example, personalised emails can deliver six times the transaction rate of 'normal' emails because the content and product recommendations provided are highly relevant to the customer. 

Netflix has hours and hours of content, but keeps people watching by learning from their viewing habits and preferences and pushing relevant content at them.

The result is that people don't waste time deciding what to watch, and this keeps users engaged and reduces churn. 

Netflix doesn't just collect data about the shows its users watch. It also uses that data to create further interaction.

So customers are getting personalised recommendations, and then an immediate lead, plus Netflix gets to make better suggestions for what a client might choose in the future. Win-win. Win.

netflix email

But it's not just for B2C, but B2B too. 

Engagio, a B2B marketing software company, was expanding their services. As a result, they needed to start new conversations, with new accounts. This meant coming up with an innovative, eye-catching idea that would allow them to get their foot in the door at a few of their target companies. 

So, what could they do to surprise and delight their target customers? Well, it was something that had a not-too-shabby 31% meeting rate. 

Engagio realised that many of the key decision makers they wanted to get their hands on attended Dreamforce, Salesforce's annual conference. 

So, they took themselves down there, along with a list of attending companies, and those companies' directors, and a suitcase full of bobbleheads of those companies' directors. Yep, that's right. They made bobbleheads of the directors. Genius. 


Then, they took pictures of the bobbleheads and emailed their targets letting them know where they could pick up their mini-me at Engagio's Dreamforce booth. 

As a result, most of their target prospects picked up their bobbleheads. and 31% attended highly valuable sales meetings.

So, this was a campaign with three separate touches. Number one, an email inviting the decision maker to pick up the bobblehead. Number two, a hosted event to hand out the bobbleheads. Number three, an offer to ship the bobblehead to them if they attended a meeting with a rep. 

All this for the cost of a bobblehead vendor on Etsy, and an ABM intern.