19 Oct Why and Where to Invest in Your Customer Experience
by: Ty Benefiel
Fall has arrived. Temperatures are cooling, leaves are changing, and next year’s budgets are being finalized. How much of next year’s budget is dedicated to improving customer experience? Now is the time to convince your CFOs that improvements to customer experience will provide an excellent return on investment. And if you are given a budget to improve customer experience, you need to know how to deploy those dollars effectively.
In an earlier post, I explained how shifting a portion of your marketing budget from acquiring customers to retaining customers can lead to a 100% increase in the value of your customer base. So what does it mean to spend money on customer retention? It is costly to staff a call center team solely dedicated to wooing customers that have ended their service. The more cost-effective approach is to proactively improve your customer experience.
According to the Harvard Business Review, 86% of executives believe that customer experience is vital to a company’s success. That’s not too surprising, given that Forrester Research found that brands they described as “Leaders in Customer Experience” showed almost a 500% higher compound annual growth rate over a four year time period than brands they found to be “Customer Experience Laggards”. And if you are looking for a stock tip, look no further than a brand’s customer satisfaction score. The American Customer Satisfaction Index created a portfolio of options that were long on stocks of companies with high customer satisfaction scores and short on stocks of companies with low customer satisfaction scores. This portfolio outperformed the S&P 500 fourteen out of the last seventeen years, with an overall improvement of 383% since 2000.
Once you secure a budget for improving customer experience, you must make each dollar count. To get the greatest return on your investment in customer experience, here are the top three things you should do with your customer experience budget for 2018:
Build a Mobile App
If you don’t yet have one, a mobile application is a necessity. Responsive websites pulled up on a mobile phone simply don’t cut it. Comscore reported in 2016 that the average visit to a mobile app is 20 times longer than the average visit to a mobile website. Mobile apps enable true engagement personalized to a customer’s desires.
Enable Self Improvement
Check your Facebook or Instagram feed. How many posts are before/after diet pictures, workout selfies, or FitBit accomplishments? Two technology trends have enabled people’s desire to be better and be recognized for it – the quantified self and social media. Personal data is being logged constantly, and consumers now have access to data about themselves. They’re using that data to set goals and track progress. Social media has given them the ability to tell the world when they achieve their goals. By building capabilities for customers to track their energy usage, understand ways to reduce it, and share their experiences with the world, you will not only increase your customers’ satisfaction with you, they will also become your greatest source of free advertising.
Personalize the Experience
If you really want to capture your customers’ attention, you must convince them that you know who they are, what they want, and when they want it. The first step to accomplish this is to create a mechanism to collect and analyze customer information. Next, message them with content that is truly relevant by utilizing the data you have collected. The more specific the content is to them, the more likely they will engage with future messages from you.
Knowing why and where you should invest in your customer experience will help you grow your company’s profitability and improve your status in the eyes of your customers and your CFO in 2018.
Ty Benefiel of Meter Genius