Making the case for CX to the higher-ups has been one of the biggest bugbears for a lot of our clients. Believe me, we feel your pain. You are measured against KPI’s that require robust growth plans and client retention strategies. You put so much work into building solid action plans to meet your goals, and a big part of that plan is improving the experience of the customer. The problem is, you’re told that there is no money for CX, that it’s not a priority right now. But you’re accountable for growth? It can sometimes feel like you’re being set up to fail.
Since CX has become the number one differentiator over price and product, companies cannot afford to ignore its role in achieving growth. For a sales team to meet target, or a client retention manager to increase loyalty and retain business, in today’s competitive climate, investing in CX is the only way to reach that pot of gold at the end of the rainbow. Think about it, as a customer yourself, do you put money or time behind a product or service if you’re not getting a good experience? It doesn’t make any sense, and the research is telling.
Let’s just chew on some stats for a second:
- Customers tell an average of nine people about a positive experience with a company, but they tell 16 people about a negative experience
- Customers are likely to spend 140% more after a positive experience than customers who report negative experiences
- Companies that focus on their customers are 60% more profitable
- Brands that offer the best CX have revenue levels 7 times higher
- Of companies that make efforts in terms of CX, 84% report an increase in revenue
So why are the higher-ups still not sold on CX? Well, it’s easy for CX to be seen as a ‘soft’ sell since the ROI is not always clear to CEOs. You are fighting a particularly hard battle if you’re expected to report on the ROI of CX overnight because it’s not always a short-term fix. In the words of Steve Jobs, ‘If you look really closely, overnight success took a long time.” This is not to say that your CX Strategy will start smelling bad and grow mold before you start seeing results, in fact, you can cut the time it takes to see results by more than half if you just take the right approach and consider your metrics.
Below I’ve shared three starting points on how to go about calculating the desired ROI on a solid CX strategy:
- Acknowledge where you are at – look at the ‘awful truth’ of where your baseline currently sits. Objectively look at your ‘averages’ and allocate an accurate starting point from which you can build on. If you know where you were, you can see how far you’ve come
- Pin down the numbers–e.g., reduced customer churn, revenue growth, increased cross-sales, and reduced cost to serve over a period of time. Did you know that offering a high-quality customer experience can lower the cost to serve customers by up to 33%? Put that in your pipe and smoke it, Mr. CEO.
- Use the results from CX metrics to drive further research and future decisions– don’t stop at a Client Satisfaction Score (CSS) or Net Promoter Score (if you’ve followed my vlog, you’ll know how much I disklike NPS), instead use this data as a guide to uncover even deeper insights into your customers – and link these insights directly back to your business KPIs, e.g., average time for conversion (not just looking at the numbers but tapping into the WHY)
When it’s done right and is considered a priority, CX yields a strong return on investment. Growth is the result of increased market share, which can easily be gained at the expense of competitors unable to match a great customer experience. If you can solidify your approach to measuring the return as outlined above, make the necessary changes, and keep to your word, you’re on your way to proving the power of great CX and reaping the rewards.