(This article was originally published on Hootsuite.com. It has been edited for content and style.)
Customer experience management (CEM) is the process of managing and improving the way customers interact with your business. CEM uses data gathered at every interaction to improve customers’ perception of your company.
At its core, customer experience management is all about understanding and improving how customers interact with your business. This means everything from how your customers discover you online to the interactions they have with your employees in-store.
Examining your customer journey from start to finish allows you to identify areas of friction and areas of opportunity.
By investing in your customer experience management, you can improve the health of your business. You’ll see real results, like increased revenue and profitability. Plus, you’ll build a strong base of loyal, happy customers, which means even more revenue down the road.
Here are 11 ways a strong customer experience management strategy can improve your business.
- Helps you understand customer’s wants and needs
Creating a customer experience strategy means putting yourself in your customer’s shoes. It’s like psychology—you need to know their wants, needs, fears and desires inside and out. Then you can understand how to better deliver.
To do this, you can use customer experience tools to collect data on your audience. For example, Hootsuite’s social listening features can show you what (and how) your customers talk about you online. You can also use customer experience tools like customer surveys to gain insight into their experience with your brand.
These deep insights will help you to deliver on their wants proactively. And what’s better than someone giving you something you want before you even ask for it?
- Build emotional connections with customers
At their core, these strategies are about better serving your customers, which will help you build stronger emotional connections with them. To do that, you need to provide a personalized service and a seamless journey.
Finding out what your customers want and giving it to them is a start. But you will also want to anticipate their needs to reach them on an emotional level. It’s not enough anymore to just make things easy. In the customer journey look for opportunities where you can delight your customers.
Take dog food suppliers Chewy, for example. When a customer called to ask about returns, Chewy learned her pup had passed over the rainbow bridge. They sent the grieving family flowers with a card signed by their customer care team member.
- Capture negative feedback before it goes live
One of the great advantages of having customer support chat built into your strategy is that you can capture issues before they turn into bad reviews. But if you can’t offer 24-hour live chat support, a chatbot can be a lifesaver.
Tools like customer service chatbots offer a golden opportunity to fix problems before they get bigger.
Customers who have their problems fixed are usually pretty receptive to giving your company another shot. Mistakes happen; we’re only human. (Except for the chatbots, of course. They’re just beautiful pieces of customer experience management software.)
- Decrease customer churn
Your churn rate, or the rate at which customers stop using your business, is an important measure of overall customer happiness. It’s pretty simple math: Happy customers = less churn. When people feel seen and cared for by your brand, they’re less likely to take their business elsewhere. That’s why making sure your existing customers are happy can lead to significant savings for your business. It costs a lot less to keep an existing customer than it does to acquire a new one.
- Boost customer loyalty
Loyal customers mean more than just reduced customer churn. When customers have a good experience with your business they are more likely to recommend you to others. This boost in loyalty can act as word-of-mouth marketing and increase your Net Promoter Score (NPS). NPS is used to measure your customer experience and satisfaction. It’s calculated on a 0-10 scale, bucketed into three cohorts: detractors (0-6), passives (7-8) and promoters (8-10). When your customer is a promoter, they’re essentially a brand advocate.
- Lower support costs
Customers who have a good experience with your business are less likely to need support. There are fewer complaints, which means less stress on your customer service team. This results in lower support costs, fewer dissatisfied customers and a happier customer service team.
- Increase sales
If you’ve made it easy for customers to complete their purchase, they’re more likely to buy from you again in the future. Plus, satisfied customers are also more likely to refer others to your business.
- Enhance brand reputation
A positive customer experience improves how people perceive your brand. When you’re mapping out your customer experience strategy, keep your ideal brand perception in mind.
Do you, like Coca-Cola, want to be known for happiness? Then you could take a page out of their book and add joyful touch points to your customer’s day. How fun was it to find a Coke bottle with your name on it?
- Improve employee satisfaction
If you work for a company that is beloved by customers, you’re going to like your job a little bit more. Interacting with happy people who have a great customer experience may raise internal employee morale.
When your employees are happy, there is less turnover. Turnover, estimated by LinkedIn, can cost a company 1.5-2 times the employee’s salary. This number may seem high, but it includes intangible losses like the employee’s company knowledge and strain placed on the remaining team.
- Create a competitive advantage
Businesses that excel at customer experience management have a leg up on their competition. This competitive advantage can help you attract more customers and grow your business.
Trader Joe’s, for example, has an almost cult-like following. And yes, in part it’s due to their off-beat and delightful product offerings. But that on its own isn’t enough. Trader Joe’s also invests heavily in customer service and understanding the friction points of traditional grocery shopping. You only have to browse the Trader Joe’s freezer aisle, where they’ve removed the cumbersome, annoying freezer doors, to see their strategy in action.
- Generate social media buzz
If something happens and it’s not posted on social media, did it actually happen? When people experience something notable, they post about it. Dedicate your customer experience strategy to creating a delightful experience for your customers. Some of them will likely share that story, possibly on their Story. (See what we did there?)
User-generated content is great for your own social content. When people turn into online advocates for your brand or share a positive experience, they create social proof that your brand is legit. Then that positive brand experience sits in front of all their followers. You, my friend, have just gained some free, effective advertising.