Long gone are the days where you can rely on products or services alone to sustain a business. Competition is getting stiffer by the day, and businesses need to constantly be on their toes in order to stay afloat or be prepared to be swept away by the ever-changing economic waves.
Consumers are being empowered by technological advancement every passing minute. The digital revolution has enabled them to be able to access information in a single click of a button, giving them the power to make informed choices about their purchases between brands.
As a result, consumers are beginning to place higher expectations on brands. But what’s the differentiating factor between competing brands? It goes beyond products and services. This is where consumer experience comes into the picture.
Today, in order for businesses to survive, they need to take customer-centric approaches. The idea is to deliver personalized experiences that make consumers feel valued and that they share a connection with the brand, which ultimately leads to long-term patronage.
So what exactly happens when you place consumer experience as the core of your business?
Your customers will be more satisfied
Customer satisfaction plays a vital role in building a long-term relationship with your customers. It is reported that 81% of satisfied customers are more likely to do business with a brand again if they had a positive experience. But what happens if they’ve gone through a bad experience? According to RightNow, 95% of consumers would ‘take action’ after a negative experience, such as sharing concerns with friends and family or churning.
However, although the art of keeping them satisfied by constantly delivering wholesome experiences doesn’t sound like an easy task, there are tools readily made available that could assist businesses in this very area — such as loyalty programs.
Tools as such are able to help businesses collect data about their customers, which helps in capturing their interests. These data collected can be then used to tailor approaches to customers in a more targeted manner.
Your new customers become your loyal customers
Remember that satisfied customers are more likely to do business with a brand again after a positive experience? That’s loyalty we’re talking about. Once your customers start receiving services that are tailored to their needs and interests, their level of satisfaction increases and they become loyal to your brand.
It goes without saying that loyalty plays an important role in sustaining a business in this present-day era. Apart from the fact that it actually costs less to retain a loyal customer than it is to acquire a new customer, loyalty ensures that your business will receive constant patronage in the long run. As a matter of fact, a research conducted by Frederick Reichheld of Bain & Company reveals that increasing customer retention rates just by 5% increases profits by 25% to 95%.
Your customers become your brand ambassadors
This constant patronage from your loyal customers will be then converted into the cheapest advertising solution you will ever find — word-of-mouth advertising.
In recent years, the bubble tea trend has seen a spike in popularity across the globe. More often than not, you may find two or more competing brands sandwiched in the same row of stores. But have you ever come across some of these brands that don’t invest a single cent in paid advertising yet have a plethora of customers flocking their stores? That’s the word-of-mouth in action.
According to Redk, word-of-mouth generates over 2x the sales of paid advertising and 92% of consumers trust recommendations from people they know, while 84% would take action based on recommendations from people they know, such as friends and family. On top of that, 88% of consumers actually read reviews to determine the quality of a business’s customer experience.
These consumers are then known as your brand advocates; a walking advertisement for your brand.
You get to stay ahead of the game
Research shows that over two-thirds of a brand’s competitive edge in the market is based on the experience that they deliver to their customers and that 84% of organizations working to improve CX have reported an increase in revenue.
We’ll use the bubble tea example again. Imagine running a bubble tea store that’s placed in the same row as two other competing brands. What’s the differentiating factor that would prompt customers to choose a brand over the other when the products offered are the same? Studies have shown companies that place customer experience as the core of their business are outperforming their competition. Customer experience is the new battlefield.
Today, it is no longer about comparing products and prices, but service and user experience. A research conducted by Gartner revealed that over 80% of organizations are expected to compete mainly based on customer experience this year. Hence, it’s safe to conclude that in this day and age, impeccable customer experience is what helps businesses to stand out among competition.
You get to build a connection with your customers
“Get closer than ever to your customers. So close that you tell them what they need well before they realize it themselves.” ― Steve Jobs
Like every other relationship, it has to begin with an emotional connection. The consumers we know of today aren’t only interested in products and services that can give them the best bang for their buck, they gravitate towards brands that they can resonate and share a connection with.
Consumers of the digital age are continuously demanding for deeper and more meaningful experiences from brands. The formation of an emotional connection encourages customers to trust that they can continue doing business with a specific brand, which therefore leads to the creation of a strong and long-lasting relationship. On top of that, it also opens doors to more positive impacts on businesses, including increasing customer value, maximizing ROI, as well as minimizing the risk.