Improving marketing strategies is the quest of every business in today’s competitive environment. Marketing has long been perceived as a cost center, necessary but no way to increase revenue. Not anymore. Companies increasingly find that great customer experience can transform marketing from being a relatively unproductive cost into a very effective revenue engine. It’s not a fad: statistics and real-world examples convince of these new themes.
Understanding Customer Experience
Customer experience is the sum total of all engagements that a customer may have with a brand, right from awareness or knowledge of the brand to after-sales support. It encompasses all aspects of website usability, quality of service, and overall satisfaction. A positive CX encourages loyalty and repeat business while a negative experience creates circumstances that run customers away.
86 percent of the buyers are likely to pay a premium for a good customer experience. This willingness to pay more signifies an investment in CX. When they increase their engagement with the brand, customers feel valued and understood, leading to a subsequent increase in sales and profitability.
From Cost Center to Revenue Engine
Traditionally, the marketing departments were cost centers. Budgets were there merely for the advertising and promotions as such without any direct linkage toward revenue generation. However, with the increased importance attached to the customer experience comes the increased recognition of the ability of the marketing department to act as a revenue generator.
According to a study, Forrester found that companies with strong strategies for customer experience boast revenue growth 5.1 times more than weak strategy companies. The importance of CX cannot be overlooked from the monetary point of view, either.
Building Customer Loyalty
Probably, one of the biggest consequences of improved CX is customer loyalty. Loyal customers are not only more likely to make repeat purchases over a period but will also spend more as time goes by. Research carried out by Bain & Company has established that raising customer retention rates by a paltry 5% can increase profits between 25% and 95%.
This way, by providing a unique experience, customers end up being loyal to the business, becoming an asset that has no match. With loyal customers, there’s frequently little or no cost of acquiring new customers because the product or service will be gladdeningly passed on among friends and family.
Personalization: The Secret Sauce
Personalization is an aspect of improving customer experience; it is one of the latest experiences that people look forward to having in their relationships with brands. Business which does not meet these expectations miss the opportunities of maximising this power. Epsilon has found out that 80% more consumers are going to make a purchase when the brand offers a personal experience.
In such a way, using data analytics and customer insight in marketing can help in launching targeted marketing campaigns that can reach an individual preference and need and create a deeper level of personalization in the relationship. This can make the CX, convert more, and sell more.
