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The Cost of Neglecting Customer Experience

author
Benedict Clark
Content Editor
4 min read
The Cost of Neglecting Customer Experience

You’d think it would be easy for businesses to keep customers front-of-mind. After all, they’re the reason they exist in the first place. But sometimes the temptation to cut corners, minimize costs, and try to maximize immediate returns simply proves too strong to resist. Before you know it, your customer experience has been critically compromised.

It just isn’t a sustainable approach. 

Sacrificing the customer experience for short term financial gains is a recipe for disaster. A bit shaved off there, another tweak here, and before you know it, customers are leaving in their droves.

So what exactly is customer experience anyway, and why is neglecting it so dangerous for your business?

Defining customer experience

Customer experience is about a journey your customers go through with you. Customers don’t experience your business in terms of its departmental silos, they see it as a coherent whole, formed across a number of different touchpoints. As they pass through these various interactions, their perception of their overall relationship with your brand forms. The sum total of these interactions creates the customer experience.

All this means that a great product on its own is not enough. Great customer support alone is not enough. Only when all relevant factors combine seamlessly, can businesses achieve a truly great customer experience.

Why is customer experience neglected anyway?

Given the importance of customers for businesses, it may seem surprising their experience is neglected at all, but there are many reasons why organizations end up falling short. 

Often, companies simply:

  • Don’t have the right technology - if your company fails to provide customers an omnichannel experience, you miss the opportunity to connect with them on their terms. 
  • Don’t have the right culture - if your leadership doesn’t instill the values needed to put customer first, they won’t filter through the company. 
  • Don’t have the right processes - if your company doesn’t have the right feedback management in place to understand what customers think, you can’t act on it.
  • Don’t have the right strategy - if your different departments aren’t working together as a cohesive whole, you can’t ensure a streamlined customer journey.

Perhaps most importantly, companies simply fail to effectively prioritize the customer experience. But it’s well worth doing. The cost of failing to do so can be dire.

The cost of poor customer service

You lose sales

Make no mistake, a poor customer experience impacts the bottom line. After all, according to Gartner, 64 percent of people think customer experience is more important than price in their choice of brand. The sheer scale of this loss in terms of sales is simply staggering. VisionCritical estimates the overall impact of bad customer experiences in the United States is more than $537 billion

(Source: ImageCritical)

Your reputation suffers

Mass social media and hyper-connectivity have led to the democratization of customer opinion. And customers like to talk. A dissatisfied customer will tell between 9 to 15 people about a bad experience. The impact of this is real as customer reviews hold serious weight with other customers. Eighty percent of customers won’t buy from companies with negative reviews.

You miss what customers want

Neglecting customer experience means you miss out on providing customers with what they really want: a positive, emotive experience. That’s why 86% of buyers are willing to pay more for a great customer experience. Savvy companies know all too well that how something is delivered is as important as what is being delivered.

You lose customers

Loyalty is the source of true value for your business, and this comes from the experience you provide, not the product or price you offer. Without that experience, customers have no reason to stick with you. It’s no surprise then that in a study by Tempkin Group, 86% of consumers that received a good customer experience said they would buy from them again compared to just 13% who received very poor customer experience. 

 

(Source: Tempkin Group)

You miss out on talented staff

Your staff wants to feel proud to work for you. And a poor customer experience can tarnish your company’s reputation. More than 70% of U.S. workers will not apply for a job at a company with negative press. Companies with a bad reputation will have to pay 21% more in salaries to keep employees on board.

How to create a great customer experience

If you want to create a great customer experience:

  • Create conversations with your customers. Get them feeling involved with your business and engaged with the brand. Personalize your correspondence, and make sure you respond to customers quickly when doing so.
  • Unite all departments. Try facilitating information sharing between different departments through regular presentations, particularly between customer-facing teams (e.g. account management, sales, customer service). This way, different teams understand each other’s unique challenges, thus increasing collaboration.
  • Be omnichannel. Allow customers to access your customer support how they want and ensure your service consistently delivers. Use technology to bridge the gap between online and offline channels by offering a multitude of communication methods including video, live chat, and cobrowsing.

The drive to provide a great customer experience is the most important factor in actually achieving this goal. Decide to place customers at the heart of everything your company does and you will be well on your way to creating amazing customer experiences.   

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