In the age of social media, where customers are sharing experiences and reviews on brands constantly, and making buying decisions based on those reviews from anonymous others, providing a great customer experience has never been more important.
Of course retaining and growing business from existing customers has always been the most profitable path to growth for companies, but it’s even more important today. Companies that provide an outstanding customer experience (CX) typically retain customers much longer, and those customers spend more with the company, creating a higher customer lifetime value. And existing customers are far more profitable because the customer acquisition cost has already been paid.
Every year Forrester does a CX survey, asking over 100,000 people to rank their experiences with major brands. USAA is typically at the top, with companies such as Southwest Airlines, Amazon, Zappos, Kaiser Permanente and others moving in and out of the top tier.
For the past six years Jon Picoult at Watermark Consulting has taken the results of Forrester’s survey and tied them to shareholder value. He’s found that the stock of companies that rank high for customer experience significantly outperform both companies with poor CX and the market in general.
Give customers what they want and they’ll give you what you want.