A step-by-step guide to customer experience management

Putting customers at the center of your business not only helps you understand their needs but also allows you to respond to those needs proactively.

Organizations that leverage customer feedback to improve their products, services, and overall customer experience (CX) easily foster strong customer relationships. This builds trust and credibility, which translates to increased brand loyalty and advocacy.

Incorporating a customer experience management (CXM) tool to manage interactions with your customers helps deliver an unforgettable experience with your products, services, and communications.

Customer experience management is the process of managing a company's interactions with its customers. Traditionally, each department of an organization creates customer experiences based on their perspectives or silos of knowledge. However, CXM aims to improve customer interactions from their point of view, taking into account their entire journey with your business.

Ultimately, the goal of CXM is to increase positive word-of-mouth and customer loyalty while reducing customer churn and detractors. Businesses need to effectively capture customer feedback to achieve this. Once they obtain the feedback, they must promptly circulate it to the right people in the organization for action.

Customer relationship management (CRM) and customer experience management are two concepts often used interchangeably. While they have some similarities, CXM is not just a renaming of CRM. 

CXM takes a more customer-centric approach to managing customer relationships. This involves using the latest technologies, strategies, and processes to control and interpret customer interactions.

While CRMs typically collect data through batch or manual entry, CXM provides real-time data flow, allowing for deeper and better insights into customer behavior and preferences.

Here are four key reasons why CXM is important:

Achieves a deeper understanding of customers

Businesses gain valuable customer satisfaction and loyalty insights by gathering and analyzing data about their behaviors, preferences, and needs. This helps them tailor their products, services, and communications to meet customer needs and expectations.

Drives loyalty and retention

To provide a smooth and personalized experience, organizations need to build trust and establish long-term relationships with customers. Doing so can result in improved levels of customer loyalty, increased retention rates, and, ultimately, more profits.

Maintains a competitive edge

With the ever-changing business landscape, businesses must distinguish themselves from their rivals to thrive. A superior customer experience can help businesses stand out and attract more customers.

Measures the success of initiatives

CXM allows businesses to track key metrics such as:

• Customer satisfaction

• Net Promoter Score (NPS)

• Customer lifetime value (CLV)

With this, businesses can gain valuable insights into the effectiveness of their CXM strategies and make data-driven decisions to drive business growth.

The customer experience journey refers to all customer touch points with a brand or business, from the initial contact to post-purchase evaluation. Here are the four stages of a customer experience journey:

Stage 1: Awareness/consideration

In this stage, the customer becomes aware of the business and considers its products or services. The customer may search online, ask for recommendations, or compare options before purchasing.

Stage 2: The sale process

Once the customer decides to purchase, they enter the sale process stage. This includes:

1. Browsing

2. Selecting a product

3. Adding it to the cart

4. Completing the purchase

During this stage, businesses can use various tactics to optimize the customer experience, such as offering promotions or providing clear and simple checkout processes.

Stage 3: The after-sale process

After the sale is completed, the customer enters the after-sale process stage. This includes activities such as delivery, installation, or support.

Stage 4: Retention and referral

In this last stage, businesses focus on retaining customers and encouraging them to refer others to the business. 

Some activities in this stage include follow-up communications, loyalty programs, and referral incentives. Such activities allow businesses to create loyal customers who are more likely to refer others and continue to make purchases in the future.

With numerous factors impacting the customer experience, it can be challenging to determine the best place to begin. To help you get started, here are three steps to better CXM:

Create and maintain complete customer profiles

To deliver a top-notch customer experience, businesses should create customer profiles that combine traditional and emerging data types. This allows them to understand customer journeys better, meet expectations, and make quick, informed decisions.

Make it personal

Personalizing every interaction with customers is crucial, and businesses can achieve this by understanding both the customer and the context in which they operate and collecting and analyzing this information. 

Companies need to enrich their core data to maintain high levels of customer focus. This can help them deliver relevant, timely and insightful offers, services, and recommendations that resonate with the customer.

Right message, right place, right time—every time

Mapping analytics to different stages of the customer life cycle is essential to delivering the best value and improving the customer experience. With this, businesses can deliver the right message at the right time, from the initial consideration stage to the post-purchase experience.

CXM can present several challenges to organizations. Some of these include:

• Lack of enough data: Insufficient customer data can hinder a company's ability to measure and address customer experience issues.

• Little support: A lack of support for multiple communication channels can make customers feel unheard and more likely to switch to a competitor.

• Ignoring individual data: Failing to analyze qualitative data, such as a customer's comments, can lead to a lack of understanding of an individual customer’s experience issues.

There are five main types of customers in CRM:

• Loyal customers

• Impulse customers

• Discount customers

• Need-based customers

• Wandering customers

• Discovery

• Engagement

• Delivery