In my decades as an entrepreneur and investor, I've watched businesses rise to the top of their industry or fall into obscurity, often due to customer experience. Unfortunately, some great ideas never seem able to reach their full potential because they lack loyal customers who will recommend them tirelessly - a reality called " poor customer experience ". 

WHY IT MATTERS: YOUR CUSTOMER IS THE MOST IMPORTANT PERSON ON YOUR TEAM.

Customer experience has always been an essential part of marketing, but in the new era, data analytics can provide more insight into customers' needs and behaviour than ever before. Yet few fintech companies take advantage or even try to use this information for their benefit. This lack of awareness is why we founded the CX practice at Engelworks.

What we do is simple: we listen to what your customers are saying, and then we help you take action accordingly. We use cutting-edge technology and human expertise to analyse customer data and identify customers' main issues with your brand. Then, we work with you to devise a plan of action that will help improve the overall customer experience. By doing this, we hope to make a positive difference for businesses and the people who matter most – the customers themselves.

We believe that happy customers lead to successful businesses. So if you're looking to get ahead of the competition and create lasting relationships with your customers, you need Engelworks on your team.

UNDERSTANDING CUSTOMER EXPERIENCE (CX)

CX is the sum of every customer interaction with your business throughout its lifecycle and how they feel about those interactions. 

CX is becoming increasingly important as companies look for ways to differentiate themselves in a crowded marketplace. Forrester Research has found that 89% of companies expect to compete primarily based on the customer experience within the next two years.

To create great customer experiences, businesses need to understand three key things:

1. What their customers want and need,

2. How they feel about their interactions with the company, and

3. How likely they are to recommend the company to others.

This understanding comes from customer feedback. Getting regular feedback gives businesses the insights they need to make improvements that will drive loyalty and advocacy.

Customers who have a great experience with a company are more likely to buy from them again, recommend them to others, and give them positive reviews online. Creating a great customer experience should be a priority for all businesses.

WHY IS CX CRITICAL FOR BUSINESS LONGEVITY?

In addition to providing differentiation, there are several reasons why CX is so important for business longevity. 

First, customers have more choices than ever before and are not afraid to switch brands if they are unhappy with their current experience. A study by Bain & Company found that 60% of customers are willing to switch brands if they have an unsatisfactory experience.

Second, the rise of social media means that unhappy customers can quickly share their experiences with a broad audience. A single negative review on a site like Google or TripAdvisor can damage a business's reputation and drive away potential customers.

Finally, CX is a crucial driver of customer loyalty and retention. A study by Bain & Company found that companies with superior CX saw a 70% decrease in churn rates.

Given the importance of CX, it's no surprise that businesses are investing more in efforts to improve their customer experience. A study by PwC found that 73% of businesses will increase their CX budget next year.

If you want your business to thrive for years, ensure you're investing in creating a great customer experience.

THE IMPACT OF CX ON CAC & CLV

As the CX becomes increasingly important to businesses, its impact on key performance indicators (KPIs) such as customer acquisition costs (CAC) and customer lifetime value (CLV) is also becoming more evident. A recent study by Harvard Business Review Analytic Services found that companies that are leaders in CX outperform their competitors on profitability, revenue growth, and market valuation measures.

There are several ways that CX can impact CAC and CLV. For example, improving the customer experience can lead to higher customer retention rates, reducing CAC by reducing the need to constantly acquire new customers. Additionally, happy customers who have had a positive

A company's CX goal should always be to make customers' lives easier by removing their pain points with minimum effort. This simple philosophy goes a long way towards ensuring customer happiness, which naturally leads to increased revenue. 

Here are some facts about customer lifetime value (CLV) and customer acquisition costs (CAC) that prove this point:

• According to Gartner, the cost of acquiring a brand new customer may range from 5 to 25 times more than retaining one.

• Similarly, your chances of converting said retained customer is between 60%-70%.

• Due to high CX, customers who stay around will spend over 65% more than new customers.

• More than two-thirds of existing companies now see CLV as integral to their organisation’s future.

WHY TRADITIONAL CX IDEAS AREN’T WORKING

The traditional ideas for customer experience (CX) are no longer working as well as they used to. They may even be making things worse. Here’s why:

1. The traditional ideas assume that customers are rational.

Customers are not always rational. They are often emotional creatures who make decisions based on their feelings and perceptions rather than logic. The old ways of influencing customers by appealing to their rationality are often ineffective.

2. The traditional ideas focus on short-term gains.

While it is essential to focus on short-term gains, traditional customer experience ideas often ignore those gains' long-term consequences.  For example, offering a discount to a customer may result in a short-term increase in sales, but it may also erode the brand's value and lead to lower prices in the future.

3. The traditional ideas are based on averages.

Not all customers are average. Most customers are not. The traditional ideas for customer experience often fail to consider the wide variety of needs and wants that individual customers have.

4. The traditional ideas rely on mass marketing techniques.

With the advent of social media and other digital technologies, mass marketing techniques are no longer as effective as they once were. Customers are more likely to be reached through targeted, personalised messages that speak to their specific needs and interests.

5. The traditional ideas don't always consider the customer's point of view.

The best customer experience ideas put the customer's point of view first. All too often, traditional ideas for customer experience fail to do this. They focus on what the company wants to achieve rather than what the customer wants or needs.

As you can see, the traditional ideas for customer experience are no longer as practical as they once were. To improve your CX, you need to start thinking outside the box.

UNLOCK THE POWER OF CUSTOMER EMPATHY

The power of customer empathy is the ability to understand and share your customers' feelings. It's the ability to see things from their perspective and to understand what they're going through.

This power is essential for any business that wants to create lasting customer relationships. When you have customer empathy, you can build trust and rapport quickly. You can also understand what motivates them and what they need from you.

Customer empathy is the key to creating a customer-centric culture in your organisation. It's the foundation upon which all excellent customer service is built. And it's the difference between a business that thrives and one that just survives.

WANT TO LEARN MORE?

Engelworks is a company that creates and implements proactive customer experiences. We do this because we believe that investing in your customers is one of the best investments any business can make. Our mission has always been centred on combining data with human interaction skills for an awe-inspiring CX experience - where your profit margins are looking bright!

Contact us today if you want to learn more about improving your CX. We can help you unlock the power of customer empathy to create unforgettable experiences that will drive long-term customer satisfaction.

Irina Pafomova