Customer experience management: What is it and how to leverage it for your business?
Updated: March 01, 2024
Published: July 16, 2021
11 mins read
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Your success as an ecommerce business doesn’t just depend on offering the best products at the best prices — it also depends on effectively managing your customer experience.
In fact, customer experience management might have a bigger impact on your growth than any pricing or product strategy. But don’t just take our word for it: According to a Walker report, the customer experience was expected to overtake price and product as the key brand differentiator in 2020.
So, if you’re looking to take your business to the next level, it’s time to learn how to use customer experience management to create satisfied customers.
What is Customer Experience Management?
Customer experience management is also known as CEM or CXM. The most basic CEM definition is when a business tracks, analyzes, and responds to all the different interactions customers share with their brand. These interactions can take various forms, including live chat, Facebook messages, and reading reviews on third-party sites.
Using a CEM tool like SurveySparrow or Custellence, you can collect feedback from customers at every touchpoint to learn how they perceive your brand. This will provide insights into how you can best satisfy your customers in each step of the customer journey.
The image below highlights some common customer touchpoints which can be used to collect customer feedback:
Simply put, customer experience management helps you learn about your customers’ preferences. You can then use these learnings to optimize your brand channels in order to meet (and exceed) their expectations.
Why is Customer Experience Management Important?
Well, for starters, customer experience management is important because you need to differentiate your brand from competitors in a way your customers care about.
According to PwC’s research, 73% of consumers say the experience provided by a company plays a crucial role in their buying decision. And the same study notes that 32% of all customers will walk away from a brand they loved after just one bad experience.
That’s why you should continuously monitor your customer experience. And work to improve it — which is easier to do with modern CEM tools.
Beyond that, good customer experience management can help you to:
1. Anticipate Customer Needs
How well do you know your customers? More specifically, how accurately can you anticipate their needs across different touchpoints?
With customer experience management, you can go directly to them and ask about their preferences.
For example, your customers may want the ability to track their order on your website instead of having to visit a carrier website. You could use a tool like AfterShip to create tracking pages on your website that provide a consistent brand experience to your customers — here’s an example:
2. Drive Retention and Loyalty
CEM can help you keep your existing customer base satisfied and happy by helping you create experiences that appeal to them.
Although your competitors might try to poach your customers away with lower prices, if your customers value the experience they’ve had with your business, they’ll be less likely to switch brands.
Consequently, satisfied customers are crucial to the success of your business.
Also, happy customers will typically spend more, refer your business to others, and leave glowing reviews of your brand.
For example, the beauty brand Glossier gets a lot of positive reviews for offering excellent products and outstanding customer service:
3. Reduce Customer Churn
Reducing churn (aka. preventing customers from leaving you) isn’t always easy. Fortunately, CEM makes the process less daunting by helping you identify some of the main causes of churn.
CEM tools are equipped with diverse capabilities like customer feedback, contextual monitoring, and analytics. These features can help to reveal potential bottlenecks in your customer experience.
To begin with, you can survey customers to figure out why they left and identify the last touchpoint they interacted with. Doing so will give you a clear idea of what’s working and what’s not in your business.
CRM vs. CEM: What’s the Difference?
CRM stands for customer relationship management. It’s a technology that focuses on customer data and analysis, which enables companies to run targeted and personalized sales campaigns.
While both CRM and CEM help businesses gather and manage customer information, they’re not the same thing. Whereas CRM software views data in terms of statistics, CEM takes more of a qualitative approach.
For example, you might use a CRM like Keap to track the average dollar amount customers spend when they make a purchase from your store.
However, the data won’t reveal how the customer looks at your company, the emotional connection they have with your products, and whether they had a good experience placing an order on your website. For that, you’ll need to invest in CEM.
For instance, customer experience management tools like Survey Sparrow are designed to track all aspects of the customer journey from the customer’s viewpoint:
Through surveys, direct feedback, and other ways of communicating directly with customers, CEM provides a clearer picture of their overall experience and where you could improve.
This gives you a competitive edge over businesses focusing merely on capturing information and utilizing it to inform sales and business strategies.
How to Measure Customer Experience Using CEM Tools
To create an effective customer experience management strategy, you need to track customers’ journeys and how they interact with your brand across several digital channels. Then, you need to extract useful insights that help you improve their experiences. Sounds fun?
Fortunately, CEM tools are designed for this exact purpose — they provide deeper insights into customers’ feelings and help companies gather, measure, and act on the data.
Here are 3 ways to understand and manage your own customer experience:
1. Use Customer surveys
No matter how you cut it, there’s no beating a good ol’ fashioned survey when it comes to collecting meaningful customer experience data.
And traditional surveys are a perfect mix of qualitative and qualitative. Let customers respond to a rating scale (a scale of 1 to 5 that uses the range from extremely unsatisfied to satisfied) and then explain the reason for the rating.
The Japanese apparel brand Uniqlo uses a rating scale survey to gather information on its customer experience:
You can also leverage user experience surveys to help you gauge how your customer experience is across different touchpoints. This can include their experience with your mobile app or website, but also cover offline or product experiences.
Here are some free customer survey tools you can use:
- Google Forms: This is a completely free survey tool that allows you to conduct unlimited surveys and receive unlimited responses — with no monthly caps.
- SurveySparrow: SurveySparrow has a free plan that offers up to 10 questions per survey and 100 responses per month. You can also embed your surveys into webpages, making it a great addition to your CEM toolkit.
- LimeSurvey: Although it’s not the most popular survey tool, LimeSurvey makes it into the list due to its free allowance of 25 responses/month. Another interesting feature is the ability to launch a survey in 80+ languages.
Regardless of the tool you use, make sure to keep your survey short and sweet. Your customers are busy people, so be sure to respect their time.
Also, make sure to only ask one question at a time.
For example, many surveys have multiple questions baked into one, such as: “How was your experience tracking orders through our website? Did you get the details you wanted? How and where can we improve?”
Don’t make customers feel like you’re interrogating them! Only ask one question at a time.
2. Define and Track Buyer personas
Buyer personas are maps of your customers’ experience. When you create a buyer persona, you build a document brimming with information about your customer buying patterns, interests, and pain points. Here’s a typical example of a buyer persona:
Buyer personas can be built on data taken from various sources, including surveys and interviews with your customers. Developing them should help you learn what motivates each kind of customer to interact with your business.
3. Harness the Power of Customer journey maps
Customer journey maps include every “touchpoint” your audience uses to interact with you and similar brands. This could include search engines, social media platforms, your website, marketplace websites, and more.
Once you know your customer’s journey from end to end, you can make sure you’re ready to support them every step of the way. This template from Custellence is perfect for tracking customer journey maps through retail commerce.
How to Improve Your Customer Experience
We’ve looked at the tools you can use to gain insights into your customer experience. Now, let’s outline some practical tips you can apply to elevate that experience.
1. Personalize your interactions
Personalizing interactions with your customers can strengthen the bond you share with them.
Based on your customer journey, personalization can take on many different forms. For instance, sending personalized emails to customers in case of a delivery delay can enhance their post-purchase experience. Here’s a real-life example from the home-goods brand Wayfair:
If you’re using AfterShip to deliver branded tracking experiences, you can use apps like Klaviyo to automate this personalization process.
You can also personalize interactions in other ways, such as:
- Recommending products based on past purchases
- Being empathic with frustrated or unhappy customers
- Personally following up with survey responses
The goal of personalized interactions is to show customers you care and inspire brand loyalty.
2. Invest in customer education
You can improve the customer experience by teaching users how to get the most out of your products.
For example, you can set up a blog to publish useful resources that are engaging and easy to share.
Videos are also an excellent way to empower customers. Their visual nature is ideal for helping customers retain information and address concerns on their own. For instance, the clip-in hair extensions brand Luxy Hair often makes videos to demonstrate how to best use its products:
When customers are empowered to find useful information on products, their trust in your brand increases — they understand you’ve got their back, and they value your guidance.
3. Keep customers in the loop
Whether they’re sharing their concerns or thanking you, customers don’t want their feedback to sit in a bloated inbox gathering dust.
So, tell customers how much you appreciate their response and how you plan to use the information they gave.
For most feedback, a message thanking them for their input is usually enough. If customers have an issue they want to be solved, let them know you’re looking for a solution, and you’ll update them soon.
You can also schedule updates to go out automatically. For instance, if your customers cite concerns over your shipping times, you can send delivery updates via Messenger to reduce some of their anxiety. AfterShip’s Facebook Messenger app makes it easy to send delivery events through Messenger:
When you put the effort in to keep customers informed, everyone wins — and you lay the groundwork for future customer experience improvements.
Summary: Grow Your Business with Customer Experience Management
Now you know everything you need to build a customer experience management strategy and delight your customers.
Remember though, customers’ needs are fluid. Preferences constantly change, so you’ll need to stay on top of the shifts as you build your experiences.
To summarize, here are the tactics you could use to manage and improve your customer experience:
- Use CEM tools like surveys to measure your customer experience performance.
- Personalize interactions to foster loyalty and show customers you care.
- Empower customers by creating resources that educate them about your offerings.
- Keep customers informed by responding to their feedback and sharing how you plan to deliver a better experience next time.
All in all, by collecting and organizing customer experience data, you can learn how to increase customer loyalty and retention, and ultimately, boost your bottom line.
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