The State of Customer Experience: A Small Business Perspective
The following article is an excerpt of a White Paper by Customerization ‘s Kira Tchernikovsky . Kira is the co-founder and CMO of this Canadian consulting company that focuses on helping SMBs stand out through superior business automation.
Customer experience (CX) is how a customer feels about a company over time. Creating great CX is about positive emotions, building trust, and leaving a lasting impression with customers.
Orchestrating excellent customer experience is essential for building brand loyalty and increasing customer retention. It’s also becoming increasingly important as more and more clients. B2C and B2B, choose to do business with companies who personalize interactions and prioritize customer satisfaction.
While larger businesses have the resources to invest in Customer Experience (CX), small businesses (and by small we mean <200 employees) face unique challenges in providing an outstanding CX.
Here are a few common challenges for small businesses :
- Limited resources : Small businesses have limited financial resources and less employees to dedicate to a comprehensive customer experience solution. This makes it difficult to compete with larger businesses that have more resources to invest in customer experience initiatives.
- Lack of expertise : Small businesses may not have in-house expertise in areas such as customer experience design, research, and analytics. Therefore, it is not easy for SMEs to develop and implement an effective customer experience strategy.
- Limited data and insights : Small businesses may have limited access to customer data and insights, which in its turn, prevents them from objectively understanding customer needs, preferences, and pain points. How can they then build effective customer interactions and experiences?
- Limited technology resources : Small businesses often do not have the budget to invest in the latest technology solutions, such as personalized messaging or mobile apps, to enhance CX.
Nevertheless , when small businesses use technology and effective guidance for their customer experience initiative, they can overcome these challenges and turn them into advantages that help them grow their business.
Customer experience (CX) refers to customers’ overall perception of a business based on their interactions with the company. CX has become increasingly important in recent years as customers expect more personalized and seamless experiences. In fact, 88% say experience matters as much as products, according to Salesforce’s State of the Connected Customer report.
A study by Forrester Research found that companies that prioritize customer experience see a 5.1x revenue growth compared to those that don’t. While the exact ROI will depend on the specifics of each business, research has shown that companies that prioritize customer experience tend to outperform their competitors in terms of revenue growth and customer retention.
So, where is this revenue growth coming from? A good customer experience leads to your customers spending more. In fact, 86% of buyers are willing to pay more for a great customer experience .
The global customer experience management market was valued at USD 10.65 billion in 2022 and is expected to expand at a significant compound annual growth rate CAGR of 15.4% from 2023 to 2030. This market growth can be attributed to the mounting importance of understanding customer behavior and their preferences, which drives various brands and organizations to implement customer experience strategies, such as regularly communicating and engaging with customers, developing a long-term program, and utilizing automation, to provide the best service performance to customers in real-time.
While large businesses are investing significantly in customer experience because they have the resources (both financial and personnel), small businesses do face challenges in providing a Customer Experience at the same level. Let’s describe the key challenges:
On the bright side , corporate environments may have more bureaucracy and layers of decision-making, which can slow down the implementation of CX initiatives. In contrast, SMEs may have more flexibility and agility to implement changes quickly but may lack the scale and resources of a larger company.
What Are The Key Components Of Customer Experience (CX)?
Customer experience (CX) is built of several key building blocks that are relevant for any company, independent of size, industry, or geography. These building blocks are:
Customer journey mapping : CX begins with understanding the customer’s journey from the first touchpoint to the last. Mapping out this journey helps to identify the specific steps the customer takes, any pain points they experience, and record opportunities for improvement. The company needs to get the understanding of what the journeys are in order to be able to improve the layout and connectivity of the touch points.
Source: Getty images
Customer feedback : Gathering feedback from customers is essential for understanding their needs and preferences, and for identifying areas where the company can improve.
This can be done through surveys, customer support processes, social media, or other feedback channels.
The ‘loop’ refers to the circular process of gathering feedback, acting upon what you’ve learned, and then asking for feedback again.
Because this journey is circular, it describes an ongoing process that never really ends, but that should result in continuous improvement.
Personalization : Customers expect a personalized experience that is tailored to their specific needs and preferences. This requires companies to collect and analyze customer data, and to use that data to provide customized recommendations, offers, and interactions.
Source: “Customer experience and personalization — benefits, best practices, and examples,” Adobe, Dec 2022
Omnichannel presence : Customers expect to be able to interact with companies through a variety of channels, including email, phone, chat, social media, and in-person. It’s important for companies to provide a seamless experience across all these channels so that customers feel like they are dealing with one cohesive entity.