The Critical Role of Customer Experience in Driving Growth

The Growth Imperative

All companies care about growth, and growth comes from two sources:

1)???? Acquiring new customers, or

2)???? Getting more from existing customers.?

In both cases, a system of proactively managing the customer experience can be a powerful lever for managing growth, in the short, intermediate and long terms.? This lever is often underutilized.?

The Economics of Loyalty

Loyalty isn’t just a feel-good metric—it’s a proven driver of business success.?

According to Bain & Co., earning customer loyalty is firmly in the interest of both shareholders and management.? “Our research shows that loyalty leaders— companies at the top of their industries in Net Promoter Scores or satisfaction rankings for three or more years—grow revenues roughly 2.5 times as fast as their industry peers and deliver two to five times the shareholder returns over the next 10 years.”

Rob Markey, Partner Bain & Company, ‘Are You Undervaluing Your Customers?’

--HBR – January, 2020--

Why does loyalty matter so much? Loyal customers spend more, stay longer, refer others, and are less sensitive to price changes. They are invested in the company’s future. On the flip side, detractors are expensive—they churn at higher rates, require more service, and spread negative word-of-mouth that can rapidly damage a brand and inhibit growth. The rise of social media amplifies this effect, making customer sentiment—good or bad—travel faster and further than ever before.?

Unlocking CX Potential

Most companies have some of the capabilities to manage this function in pockets across the organization, but lack the coordinated effort and structure required to implement and operate it.? The CX leader should report into a senior executive within a function that scales across the company.? It is often siloed and under-leveled.? As a result, the efforts produce sub-optimal results and become marginalized over time.?

When faced with tension between short and long term investments, companies continue to prioritize quarterly earnings pressures over customer relationships.? The two can co-exist.? A small, central team managing CX can drive a material disproportionate amount of value to an organization.?

Building a Leading Class CX Function – What are the critical components of a CX team?

A leading class CX team structure contains the following components: Data, Analytics, and Culture.

• Data: A high quality, trusted, end-to-end measurement system is essential for understanding customer sentiment across the entire journey. This includes not just quantitative metrics like NPS or satisfaction scores that can and should be goaled against, but also qualitative feedback to explain the "why" behind the numbers, sometimes referred to as the ‘root causes of Promotion and Detraction’. Incorporating multiple data sources—such as surveys, CRM data, support logs, and social media—into a centralized platform provides a holistic view of the customer experience and should be managed by the CX Data team.
• Analytics: Data alone isn’t enough; it must be transformed into actionable insights. The Analytics function helps manage this transformation.? They sort through customer data, both sentiment (e.g., NPS) and operational (e.g., actual behavior), and prioritize the most impactful improvements, which align teams across the organization around customer centric actions. This team function produces a detailed understanding and prioritization of actions by stakeholder group, establishes and manages targets (sometimes co-owning them) and is central to the process of listening, learning and responding to customer feedback. By setting clear goals and embedding customer-centric metrics into daily operations, businesses can track progress and refine their approach over time to drive measurable results.
• Culture: A customer-centric culture is the glue that holds a CX function together. This means a governance model that fosters accountability, collaboration, and a shared commitment to serving the customer. Regularly sharing customer sentiment—through daily updates, monthly reviews, or quarterly executive reports—keeps the customer front and center, driving meaningful change across the organization.? This function is often led by the CX leader or Chief Customer Officer and serves as the central hub in a cross functional organization, ensuring that the collaborative partnerships drive progress.

Clearly a highly collaborative role, the responsibility of the CX function is to work with stakeholders to share in the analysis and interpretation of customer sentiment, action planning and prioritization, goal setting, closing the loop with customers and communicating the status of progress.? This function plays an active participation in the growth of the company.

Extending the Impact: Employees and Technology

While the focus of CX is often on external customers, the same principles can be applied internally to improve employee experience (EX). Happy, engaged employees are critical to delivering great customer outcomes, and the economic case applies here as well. By creating an employee feedback loop, similar to NPS, companies can identify pain points, reduce turnover, drive engagement and delight customers.

Technology also plays a pivotal role in scaling CX. Emerging tools powered by AI can aggregate and analyze data from diverse sources, providing actionable insights in real time. The concept of a “CX Cloud”—a centralized platform for managing loyalty and satisfaction metrics—represents a powerful opportunity for businesses to leverage data at scale while maintaining a strong focus on privacy and security.

The Path Forward

In a world where customer and employee expectations continue to rise, companies that proactively manage these experiences will gain a decisive edge. By integrating data, analytics, and culture into a cohesive CX strategy, businesses can build stronger relationships with their customers and employees, fostering loyalty that drives measurable results.

The journey to becoming a CX and EX leader requires commitment, coordination, and a willingness to act on feedback. But the rewards—stronger growth, higher loyalty, and a competitive edge—make the effort essential for any organization aiming to thrive in today’s fast-moving landscape.

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Up Next: A look at why managing a CX function sounds simple, but in reality is quite a challenge