Does An Improved Customer Experience Mean Increased Revenue?

Verde Group white paper: Driving Improved Business Outcomes via Customer Experience Excellence

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AN EXCERPT: In conversations with leading CX practitioners, we hear it time and time again: They’re frustrated despite mountains of data being generated.?They're searching for ways to increase the meaning and importance of their work, and to make a difference in the outcomes of their business enterprise.

Why are they frustrated? What is driving this challenge? After all, the customer experience industry is growing at a rapid pace. According to a 2023 Yahoo Finance article, the customer experience industry is expected to grow at a 7% compounded annual growth rate for the foreseeable future, reaching $120 billion by 2026. Even the U.S. economy would be envious of such a rapid trajectory.?

A key driver of the growth of the industry is the importance placed on improving the customer experience by Executive Leadership. This point is clearly demonstrated in Forrester’s 2023 customer experience study where 80% of businesses stated that improving their CX is a high priority. It makes sense. Who wouldn’t want to deliver a better experience to their customers? But there’s a catch, after investments in very bright people, dedication to process changes and licensing of voice-of-customer insight technology, only 6% of businesses saw a significant increase in the performance of their customer experience. And it hasn’t gone unnoticed by the customer. According to a CCW survey, over half of customers stated that customer service has gotten somewhat or much worse this past year.

How is this possible? Companies are dedicating considerable resources to improve the experience their customers have with their brand, products, and services every day, yet progress is elusive.

Our Hypothesis: Organizations that use legacy CX research methods that do not clearly correlate to changes in customer behaviors will continue to realize sub-optimal business outcomes.

The Truth: CX Insights Are Not Consistently Used to Drive Business Decisions

There is a great debate going on across global boardrooms. Will investing in improving the customer experience truly yield improved business outcomes? Intuitively one would think the answer is clear. Of course, a better experience should drive an increase in revenues and profits. However, what part of the experience should companies focus on? What specific interactions should be triaged and improved? If investments have been made using existing insights, has the company realized improved financial outcomes? If no, why not?

The hard truth is that the customer experience is complex. Sifting through all the noise to find a signal is a challenge and let’s face it, focusing on improving one attitudinal metric is likely not going to get it done.

In a 2023 Verde Edition reader survey, we found that 66% of businesses are not consistently using CX insights to guide their decisions

Why? Our belief is that organizations are not widely using CX insights to drive business decisions due to the lack of connection to their financial performance data. This was substantiated in a separate Verde Group survey where we found that only 20% of companies link CX insights to financial results.

Read the rest of this whitepaper HERE.

?At the Verde Group, understanding the specific problems that create market damage is what we do. To learn more, visit our?approach page?or?contact us?to learn more about how we can help you take action and drive revenues and profits.