| | FEBRUARY 202319wrote in Forbes, "Commerce is about community and community is about relationships. The better you treat your customers, the more likely you are to retain them, the more likely they are to return, and of course, the more likely they are to spread the word". A Strong Foundation: Converting CX to a Competitive Advantage If you were asked to cite two examples of companies that have used customer experience (CX) as their competitive advantage, chances are you will name Amazon & Netflix. They have clearly demonstrated benefits of having customer centricity as the prime determinant for every decision & strategy. And its catching on. As per research firm Statista, 44.5 percent of organizations worldwide revealed that they perceive CX as a primary competitive differentiator. But securing a competitive edge isn't a cakewalk as some might think. To ensure it doesn't fester in the realms of spirited board discussions, it is important to understand & measure the business impact of your CX activities. You start by defining the value proposition in the context of your business strategy. And once you set up your CX program, you start tracking the impact with the help of the following metrics. As you start acing these, you will soon see your CX transforming to your Competitive Advantage. Four Key Metrics to Measure the Financial Impact of CX Customer Satisfaction Heads up! Don't mistake Customer Satisfaction for Customer Experience. Customer satisfaction ­ or what I like to call ­ the 'Happiness Quotient', is one of the measures to tell you if your CX strategies are working. It should be measured both quantitatively (think NPS/CSAT) and qualitatively (through reviews, direct feedback, interviews, focus group feedback, online mentions). Industry level benchmarks are generally available for you to baseline yourself against your competitors. To exhibit financial impact of customer experience, you will need to identify how each part of the experience (touchpoint ­ for e.g., the contact centre or website) influences a particular response ­ and apply a scoring system. Mapping the entire customer journey & scoring each interaction helps identify & measure friction points in a journey. It also highlights points of happiness ­ which is what you want more of. Advanced tools like behavioral analytics and conversion funnels can help you understand the 'why' behind the response & scores. Customer Lifetime Value (CLV) & Average Order Value (AOV)
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