How to Justify ROI of a CX Program in the Next Normal
There is no doubt that customer experience initiatives and strategies have been an indispensable element for every brand's customer outreach exercise. However, in today’s uncertain scenario, increasing customer churn due to rapid shift in brand loyalties, customer impatience and meeting their ever-changing demands - has led all leading brands to craft CX programs which are robust & future-proof - to help them achieve better ROI in the next normal.
Every CX team today, is put to a new task, by its various stakeholders, including the existing sales and marketing departments, to show visible revenue gains of such detailed and cost incurring exercise. To understand and then to justify the ROI of a CX program, we need to answer few important questions which are listed below:
Do CX initiatives make sense in turbulent times?
What does a good CX program consist of?
Let's have a look at few stats:
According to a study by the Temkin Group, companies that have been earning $1 billion annually can add a whopping sum of $700 million within 3 years, by simply investing in a CX program.
Source : SuperOffice.com
A Good CX program:
A good customer experience program will be based on 5 fundamental premises- to understand if your customers are delighted at all stages of their journey & across all channels of interaction:
- Know your Customer
- Identification and Presence on all customer touch points
- Working Upon Customer Pain Points (friction points)
- Having the Right CX Metrics to Assess and manage the CX program
- A robust Customer Communication Management
Read here for: Top 4 metrics to measure your Customer Experience
Also, Read: Quick Tips To Improve Your Customer Experience Strategy
Does CX Add Up to Visible Revenue gain? How is a CX program an important element of Sales, Marketing and Retention?
Studies & Research from top analyst firms have shown how a good CX program can bring in revenue growth.
Forrester in its report on "Customer Experience Drives Revenue Growth" has aptly concluded that CX leaders achieve a CAGR of 17% over 5 years whereas the CX laggards just achieve 3% growth during the same period.
Bain & Company in their 2015 analysis found that CX leaders report 4% - 8% more growth rate above their market. This analysis concluded that revenue impact of improving customer experience is all about having more and more loyal customers who in turn act as brand ambassadors to the organization - recommending their products / services, tend to buy more and stay longer.
With the stats given above, revenue gain seems like an obvious result of a robust CX initiative.
But stats don't and can't run your business expenses and you do need money to execute your customer experience program. People in-charge of driving these strategies, find it difficult to monetize their efforts or quantify their results at least in near future. It thus, becomes very crucial for every organization to have an implicit understanding of how much ROI, their CX efforts have generated- in relation to time & cost involved in the process.
Will the CX program have positive impact on the business? Your sales team might be able to quantify that and your marketing team may bring in qualified leads for your sales team to nurture but how do you justify the short-term business gain for a customer experience initiative?
There is no good CX pros or a good CX team, it is all about a collaborative CX organization that works together to not just nurture leads but nurture relationships and build long lasting bonds and loyal customers in today’s era of shifting loyalties.
CX program is an altogether different game and cannot be limited to a siloed approach- to be taken care by a CX team. It has to be a journey that the organization as a whole has to traverse over time with sales, marketing, customer support and all customer facing teams - to develop an ecosystem that is focused & centered around customers. There is no good CX pros or a good CX team, it is all about a collaborative CX organization that works together to not just nurture leads but nurture relationships and build long lasting bonds and loyal customers in today’s era of shifting loyalties.
At Espire, we stand together with our clients- fast-tracking their CX transformation journey to enable them to deliver enhanced CX everytime! Espire has helped Insurance companies worldwide to revamp their digital experience management and CX strategy, resulting in up to 20-30% increase in revenue through new digital channels.
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