What’s the secret to sales success? Happy customers! Yes it really is that simple. Just look at the most successful companies over the last decade (Apple, Google, Zappos). What do they have in common? Customer trust. Customer happiness. Customer delight and focus.
Executives will often state that they are committed to the customer, but when it comes to making an investment to improve the customer experience their actions say something else.
They routinely make big investments in other types of initiatives that are notorious for questionable ROIs such as corporate re-brandings, advertising programs, “synergistic” mergers, and even hiring highly compensated, star CEOs. The list could also include fancy CRMs and Loan Origination systems and other technological investments that sound good but never seem to work right. The truth is it can sometimes be difficult to quantify the return on improving the customer’s experience. What’s the dollar value of a better trained front-line staff? Or a streamlined sales process? Or a manager’s ability to coach the sales staff and hold them accountable?
We now have the research to prove that improving customer experience is an effective investment. Watermark Consulting has done excellent work in analyzing the financial impact of superior customer experience in its 2014 Customer Experience ROI Study. The firm’s analysis demonstrates that the ROI of a great customer experience isn’t vague and subjective. Companies that excel in this regard are rewarded by consumers and investors alike.
Watermark analyzed seven years of stock market returns for companies that lead in customer experience versus those that lag. “This year’s results (2014) provide the strongest support yet for why every company should make differentiating their customer experience a top priority,” explained Jon Picoult, Watermark Consulting Founder. The study also noted that leaders in customer experience handily beat the S&P 500, while less adept companies trailed it by a wide margin.
Keep in mind, this analysis reflects more than half a decade of performance results. It spans an entire economic cycle, from the pre-recession market peak in 2007 to the post-recession recovery that continues today.
The customer experience leaders in this study are clearly enjoying the many benefits that happy, loyal customers deliver: better retention, greater market share, lower acquisition costs and more cost-efficient service.
And the laggards? They are being crushed under the weight of high customer turnover, escalating acquisition costs and a cost structure that is inflated by each customer complaint and avoidable inquiry.
Who drives the customer experience? The front-line sales force and their managers.
Are you investing in the front-line staff to ensure that the customer experience is successful and enjoyable? Companies can’t afford to ignore this issue if they are to achieve long-term success.