Customer Experience: The economic value is significant | WARC | The Feed

Customer Experience: The economic value is significant

Firms that lead in customer experience (CX) outperform those that lag by a more than 3-to-1 margin in shareholder return, according to leading customer experience consultancy firm, Watermark Consulting. 

Why it matters

The  firm analysed shareholder returns for companies identified as CX Leaders and CX Laggards in third-party customer experience rankings. The results highlight a competitive opportunity. While things like product innovation and technology advances can be copied, it’s far harder for rivals to effectively replicate a great customer experience (and the internal ecosystem supporting it). This can deliver significant strategic and economic value to a business.

Takeaways 

• Widely loved brands with strong consumer feedback ratings enjoyed an average shareholder return that was nearly 110 points higher than the market index, while widely loathed ones lagged by an almost identical margin.
• Companies that consistently impress customers reap rewards – through increased loyalty, greater wallet share, stronger word-of-mouth, and a more competitive cost structure.

Key quote 

“Many companies excel in frustrating their customers, whether it’s from a complicated purchase process, unintelligible assembly instructions, difficult-to-use products, hidden fees, long lines, or just plain poor service. Our study reveals that businesses eventually pay a price for subjecting consumers to such indignities” – Jon Picoult, founder and principal of Watermark Consulting. 

Sourced from Watermark Consulting