Hi Crew,

Have you ever been asked to prove WHY customer experience is so important? Do you find it difficult sometimes to articulate the ROI from CX?

Well, look no further. I’ve scoured the internet and have uncovered 8 graphs that can help you prove your point the next time someone says that “CX Isn’t Worth It” 🙄🙄

What do I ask for in return? For you to share this newsletter with one other person in the CX industry. I hope that’s a fair deal …

ROI on CX; 8 Graphs You Can Use To Prove Your Point 🫵

All visuals have been taken from websites who have strong ties to the CX industry. Apologies in advance for the quality of some images - that’s the best I could do!

Graph 1: CX leaders drive 2x revenue growth

• Key Finding: McKinsey analysis shows that companies that are leaders of CX achieved more than double the revenue growth of “CX laggards” between 2016 and 2021.

• Why this happens: A common factor in companies that fail to achieve sustainable growth (i.e. CX laggards) is that they put too much focus on short-term acquisition measures, and insufficient investment in customer engagement and retention, thereby falling into the “acquisition trap.” CX leaders, by contrast, are masters at the art of “cultivating” growth from existing customers by making it enjoyable to use ever more of the company’s products and services over time.
  

• Source: Experience-led growth: A new way to create value

Graph 2: CX leaders outperform within the stock market

• Key Finding: CX Leaders outperformed the broader market, generating a total return that was 108 points higher than the S&P 500 Index. Their total cumulative return was 3.4 times greater than that of the CX Laggards.
  

• Why this happens:

  • They aim to impress customers, not satisfy them

  • They choreograph every touchpoint

  • They shape memories, not just experiences

  • They focus on addressing the emotional needs of customers

  • They focus on EX, as well as CX
    

• Source: The Customer Experience ROI Study

Graph 3: CX leaders focus on signals, not surveys

• Key Finding: Surveys typically collect feedback from ~7% of customers. CX leaders acknowledge that surveys only paint a partial picture and are subsequently focused on trying to derive insights from other customer signals - digital behaviour, speech & text analytics.
  

• Why this happens: Leaders pointed to low response rates, data lags, ambiguity about performance drivers, and the lack of a clear link to financial value as critical shortcomings.
  

• Source: Prediction: The Future of CX

Graph 4: Importance of solving problems quickly

• Key Finding: Quick answers & clear communication are clear drivers of improved customer experiences.

• Why this happens: 58% of customers will re-contact customer service if they don’t receive an answer within a week. CX is like chinese whispers - the needs of the customer becomes misunderstood as more people become involved in the situation.
  

• Source: What’s The ROI of CX Transformation?

Graph 5: Poor CX leads to 9.5% revenue loss, on average

• Key Finding: Research shows that just one bad experience is enough to have a negative impact on revenue. Across 17 different industries, it was found that consumers who have a negative experience are much more likely to decrease buying, or stop altogether.

• Why this happens: A recent PWC survey found that 92% of customers would completely abandon a company after 2 or 3 negative interactions.
  

• Source: ROI of customer experience 2021

Graph 6: Great customer service is significantly more important than great technology

• Key Finding: Employee attitudes, customer service & company trust are the largest drivers of customer churn.
  

• Source: Experience is everything: Here’s how to get it right

Graph 7: Under-delivering is 2x as expensive as over-delivering

• Key Finding: KPMG was able to quantify the economic cost of under-delivering & over-delivering on customer expectations. Whilst it was acknowledged that “wowing” a customer has a certain economic cost to business operations, the impact of not meeting customers expectations is 2x as high.

• Why this happens: Failing to meet customer expectations has been shown to have twice the negative impact as delighting customers has a positive impact. This happens because a poor experience will typically lead to customers churning, or spending less with your company. On the flip side, it will likely become unsustainable over time to produce discounted prices or rewards for customers. Producing a “wow” experience for customers should therefore be reserved for critical moments that matter, not every experience.
  

• Source: Mastering The Economics Of The CX Journey

Graph 8: Customers are 4x more likely to trust you if you provide a good CX, compared to a poor one

• Key Finding: There’s a 69-point gap between the likelihood to trust after a very good experience (5 star) versus a poor experience (1-2 star).
  

• Why this happens: Using KPMGs six pillars of customer experience as the definition of customer trust, it becomes quite evident why CX is so important in establishing trust with customers. Whilst things like data privacy may have some influence on customer trust, trust is typically gained (or lost) after an interaction that an organisation has with your company. As such, make sure each interaction counts!
  

• Source: The ROI of CX in 2021

Image Of The Week

I felt extra special this week when somebody sent me this meme. Shoutout to Dan Brady - this made me laugh:

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