Information, news and best practices covering our industry, company, partners and customers
3-01

How Customer Experience Translates to LTV

Customer expectations have risen consistently in recent years to unprecedented levels, with major implications for companies of all kinds. Arguably the biggest development is the need to reach out to and engage with users through a wide range of channels and for the entire duration of the customer journey and lifecycle. If businesses do not consistently offer up satisfying customer experiences at every possible touchpoint, it will fall behind its more customer-friendly competitors.

But there is good news here, as well. Those companies that prioritize and optimize customer experience management can expect to see an associated increase in their customer lifetime value (LTV). To achieve that outcome, it’s imperative for firms to fully embrace integrated customer communication solutions. In this new world of higher customer expectations, disparate, static communication strategies simply aren’t enough.

Customer Experience and LTV

To appreciate the link between customer experience and LTV, consider this: 64 percent of companies believe that customer experience is the most important factor for improving customer lifetime value, according to an Econsultancy survey.

To a significant degree, this goes back to the issue of growing customer expectations. Nearly half of consumers in a 24/7 survey said they would leave a business for a competitor within one day of a single poor customer experience. That’s a striking figure – almost 50 percent of customers across industries won’t tolerate underwhelming customer experiences whatsoever. This demonstrates how important it is to deliver high-quality, satisfying service, support and communication at all times – not just at the beginning of the customer lifecycle. Consumers simply are not willing to tolerate underwhelming customer experience at any stage or in any form.

What’s more, the White House Office of Consumer Affairs determined that only 1 out of every 27 dissatisfied customers actually complain to companies. This means that you won’t hear about your clients’ unhappiness until they take their business to one of your industry rivals, making it all the more important to deliver a steady, consistent, high-quality customer experience throughout the entire customer lifetime.

And effective CX is not just about avoiding churn – excellent CX will also lead to higher customer loyalty and retention, and therefore much greater LTV. Harvard Business Review emphasized the importance of consistency for the user experience, asserting that customers shouldn’t feel like the business’s interest ends right after they sign a contract and picks up again when it’s time to renew. And as the source noted, achieving this level of consistency and effective engagement requires integrated, rather than siloed, IT systems.

Upgrading CX

Given the LTV benefits, why don’t more businesses make CX a priority?

A big part of the problem is the fact that many CX and CCM solutions are simply difficult to deploy and utilize from the enterprise perspective. If these tools add stress and eat up time from employees’ busy days, then decision-makers will understandably decide that the solutions are not worth the investment.

Critically, though, this is not the case for every effective CX solution. Doxee’s C2X platform was specifically developed to address CX from both the consumer and the enterprise perspective. This double-sided user-friendly approach helps to ensure consistency across the entire customer journey, and the entire organization. Together, this focus on CX delivers the opportunity to tremendously increase customer LTV across the board.

SOURCES:
hbr.org
www.helpscout.net
econsultancy.com
blog.kissmetrics.com
blog.accessdevelopment.com

 

Back to Blog