When it comes to marketing, there are some firmly held tenets about the importance of investing in long-term brand building. VP marketing, Asia Pacific of Verint Martyn Riddle explores the importance of CX as an investment.
It is widely accepted that a brand is the identity of a business, encompassing its values, emotions, and personality. Consequently, marketing and advertising budgets are typically seen as investments – expenses that are made with the expectation of generating future benefits. Naturally proving ROI is important, but for longer-term strategies the long game can be played and the investment approach allows for some creative experimentation.
However, when it comes to Customer Experience (CX) which is increasingly intertwined with brand value and personality, the situation is different. Instead of being viewed as an investment, CX is often viewed as an operational cost of doing business and like most business costs, the pressure is often to minimise.
Why does CX so often continue to be considered a cost and not an investment? It’s largely a legacy issue. Rewind half a century or so ago and the CX journey of a business usually began with the procurement of a telephone or two to build out what became the call centre. Procurement means operations and operations mean cost; something that may have made sense last century but in 2023 this approach is short-sighted.
But, it’s time to start looking at CX as an investment, here’s why:
CX is now part of the purchase funnel
The proliferation of digital channels, a culture of immediacy and a decline in trust and tolerance of digital advertising means we are now in a world where consumers are increasingly making their purchase decisions based on recommendations from trusted sources. This can include friends, influencers, publishers and review sites. Research from Wharton School of Business found that social influence has a significant impact on purchasing decisions, specifically that people are more likely to buy a product when they know others are buying it.
Whilst you can’t control what people say about your business, you can predict and promote great feedback with great experiences. Customers now expect seamless, personal experiences across all new and existing channels and loyalty is easily lost when things go awry. According to our 2022 State of Digital Customer Experience Report, 64 percent of the consumers surveyed have stopped doing business with a company due to a poor customer experience.
Consequently, reviews and ratings from satisfied customers have become a key factor in the purchase funnel – and as such, should be considered an investment.
CX requires the human touch
At Verint, we are all about using technology, automation and AI to drive a joined-up customer experience, but – and it’s a big but – it has to be used to empower real human employees to help them shine and solve their customers’ issues.
This means companies need to invest in skilled customer service and customer experience professionals who are at the frontline and, in our increasingly digital world, often the first brand ambassador a customer has spoken to. Too often, the KPIs for front line staff focus on cost-based metrics. An example of this would be the length of a call. Then more qualitative measures related to brand affinity and satisfaction are ignored. Misaligned objectives can lead to a real disconnect within the brand experience, resulting in a ‘negative’ cost to the business in terms of abandoned brand loyalty. Not to mention, a wasted opportunity to extend brand personality and create advocacy.
CX data offers invaluable insights
Oh, the stories that CX data can tell – and that often remain untold within an organisation which has likely paid millions for its capabilities but is often trapped in organisational silos. Structured and unstructured data from across customer touchpoints usually contains golden insights to inform almost every department within an enterprise. From product, finance, people and culture, governance and compliance, through to marketing, you literally have at your fingertips what your customers are telling you about your brand and product, both good and bad. The problem is, as the technology often sits in operations, there can be difficulties in disseminating the insights across the organisation. Further, typically politics comes into play when a technology has emanated from operations versus the whole of business. We see these types of issues play out day in and day out.
However, we also see those organisations that have shifted thinking in regard to CX as a strategic investment and whose programmes are championed by the CEO, really being to shift customer and business outcomes.
The bottom line is that CX is ubiquitous. Customers don’t experience your brand according to your organisational structure, so why do businesses continue to see touchpoints as line items on a P&L? Modern organisations are shifting their thinking to better align to customer experience everywhere. By taking the long-term view that customer experience is a revenue generating benefit that is ubiquitous across the customer journey, businesses will achieve greater success in marketing and advertising.