Running a business isn’t always about having the best products, the trendiest advertising or the most affordable prices. Sometimes what keeps customers coming back for more is how you connect with them. Customer experience management (CXM) is about creating these connections and rewarding customer journeys. Implementing customer experience software is a surefire method to boost client satisfaction and bring in new business through word of mouth.
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Article Roadmap
- What Is Customer Experience Management (CXM)?
- CXM vs. CRM
- Importance and Benefits
- Strategic Framework
- CXM Software
- CXM Top Tools
- Key Challenges
- Next Steps
What Is Customer Experience Management (CXM)?
Customer experience management (CXM) is a set of strategies, processes and technologies that companies use to organize, track and oversee customer interactions. Often called CEM or CXM, it focuses on optimizing the customer experience, engagement and satisfaction to boost client loyalty.
This approach to customer relationships goes beyond marketing tools. It strives to meet or exceed customer expectations and puts customers at the center of business, prioritizing the entire customer lifecycle’s personalization. Whether answering queries, interacting on social media or assisting during purchases, CXM helps turn every engagement — be it passive or active — into a positive one.
In today’s hyper-competitive business world, it’s not enough to know where your customers shop or what cat food they buy — you need to know them inside out. However, gaining such in-depth insight into clients is not easy. You need to harness all your touchpoints and communication channels to collect valuable customer data with speed and precision. With CXM, you can study client behavior, analyze it and suggest ways to boost customer retention and loyalty.
An example of a good customer experience management solution is Netflix, a streaming platform that offers 1,000s of shows and movies. But with so many options, the internal search tool can be a hard experience to personalize. To resolve this, Netflix provides a thumbs up or thumbs down rating system to viewers. This tool helps understand individual and demographic preferences to come up with better algorithms.
Before delving deeper into CXM and what it can do for your company, let’s brush up on some key definitions.
What Is Customer Experience?
Customer experience or CX is a catchall term for how a customer perceives your organization based on all their purchases and interactions through various channels — direct or indirect. We can further divide it into experiential measures for a nuanced understanding.
Customer Experience (CX) – The feelings and ideas one experiences through the customer lifecycle, including purchase, post-purchase and during the use of the brand or service.
Employee Experience (EX) – The experience that is a direct result of engagement with your company as a current or former employee.
Brand Experience (BX) – The feelings and reactions resulting from direct or indirect exposure to branded interactions that influence future purchase decisions.
Customer Relationship Management (CRM) – A system used by sales, marketing and customer service teams to manage customer relationships and organize client data.
CXM vs. CRM
Though CXM and CRM share the same goal of crafting good customer relationships, there are some key differences.
| CXM | CRM |
|---|---|
| You can get qualitative insights based on customer lifecycle data using sentiment analysis. | You can get quantitative insights and view customers in a relatively impersonal way through data, statistics and trends. |
| It shows what a company looks like to a customer. | It shows what a customer looks like to a company. |
| A customer-centric approach works to correct negative perceptions about the brand and builds positive associations. | A sales-oriented approach and focuses on outreach to customers to capture more revenue. |
| It focuses on customer engagement to improve profitability. | It focuses on improvement in internal processes and business operations to drive profitability. |
| You can enhance customer experience using integrations across channels and consolidation of customer data for user sentiment analysis. | You can use AI and CRM data to anticipate customers’ needs, leading to faster responses and real-time impact on customer experience. |
Importance and Benefits
In the hyper-competitive, hyper-connected global marketplace, good customer experience management gives you an edge over your competitors. It improves the quality of lead generation, conversion and customer retention while giving clients rich, personalized and satisfying customer journeys.
Stan Phelps, an instructor at the ANA School of Marketing, said “Customer experience isn’t an expense. Managing customer experience bolsters your brand.” CXM connects the right people to the right information at the right time and is a value for money investment.
CXM has numerous benefits and it can help companies:
Gain a Deeper Understanding of Customers
- CXM helps get an enhanced view of customer behaviors and preferences.
- You can use the data to provide highly relevant tailored experiences and in turn increase sales.
Boost Customer Loyalty
- CXM allows you to cultivate lasting customer relationships with the help of automation, product recommendations and loyalty incentives.
Drive Improvement Through Customer Feedback
- The more you listen to customer insights with intent, emotion and effort, the more effectively you fine-tune CX to improve customer satisfaction scores.
Maintain a Competitive Advantage
- Providing unique differentiated experiences will strengthen preferences for your brand.
- Good CXM encourages existing customers and new clients to share positive reviews through word of mouth, ultimately boosting ratings and revenue.
Measure the Success of Campaigns
- CXM helps analyze vast amounts of data so you can identify bottlenecks in the process and assess team performance.
- The solution’s dynamic range of tools facilitate informed, customer-centric business decisions.
Create Meaningful Employee Experiences
- Many studies on CX show a strong link between employee experience and customer experience.
- Companies should focus on keeping employees happy so they help project better brand experiences to customers.
Strategic Framework
Now that you know what CXM can do for you, it’s time to make a step-by-step framework on how to implement the process.
Understand Your Customers
The first step is to understand clients’ needs and behaviors. Go beyond basic customer segmentation based on demographics such as age, location and spending habits. Diving into behavioral data like touchpoint preferences, interests, social media behavior, decision drivers, emotions and involvement goes a long way.
Create and Define a Customer Vision
Each stage of a customer lifecycle is important – be it initial consideration, active evaluation, purchase or post-purchase experience. Making a detailed customer journey roadmap for each of these stages helps identify touchpoints and anticipate how customers will interact with the product. It’s critical to set objectives with clear KPIs and target levels.
Another key component is creating customer profiles and personas based on the main archetypes a company finds in its customer base. The personas help build customer experiences that cater to a wide range of clients.
Make It Personal
Once you map out customer journeys and set objectives, it’s time to design targeted personalized experiences for each customer segment. Refer to the existing core data as well as new updates to customer profiles for curating these journeys.
Remember to not only focus on the client but the context in which they operate. This helps in marketing relevant offers, products, recommendations and advice when a customer is most open to them. Creating differentiated CX will make you stand out in a sea of competitors.
Design the Brand Experience
In this stage, you organize internal operations and decide what you need to develop, alter and procure to create desired customer experiences. Get a clear vision of your brand identity, values, what feelings you want your brand to evoke and what clients can expect from the brand.
Take a closer look at business processes, structures, technology, skills and personnel – especially people who deliver customer experiences, their attitudes and how well they reflect your brand.
Structure Customer Relationships
After optimizing your internal processes, it’s time to execute relationships with customers and prospects. Focus on touchpoints and ways to deliver seamless customer experiences in real time. This stage is process-driven so having skills and capabilities to adapt to possible bottlenecks, delays or crises in the timeline is necessary.
Measure Customer Feedback
It’s vital to capture customer feedback and measure customer satisfaction in real time. You can track customer perceptions, measure how they fare against objectives you’ve set and adapt if there’s room for improvement. Assessing customer sentiment is a continuous process and you can use the tools below as a guide.
What Are CXM Tools?
CXM software and tools are on-site or cloud technologies that aid the customer experience management process. These platforms primarily include components such as:
- CRM – This software is beneficial for sales, marketing and customer service teams who manage customer data and interactions. It can access various touchpoints, pull valuable client data and forecast buyer trends.
- Automation Tools – You can automate repetitive manual tasks like lead management, customer segmentation and campaign management, thereby reducing clutter and improving data accuracy. The latest AI automation features help marketing teams concentrate on more complex activities, saving time and resources.
- Customer Service – Many CXM platforms offer omnichannel customer service tools such as emails, calls, texts and social media to help clear queries. Also, self-service channels like chatbots and knowledge centers allow customers to solve their own problems.
- Ecommerce – A platform that enables companies to build an online storefront and provides customers with capabilities like checkout and integration with payment processors.
- Help Desk Software – It aims to provide quick customer support by creating a full-fledged knowledge database with FAQs, guides and tips to answer customer queries.
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Top Tools For CXM
Personalization Engines
This tool automates one-on-one customer communication using new technologies such as mobile marketing and location-based services to market products to clients in real time.
Emotional Analytics
It provides insight into how customers perceive a product and their interactions with a customer service representative. Also known as sentiment analysis, combining this tool with existing CRM data can help sales and marketing teams to create personalized ad campaigns and connect with customers on a deeper level.
Feedback Tools
You can ask customers for immediate reviews or collect feedback at a later date. It helps understand customer sentiment better, identify struggling users and spot flaws in the design causing negative feedback.
Survey-making Tools
This interactive means of creating feedback tools like surveys, quizzes, polls, assessments and web forms helps launch survey campaigns in minutes across multiple channels. You can also track quiz scores, analyze responses and measure completion rates, among other metrics.
Chat Tools
The live chat widget allows you to transfer queries to the right department so customers get real-time support. AI chatbots help communicate with clients even during odd times, a beneficial tool as many customers prefer self-service over calling customer care. You can also set up chat invitational popups and product announcement popups.
Communication Templates
You can use templates to customize and create user manuals, answers to common queries, FAQ sections and help guides to save resources and relieve pressure off the support staff.
Voice of Customer Software
This tool gathers customer data from all channels in a single interconnected platform like the company’s contact center to get a nuanced understanding of customer sentiment.
Key Challenges
It’s vital to know what possible problems you may face in the CXM process to prepare for viable solutions and overcome them.
Lack of Customer Data
To analyze customer trends, you need to have a large set of data to accurately measure customer experiences. Without enough information, your sales and marketing teams may feel lost as they can’t solve problems they don’t know about.
Ignoring Qualitative Data
Companies should invest in analyzing qualitative data like individual comments and reviews on surveys or other communication channels to get a greater understanding of the CX they’re providing. While quantitative data like numbered ratings are useful, qualitative data leads to better CX insights.
Overwhelmed With Customer Data
On the flip side, companies can also deal with enormous amounts of data from all their communication channels. It gets difficult to consolidate and analyze it in a single profile, especially with all the privacy and security concerns.
Difficulty in Measuring Success
Qualitative data is narrative responses of why a customer perceives the way they do, which is challenging to measure. Customer loyalty, brand trust, word of mouth and positive brand association are especially hard to track. You can easily arrive at conflicting or inaccurate data if you don’t take the whole customer lifecycle and all interactions to date into account.
Poor Internal Collaboration
Creating positive customer experiences through all stages in the sales pipeline builds trust and loyalty to your brand. That’s not possible to achieve unless your teams are on the same page referring to the same sets of data. A lack of efficient team collaboration can make information sharing tricky, leading to delays, wasted resources, missed opportunities and data inaccuracies.
Lack of Omnichannel Support
Whether your customer uses email, social media, mobile app or web chat, they should get the same level of high-quality support. However, when businesses can’t help or listen to clients through these channels, customers do not feel heard, making it likely to switch to a competitor.
Overreliance on Surveys
While survey tools are an integral part of CXM, many feedback collection and measurement systems companies use are outdated and don’t satisfy customer needs. Low response rates, ambiguity about performance drivers and data lags are some major issues you can face, making it difficult to rely on these tools for critical business decisions.
Next Steps
Customer experience management is an effective way to create worthwhile customer experiences and analyze what you could do to better provide for your clients. Using software that includes CRM, automation, customer service and help desk or tools for survey making, feedback, emotional analytics and templates can help bolster your brand service.
While Customer Experience Management (CXM) is a great method to approach customer relationships, you need to look out for challenges like lack of customer data, poor internal collaboration, overreliance on surveys and difficulty in measuring success. Overcoming these bottlenecks can help you increase customer loyalty, gain a deeper understanding of client needs and stay ahead of competitors.
How can customer experience management make a difference for your business? Let us know in the comments!