What is customer experience?

Customer experience is a customer's response to a company and its products and services. This approach shows customer loyalty and potential toward goods and services offered by a company. Customer experiences are based on their taste, preferences, and services provided by the company. Customers have simple logic—they stay if they are satisfied. If not, their loyalty shifts to the competitors who satisfy their wants. Companies should take care of their product, production, selling, and marketing as they are crucial in increasing customer satisfaction.

Why is customer experience important?

Customer experience is essential as it promotes sales and a company's brand. Customers' positive experience also shows the effectiveness of sales performance and advertising. With positive feedback from a customer, a company understands more about sales process management. Positive customer experience response motivates sales to upgrade more in the marketing mix and distribution policy.

• Customer experience helps in preparing good marketing strategies. The marketing team needs to concentrate on the demand, taste, and preferences of the customers.
• Customer experience helps in maintaining the loyalty of consumers. Customer experience helps in retaining customers for a longer period.
• Customer experience is important in increasing the sales and revenue of the business.
• Customer experience helps to take conscious and positive steps towards identifying and eliminating any kind of hazard in the organization or industry.
• Customer experience also helps in establishing proper commitments and contributions towards the achievement of productivity.
• Through customer experience feedback, companies can plan suitable strategies to define sales volume.
• Customer experience provides a balanced environment in the market. Customer experience helps in prioritizing diversity and equity.
• Customer experience helps in the sustainable growth of any business. It also encourages brand power.
• Customer experience helps to encompass each aspect of any company’s offering.
• It helps in maintaining long-term customer relationships. Customer experience strategy helps to improve business strategy.
• Customer experience provides a motivation factor to the services so that they can be balanced in further productivity.
• Customer experience response provides effective information to the company engagements.
• Customer experiences also show the journey of the likes and dislikes of customers about a product and the added value they are looking for.
• Customer experience also encourages companies to be updated with modern technology.
• Customer experiences also depend on the demand and supply of products or goods as per their taste and preferences so that companies can increase their sales volume properly.

Disadvantages of customer experience

Increases cost

Implementing a customer experience program can be costly. You need to invest in technology, hire additional staff, and train employees.

Risks alienating customers

In some cases, customer experience efforts can backfire and alienate customers instead of winning them over. This is often the case when companies make changes that customers don't like or that are too disruptive.

It can be difficult to measure

Customer experience is intangible, making it hard to measure the ROI of your efforts. This can make it difficult to justify the costs of a customer experience program to upper management.

It takes time to implement

Customer experience improvements can take months or even years to implement. This can be frustrating for companies that are used to seeing quick results from their marketing campaigns.

Types of customer experiences

Cultural customer experience action

This action requires the business and employees to mainly focus on the well-being of the customers. Here, the company’s vision, mission, and values might intertwine with the customer’s insights concerning their experiences with the entity. So, it is necessary to focus on what customers are expecting.

Micro customer experience action

This action focuses mainly on a low customer base or specific customer groups as these experience actions work on a micro-level rather than covering a huge customer base. They engage more in addressing the issues specific to each customer.

Macro customer experience action

This action focuses on the customer base as a whole. The main focus of this is on innovation so that products or services can be improved for all the customers. The innovation should be prepared to meet the demands and expectations of the customer base as a whole. In other words, this action works on the universal pain of the customers.

Common Mistakes

One of the most common mistakes students make is not putting enough effort into understanding their customers. This can manifest in a number of ways, such as failing to properly research customer needs and preferences or not bothering to ask customers for feedback. As a result, they often end up designing customer experiences that are either ineffective or downright irritating. They mainly get confused between user experience and customer experience. These two concepts seem similar but have different meanings. Customer experience involves the overall perception of a business. On the other hand, user experience involves the perception related to a particular product.

Context and Applications

This topic is significant in under-graduate, postgraduate, and professional exams, especially for

• Bachelor of Business Administration
• Master of Business Administration (Marketing)
• Post Graduate Diploma in Management (Marketing/Sales)

Related Concepts

While studying social media marketing, it is important to read the following topics to get a better knowledge:

• Social media
• Sales Management
• Marketing Management
• Marketing
• Customer-centric

Practice Problems

1. Which of the following is not an element of customer service?

1. Organization
2. Customer Care
3. Communication
4. Co-founder

Answer: d

Explanation: A co-founder is not an element of customer service.

2. Which is not a tool used to collect customer complaints?

1. Social Media
2. Ask a manager of a company to list down potential reasons for customer complaints
3. Toll-Free telephone
4. Customer visit

Answer: b

Explanation: Social media, questionnaires, toll-free telephone, and customer visits all are used to collect customer complaints.

3. Which of the following is an organization's best set of activities to satisfy customer needs?

1. Customer platforms
2. Individual needs
3. Customer Service
4. Social media queries

Answer: c

Explanation: Customer services include the best set of activities from an organization that helps in satisfying the customers.

4. Which of the following customer need gives customer delight?

1. Excitement needs
2. Quality time
3. Performance
4. Delivery standard

Answer: a

Explanation: Customer delight is also called excitement needs which gives them pleasant surprises.

5. What is the full form of CE?

1. Customer Environment
2. Customer Entity
3. Customer Environmental
4. Customer Experience

Answer: d

Explanation: CE stands for Customer Experience.