Customer experience management, also referred to as CXM or CEM, is a way to track every customer touchpoint, both physical and digital, to create optimal customer experiences and meet or exceed customer expectations.
Simply put, customer experience management uses customer data to minimize friction and create experiences that keep customers coming back.
To deliver best-in-class customer experience management, you must know your customers so well that you can offer them personalized experiences that will keep them loyal to your brand. And to do that, you must be collecting and acting on feedback from every stage of the customer lifecycle.
But there is a disconnect between how companies view their customer experience and how it’s actually perceived by customers. Research from Adweek and Accenture Interactive found that 80% of brands think they deliver a top-notch customer experience but only 8% of their customers agree.
So how can you provide meaningful customer experiences that truly connect with your customers?
We dig into what today’s customer experience looks like, offer tips for how to level up your CXM, and highlight metrics you should be tracking to amplify your customer experience management.
What’s the difference between CRM and CXM?
While customer experience management and customer relationship management are related, they are not the same thing. Customer relationship management is a type of software businesses use to develop and nurture customer relationships.
Customer experience management is a way to manage a customer’s entire journey with a company. This begins from the moment they discover a brand all the way until they’re using the product or service.
CXM aims to improve customer perception and retain customers by gathering insights along the customer journey.
Why is customer experience management important?
In the way that customer service aims to provide a positive interaction between a customer and an agent, customer experience looks to foster positive feelings within a customer toward a brand. This leads to lifelong brand advocates, which are the lifeblood of a successful company.
As many companies offer similar products at similar price points, the real differentiator is the customer experience. Research from Salesforce shows that 80% of customers feel the experience a company offers is as important as their products and services.
To pull off a successful customer experience, it’s crucial that you get to know your customers more intimately. Creating a customer experience management strategy helps to track customer behavior and allows a company to build informed customer profiles.
Benefits of customer experience management
There’s real value in prioritizing customer experience management. Exceptional customer experiences can lead to:
- Reinforced brand loyalty: Next-level customer experiences lead to brand advocates that recommend the product or service to their friends and family.
- Reduced customer churn: Customer retention is a key metric for company success. Customer service expert Shep Hyken points out that a focus on keeping good customers translates to increased profits. A 5% increase in customer loyalty could be a 95% increase in profit. Reducing customer churn by just 1% can have a massive impact on your business.
- Increased revenue: Great CX management can lead to higher profits. PwC found that companies offering exceptional customer experiences are able to charge up to a 16% price premium on products and services.
5 tips to amplify your CXM strategy
Improving your customer experience management can be a catalyst toward increased profits and customers-turned-advocates. These tips can help you create a game plan for better customer experience so you can reap the benefits that come with it.
1. Identify and map your customer’s journey
The customer journey is a way to understand the steps a customer takes to achieve a goal. That goal could be buying a product or joining a loyalty program. Identifying the customer journey helps tell a story about how customers interact with your brand, where improvements can be made, and how to keep them coming back.
Using software like Nextiva allows companies to collect customer insights over time to map the customer journey. Important metrics to look at include:
- Knowledge of the customer’s past interactions with the company
- Their level of satisfaction with products and services
- How they feel about the company overall
Obtaining and organizing this data is just one piece of the puzzle. Head of the Qualtrics Institute and “Godfather of Customer Experience” Bruce Temkin says:
“Your customers don’t live in spreadsheets; you need to go out and talk to them to understand who they are as people. That is, of course, unless each of your customers is really a 55% female with 2.3 kids who is 48% from a suburb and is 11% Hispanic.”
To create a dynamic customer journey map, you’ll need to dig beyond surface-level metrics and demographic information. Collect a mix of analytical and anecdotal data.
In addition to the standard “How are we doing?” type of questions, try interviewing customers that are a good representation of your audience to explore potential flaws or features they’d like to see.
When combined, analytical and anecdotal data can help create a simple graph of the customer journey. Be sure to maintain your customer journey map over time as your company grows and your product offerings expand.
2. Begin collecting customer feedback
Customer feedback is a cornerstone of customer experience management. Rather than arbitrarily asking for feedback at different touch points throughout the customer journey, it can be helpful to define a goal and then work backward, creating questions that align with that result.
When collecting feedback, remember to go beyond the “How did we do?” type of validating questions to more “understanding” questions. This will help identify what a customer needs and how they’re feeling, which are key aspects of customer experience management.
For example, maybe you’ve received a high volume of complaints regarding packaging and shipping times. Setting up questions along the way about how customers would prefer to receive their items and potentially offering more shipping options may help solve the problem.
Strategies like Voice of Customer (VoC) can help optimize all stages of customer experience and create a deeper bond with customers.
Be sure to use a variety of feedback collection methods beyond surveys. While surveys can be a valuable tool, they aren’t the be-all and end-all for collecting customer data.
And experts agree. “Surveys are after-the-fact assessments of sentiment; they help you correct issues and seize opportunities to delight tomorrow’s customers, not today’s,” says Steven Peltzman, Chief Business Technology Officer at Forrester.
Additional avenues for collecting customer data include:
- Customer interviews
- Online customer surveys
- Live chats
- Social media
- Website behavior
- Recorded call data
- Online customer reviews
- In-person surveys
- Focus groups
- Dedicated feedback forms
3. Provide specific CX training for your team
Customer experience training is important for teams beyond your core customer support team.
Because good customer experience involves everyone in the customer experience journey, it’s important to educate your sales, marketing, legal, and IT teams on how customer experience plays into their roles.
Prioritizing the customer in every step of the customer journey should be a tenet of your company culture, rather than a checklist to be managed by customer-facing staff.
Fostering a customer-centric culture company-wide can also help build a more CX-minded team. You can measure where your company stands on customer centricity by having employees describe your company culture through a short poll, exit interviews, and onboarding feedback from new hires.
Offer refresher training whenever there are new updates to your existing products or when new features are available to track customer journeys or feedback. These trainings can be about how to ask for better feedback when chatting with customers or more general “people skills” training.
“It is all about focusing on the customer, not just the operation,” says Hyken. “Too many times we get hung up on teaching people the specific things necessary to do their jobs. However, we miss teaching the people skills. For some reason we think people just know what to do. Some do, some don’t. And even the ones that do need to learn how to use them in their present job.”
4. Analyze and act on customer feedback
Taking customer data and actually acting on it is what sets a great customer experience strategy apart from a decent one.
One of the biggest challenges that companies face when collecting customer feedback is sharing data between departments. Creating an internal data management process can prevent data segmentation within various departments and collect the right information to reach the right customer.
When you begin organizing customer feedback, the sheer volume of data can be overwhelming. It can be helpful to organize feedback from most urgent to less urgent.
Once you have compiled enough VoC data, it’s not enough to simply have that information on hand — it must then be analyzed fully to understand any friction points in the customer experience.
Acting on this feedback doesn’t have to mean overhauling your existing CXM process. Instead, double down on the aspects that are working and introduce new processes over time.
5. Set up a framework for accountability and governance
Creating a CX charter adds a level of accountability to your customer experience management strategy. A charter clearly states goals, outlines responsibilities, and sets expectations for team members.
- What is our CX vision?
- What are our CX goals and objectives?
- What are our roles and responsibilities?
- How can we prioritize CX efforts?
- Who needs to know what we’re doing and who needs to approve?
- How will this team work together?
Customer experience metrics you should be tracking
There are many customer service metrics that can help you monitor and improve your customer experience management strategy. Here are a few to consider:
- Net Promoter Score (NPS)
This metric measures how likely customers are to recommend your company to friends and family.
This one-question survey can be sent to any customer at any touchpoint. It can be worded as simply as “How likely is it that you would recommend [brand] to a friend?”
This is a key metric that’s been identified by two-thirds of organizations as their core CX metric, according to Qualtrics XM Institute. And while the NPS is a great metric to track, it’s important not to chase a certain score for the sake of impressing investors or leadership. Instead, the NPS should be used as a way to measure earned growth, or how much customer love has been earned.
- Customer Satisfaction Score (CSAT Score)
The customer satisfaction score is calculated by giving customers a one-question survey after an interaction with a customer service rep.
This question may be worded like “How was your experience with us today?” Customers will then rate their experience using a scale of 1 to 5. Using the CSAT Score formula, you’re then able to determine customers’ overall satisfaction with your customer service.
3. Average Time to Resolution
This metric tracks how long it takes to resolve a customer support request from the first contact until completion. This metric helps paint a picture of how quickly customers are getting their needs met and highlights areas in your customer experience journey that need improvement.
4. Customer Effort Score (CES)
It shouldn’t be hard for customers to resolve their issue once they make first contact with an agent. You can measure just how easily a customer feels their problem is resolved through the customer effort score.
This is done by asking another single-question survey. After their interaction with a support staff member, ask the customer, “To what extent do you agree or disagree with the following statement? [Brand] made it easy for me to handle my issue.”
Then provide a scale with answers such as strongly disagree, disagree, neutral, agree, and strongly agree. The final CES is the average score of all customer responses.
5. Customer Churn Rate
Churn rate measures the number of customers that left during a specified time period. The timeframe you choose to measure your churn rate will depend on your business and industry. For example, a real estate company may choose to examine their customer churn yearly.
How Nextiva can help
One of the biggest challenges companies face is gathering and tracking customer data. This information may be siloed across departments or the management system may be disorganized.
Nextiva’s contact center software does the heavy lifting for you to help build stronger connections with your customers and better understand the customer journey.
You can track customer sentiment during every interaction with our Customer Experience Score. Use Natural Language Processing to help interpret customer needs and act faster to resolve them. And real-time alerts can notify your team about customers that need quick attention when it matters most.
Ready to close the gap between your customer support and marketing teams? Nextiva’s customer service platform brings it all together in one view.