Customer experience (CX) – what is it and what shapes it?

Customer experience is a term that plays an important role in modern business. Its proper understanding can contribute to the success of your brand. What factors have the greatest impact on customer experience? Can they be designed?

Customer experience – what is it?

Customer experience, or in Polish customer experience, can be briefly defined as the entirety of the customer’s experience of your brand. It will be the resultant of the company’s activities, evoked feelings, sensory stimulation and customer expectations when interacting with the brand. Customer experience can be seen as a contemporary formulation of the principle “the customer comes first”.

Customer experience can be understood similarly to user experience. Both experiences are influenced by similar factors. The difference is that the former refers to the customer, the latter to the user (usually a website).

Customer experience can also be defined from the emotional side – in this case it would be the sum of all the emotions, experiences and feelings the customer has about your company.

It is also treated as a tool for building brand image. The company analyses the customer’s feelings and experiences and then develops and implements solutions to improve or change them.

Customer experience can also be understood as a certain outcome. Its components are the customer’s needs, the product or service and the level of satisfaction with it.

In turn, Iwona Skowronek, author of the paper ‘Experience marketing as a determinant of corporate image and value’, claims that customer experience is a combination of activities carried out by a company and their results. They intersect with the expectations and values held by customers, which gives an overall picture of the customer experience

In short, customer experience will be the overall sum of all the customer’s experiences, emotions and thoughts. They result from their interactions with the brand. They are also influenced by the company’s actions to build a positive experience. Customer experience has an emotional dimension – these are the personal experiences of the customer. It is also a process aimed at improving the company’s image and effectiveness.

It is worth bearing this in mind, as customers will always experience a brand or product holistically. If one stage of the sales process does not meet their expectations, they will relate their feelings about it to the company as a whole.

What makes up customer experience?

There are many factors involved in building customer experience. Broadly speaking, all areas of a company’s business have some influence. However, it is possible to distinguish among them those issues that will play a particularly important role in creating experience.

Product or service

The product or service is by far the most important in building the customer experience. All other factors will depend on them. The overall experience is influenced by, among other things, the price of your product or service, packaging conducive to a good unboxing experience or the delivery method. Satisfaction with the service will also be important. In short,the better the product, the better the customer experience will be.

Sales process

Another of the most important factors influencing CX is the sales process of the product or service. Here, the customer experience is influenced by, among other things, the price and availability of the product, but also the time and manner of delivery or . The clarity of information about the process itself is also important in building a positive experience.

Place of purchase

The place where the customer interacts with your brand is extremely important in building their experience. It does not matter whether it is the company’s headquarters, a stationary shop or a website such as E-commerce. The appearance and functionality of places greatly influence the thoughts and emotions of shoppers.

Advertising activities

Advertising and marketing build the desired image and promote brands. They also influence the customer experience – they will associate the brand with certain emotions or values. To make their experience the best it can be, all marketing and advertising activities must be responsive. It is good if they are properly coordinated and complementary across all channels.

Customer service

Service is often confused with customer experience, although it is one of its most essential components. Customer service is actually one process that a company runs, whereas customer experience encompasses and describes the overall experience.

If customers are satisfied with the quality of service, their experience of the brand will be more satisfying. They will pay attention not only to the approach and knowledge of the employee, but also to the honesty in their dealings.

Do you know if your customers are happy to work with your company? If not, perhaps one way to find out would be to conduct a customer satisfaction survey using one of the methods below:

• Gathering feedback
• Surveys or forms
• Rating scale
• Open-ended questions
• Accessibility and convenience
• Analysis and interpretation of data

Sensory experience

This factor should be understood very broadly. It consists of the sensory experience resulting from the interaction with a product and all the impressions received by customers when interacting with a company, such as in a shop or when browsing a website. It is often combined with marketing activities that seek to stimulate all available senses in order to create the best possible customer experience.

Emotions and evaluations

Although people prefer to describe themselves as rational, more often than not their actions are driven by their emotions. If your brand evokes positive associations, this will translate into higher customer satisfaction.

Buyers’ emotions are influenced by, among other things, product satisfaction or marketing activities. Their role should therefore not be underestimated, as they significantly influence the customer experience.

Equally important will be their evaluations. Every customer approaches your brand with a certain knowledge. This may or may not be proven, but its influence cannot be avoided. This means that the customer will relate their evaluations of similar products they have used before to your products.

Previous experience

One of the components of CX is also the customer’s previous experiences with your brand or with similar ones.

It cannot be ruled out that a customer disappointed with, for example, one induction cooker company will go to another, but he or she may thereby transfer his or her previous experience to the other brand.

Customer experience can also be used to build consumer loyalty. The more positive their experience with your brand, the more likely they are to use it again. To do this, you also need to consider your customers’ previous experiences.

Why should you care about CX?

Determining the customer experience allows you to assess the material and symbolic value of your In the first case, you can find out how much customers are willing to pay for your product and what they gain from it. In the case of symbolic value, it is about what the customer feels when interacting with your brand. This allows you to pinpoint the brand’s strengths and weaknesses. Defining the customer experience checks the company’s previous perceptions of it.

Brands that focus on customer experience are more likely to be chosen by customers. On the other hand, implementing the solutions identified during the customer experience analysis can translate into more efficient company processes. Both factors can result in higher profits.

Customer experience as a process

Customer experience can be seen as the sum of emotions and interactions with a brand, but it can also be understood as a process. CX is one of the most important tools in the construction of a brand image, which can, in addition, be designed from scratch.

The first step should be to identify all sources of customer knowledge about the brand. Surveys, social media analysis or customer service reports will work well for this.

The data collected can allow you to do two things. Firstly, based on them, you can identify a model customer to whom all activities will be directed – build a sales persona. This approach is based on the assumption that it is impossible to please everyone, so it will be more beneficial to deal with those who will bring the most profit to the company. Secondly, information can also be used to indicate the emotions felt by customers at touchpoints with the brand.

Data allows you to ‘step into the shoes’ of the customer. In other words, all their interactions with the brand can be traced and reconstructed. This makes it possible to pinpoint points of contact that need improvement. Going through the whole process is also an opportunity to find places where low-investment actions are possible, which can produce quick positive results. By getting into the shoes of the customer, it is also possible to identify the factors that influence their brand loyalty.

An important, and often overlooked, aspect in customer experience design is the experience of the employees responsible for implementing solutions and contact with customers. If they are satisfied with their work and understand the meaning of their work, they will transfer this to their interactions with customers.

The final stages are to establish and group priorities and develop a timetable for what the project team should do. Success criteria and KPIs will also need to be defined to analyse the effectiveness of these activities on an ongoing basis. Equally important will be consistent communication of the action plan within the team and managerial support.

How to influence the customer experience?

In implementing a strategy to build a positive customer experience, the best effect will come from using several tools simultaneously. This allows all customer needs to be addressed.

Among the most commonly used methods are:

Increasing transaction value

This means increasing the perceived attractiveness of the product or service by increasing the satisfaction of the purchase. In other words, the more, for example, delivery methods available to the customer and the faster and cheaper they are, the better the experience will be.

The appearance of the packaging or complimentary products included with the order also have an impact on increasing the value of the transaction. The overall transaction value can also be increased in the eyes of the customer by cross-selling or indicating that the delivery price applies to multiple products.

Increasing the overall financial value

Another effective method is to increase the overall financial value through discounts. These can be offered in various forms – coupons, discount codes or promotions.

Increasing product value

Every product has a perceived value, i.e. a maximum price the customer is willing to pay for it. This can be increased, for example by communicating the benefits of the purchase. Another way is to allow comparisons with the ratings of previous buyers or with similar products. A combination of these factors will ensure that, in the eyes of the customer, your product may look more valuable than it actually is. They will be able to compare their perception of the price with the actual price. If it is lower than the perceived value, the customer will be more likely to take up your offer. It will also improve his experience.

Building an emotional connection

Customers often form an emotional bond with brands that hold values close to their hearts. This can be used to build a positive experience. Building emotional relationships can be understood as both encouraging customers to engage on the brand’s social media and participating, for example, in charitable campaigns run by the company.

Loyalty programme

One of the most effective ways to improve the customer experience is to offer a loyalty programme, which will involve, for example, discounts or other benefits. It is also a tool to build a bond between the brand and the customer.

Quick contact

This seems like a simple method, but its implementation can often be problematic. Customers do not like to wait, so responding to their queries quickly and efficiently will improve the experience in a positive way.

Service and marketing automation

To improve the customer experience, as well as to influence the speed at which queries are answered, automation can be used. Solutions such as call acceptance notifications or chatbots can have a very positive impact, as customers will feel that someone is keeping in touch with them all the time.

Publish positive reviews and respond to negative ones

A good way to build customer experience is to allow customers to have their say about your brand, product or service. Positive feedback will encourage others to use your company.

A matter-of-fact and calm response to negative comments can in turn translate into building an expert image.

Customer experience analysis

Customer experience can and should be continually analysed. This not only identifies the strengths and weaknesses of a brand’s actions, but also enables the implementation of appropriate solutions. A number of indicators have been developed for CX analysis and, as with implementation methods, it is useful to use several of them at the same time.

Among others, the following are used for this type of analysis:

Customer Effort Score (CES)

Means literally “customer effort score”. This indicator measures the experience of a specific product or service.

In short, after a purchase, the customer is asked a question that means roughly “how much effort did you have to put in to find a solution to your problem?” The answer is usually given by indicating a specific value on scales of 1-10 or 1-5. Some companies use symbols – smiling, neutral and sad emoji.

Customer Effort Score (CES) can also be measured by its relationship to a statement such as: “it cost me a lot of effort to solve a problem”. In response to this statement, customers choose a degree of agreement. They can, for example, strongly agree, somewhat disagree or be undecided.

Net Promoter Score (NPS)

Literally ‘customer loyalty score’. This acronym covers questions such as “how likely are you to recommend our brand to others?”. Most commonly, you answer by ticking a number between 1 and 10. In some surveys, you can also provide an open-ended answer after casting your vote. Collecting this type of information helps to identify the key factors for maintaining customer loyalty.

Customer Satisfaction Survey (CSAT)

That is, a ‘customer satisfaction survey’ that measures satisfaction with the sales process, e.g. the choice of delivery method. The CSAT can refer to the whole process, but it can also relate only to a specific aspect, e.g. delivery options. An example question is “how would you rate your satisfaction with the service provided?”. The answer is given by selecting the appropriate value in the ranges 1-5, 1-7, 1-10.

Time to Resolution (TTR)

Time to resolution, as this indicator should be translated, measures the time it took the service department to resolve a customer problem. In this case, there is no need to implement surveys, but simply measure the time it took staff to resolve a problem. The faster the TTR, the more positive the customer experience.

Strategy and trends in customer experience

The topic of customer experience can be approached in different ways. This is demonstrated by the Hotjar report ‘How to improve customer experience’, whose authors examined which customer experience strategies are used by different companies. Experts from the USA, England, Australia, Canada and EU countries took part in the research, and a total of 2,000 responses were analysed.

The organisations that took part in the study were divided into 4 types based on the strategy used.

• Ignorant (10%) – do not pursue a customer experience strategy and do not see it as a key competitive differentiator;
• Newcomers (40%) – see the need to improve the customer experience and have started to work towards this, but without a clear strategy;
• Young (38%) – strive to provide a high-quality experience, have a customer experience strategy in place and are measuring the results;
• Mature companies (12%) – have a customer experience strategy and apply it to everything they do. They are constantly improving processes to meet customer needs; They make decisions primarily based on feedback;

The report also shows that the bigger the budget a company has, the more consciously it implements a customer experience strategy. However, this is not the only information the report provides us with. We learn, among other things, what phenomena in customer experience can be considered trends.

Based on the data collected by Hotjar, we can distinguish five key trends in customer experience. These are phenomena that are worth bearing in mind when planning the implementation of a customer experience strategy.

1. The more important customer experience is to a company, the less interest it has in acquiring new customers. This attitude prevails among mature companies, whose culture is clearly customer-centric. In contrast, profit-centric (22%) and mission-oriented brands (26%) predominate among ignoring companies;
2. The methods to implement a customer experience strategy differ. Interestingly, mature companies are more likely to use old-fashioned solutions such as talking to the customer or market research. Augmented reality or chatbots are used less often by them; this is the domain of ignorant companies, which use them to a much greater extent. Young and newcomers, on the other hand, choose surveys and phone calls as methods to help them understand their customers;
3. The driving force for mature companies in creating a customer experience strategy is feedback, while for ignoring companies it is market research and industry best practice. Companies are also guided by gut feeling and intuition, but to a small extent: mature – 12%, young – 15%, newcomers – 16%, ignoring – 17%;
4. The biggest obstacle to achieving the goals of the customer experience strategy is the lack of knowledge and adequate training of employees. This was unanimously stated by all companies. Other obstacles are: competition, external market mechanisms and company policies. To cope, ignorant companies invest in new technology and software, while mature and young companies focus on training employees and improving processes;
5. Long response times, employees who do not understand customer needs, unresolved problems and questions left unanswered are most often blamed for a bad customer experience . Mature companies receive the fewest complaints about rude employees.

What conclusions can be drawn from this? It turns out that customer experience is most important for mature, well-established companies. Those ignoring it, which are more focused on profit and winning new customers, do not prioritise customer experience. Assuming, therefore, that we should learn from the best, customer experience should be prioritised over other strategies. This may involve changing the culture of the company, as well as the methods used, but it could also be an opportunity for better results.

Which is more important – return on investment or return on experience?

Designing the customer experience properly can improve a company’s bottom line and therefore increase the return on investment in other areas, such as product. A positive CX can make customers more likely to choose your brand. This can increase your company’s turnover.

However, it is important to remember that money, while important, does not describe the entire brand or product experience. ROI makes it easy to understand how CX activities have translated into company finances, but it says little about the experience itself.

ROX (return on experience) measures both the short- and long-term impact of a brand on customers. It takes into account not only their experience, but also the experience of the employees responsible for implementing CX solutions.

However, it is important to remember that ROX is a much more complex indicator than ROI, but one that describes a wider range of company activities. Conversion and rejection rates, among others, are used to measure and determine ROX. It is also influenced by the degree of customer engagement on your social media, traffic to your website or the number of leads acquired. In short, ROX describes the entirety of the customer’s financial, material and symbolic experience with your brand. It also examines their translation into business and results.

One thing is certain – if your company properly ensures a positive customer experience in all interactions, it will positively impact both the customer experience and the financial results.