What is the next-generation customer experience, and how to get there?

Just keeping up with customer expectations is no longer enough. Companies today need to exceed expectations and provide exceptional CX to keep their customers happy, loyal, and coming back. Today is about company loyalty, not customer loyalty. Implementing Next-Gen CX solutions will drive value, reduce costs, and increase revenue.

The high-expectations era

We’ve reached a time where people are no longer buying products; they’re buying experiences. And they expect those experiences to be seamless. Expectations are rising primarily due to customer technology development. Today, the new generation of customers want and expect instant solutions, 24/7 availability, omnichannel support (access to both desktop and mobile), online and offline support, flexibility, and efficiency. They quickly adapt to new channels and devices and expect the companies they buy from to do the same. They want multiple touchpoints in their customer journey, making their interaction smooth, effortless, and more accessible. And most of all, they value omnichannel presence, speed, trustworthiness, and responsiveness. Today, it doesn’t matter what you sell. First and foremost, you’re selling an experience!

High-quality over high-quantity

It is common practice in the customer service department to measure success using several KPIs (key performance indicators) such as: call handling time, the number of calls handled, first response time, first contact resolution, and level of customer satisfaction. However, today these KPIs are only a tiny part of the customer service department’s overall success. Previously, agents would send a customer to another department for issue resolution and close the ticket with the shortest handle time, whether the issue was resolved or not.  Customers now regard this as an unsatisfactory “bouncing-ball” experience. As a result, today’s customers prefer a longer initial call where they receive high-quality service rather than being transferred between departments. And this is also a part of Next-Gen CX.

Human & machine superintelligence

Without a doubt, the next generation means cutting-edge technology. We can say the same for customer service departments. Companies must leverage well-trained and well-intentioned employees alongside the latest technologies, software superintelligence, and AI to provide a Next Generation Customer Experience. It should ideally be a hybrid of the best of both worlds – human and machine.

The customer-centric strategy

In both life and business, not all experiences are positive and bad experiences are unavoidable. But imagine you’re a customer who had a bad experience with a company. You’ll most likely be frustrated and leave the company without explaining what went wrong. Customers today take immediate actions that harm businesses after a single negative experience (without considering all the previous good ones).

This only emphasizes the importance of companies focusing on becoming customer-centric. Essentially, this means putting customers at the center of the business and organizing around them. Teams, processes, and technologies should be focused on creating a next-generation customer-centric company. That is the only way to provide your customers with the Next-Gen Customer Experience they require.

Boost your sales and success with FrontLogix’s top-notch Workforce Management and Customer Experience outsourcing services, designed to strengthen customer relationships. Contact us to elevate your business growth.

We’ve already discussed the importance of good customer experience and how to measure it for the best results. This guide will teach you the essential elements of customer experience that businesses must include in their CX strategy.

1. Reliability

Reliability is a critical factor that significantly impacts the customer’s experience. The perception of reliability helps to build your company’s brand image and generate positive word of mouth. So, what exactly qualifies?

• Providing support for both critical and non-critical business issues;
  
• System and network reliability and providing appropriate resolutions in the shortest time possible;
  
• Reliably integrating different channels to communicate with the customer
  
• Consistently delivering an outstanding customer experience.

2. Availability

In today’s fast-paced world, customers expect to be able to contact a company whenever and however they want. They interact with companies on their terms via email, chat, voice calls, messaging, or social media. But, they also expect to have all inquiries answered quickly (if not immediately). They especially do not want to spend (or waste) their time waiting for answers or repeating their questions. And that’s precisely why availability is among the essential elements of a good customer experience.

3. Convenience

Customers, in addition to availability, expect convenience. They do not want to waste their precious time waiting in phone queues or repeating their questions to different representatives. The ability to reduce customers’ non-monetary costs, such as time, energy, and effort when purchasing/using services or products, significantly impacts CX.

4. Personalised Communication

Receiving personalized messages from a company, whether related to previous interaction with the company, offers linked to purchase history, or simply an interactive voice response (IVR) message personalized with a first name, provides the customer with a feeling of being valued. As a result, personalized communication is one of the most important aspects of a customer’s experience and expectations.

5. Simplicity

Customers expect all business interactions to be simple and seamless at every step of the customer journey. They anticipate being heard while also having their interactions simplified. This means a company should keep the number of jumps from one touchpoint or stage to another at a minimum. Providing and implementing a one-step resolution or access to information through all available channels would be the ideal approach. But even that is insufficient.  Besides simplifying the process, businesses must ensure that as much data as possible is collected and stored at each step so that customers do not have to share the same information repeatedly. All of this will make customers’ lives easier at each stage of their customer journey, enhancing their experience significantly.

6. Accountability

Accountability is yet another vital factor in providing a positive customer experience. Customers always assess whether a company has delivered on its promises. This evaluation occurs at every stage, often before they make a purchase. Once the customer makes a purchase, the review does not end. Whether the solution or product is delivered on time and whether the provided experience, solution, or resolution is straightforward and honest is essential. Of course, doing business can sometimes be unpredictable, and situations may arise where the promised resolution is challenging to deliver. Customers must be informed of why and adequately compensated if such scenarios occur.

7. Adaptability

Because the digital world is rapidly changing, customers (particularly younger generations) are likelier to experiment with newer technologies and commit to newer engagement channels. This simply means that companies must consider the changing consumer environment and be ready to adapt and change quickly and smoothly. Adaptability in a technological environment is critical for a company to provide exceptional customer services in speed, data security, data accuracy, and so on. Because each customer is unique, a company’s solutions should be adaptable, scalable, and tailored to the customer’s specific needs.

8. Anticipation

Anticipation is also closely related to the rapidly changing technological environment. To be able to adapt quickly and smoothly, companies must be able to anticipate changes before they occur to stay ahead of both their customers and the competition. To provide an exceptional customer experience, every company must be a digital innovator in their respective fields and industries.

9. Feedback

Allowing customers to provide feedback is another essential aspect of providing a good customer experience. Customer feedback can be advantageous to both parties:

• Customers will appreciate it because it demonstrates that the company cares about what they think.
•  It shows the company which aspects of their business are most valuable to customers and which could benefit from improvement.

10. Responsiveness

Responding to customer complaints or inquiries consistently and promptly is crucial to providing  excellent customer experience. A responsive CX team can contribute to success by assisting as many customers as possible and finding solutions quickly.

When customers provide positive feedback, responsiveness is also critical. Customers will be satisfied with their experience if their suggestions prompt change.

11. Communication

Excellent internal and external communication is another critical component of the customer experience. All customer experience interactions revolve around communication. Knowing how to communicate, regardless of the situation, can assist the CX team in being ready for any type of interaction.

Being an effective listener is an integral part of communication. Employees and managers must try to hear what customers say, respond with relevant information, and contribute to a satisfactory solution.

12. Transparency

Customers appreciate it when brands and companies they purchase from are transparent, open, and honest. Transparency is demonstrated through honesty. Even in cases when employees do not have all the necessary information or all the required answers, customers will appreciate a transparent and honest response rather than a generic one.

Another crucial aspect of transparency is the service/product descriptions and prices. Customers appreciate it when they can find sufficient and accurate information.

13. Exceeding expectations

 Exceeding expectations simply means going above and beyond for your customers! This is another essential aspect of the customer experience because it increases customer satisfaction and contributes to credibility. Going the extra mile will undoubtedly result in long-term, positive customer relationships. It will also encourage customers to return, renew, or re-subscribe. Return customers are more likely to recommend the brand to their peers, which leads to acquiring new customers. As a result, a company must not pass up any opportunity to go above and beyond to engage and delight existing customers.

14. Balancing CX and Profitability

Creating a great customer experience is much easier if you’re willing to spend a lot of money and effort. Many companies cannot afford this in the long run. That is why balance is so important. The best customer experiences provide customers with recognizable and prominent value at a low cost to the organization. This is precisely why companies choose to outsource their customer experience.

Key Takeaways

We’ve identified 14 key triggers that we believe are crucial to delivering a superior customer experience. Building a successful customer experience strategy requires balancing these factors. Most are codependent and need to be implemented as a whole to provide better results.

A company should carefully consider all the above aspects to provide an exceptional customer experience. Furthermore, businesses should evaluate all touchpoints in the customer journey, carefully design content for each channel, and personalize it for each customer.

Finally, to provide a truly memorable experience, the team in charge of the customer experience must be well-trained, enthusiastic, and compassionate. FrontLogix has highly trained, experienced, and skilled employees that are reliable, accountable, available, responsive, and provide exceptional, transparent, straightforward, and highly personalized communication. Get in touch today!

While customer experience, service, and care might be seen as interchangeable, there is a distinct difference in the way they are implemented. One thing is certain, companies are investing more resources in creating a seamless experience, resulting in a significant shift in business from profit-centric to customer-centric. The competition is also shifting away from price and toward experience. There is no doubt that companies are beginning to prioritize Customer Experience. What about Customer Service and Customer Care?

The difference between Customer Experience, Customer Service, and Customer care

There is a considerable difference between Customer Experience, Customer Service, and Customer Care. It’s essential to define these terms, be aware of the areas they cover, and distinguish between the means of interaction they use.

What is Customer Service

The primary responsibility of Customer Service is to advise customers and provide them with help and assistance. The main focus of Customer Service is customer satisfaction, with the ultimate goal of increasing the Customer Satisfaction Score (CSAT). So, what exactly does Customer Service include?

• Responding to product/service inquiries
• Assisting customers in making the best purchasing decision
• After-purchase assistance for customers
• Advising the customer on the best way to use the product/service
• Troubleshooting a problem
• Providing a superior purchasing experience for customers

What is Customer Care

Customer Care is exactly what it sounds like: caring for customers while interacting with the brand. Genuine care entails listening to customers’ needs and desires and developing appropriate solutions. Customer Care, while similar to Customer Service, entails deeper interactions and the development of personal and emotional connections with customers. While both contribute to customer satisfaction, another significant difference is that Customer Care cannot be easily quantified. Each company’s Customer Service strategy will be unique (even within the same industry).  Common examples include:

• Personalized customer interactions (like sending birthday cards)
• Targeted and unique messaging (like sending suggestions based on their behavior)
• Customer convenience benefits (like a money-back guarantee or free delivery)

What is Customer Experience

Customer Experience encompasses the entire customer journey, including all brand interactions along the way. CX refers to the entire customer lifecycle and every touchpoint a customer has with a product or service. It also considers how customers feel about a company, including their emotional, physical, and psychological attachments to the brand. The purchasing process can be lengthy, from discovering the brand to researching a product or service, making a purchase decision, purchasing, using, and following up with the brand. All of this contributes to the overall Customer Experience.

Here, you can read more about the importance of the Customer Experience, how Customer Experience can drive business growth, and some valuable techniques to improve your Customer Experience.

The Conclusion

We wouldn’t be surprised if the three concepts of Customer Service, Customer Care, and Customer Experience sound familiar. They help a company keep its commitments while creating loyal, satisfied, and returning customers. While Customer Experience is the sum of all interactions, Customer Service and Customer Care are also critical components of the equation.

Customer Service and Care are equally essential, and businesses can not overlook them in favor of a better Customer Experience. Customer Service and Customer Care are necessary because no matter how hard a brand works to provide a flawless experience, not every customer will be delighted at all times. This is precisely why all three segments should be equally incorporated and always collaborate closely. Only then will a company be able to maintain a large, satisfied, loyal customer base. And, as we’ve previously stated, loyal customers are return customers and will refer and recommend others.

So, while Customer Experience should be at the heart of everything a business does, incorporating Customer Service and Customer Care will result in exceeding expectations and keeping customers delighted. However, if you are having difficulty with any of these services, FrontLogix can undoubtedly assist you. We provide Customer Service and Customer Care outsourcing services and improve all touchpoints of the Customer Journey for a better overall Customer Experience — just Get In Touch!

This is the ultimate guide on how to measure and improve CLV CRR and CCR. Here, you’ll find everything you need to know about the most important customer success metrics and what to do to achieve CX greatness.

Contents:

What is Customer Lifetime Value (CLV)
5 reasons why Customer Lifetime Value (CLV) is im#portant
How to measure Customer Lifetime Value (CLV) ‒ 5-step formula
How to improve Customer Lifetime Value (CLV) in 8 ways

What is Customer Retention Rate (CRR)
12 reasons why Customer Retention Rate (CRR) is important
How to measure Customer Retention Rate (CRR) ‒ 3 formulas
How to improve Customer Retention Rate (CRR)

What is Customer Churn Rate (CCR)
6 reasons why Customer Churn Rate (CCR) is important
How to measure Customer Churn Rate (CCR) ‒ 2 formulas
How to improve Customer Churn Rate (CCR) in 6 steps

Which metrics to use?
Conclusion

What is Customer Lifetime Value (CLV)

This article will teach you how to measure and improve CLV CRR and CCR, but first – what is Customer Lifetime Value (CLV)? CLV is a metric that represents the total net profit a company is expected to have from a customer over the course of their entire relationship. In simpler terms, CLV is the average amount of money a customer is likely to spend on a company’s products or services during their lifetime.

So basically, the longer customers buy from a company, the bigger their lifetime value. The customers with a high CLV are the ones who make frequent, high-value purchases.

5 reasons why Customer Lifetime Value (CLV) is important

CLV is a key measure for determining a customer’s long-term worth. Calculating Customer Lifetime Value will indicate how much revenue they are likely to generate over their lifetime. You can then use this data to determine how much you should invest in customer acquisition and retention.

Still not convinced? Here are the top 5 reasons why to measure CLV:

1. Knowing your customers’ CLV helps you discover which customer segments are the most valuable and spend your marketing and sales resources accordingly.
2. If you know the CLV of different customer segments, you can make more informed decisions about budget allocation. For example, if you know that acquiring a new customer is more expensive than retaining an existing one, you may naturally choose to invest more in customer retention programs.
3. Once you measure customers’ CLV acquired through different channels, you can make calculated decisions about which customer acquisition channels to focus on.
4. CLV offers insight into a customer’s long-term value, which can drive strategic decisions about product development, expansion, and revenue projection.
5. Knowing customer CLV means knowing who your most profitable customers are. With that information in your pocket, you can focus on retaining them and providing an exceptional customer experience

How to measure Customer Lifetime Value (CLV) ‒ 5 step formula

So, at this point, you are wondering how to measure and improve CLV CRR and CCR. According to research, just 42% of businesses can effectively measure their CLV. Follow this 5-step formula to successfully calculate CLV:

1. First calculate the Average Purchase Frequency Rate (APFR) ‒ the number of times a customer makes a purchase over a specific period of time.
2. Then calculate the Average Purchase Value (APV) ‒ the average amount of money spent by a customer during a single purchase.

3. Having the APFR and APV, you can now calculate the Customer Value (CV) ‒ the overall value that a customer brings to your business over a specific period of time.

4. Then calculate the Average Customer Lifespan (ACL) ‒ the average number of years a customer continues purchasing from your company.

5. And finally, you can now calculate the Customer Lifetime Value (CLV).

How to improve Customer Lifetime Value (CLV) in 8 ways

1.     Personalization, personalization, personalization

• Offer personalized incentives, such as discounts or rewards based on customer behavior or purchase history.
• Use customer data to make personalized product recommendations. 75% of consumers are more likely to buy following personalized recommendations.
• Personalize your marketing. More than 70% of consumers respond to marketing only when it’s customized to their interest, with around 75% of them being outright frustrated by generic adverts.
• Send emails with personalized subject lines. They are 50% more likely to be opened.
• Create customized landing pages for different customer segments or for specific campaigns.
• Personalize the communication by using the customer’s name, location, and other personal information.
• Use A/B testing to test different personalized messages and offers to see which ones perform best with different customer segments.

2.     Active listening

63% of consumers expect businesses to recognize their individual needs and expectations.

Evaluate your customer’s needs through surveys such as the NPS (Net Promoter Score), CSAT (Customer Satisfaction), and CES (Customer Effort Score). These will help you understand how customers perceive your brand and identify areas for development:

You may find information and formulas for measuring NPS, CSAT, and CES in the Measuring Customer Experience article.

Make the most of your data by offering optional short comments on the rating. Allow consumers to explain their ratings and make suggestions on how to improve your customer service. Customers will appreciate the effort and remain loyal to your business if you ask for feedback and act on it.

3.   Monitor and analyze customer data

Use data and analytics to understand customer behavior, preferences, and spending patterns. This can help you identify opportunities for improvement and make more informed decisions about how to increase CLV.

4.  Omnichannel personalization

From personalized marketing to personalized support, the omnichannel approach can greatly improve CLV. Delivering a consistent and seamless experience across all channels makes it easy for customers to receive the support they need, reducing customer effort and boosting their satisfaction.

Omnichannel integration will give your business a complete view of customer interactions and purchase history, helping you identify opportunities for personalized marketing, cross-selling and upselling.

Related: Next-Generation CX & Omnichannel Support

5.  Reward loyalty

Your most loyal customers are your greatest brand advocates. Use customer data to create personalized offers or discounts that are tailored to their interests and purchasing habits.

Reward loyalty through discounts, freebies, or exclusive offers for frequent purchases. Give your loyal customers special access to events, sales, or early access to new products. Recognize their loyalty publicly on social media.

The key is understanding your customers’ value and creating a loyalty program that aligns with their needs and preferences.

6.  Increase the frequency of communication

Regularly communicate with your customers about new products, services, and promotions. This will help to keep your business top of mind and increase the likelihood that customers will return.

7.  Increase customer spending

Encourage customers to purchase more often and to purchase higher-priced items through upselling and cross-selling by offering incentives for larger purchases. Create product bundles and packages that make it easy for customers to purchase multiple products or services at once. For example, a customer buying a new laptop may also be encouraged to purchase a laptop bag, a warranty, and a mouse.

Always keep in mind the golden rule of upselling: customers should feel that the recommendations are tailored to them and not just a sales pitch.

8.   Increase customer referral

Encourage happy clients to refer you to their friends and family. Referral schemes and incentives can help with this. Offering a referral program increases your CLV while also exposing you to new potential consumers, who can later be turned into loyal clients. Customers who have been referred have a 16% greater lifetime value and 18% lower turnover. In addition, 81% of consumers trust suggestions from people they know, and 55% discuss their new purchases on social media.

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What is Customer Retention Rate (CRR)

The Customer Retention Rate (CRR) is a metric that calculates the percentage of customers who continue to do business with a company over time.

Customer retention refers to the process of keeping customers. It can be used to uncover trends and patterns in consumer behavior and is used to track how successfully a company retains its customers.

12 reasons why Customer Retention Rate (CRR) is important

Calculating CRR will help you understand how many customers continue doing business with you. Read on to find out why client retention is crucial for the success of your business:

1. Acquiring new customers involves marketing and advertising costs, which is why it is 5 to 25 times more expensive than keeping existing ones.
2. The likelihood of selling to an existing customer is 60-70%, as opposed to 5-20% to a new customer.
3. Existing customers spend 31% more.
4. Existing customers are 50% more inclined to try new products.
5. Even a 5% improvement in client retention improves profitability by 25-95%.
6. Existing customers contribute to word-of-mouth marketing.
7. Existing customers are five times more likely to purchase and four times more likely to refer than new visitors.
8. Long-standing relationships make for easier data-gathering about customer behavior. This helps development, marketing, and sales efforts.
9. CRR helps identify issues, suggestions, and opportunities to increase customer loyalty and retention.
10. CRR provides insights into how many users value your product over time.
11. Enables targeting ideal customers.
12. New customers come and go, but an established customer base can provide a more stable source of revenue.

Despite this, 44% of businesses prioritize client acquisition versus 18% that favor retention.

How to measure Customer Retention Rate (CRR) ‒ 3 formulas

CRR formula #1

Add the total number of customers at the end of the month, subtract the number of new customers added during the month, and divide by the total number of customers at the start.

It looks like this:

CRR formula #2

Subtract the number of customers who churn over time from those who remain loyal:
90% retention  – 10% churn = 80% retention rate

CRR formula #3

Consider how many customers remain loyal for one period of time versus another.
% of loyal customers in period one / % of loyal customers in period two = retention rate

How to improve Customer Retention Rate (CRR)

Customer Retention Rate and Customer Lifetime Value are strongly linked. In other words, they are both a result of a successful and profitable relationship with your customers.

The higher the CLV, the higher the CRR is likely to be. If you take the initiative to raise your Customers’ Lifetime Value, retention will most likely follow suit. This is not pure cause-and-effect, but the two values are both driven by the exact origin: customer satisfaction.

As a result, to increase the CRR, follow the above 8 steps for improving Customer Lifetime Value.

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What is Customer Churn Rate (CCR)

Customer Churn Rate, or Customer Attrition Rate, is the percentage of customers that stop doing business with your company.

In a subscription model, it is the percentage of subscribers who cancel their subscriptions within a given time period.

6 reasons why Customer Churn Rate (CCR) is important

A high percentage of customer churn is a red flag for businesses as it suggests that they are losing clients at an alarming rate, and there must be a reason behind it.

Regularly measuring your CCR rate will allow you to react to negative trends and prevent other customers from leaving.

1. 32% of customers would stop doing business with a brand or company they’d previously loved after just one negative experience.
2. Getting new customers ‒ or winning over churned ones ‒ is far more expensive than keeping existing ones. In particular, between 4 and 10 times more.
3. The lower the churn rate, the larger the number of loyal customers.
4. CCR measures the impact of various products/services/projects or company initiatives.
5. CCR determines the company’s progress and provides benchmarks to measure against.
6. Some industries are more affected by churn than others: in the United States, online retail has a churn rate of about 22%. However, SaaS companies aim for a yearly 5% or less churn rate.

How to measure Customer Churn Rate (CCR) ‒ 2 formulas

CCR formula #1

1. First define a specific period to calculate your churn rate.
2. Then divide the number of customers who churned by the total number of customers you had at the start of the time period.
3. The formula is: CCR = total number of customers lost divided by total customers started with.

CCR formula #2

Another possible way to calculate the churn rate is to do a reverse sum of the retention rate.
Churn Rate = % lost customers in period X / % lost customers in period Y

How to improve Customer Churn Rate (CCR) in 6 steps

Aside from following the eight steps to boost CLV and CRR ‒ which will also positively influence the CCR rate ‒ there are other measures to take to avoid a high customer churn rate (CCR):

1. Identify customers at risk of churning

Use data analytics to identify customers at risk of churning and reach out to them ahead of time to address any difficulties or concerns they may have.

2. Investigate why customers are leaving

Determine why customers are leaving through surveys, calls, focus groups, or other feedback channels. Then take steps to solve the core problems.

3. Provide incentives

Offer incentives for staying, such as loyalty programs, exclusive deals, or other perks.

4. Work on improvement

Continuously work on improving the quality and features of your product or service. The needs of your customers are constantly evolving, and so should you.

5. Be proactive

Monitor customer engagement and be ready to address any concerns that may arise. Be proactive in finding and solving potential issues.

6. Invest in retention marketing

Use targeted marketing efforts to retain existing customers, and make sure they are aware of the value they are receiving from your company.

[Read more] How to measure Customer Experience

Which metrics to use?

There are many metrics for measuring the customer experience, but should you track all of them? Well, the answer is no. BUT, you should carefully review your business goals, set the indicators relevant to your business, and measure those. Before you send out surveys and ask for customer feedback, you should know precisely how to measure and improve CLV CRR and CCR.

However, we think it’s important to understand the appropriate customer experience metrics for your company’s growth. Moreover, it’s important to know how to measure and improve CLV CRR and CCR. But, if you have difficulty identifying, tracking, and measuring all those metrics, you can always reach out to us. FrontLogix provides strategies for improving your overall customer experience and improving the CLV, CRR, CCR, and other important KPIs.

Conclusion

Providing a positive customer experience is critical to keeping your customers happy and satisfied. They’ll stay longer, and you’ll have better business results. As a result, investing time and money in measuring customer experience metrics is essential. These metrics will not only help you understand how simple your customers find it to use your product or service, but they will also provide you with actionable insights into improving many aspects of your business. This can significantly impact your company by lowering churn or increasing retention.

Simultaneously, these metrics can help you see where your CX team excels and where they can improve. Collecting and analyzing these metrics can also improve your products, services, and procedures. The better you understand how your customers use your offer, the more enjoyable you can make the entire CX for them. Finally, we hope this article helped you learn how to measure and improve CLV CRR and CCR and you’ll finally reach the success you long for!