What is customer experience and why is it important? thumbnail image Published on 26th March 2023 by Gemma Harding

In the business world, the term ‘customer experience’ is often thrown around – but what does it actually mean, and is it important?


Firstly, it’s useful to understand the basic meaning behind the term. The truth is, there are many different elements that make up the customer experience, but ultimately, it all boils down to the perception your customer has of your brand. But why is this so important?


Well, in a nutshell, because positive customer experience is a key way your brand can stand out from competitors. In today’s global marketplace, there are more brands than ever before in practically all industries. Naturally, as more brands compete for your attention, the harder it is to differentiate yourself. Good customer experience and satisfaction levels help you build a good reputation, maintain a loyal customer base, and stand out in a crowded marketplace.


In this guide, we take a closer look at these key benefits. We also explain exactly what customer experience is in this context and, crucially, outline its relationship with customer services.


What is customer experience?


Put simply, customer experience (CX) refers to the total sum of a customer’s interaction with your brand. Spanning the entire lifespan of a customer’s relationship with the brand, this metric includes all perceptions, feelings and opinions a customer experiences that results from their interaction. 


It involves every way in which a customer interacts with your organisation, from the marketing materials they might see before they even become a customer, to the experience they have at the sales stage and the quality of the products or services they receive, to the customer service they receive once they’ve made a purchase. With customer relationships specialists SuperOffice claiming that 86% of consumers are willing to pay more following a great customer experience, it’s clearly worth getting it right.


Whether they are aware of it or not, all brands provide customer experiences. No matter where a brand pitches itself in its industry – from premium market leader to cheap and cheerful value retailer – it is potential customers who hold a brand’s success in their hands. This means being able to not only measure CX, but actively working on constantly improving your offerings, is such an important aspect of running a successful business. 


Naturally, however, this is much easier said than done. Indeed, controlling customer experience is a notoriously tough task. This is because customers in all industries can behave and react in unpredictable and even irrational ways. However, through good customer service techniques and omnichannel communications and support, brands have a better chance of influencing customers positively. We will look at this in more detail below.


What is the difference between customer service and customer experience?


Although incorrectly used interchangeably, there is a difference between customer service and customer experience. In a nutshell, as we have explored above, CX refers to any and all interactions a customer has with your brand. On the other hand, customer service refers to a specific single event within a customer’s brand journey in which they reach out for support from the brand. This could be in the form of a call to your brand’s outsourced customer services call centre, a face-to-face discussion with a retail assistant in one of your stores, or a conversation a customer has with an advisor using a live chat tool.


Despite referring to different things, there is crossover when it comes to customer service and customer experience. As touched on above, customer service is part of the larger CX picture. This is to say, the feedback collated from your brand’s various customer service touchpoints can be used to put together a snapshot of your brand’s larger CX strategy. After all, a lot of the time, it will be your customer service representatives that have most direct interactions with your customers. If you are noticing patterns in customer support feedback after talking to your representatives, this information can be used to make CX improvements going forward.


Why is customer experience important?


There are many ways in which customer experience is paramount for a business. Check out three of the most important below.


  • It ensures customer loyalty and retention

It’s no surprise that if a customer has a positive experience with your company, there will be a higher chance that they’ll continue to repurchase your products or use your services. According to Zendesk’s Customer Experience Trends Report 2020, over half (52%) of customers said that they go out of their way to purchase goods and services from the brands they are loyal to.


There’s no denying that customer loyalty is crucial for retention, which in turn, is good news for your bottom line. So, by providing outstanding customer experience in the first place means you’re already halfway there.


  • It helps set you apart from your competitors

Especially in an ultra-competitive business environment, it’s vital that you’re able to set yourself apart from your competitors – and providing outstanding customer experience is one way of doing this. In fact, experience management experts Qualtrics XM Institute claim that 89% of companies with “significantly above average” customer experience actually perform better than their competitors.


The truth is, ignoring the importance of effective customer experience can mean that you lose out to your industry rivals who are doing it well. So if you want your customers to choose you, you’ve got to make it worth their while.


  • It can protect your reputation

If a customer has just one negative experience with your business, it could mean bad news for your reputation. Zendesk’s 2020 Trends Report shows that 50% of customers would actually switch to a competitor after just one bad experience, with this number snowballing to 80% if a customer was to experience more than one negative experience. As a result, this could have a drastic impact on the reputability of your brand.

In a modern world where anyone can post, share or even tweet about a company that didn’t meet their expectations, it’s important that you’re doing everything in your power to ensure positive experiences for each and every customer that goes above and beyond all expectations.


Do business communications affect customer experience?


A recent study conducted by PwC found that 32% of people would stop interacting with a brand completely after just one negative customer service experience. This figure rose to 59% after several bad experiences. This suggests that effective communication and customer support is essential when it comes to CX and customer retention. This typically manifests itself in two different ways. These are:


  • Loyalty building
    Over half (51%) of customers remain loyal to brands that communicate with them through their preferred channel. This is to say, the stronger your brand’s communication and customer support services are, and the more channels of communication are open to customers, the more likely you are to build a loyal customer base. 
  • Trust creation
    According to a recent HubSpot survey, 82% of customers now expect an immediate response from a brand after requesting customer support. Anything less than ‘immediate’ could damage customer trust. Once again, this suggests the more channels you open for customer support, the better CX you can offer, and the more customers you can retain. With this in mind, investing not only in call-based customer service solutions, but also digital channels like instant messaging live chat, email, chatbots and social media DM responders could be key when it comes to creating trust in your brand. 

Here at CALLCARE, we understand the importance of professional, efficient and personable customer service solutions when it comes to creating an outstanding customer experience. For this reason, we offer a range of services that can be tailored around the needs of your business. This allows your brand to offer a seamless customer journey, no matter what channel your customers are choosing to interact with you through.