Sunday, February 5, 2017
Research Confirms that Customer Experience Drives Financial Performance
It's no secret that B2B marketers have become intensely focused on improving the quality of the experiences they provide to existing and potential customers. In the B2B Digital Trends 2016-2017 report by Econsultancy and Adobe - which was based on a survey of more than 1,000 B2B marketing, digital, and ecommerce professionals - respondents identified optimizing the customer experience as their most exciting opportunity in 2016 and for the next five years.
Over the past few years, there's been a significant amount of research regarding the benefits of improving customer experiences, but most of the research has focused on qualitative benefits, such as improved customer loyalty. Some research firms have addressed the issue of how much financial value a company can realize by improving customer experiences. For example, Forrester Research and the Temkin Group perform regular studies to quantify the economic value of improved customer experiences in several industries.
A recent study sponsored by Avanade and Sitecore provides some fairly compelling evidence that investing in better customer experiences can drive significant financial benefits. This study was based on interviews with 880 business leaders who have responsibility or influence over their company's customer experience efforts. More than 650 of the interviewees said their company "prioritizes" its customer experience strategy, and many of the study's findings are based on the responses from this group.
The most attention-grabbing finding in this study is that respondents said their company realized $3 in benefits for every $1 it spent on improving customer experiences. Four out of ten respondents reported increased revenues, 38% said they achieved better financial performance than their competitors, and 37% said they improved sales cycles. Where these benefits were seen, the improvements were substantial. Respondents reported an average improvement of between 18% and 21% in each of these dimensions.
Respondents also reported that improving customer experiences produced increased levels of customer satisfaction (58%), increased customer loyalty (45%), and increased levels of customer acquisition and retention (41%). Once again, these benefits were significant where they were seen. Respondents said they saw an average improvement of between 19% and 22% in each of these areas.
The Avanade/Sitecore research provides more evidence that improving customer experiences is a sound strategy for virtually all kinds of companies. While this study didn't focus exclusively on B2B companies, other research - such as the Econsultancy/Adobe study mentioned earlier - has demonstrated that customer experience is as important in B2B as it is in B2C.
Illustration courtesy of frontriver via Flickr CC.