Four years ago, Forrester Research discovered that in certain industries, a better customer experience (CX) could result in $1.3 billion in additional annual revenue.
Customer Experience Improvement Change Model
Watermark Consulting took Forrester's model a step further, and laid the data into returns based on two stock portfolios modeled from 10 organizations claiming to provide the best customer experience. For a 6-year period from 2007-2012, the CX leaders:
- Outperformed the broader market
- Generated a total return 3x higher on average than S&P Index
- Bottom 10 CX laggards trailed by a wide margin
CX leaders had better retention rates, greater customer wallet share and more cost-efficient processes and services throughout the organization.
A Temkin Group CX study proved a high correlation between customer experience and loyalty. They found that CX leaders held a 15% advantage over CX laggards in:
- Consumers' willingness to purchase
- Reluctance to switch to a competitor
- Likelihood to recommend offerings to others
Make Your CFO See the Light
Although these studies were based on models and conducted at the onset of the CX boom, there is now irrefutable evidence that makes CX a necessary strategy to sustain market leadership. The trick is to make the case to the right leaders.
So, what is the surest way of getting not only agreement from C-suite executives, but company-wide buy-in for such a long-term commitment? By enlisting the Chief Financial Officer (CFO) to advocate the case for improving customer experience.
Provide your CFO clear metrics, industry role model examples—even how a competitor is addressing the CX challenge—that are factual and defined. Compare the data to your organization and see where you can map improvement opportunities and begin building your CX strategy.
By proving the ROI on your plan to the CFO, you'll make the case for putting CX improvement in the top brackets of your company's strategic initiatives.