You’re Being Watched: The Financial Impacts of Neglecting CX
It’s time for organizations to open their eyes to the reality of the situation: you’re looking at profit the wrong way.
It’s not just you though—a surprisingly large number of “modern” companies are still stuck in the old dynamic of seeing product development and marketing as revenue driving, while after-sales services and customer experience continue to be minimized.
This old way of doing business isn’t profitable anymore. After-sales services and customer experiences are now the main drivers of profit, and neglecting them will have a significant economic impact on your bottom line.
Why CX is a Key Profit Driver
Profit isn’t always as apparent as “opportunities won versus opportunities lost,” or “customers acquired versus customers who’ve churned.” The fact of the matter is, there is a reason behind this activity, and it’s not as complicated as you might think. It’s really about focusing on your existing customer pool and delivering the best CX possible.
As I discussed in my previous blog on brand loyalty, one of the most important things a business can do to encourage profit is to focus on increasing brand loyalty. Good CX will help create a meaningful social connection between your brand and your customers, and lead to an environment built on honesty and trust.
In fact, honesty and trust are the leading contributing factors to customer loyalty, at 76% and 74%, respectively. When your customers are provided a great experience during every step of their journey, and they feel like they are appreciated, kept in the loop and are up to speed on all brand issues, they will trust you.
The relationship between excellent CX and profit is clear as day; as the level of CX increases, so does the likelihood that your customers will contribute directly and indirectly to your bottom line.
In the chart above, the pink bars represent the direct impact that customers can have on profits by directly purchasing more, while the blue bars show the indirect impact they have by recommending your brand.
It should be clear at this point why CX should never be neglected; as the quality of your CX deteriorates, so does your ability to increase profits.
Your Community: A CX Hotspot
As you may already know, your online community is a hot spot for the biggest fans of your brand. It’s a place where they can congregate, share ideas, answer support questions for other customers and discuss product or services issues.
Whether you like it or not, your community is the centerpoint customer interactions that impact CX, and your leadership in the community should always be a top priority. If you do this correctly, your most engaged customers can be your biggest fans and do more than you think to help your product and marketing efforts. This is especially true if your community happens to be support-based, or has support functions.
Now, I’ve seen a lot of communities do things right, and a lot of community do things wrong. Recently, I came across a community forum where the members were experiencing product related issues, and in my opinion, the organization’s community didn’t do right by their customers. I’ll refer to this community as Community X.
With that in mind, I’ve made a quick list of some of the best practices when it comes to delivering top notch CX, drawing from the mistakes made by Community X.
Community CX: The Do’s and Don’ts
Here are 3 things that you need to do when issues emerge in your community. Again, these items are inspired by the poor and neglectful CX delivered by Community X when their customers were experiencing a product issue.
1. Keep Your Community Posted
First and foremost, you need to first acknowledge the issue and keep your members updated on the status of the issue. Even if you don’t have a solution at the moment the issue is discovered, excellent CX means, at the very least, acknowledging that there is an issue. It doesn’t mean waiting 3 days and dozens of customer discussions later to acknowledge the issue and give an update.
This is exactly what Community X did, and I couldn’t believe my eyes. After a number of customers made posts about the issue, and even after one customer took the initiative of creating a master post, there was still no input from the Community Manager.
3 days and 32 posts later, the simple response from the Community Manager was:
The hardest part for me was to read “we did release an update to resolve this issue,” simply because this emphasizes the fact that a solution was made and the community wasn’t told about it.
This was the only post that the Community Manager made in the discussion, even after all the “waiting and watching” by the community members for a solution.
2. Don’t Just Fix The Problem—Explain What Happened
Your customers are valuable and they deserve an explanation for any product or service issues they may encounter. This is absolutely necessary when looking to deliver great CX.
In the case of Community X, as you can probably guess from the response they provided above, they didn’t provide an explanation. Even after multiple customers expressed their desire to know the cause of the issue, the Community Manager remained silent and customers were left to speculate amongst themselves, even after the issue was resolved.
One of the most important parts of delivering excellent CX, as I have discussed above, is being transparent and honest with your customers and your community. Product issues are bound to happen, but providing an explanation as to what happened and what’s being done to make sure it won’t happen again is key, especially if your customers are asking for one.
3. Keep your Support Team in the Loop
Central to providing even a decent level of CX is actually using and monitoring the activity in your community. As a primary channel for customer self service support, your community is likely the first place that you’ll find out about any emerging product or service issues. As such, it’s important to keep tabs on your community and inform your support team the moment that any issue is identified.
If Community X had been actively monitoring their forum, it’s likely that a solution could have been developed and implemented much more quickly.
The CX mistakes made by Community X and the negative impacts that they’ll have on the organization certainly won’t happen overnight. This is likely why it’s so easy to gloss over these errors when looking at organizational profits—they’re happening “behind the scenes” so-to-speak.
Errors like this, as we’ve discussed, are costly. A consistent inability to deliver great CX to your community will eventually tarnish the trust between the customer and the brand. Moreover, your superfans won’t feel appreciated or cared about, and let’s be honest, they’re the backbone of your community and you need them more than they need you.
My point is, your actions within the community reflect not only how you view your customers, but also how much you value them. Your customers are watching you, so make sure you show them how important they really are, or you’ll eventually lose out.
RIP Community X.