Great Debate: The Tension Between Customer Experience and the Bottom Line

No marketing phrase is used more than customer experience. We’ve written scores of articles about it. Too often, however, it’s the type of buzzword that people say without fully explaining their concept of it or attributing a reasonable meaning to it.

Simply put, brands exist to sell goods and/or services. And the more they make customers feel good about purchasing said products or services, the more likely they are to sell those things. So, the idea that promoting a good customer experience is positive for your business makes sense.

However, businesses often do things that negatively affect the customer but positively affect the bottom line. No airline has one staffer per customer to make sure everything is running smoothly on an individual basis. Hotels still can and will charge for individual wifi, even though it’s practically a free utility throughout the Western world. Banks may have fraud prevention, but they also charge plenty of nuisance fees that drive customers crazy.

So, what do we mean when we say customer experience? How do we square the noble pursuit of giving customers exactly what they want with what needs to be done to keep the business healthy?

We’re soliciting opinions on the customer experience dilemma. If you have a strong opinion, fill out this form below or click here. We’ll post our five favorite answers below on May 12.

Ron Kurtz, President, American Affluence Research Center

“A positive customer experience is required to maximize the bottom line. It should not be considered a choice between one or the other.

I believe it could be misleading to talk so much about the need to make shopping an “experience”. That seems to have led some retailers to think they are in the entertainment business or that they need the latest exotic technology on their floor.

I believe a good retail shopping experience starts with the availability of knowledgeable, motivated, and helpful staff as well as good organization and orderly display of merchandise so the shopper can browse easily rather than having to search. Both are very rare in the outlets of the retail chains.

In service industries, consumers want a problem free experience that meets reasonable expectations at a competitive price. When there is a problem, they want to quickly be approached by knowledgeable and helpful staff who will accept responsibility for the problem and work to correct it quickly.”

Amanda Clancy, Intilery

The secret of delivering a great customer experience is to ensure brands understand exactly what individual customers expect and need. The only way to do that is to collect and importantly utilise as much (big) customer data as possible to better inform the journey customers travel with you. Brands must consider every stage of the journey from browsing, to consideration, to purchasing and post sales. Too often companies focus on the sales element and still fail to understand the drivers and motivations…and satisfaction levels of that sale. If brands can provide a personalised, relevant customer experience in real-time across all marketing channels, customers will not only come back for more, but will become advocates. By improving conversion, upselling and retaining customers for longer, brands will improve overall customer lifetime value – the bottom line. Put customer needs at the centre of your strategy, convey sincerity – the returns will be evident from the outset.     

Jeffrey Evans, Epsilon International

If you understand the lifetime value of your customer, and recognize those customer who deliver greater profits over their lifetime, then you should be ensuring the experience they get is superior to customers who have a lower lifetime value. You should not treat all of your customers the same. This means you cannot provide the same experience.

Chris Duskin, VP, Marketing Extole

Balancing customer experience with the bottom line means looking at your business through the lens of advocacy and evaluating where your revenue is really coming from in terms of the quality of the customer. It’s hard to provide a good customer experience if you’re always focused on refilling the funnel; you need to craft an experience that brings customers in and retains them. Loyal customers are higher-quality customers. To provide this kind of customer experience, you have to make customers part of it. Social media, always-on internet and smartphones enable customers to be active participants in your brand, and when you bring them in through methods such as UGC-centered ad campaigns, enabling your customers to refer their friends or even just directly responding to their posts on social media, they’re more likely to think positively of your brand. If a customer is part of the experience, chances are that they’ll think it’s a good one. This will be what convinces them to come back thereby protecting and improving the bottom line.

Alain Thys, Chairman & Chief Storyteller, Futurelab

By making sure that those customer experience improvements are prioritised which have the highest impact on the economic behaviour of customers. This way it is possible to directly link customer experience to profit and calculate whether a customer investment is worth making or not. I.e. for me there is no tension between the two concepts. 

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