If you are on a customer-facing team, it can feel like you come up with brilliant ideas to create a better customer experience, only to be met with pushback about the financial impact that it will have on your company.
Anyone who works in a customer-facing role knows the value of customer loyalty: loyal customers are stickier and more willing to advocate for your brand. They’re also more likely to provide you with feedback about your product, and they are the first people who will agree to try a new product or service that you’re offering.
In the United States, 84% of adults are loyal to retailers, and 82% of them are loyal to product-brands.
But, how do you translate that information to ensure that your whole company is working together to make sure your brand is the one customers are loyal to?
In this blog post, we’ll explore 5 strategies for communicating the benefits of having a customer-centric culture into a language that everyone in your company speaks and understands: money.
1. Show the impact on lifetime value
Customer loyalty is built via trust—oftentimes through the hard work of the customer-facing experience teams within your company. It takes time, resources, and clever branding from your marketing team for people to grow loyal to your company and become emotionally invested in your brand. Funnily enough, customers are extremely receptive to becoming emotionally invested. Most consumers nowadays want to feel aligned with the brands that they purchase from.
Due to heavy market saturation for most products and services, the modern customer looks for a brand with ethics and philosophies that align closely to what the customer themselves value and may switch to another product if they find that they’re not aligned with the brand. A customer-centric culture is the only environment that promotes this type of emotional connection.
But, how do you measure this loyalty and emotional bond so that someone on your sales team more readily “buys into it” and understands what you’re talking about?
How to take action
Talk to them about lifetime value. Consumers with an emotional connection to a brand have a 306% higher lifetime value, stay with a brand for an average of 5.1 years vs. 3.4 years, and will recommend brands at a much higher rate (71% vs. 45%). By focusing on the values of the people using your product, you heighten their value to your company exponentially.
2. Communicate the reduction in customer acquisition cost
Customer acquisition cost (CAC) is a metric that a customer-centric company may reap the most benefit from: it is significantly less expensive to retain an existing customer than to acquire a new one. In fact, just a 2% increase in customer retention can lower costs by as much as 10%.
While retention can certainly be improved with continuous product updates and changes, customer experience is one of the best levers to pull to make an almost-immediate impact. By focusing on leveling up your support and success offerings, both proactive (things like documentation and email reach outs) and reactive (responses to incoming support inquiries), you ensure that the customer has an excellent experience even when they are at their most vulnerable and frustrated. An angry customer is one of your best opportunities: if you can win them over there, you are building customer loyalty for life.
Another behaviour that loyal customers often display, beyond being super sticky, is talk about products and brands that they are loyal to with their friends and family. In fact, 60% of customers will share about an experience they had with a company that they love.
Consider how many of your customers have the potential to become vocal advocates right now, based on the experience that you are providing them.
What would that additional boost look like in tandem to the marketing outreach your company is currently doing to acquire new users or customers? As you create loyal customers, you lower CAC by maintaining the customers you already have and saving yourself money on new acquisitions through customer word of mouth.
How to take action
By communicating the impact that each delighted customer could have on your organization, even the most revenue-focused employee might start bending over backwards to create wow moments.
3. Demonstrate valuable product insights
There’s a reason that user testing is becoming a more and more valuable service to up-and-coming companies—there’s no one who is better positioned to tell you about where your product rocks and lacks than the people using it everyday. However, wouldn’t it be great if you could get real, in-depth customer feedback without having to pay for user testing? Further, wouldn’t it be excellent if getting that feedback and acting on it helped to keep the flywheel of customer loyalty flowing? Good news! It does.
90% of customers who feel high levels of trust and loyalty to a brand are significantly more likely to provide feedback in the form of numerical ratings on that brand, and 70% are willing to share detailed commentary (read: open-ended feedback) about their experiences. The important distinction here is that these loyal customers feel invested in your product and what you are offering—their insights will likely reflect both constructive and positive aspects of feedback and be detailed enough that you can either take action on them or respond. By taking the time to engage with customers about their product feedback, you create even more loyalty by making them feel seen and heard.
How to take action
Using direct insights to make your product better and increase loyalty is an excellent way to improve revenue drawn from both new and existing customers.
4. Boost monthly & annual recurring revenue
For SaaS companies, two related business metrics that are relevant and important across all departments are monthly recurring revenue (MRR) and annual recurring revenue (ARR). While we often talk in terms of CSAT, NPS and sometimes churn, MRR and ARR are just as heavily affected by having a customer-centric culture as they are by other efforts. In fact, customers that are loyal and continue to support your brand over time will spend 67% more than new customers you’ve just acquired.
Creating a customer-centric culture outside of your customer experience team is one of the best ways to make an impact on these hugely important metrics.
Similarly, outside of offering excellent experiences to customers, some companies even consider monetizing some forms of customer guidance, such as in-person or phone support, for an additional boost to revenue.
How to take action
When talking with teams outside of the ones that directly interface with customers, you can focus on the monetary benefits in both ARR and MRR that are boosted by having an excellent customer experience.
5. Help identify the perfect customers
Creating a customer-centric culture means that everyone within the company will be closer to customer needs and wants, and thus better able to advocate for and act on them when the time comes. Having your finger on the pulse and a more holistic view of every customer helps your organization to identify opportunities for growth as well as customer types that might not be the best fit.
Generating this knowledge allows internal teams such as marketing and sales to go after ideal-fit customers that, in the long run, will be more loyal and easier to retain. If you help these customers make the right choice for a product or service that will be the best fit for them, you’ll earn yourself a loyal non-customer who will advocate for your brand despite not moving forward with using it.
How to take action
Armed with this knowledge, build programs that directly connect decision-makers with customers. From all-hands support days to arranging customer interviews, anything that helps marketing teams do their job better will be an easy sell.
While it can feel really good to veer away from numbers in favor of speaking to customer benefits and happiness, there are some team members within your company that this just won’t resonate with. To ensure that everyone is on the same page and understands just how important, valuable and impactful your customers are, speak to metrics and numbers that make sense to the person you’re talking to.
Within an organization, people are likely to be motivated by numbers around continued monetary success of their role and the business—CAC, LTV, ARR—and, amazingly enough, customer experience teams that help to promote a customer-centric culture are one of the best levers you can pull to be profitable.
With the Kapiche platform, customer insights teams are finding success with the discovery-led approach. They aren’t spending weeks manually coding datasets with hundreds of thousands of pieces of feedback or waiting for vendors to update their code frames. They are getting time back time to understand the behavior drivers and reporting actionable insights across the business. And this is happening because their text analytics solution is doing all the heavy lifting for them.
Curious to see how it work with the Kapiche platform? See this demo video.