It is the Service Stupid | How One Company Increased Revenue by Millions of Dollars Per Month by Improving Customer Experience
4 Quick Tips to Help you Make Price Irrelevant
1. It is the Service Stupid
A small number of companies have now redefined what customers expect from brands. In short, the most successful companies in the world are not characterized by the best products in the world, but by redefining our expectations. Let’s face it, most products and services today are of similar quality. The differentiator of products and their functionalities no longer play a role in the customer’s purchase decision.
Why do companies like Apple, American Express, Tesla, Chick-fil-A, Starbucks, Amazon, Southwest, and Zappos always outperform the rest of their industry regardless of the economy? It is the service stupid!
In a time of uncertainty, there are only 3 certainties in life:
- And Customer Experience
An economic fallout is always the best advertisement for the competitive advantage outstanding customer service companies have over the rest of their industry. After 25 years in the customer experience consulting business, it still shocks me at how many leaders don’t get it; how many don’t see the correlation between customer service and a company’s success. It is the service stupid!
Most CEO’s fast-talk a commitment to customer experience but slow-walk execution
As an economic downturn has put increased pressure on most businesses, study after study shows the irrefutable evidence that companies with superior customer service can weather hard times. McKinsey research has shown that in past recessions, companies that invest in and deliver superior customer experience during a downturn emerge far stronger than their peers once the economy rebounds, producing shareholder returns three times larger than average.
A company’s customer experience plays a major role in how effectively it can weather a recession. No better point can be made than the following graph from Watermark Consulting’s Customer Experience (CX) ROI Study.
The study analyzes the stock market performance of the top-rated companies in customer experience versus the bottom-rated during the period of the last U.S. recession, 2007-2009. The worst CX companies had a negative 57% ROI; many of them didn’t survive. The stock market struggled at a negative 16% while the best CX companies posted a positive 6%.
“The companies that don’t invest in customer experience are the ones that their
leaders don’t understand the financial impact CX can have.”
You must know what victory looks like
In order to know what victory looks like, you must have a ROX (Return on eXperience) dashboard. The ROX dashboard should have 3-4 Key Performance Indicators that are directly tied to the level of customer experience delivered from every customer facing employee & department, such as:
- Increasing customer retention/resign rates
- Increasing referrals & word of mouth
- Increasing average customer lifetime value
- Improving 1st time call resolution
- Reducing customer complaints, which also reduces call volume
- Reducing advertising expense
When you have KPI’s like that, even your CFO gets on board with improving your customer experience. A ROX Dashboard holds everyone in the company accountable.
Do you have a ROX Dashboard?
2. How One Company Increased Revenue by Millions of Dollars Per Month by Improving Customer Experience
NewDay USA is a mortgage company serving veterans. Their biggest issue was 15% of their Veterans (potential customers) who were already approved, were opting out before their loan closing each month. They called this VOO – Veterans Opting Out. Every 1% of VOO was costing NewDay USA over $400,000 in revenue per month. Obviously, a huge problem.
After finding out the primary cause for VOO to happen was a lack of consistent weekly communication and updates, we helped NewDay USA create systems that ensured every veteran was communicated with at least once a week, keeping them engaged, providing certainty and a reduction in anxiety.
NewDay USA’s monthly VOO percentage went from 15% to 8% in a few months. That reduction of 7% meant an increase in over $2 million dollars in revenue each month with no additional expense for advertising & marketing.
Now I ask you, is customer experience training an expense or an investment?
3. The Future of CX is Looking Bright
Congratulations to the Customer eXperience Executive Academy (CXEA) Class of 2020. This amazing group flew from all over the world to Cleveland to attend quarter 1 of the 2020 CXE Academy. Then the pandemic hit, and the remaining th
ree quarters were virtual. That did not stop this group’s commitment to becoming the next generation of CX superstars, bonding together, and having a lot of fun in the process. We would like to congratulate the newest members of Certified Customer eXperience Executives:
Christian Adler from Adlercorp, Jen Atkinson from MCRM Fertility, Pooja Bansal from NewDay USA, Alan Beech from Beech Consulting, Andrew Colombo from NewDay USA, Jenn LaPlant Freitas from CBC Federal Credit Union, Geneva Gross from Call One, Nicole Jones from Jayman Built, Jesse James LaFauci from NewDay USA, Alec Lasalle from NewDay USA, Geri Morgan from SentriLock, Brandon Mendoza from McDonald’s, Cail Morrison from Stronger U Nutrition, Jennifer Neitzel from McDonald’s, Amanda Phillips from Coit Cleaning and Restoration Services, Lindsey Pitsch from Voicebrook, Caitlin Robertson from William Mattar Law Firm, Lauren Sparks from NewDay USA, Destinee Stice from NewDay USA, Anita Toflinski, from Avient Corporation, Ryan Voight from Drake & Associates, Shannon Wilson from NewDay USA, Courtland Womble from NewDay USA, Sarah Bucher from Citizen Advisory Group, and Annette Vega-Young CBC Federal Credit Union.
4. What is the Difference Between CXEA and CX Coaching?
We get asked this a lot and understand it can be confusing. The CXEA (Customer eXperience Executive Academy) is a twelve-month, part time course, for leaders who want to become their organization’s Chief Xperience Officer (CXO). It is like a master’s degree in Customer Experience. CX Coaching on the other hand, is for entrepreneurs who want to grow their own coaching business by becoming licensed by The DiJulius Group and coach other businesses on our proven methodology.