Create an Experience Strategy That Drives Brand Loyalty
Are you investing enough into your most valuable audience?
Brands spend a lot of time and capital devising strategies to reach new customers. But it’s 5 to 25 times more cost-effective to retain existing customers than to acquire new ones.
One of the best growth strategies is simply keeping existing customers happy. Great customer service and targeted marketing is a start.
But this conversation is more accurately about customer experience.
The connection between customer experience and loyalty
What’s the relationship between customer experience and loyalty?
People don’t want to continue purchasing from brands that:
- Consistently get orders wrong.
- Are always 30 minutes late for appointments.
- Don’t listen to their customers when they tell them what they want.
Customers stay loyal to brands that listen, keep improving and consistently deliver a positive experience.
Experience sets your brand apart
Moreover, experience is a differentiator.
It can be hard to compete with brands that offer a more affordable solution (or one that’s better in some ways). But if your brand provides the best experience, you retain the people who may have switched to another solution.
This is still true when your solution is more expensive. Studies show that people are willing to pay more for a better experience.
Related: Why do people switch brands? Explore the factors at play in consumer decision-making.
The delivery gap in customer experience
Experience is clearly important to consumers. But most of them don’t think brands are doing enough in this department.
A report released by Bain & Company in 2005 highlighted what’s referred to as the “delivery gap”:
When surveyed, 80% of leaders believed their brands provided a “superior experience.” However, only 8% of customers felt that most brands actually did.
But that was a long time ago. Surely the gap has closed by now, right?
Slightly, but not enough. Stellar Element’s 2023 report, Hidden in Plain Sight: 20 Global CX Blindspots Uncovered, tells a similar story. The graph below shows the gap between customer and business leader perceptions, broken up by industry.
Close the gap: How to create a customer experience strategy that drives loyalty
In this gap lies opportunity. Outperforming other brands on experience doesn’t need to be difficult. Many brands fail to meet consumers’ basic expectations in the first place.
When rethinking your customer experience, take a multifaceted approach:
- Ensure you’re meeting customer expectations.
- Ensure your experience lives up to how it’s marketed.
- Find and improve the negative moments.
- Understand and enhance the positive moments.
1. Understand customer expectations
Brands like Amazon and Domino’s are raising the bar of customer expectations. Amazon can deliver almost anything to your door overnight. Domino’s notifies you the exact moment your pizza is coming out of the oven.
This draws attention to experiences that aren’t as great. When people have to drive to the pharmacy for prescriptions each month — or wait weeks for blood test results with no update — they might wonder, “If a pizza company can figure it out, why can’t this health system?”
When upgrading your experiences, don’t just look within your market. Draw inspiration from experiences in other industries.
2. Align marketing and customer experience
Customers desire authenticity. That means your experience has to live up to how it’s marketed.
Here’s how to create that alignment between customer experience and marketing:
- Learn where your experience is truly differentiated, and be honest about where it’s falling short.
- Understand the expectations your current messaging sets.
- Adjust your messaging to more authentically represent your experiences.
3. Identify and resolve points of friction
Friction points are the pain points in your experiences. They make it harder for people to achieve what they’re looking to get done with your brand. And they make customers less likely to purchase again.
Speak with consumers to identify your brand’s areas of friction. (They’re often the moments that evoke negative emotions, like frustration, fear or anxiety.)
Then take a collaborative, human-centered approach to resolve these pain points alongside the people who experience them.
4. Find and amplify the positive moments
The positive moments within your experiences also influence customer loyalty. You might already know where some of these defining moments exist in the customer journey. But others may surprise you.
Speak with customers about the highlights of their experiences with your brand. They’re often accompanied by positive emotions, like relief, joy or contentment. Uncover these moments, look for themes and seek to replicate or enhance them.
Tools for improving customer experience and retention
In experience design, the best tool is an open mind. Come in with the intention of uncovering what you don’t know about your customers and the journey they take with your brand.
With your mindset in the right place, apply these tactics:
- Jobs-to-be-Done research: People “hire” your product or service with the goal of getting a job done. Learn more about the Jobs-to-be-Done framework (and how McDonald’s used it).
- Journey mapping: Understand the experiences your brand provides, including friction points and the positive defining moments. (Take a human-centered approach by involving customers and employees in the journey mapping process.)
- Design thinking: Follow a structured framework for problem-solving that includes rapid ideation, prototyping and testing. Learn more about the steps of design thinking.
Capitalize on customer experience
Join the small percentage of brands that deliver on consumer expectations to drive loyalty.
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