In the increasingly jargoned world of business services and software solutions, the concepts “customer experience” (CX) and “customer engagement” are often conflated and confused.
As the CEO of a customer experience management (CXM) company, I frequently encounter this confusion from customers. It’s understandable, given the rise in importance of both customer experience and customer engagement. As companies move deeper into their digital transformation, customer-centricity becomes the name of the game. It’s important to understand the difference between customer experience and customer engagement, the distinct roles they each play, and where your focus needs to be to align with your business goals and strategy.
An important distinction
Customer experience and customer engagement operate as a duo, but are, in fact, two distinct practices that are informed by different perspectives. The simplest way to think about this is that customer experience is about the customer’s point-of-view and their first-hand experience of your company. Customer engagement is how your company interacts with those customers.
Because we’re naturally predisposed to think from the side of our companies, we tend to start there. We spend countless resources on determining who we are as a brand, how we sound, and how we act. We make that first impression or initial engagement based on these determinations, and adjust based on how the customer responds.
I believe this is something that needs to change. Customer experience must precede customer engagement because the former should dictate almost everything about the latter. The highest quality engagement can only achieve so much if the customer comes to the table already having had a bad experience, particularly if the engagement is not taking that experience into account.
Customer experience is hard
Both customer experience and engagement need to be ongoing strategic priorities that span across an organization, from sales and marketing to product development and even R&D.
While CX and engagement are often partners in a well-choreographed dance, customer experience must take the lead. If a customer’s first experience with a brand is subpar, there is often no chance to save the relationship through engagement. CX also tends to have a lot of up-front pain points because initial interactions tend to happen before companies have the kind of data about a customer that can be leveraged to optimize their experience.
With the explosion of potential customer touchpoints, customer experience has only gotten more complicated and more difficult. Customers may see an ad or commercial, engage through a website, or – as is increasingly the case – they may be first exposed to your brand through an experience intermediated by an ecosystem partner.
If your company is selling through a marketplace like Amazon, eBay, or WalMart, the customer’s experience of your brand is inextricably linked to their experience of those brands as well. This is a more obvious example, of course, but as ecosystems expand — particularly for service providers — the distinction between your brand and your partners’ brands is not nearly as clear and obvious to most customers. This lack of clarity presents a major challenge in controlling the brand experience.
Banking and finance are excellent examples of how the increasingly fragmented customer journey can present a number of pitfalls for customer experience. If a business owner signs up for a pay-at-table card reader offered through their financial institution that integrates into their PoS system and it stops working, they might tie that bad experience to all the brands involved, no matter where the problem is coming from.
Bringing it all together
The good news is that there’s a huge upside to nailing CX. When a user has an excellent experience with your company, it opens up opportunities to engage with them further. Each positive experience generates more data and valuable insights into how you can best serve customers, and – if you’re really lucky – it teaches you how you can serve other customers like them. Well-executed CX can build customer affinity and loyalty more than any single sales or marketing strategy.
I’ve seen – time and again – how a concerted focus on CX can result in real business outcomes, including increased lead generation and double digit improvements to retention and NPS scores.
The most important thing to note about customer experience is that it must be considered from the very, very beginning — before your brand even enters the picture. What events lead up to the customer’s journey with your brand? Which parts of that experience can you control or influence, and how much leverage do you have? How can your brand stand out when it’s ‘bundled’ with other brands in any given experience? Finally, how can you ensure that your customers’ experience with your partners is as valuable and rewarding as possible?
None of these questions are easy to answer. They’re all complicated elements of modern CX, and it’s why it’s imperative to consider them early and often.
It’s never been easier to reach out and engage with customers, but it’s also never been more difficult to ensure that they have exceptional customer experiences. So next time you’re thinking about customer engagement, remember your solution for customer experience must come first.