The Ultimate Guide to Customer Experience

In this guide, you’ll learn what customer experience is, how you can measure it, and how your business can give your customers great experiences in every interaction.

Table of Contents

What is Customer Experience? Go here

Customer Experience and Customer Service Go here

Why is Customer Experience Important? Go here

What is a Great Customer Experience? Go here

What is a Bad Customer Experience? Go here

What is a Customer Experience Strategy? Go here

Developing a Customer Experience Strategy Go here

How Do You Measure Customer Experience? Go here

How to Improve Customer Experience Go here

How Kona Cleaners Improved NPS with BirdEye Go here

What is customer experience?

Customer experience is the relationship a customer has with your business from the moment of discovery.

That’s more than just getting your customer to buy your services. Customer experience means making your customers happy during each interaction with your business—from becoming aware of your services to using your services to coming back for more.

What is the Difference between Customer Experience and Customer Service?

People often confuse customer experience with customer service. While there are some similarities between these two concepts, they are not the same. Here’s the main difference: customer experience relates to everything in the customer’s journey from awareness to purchase decision. Customer service refers to specific parts of the customer journey where a customer requires your help - such as a refund or a service request.

While great customer service is part of a good customer experience, it’s only a small part. Customer experience means anticipating problems before your customer service team even hears about it. Let’s talk about how you can do that.

Why is customer experience important?

Customer experience drives revenue. When an existing customer is happy with your business, they’re more likely to come back for more. The better your customer experience, the less likely it is that customers will churn.

After all, it’s cheaper to engage an existing customer to come back then it is to find a new customer. Plus, a happy customer is more likely to spread the word about your business to family and friends.

Remember, customers care about the experiences of other customers. 92% of customers consult reviews before making a purchase decision. The better your customer experience, the more positive reviews you can expect. The more positive reviews you receive, the more revenue goes to your business.

While getting more referrals sounds like a no-brainer, building a strong customer experience can be difficult. Businesses need to have a strategy in place to ensure that customers experience the same level of service through all touch points in the customer journey.

What is Customer Experience Strategy?

Remember, customer experience is the relationship a customer has with your business from the moment of discovery. Customer experience strategy is how your business plans to make sure that you are meeting your customer’s needs across their entire journey.

The key to implementing a great customer experience is data. The more data you have about how your customers feel across their journey, the more you’ll be able to adapt your services to meet their needs.

Your business can capture data about the customer journey as your customers move from touchpoint to touchpoint. This data can be used across departments to provide a personalized experience to all of your customers.

For example, a data collected from a customer survey can be used to improve the customer journey. Let’s say that you find that your customers love your “friendly service” but hate your “long wait times”. This feedback can lead you to take steps in order to make your business operations run more smoothly and leave your customers more satisfied than ever.

What is a Great Customer Experience?

Trader Joe’s: the popular grocery chain delivers a whopping 69 positive customer experiences for every negative experience. In 2018, Trader Joe's was named the top retailer providing a high-quality customer experience, according to the Forrester Research. The study evaluates 287 brands in the United States across 19 industries to identify how well the brand’s customer experience strengthens the loyalty of its customers.

How does Trader Joe’s deliver such a great customer experience?

Put simply, they listen to their customers. Trader Joe’s puts customers first and reaps the rewards with $13.3 billion in annual revenue. Trader Joe’s doesn’t react to customer feedback, they are proactive about it.

Store managers (called "Captains") at Trader Joe’s spend most of their day on the retail floor and directly interact with customers, immediately altering the store and its products to local needs.

Crew members respond to customers in ways that encourage trust and emotional connection. When asked about a product, they instantly bring you the product, open it, and give you a taste test to make sure it is to your liking. Trader Joe’s also refunds your money for any product that you are not satisfied with.

They even design their stores around their customers. Every Trader Joe’s is around 15,000 square feet--roughly ⅓ of your typical grocery store, and that's on purpose. They design it this way so that you have both an expedient and pleasant grocery shopping experience. Each store is also decked out with murals of the city the store is located in, featuring landmarks of the town. This small detail helps customers build an emotional connection to the store.

Bottom line: Trader Joe’s leverages the value of customer experience. They figured out what they do really well (selling high-quality food at a low price) and change with their customers’ tastes at a place designed to make them feel at home.

How can a Small Business Deliver a Great Customer Experience?

If you’re a small business owner, chances are that you don’t have the same resources of Trader Joe’s. No matter the size of your business, you can start putting customers at the center of every interaction.

Remember, Trader Joe’s customer experience starts with understanding the customer. You don’t need to paint murals. But you do need to pay attention to the feedback that your customers are giving in surveys and reviews.

What is a Bad Customer Experience?

Now let’s talk about an example of a bad customer experience. The Yellow Cab Co-op filed for bankruptcy 2016. In 2018, it was sold to a rival company for far below its market value. Not only did they fail to adapt as the industry shifted to smartphones, they flat out provided a bad customer experience.

When a rider had a bad experience, it was extremely difficult to get in touch with the company. Especially in the cases of major collisions and injuries, which often resulted in multi-million dollar lawsuits. This set the stage for more customer-driven and convenient competitors, Uber and Lyft.

What makes Lyft a better customer experience than the Yellow Cab Co-Op?

Convenience: Smartphone technology helps riders find a cab and vice versa. Lyft has far shorter wait times because there’s a much greater chance that a Lyft is nearer to you than a taxi at any given moment.
Accountability: Lyft's review system lets riders and drivers rate each other after each ride, so there are rewards for a great experience and consequences for a bad one. If you have a terrible experience with a Yellow Cab, filing a complaint or trying to get a refund can be quite a hassle. With Lyft, all you have to do is 1) tap the Menu icon 2) tap Ride History 3) tap Get Help.
Rewards: Lyft riders earn points (Lyft Rewards) for every dollar they spend. Lyft points will get you upgrades and savings on future rides.
Customer-experience culture: Lyft’s customer-centric culture starts from the top down; executives regularly drive passengers so they can understand the experience from both a driver’s and passenger’s point of view. This shows other employees how important it is to stay close to the customers and understand their needs.

How Do You Measure Customer Experience?

Most companies measure their success by looking at their bottom line. For any company to be successful in the long-term, they’ll need to achieve solid financials.

The same concept applies to customer experience. The best way to measure customer experience success is to tap into its source: customers themselves. Here’s a few different metrics that you can use to gauge customer satisfaction.

Online reviews: The average rating from online review sites like Google and Facebook are a good indicator of how your customers feel about your business. To go the extra mile, read and respond to those reviews.

Net Promoter Score (NPS): This metric is based on the question “How likely are you to recommend us?” with a ranking of 0 to 10. You can send emails to your customers asking for feedback yourself, and there are also many online survey tools to make is easy for you.

Customers who answer 0-6 are considered Detractors and are likely to spread negative word-of-mouth.
Customers who left a 9-10 scores are Promoters, and are valuable brand advocates.
Those who rate 7-8 are Passives, and could easily become Detractors or Promoters depending on their next experience.
You calculate your NPS by subtracting the number of Detractors from the number of Promoters.

Social media engagement: Today, 80% of consumers use social media to engage with brands. All those posts, comments, likes, and shares on sites like Facebook, Twitter, and LinkedIn can tell you how engaged customers are with your business, but also helps businesses like yours engage with your customers.

Customer churn rate: This is the percentage of customers who don’t return or cancel their subscription. A good customer experience can help lower churn rate.

How to Improve Customer Experience

Remember, the key to a great customer experience is listening to your customers. Here’s a few of ways that you can listen and collect data on what your customers want.

Customer Experience Surveys

Of course, you don’t have to wait for a customer to post a review online to get feedback. Use surveys in order to collect data on what your customers want.

Net Promoter Score

Remember, one of the best ways to measure customer experience is with net promoter score. Again, a customer is asked how likely they would be to recommend a business to friends on a scale of 0-10, and are sorted into promoters, detractors, and passives.

Make sure that you’re sending emails to your customers where they can take an NPS survey. With just a few clicks, you have the data that you need to start improving your experience.

Positive, Negative, and Neutral

The fact is that not every one of your customers are going to want to take the time to go through an elaborate survey. Some of them might not even have the time to go through an NPS survey. Luckily, there’s a better way: customer experience templates. These are simple templates that look like this:

You send an email or text to your customer. To leave feedback, all they have to do is click one of the three buttons to indicate what kind of experience they had.

Online Reviews

Remember, there's a lot of customer feedback available on the Internet. Do a quick Google search for your business. Then answer these questions.

Is your business listed on multiple review sites like Google, Avvo, Zocdoc, Facebook, TripAdvisor, etc.?
Have you read all of these reviews?
Have you responded to all of these reviews?
Have you gleaned insights from what your customers are writing about your business—both the good and the bad—in order to improve your business?

If you want to provide an excellent customer experience, online reviews should be a huge part of that strategy. How?

Make your customer feel special. Show your customer that they are more than a [First Name] with personable, in-the-moment engagement across all channels. Reply to all reviews—whether you are thanking your customer for the wonderful review or addressing complaints in a 1-star review. Use humor, share photos—anything that helps your customer get to know you.

Customer Experience That Grows Your Business

Resolve all customers’ issues by going above and beyond. A bad review does not have the be the end of your relationship with the customer. Start with responding to the feedback in a creative way then win your customer back by proving your devotion with amazing customer service. If you’re able to resolve the issue rapidly, even your disgruntled customer can end up being a loyal one.

Listening to and engaging with your customers also helps you find the services that are and aren’t working. Your online customer reviews provide the data and insights that can help you to decide to do the following with your services.

Reduce. Since these services are not valuable to your customer, you can cut back on them, saving you resources that can be spent on what is important to your customer
Raise. Get even better at the things your customers already love.
Create. Offer new services that are important to your customers can disrupt your competition while giving your customers what they really want.

Developing a Customer Experience Strategy

Let’s talk about what you can start doing today to build a customer experience strategy.

Ask for feedback. If reviews aren’t giving you enough insights into how to improve your customer experience, you can always just ask the customers for feedback yourself within one to two days of seeing them.

Listen to what your customers are saying about your business across all channels. Monitoring and managing your online reviews will definitely make a dent in your customer experience initiatives. Spotting trends over a period of time is the next step to knowing what changes to make in order to make your customers happy. Looking at month-to-month trends is a great place to start.

Example 1: You receive a 1-star Google review. It states, “Delicious meal. Lovely waitress. But the chicken was undercooked.” As a result, you respond to the customer review by not only apologizing, but also giving them a free appetizer and perhaps a bottle of wine on their next visit. This is review management.
Example 2: A month goes by, and you see a trend developing of complaints on Facebook about the food only on days a specific chef is working. With this knowledge, you can go to that chef and make him aware of the problem. This is social listening.

Use what you learn from these reviews and feedback.

Show your customers that you are by making changes to improve negative experiences, and replicate positive experiences. This doesn’t mean you have to completely overhaul your business model. Sometimes it’s the little things that count.

Here’s an example : You’re a dentist. You read reviews that consistently mention how much your patients love that they can watch Netflix while getting a root canal, but they’d love to be able to watch Hulu too. Now all you have to do is download Hulu and your patients are delighted. Not only because they can now catch up on “The Mindy Project” in the dental chair, but also because you listened to them. You have a patient for life now. How easy was that?

Improving Customer Experience with NPS

Kona Cleaners is a Hawaii-based dry-cleaner business. Net Promoter Score helped Kona Cleaners improve customer experience.

With BirdEye, Kona Cleaners was able to track fluctuations in Net Promoter Score on a week-by-week basis. The feedback was easy for customers to submit. All they had to was click a button asking how likely they were to recommend the business on a scale of 0-10.

By tracking Net Promoter Score, Kona Cleaners could see how good of a job it was doing satisfying customers on different parts of the customer journey. With BirdEye, the business could see Net Promoter Score across different locations. With this insight, Kona Cleaners was able to go to each individual location and make improvements where needed. Kona Cleaner’s NPS started at an already phenomenal 85. Since using BirdEye, Kona Cleaners’ Net Promoter Score has only gone up and up.

How BirdEye Can Help

Collecting and analyzing customer feedback is not easy. With a customer experience software like BirdEye, every business can take the steps to start developing a 5-star customer experience.

1. A review management tool like BirdEye can help you because we aggregate all your reviews from 150+ sites into one place. You can monitor and manage reviews from sites like Google and Facebook on one comprehensive dashboard.

2. If a bad review does get posted, we’ve got your back. BirdEye’s review monitoring tool informs you with email and text alerts so you convert that bad review into a service ticket. Don’t miss out on an opportunity to turn an unhappy customer’s issue into a victory with a swift response.

3. No time to ask for feedback? BirdEye’s surveys are an awesome way to effortlessly connect with your customers. They also help you engage at the right time, on the right channel. BirdEye allows you to send fully customizable surveys that allow you to collect feedback from your customers.

4. Want a better understanding of what products and services your customers and prospects value? A business insights tool like BirdEye can dig deep into customer feedback to reveal positive and negative themes emerging within your market.

5. Our social listening tool also lets you track your customers’ social conversations across 300M+ websites, blogs, forums, and social media networks like Facebook, Twitter, and YouTube. With all of these actionable insights at your disposal, you are set up for success.

6. Remember how difficult it was for Yellow Cab’s customers to get in touch with their support and/or get a refund after a bad experience? Remember how easy it was for Lyft’s customers? BirdEye’s Webchat helps you respond to you customers and prospects faster by converting every incoming chat from your business’s website into a text message. This way you can immediately reply on-the-go, right from your phone.

Try BirdEye, the #1 Customer Experience Software

More than 50,000 businesses use customers to keep track of the customer’s voice. With review monitoring, surveys, and insights, BirdEye gives you the tools to listen every time a customer talks. Watch a free demo to see what BirdEye can do for you.

Improve Customer Experience with BirdEye

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