ROI Of: ROI of Customer Customer Experience Experience in 2021 in 2021
ROI Of: ROI of Customer Customer Experience Experience in 2021 in 2021
ROI Of: ROI of Customer Customer Experience Experience in 2021 in 2021
customer
experience
in 2021
How breakthrough customer
experiences are driving
loyalty and growth
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Table of 3 Summary
23 Maximizing CX ROI
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SUMMARY
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Summary The better the experience, the stronger the loyalty
It’s clear from our research that a good, or very good, customer experience can increase
loyalty, improve sales and revenue, and differentiate a brand from its competitors.
Brands that overlook the importance of customer experience also underestimate the
damage bad customer experience can cause. Our research found that just one bad
experience can have a negative impact on customer relationships and reduce future
sales by up to 14.7%.
CONSUMERS ARE:
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Overall, we found a strong connection between good customer experience and loyalty.
Based on customer satisfaction ratings (1-5 stars), it’s clear that the better the customer
experience, the more likely customers are to trust, advocate and purchase more.
CUSTOMER EXPERIENCE
A global view
In partnership with the Qualtrics XM Institute, we surveyed 17,509
consumers across 18 countries, exploring customer experiences across 17
industries. We investigated how satisfaction with an experience impacted
three loyalty metrics – trust, advocacy and likelihood to purchase more. We
analyzed the effect of poor, okay, good and very good CX to determine the
upside of a positive experience on businesses, and the dangers posed by
providing poor experiences.
Read on to dig deeper into these three loyalty metrics, how they vary by industry and how
your brand can leverage great customer experiences to drive sales and growth.
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It takes just one bad experience to impact revenue
Just as it’s clear that good customer experiences have enormous upside for businesses,
there are also threats to be wary of that come with a bad experience.
Our research shows that just one bad experience is enough to have a negative
impact on revenue.
9.5%
On average, organizations across all
17 industries risk losing 9.5% of their
revenue due to bad experiences.
The repercussions of bad experiences can be seen across every industry we surveyed.
On average, across all 18 countries and 17 industries, 18% of consumers reported
having a very poor experience recently with an organization in one of the industries
we asked about.
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Poor customer experiences impact the bottom line
Businesses risk losing on average 9.5% of their revenue, and up to 14.7% of their
revenue in some cases, by providing a poor customer experience. No matter the
service or product provided, all industries stand to lose when consumers aren’t
satisfied with their experiences.
Whether it be internet service and mobile phone providers, fast food or online retailers,
it’s never been easier to switch. Consumers that have a negative experience within
these industries are much more likely to decrease buying, or stop altogether. After all,
they can just go elsewhere.
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Internet Service Provider 14.7%
Airline 13.7%
INDUSTRY SNAPSHOT
Online Retailer 13.0%
Bank 8.6%
How customer
experience impacts trust
How customer Invest in building trust — the payoff is worth it
experience The more satisfied your consumers are, the more trust they place in you. We found that
impacts trust 89% of consumers were likely to trust an organization after a very good experience,
meaning it’s vital to provide excellent CX to win customers over.
21%
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TRUST: INDUSTRY VIEW
Airline customers are the most forgiving Airlines have the highest trust
ratings of consumers who didn’t have a good experience (30%). Given that 27%
of consumers we surveyed had a very poor recent experience with airlines – the
second highest industry result – airlines seem able to weather poor experiences
better than most.
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Mobile phone providers are at highest risk of losing customer trust
Only 15% of consumers are likely to trust mobile providers when they have a bad
experience. With 23% of consumers having a recent negative experience – the
fourth highest industry rate of very poor experiences – it’s clear that mobile phone
providers have their work cut out for them to build trust.
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Percentage of customers ‘somewhat likely’ or ‘very likely’ Lowest Trust Rate
to trust based on satisfaction rating Highest Trust Rate
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SECTION 2
experience Of all the loyalty factors measured, advocacy is the most strongly correlated to customer
impacts satisfaction (.55). The more satisfied consumers are with their experience, the more
advocacy likely they are to recommend your services or products to others. We found that 88% of
consumers were likely to recommend an organization after a very good experience.
17%
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ADVOCACY: INDUSTRY VIEW
Parcel delivery services are the most at risk after a poor experience
When consumers have a poor customer experience, they are the least likely
to recommend parcel delivery services. In contrast, consumers who have a
negative experience with fast food restaurants are still twice as likely (26%)
to recommend it.
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Percentage of customers ‘somewhat likely’ or ‘very likely’ Lowest Recommend Rate
to recommend based on satisfaction rating Highest Recommend Rate
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SECTION 3
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How customer Maximize the top line by doubling down on CX
experience When customers have had a good experience, they’re more likely to purchase more from
impacts that business in the future. In fact, we found that 85% of consumers were likely to purchase
3.5X
purchase more Consumers are 3.5x as likely to purchase
more after a 5-star satisfactory experience
than a 1- or 2-star experience.
When compared to trust and advocacy, CX seemingly has a lesser impact on likelihood
to purchase more. Businesses might think that this means they’ll be forgiven for a poor
experience and customers will return, but they would be wise to rethink that. Our research
shows that businesses risk losing on average 9.5% of their total sales, as more than half
of customers say they’re likely to decrease or stop spending with a brand after a bad
experience. Brands cannot afford to get complacent.
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IMPACT OF CX ON LIKELIHOOD TO PURCHASE MORE
24%
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PURCHASE MORE: INDUSTRY VIEW
Credit card providers have the most to lose from poor CX Consumers are
least likely to return to credit card providers (17%) after a poor experience, with
20% of consumers reporting a recent experience that was negative. We found
that 11.5% of credit card providers’ sales are at risk after a bad experience – with
customers seemingly more likely to cancel their card or switch provider.
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Percentage of customers ‘somewhat likely’ or ‘very likely’ Lowest Purchase More Rate
to purchase more based on satisfaction rating Highest Purchase More Rate
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SECTION 4
Maximizing
CX ROI
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Maximizing Where should you focus for maximum return on your customer experience?
CX ROI + Invest in the experience to grow your customer base Customer experience –
good and bad, has the greatest impact on advocacy. As previously mentioned,
the strong correlation between global satisfaction rates and recommendation rates
shows that advocacy is the most likely to be influenced by satisfaction when compared
to trust and purchasing more.
A poor experience will also see you slipping behind the competition. Consumers are
least likely to advocate for a brand after a poor experience, compared to trust (21%)
and purchasing more (24%).
+ Improve satisfaction to grow loyalty across the board Across all the countries and
industries we asked about, there was a strong correlation between the three loyalty
metrics of trust, advocacy and purchasing more. By focusing on customer satisfaction,
you can improve all three metrics, improving your chances of expanding your customer
base, getting repeat business and improving sales.
+ Be proactive – Standing still will cause you to fall behind Proactively
developing and maturing a CX program that improves experiences, not only
increases trust, advocacy and number of purchases, it also gives you that all
important competitive advantage.
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What’s How to improve the customer experience
Qualtrics XM Institute explains how you can begin to make customer experience
your competitive advantage:
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+ Focus on improvements, not measurements When companies obsess over a
metric rather than using the score to drive improvements, their progress improving
the experience can stall. To avoid that – and keep the focus on CX improvements
and resulting business outcomes – leaders should always ask two questions
whenever their team presents CX data: “What have we learned?” and “What
improvements are we making?”
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