Customer experience improvements can translate into revenue growth for companies, with auto manufacturers, hotels, wireless service providers, and big box retailers netting the biggest sales gains, according to Forrester Research.
Forrester Research has been pushing its Customer Experience Index (CX Index) as a way to measure and quantify things like loyalty, quality of service, and sales. Qualitatively it's obvious that customer experience drives sales, but quantifying CX to get projects approved is another matter entirely.
To better quantify CX, Forrester modeled improvements and tried to value a customer's loyalty based on revenue. The research firm looked at advocacy loyalty, retention, and the quality of CX. Forrester examined the largest brands in the CX Index in each industry. The CX battle is only going to intensify.
Much of Forrester's take revolves around incremental purchases driven by loyalty and retention, not necessarily landing new customers. Here's the money graphic that calculates per customer revenue upside for a brand that boosts its CX Index score by 1 point, and then Forrester multiplied that revenue gain by the number of customers.
There are a number of caveats, but the Forrester Research report may serve as a starting point to justify more CX improvement projects. You'd think customer experience would be the cost of admission to compete in an industry. But, as any consumer will tell you, there is plenty of room for improvements across all industries.