COVID-19 has caused more damage to businesses than anyone could have imagined. Sales, revenue, finances, cash flow, all have seen a sharp drop since the onset of the coronavirus, resulting in layoffs and other cost-cutting measures, including a reduction to customer experience (CX) budgets.
While those who already have demonstrated the fantastic value CX before COVID-19 hit will have little to fear, that tactic may be too late and not enough to avoid cutbacks in a sharply declining economy.
Ali Cudby, CEO of Your Iconic Brand and adjunct professor of entrepreneurship at Purdue University has shared his thoughts on what businesses can do with their CX with a reduced budget.
“The priority for customer experience is to focus on engagement,” he said. “When customers feel seen, heard and valued they’ll be more inclined toward retention. To boost engagement, develop a plan for personalized customer outreach. There’s an art to personalized outreach, and it’s easy to get wrong. At some point in your life, you’ve probably received a well-intentioned, but utterly impersonal, ‘personal’ note from a sales rep. Those do little to improve the relationship.”
Instead, Cudby advises businesses to take the time and effort to think and understand the customers better in order to provide them with a more honest and personalised experience. The messaging of a company need not be just about the brand, rather, focus it on the customer. When companies are stressed about hitting their numbers, it’s easy to have that message infuse the outreach. Understand the value that customers place into their relationship with the brand and use that knowledge to lean into the positive talking points.
“As you consider your mechanism for outreach, think about the value of digital vs. analog interaction,” Cudby added. “Picking up the phone to connect, not sell, is a powerful commitment to the customer relationship. Even for digital businesses, some analog points of connection can go a long way to cement the relationship.”
Unlike digital, it would be near impossible to reach out to every single customer via analog. However, it can prove to be an effective and personal way to keep connected with them. Businesses could at least try to do so with their best customers and prioritising outreach based on customer lifetime value.
Robert M. Hebeler, adjunct business professor at Rollins College and hospitality industry veteran is more concerned about trying to reduce cost while maintaining the same level of customer experience. According to him, what we know about the traditional customer experience may not survive the pandemic.
“Unfortunately, all of these cost reducing initiatives will further erode revenues by providing a customer experience that falls below customer expectations. Numerous customer experience research projects have found that when customers notice a reduction in quality, quantity and responsive service, they will not return nor recommend the company to friends and family,” Hebeler said.
In order to reduce costs without compromising the customer’s own experience with a brand, Hebeler has recommended a few options:
- Renegotiate vendor supply contracts. Ask for a 5 percent cost reduction, and in return offer a longer-term contract or an exclusive arrangement.
- Complete a “customer experience blueprint map” that illustrates the customer experience in three dimensions: on-stage with the customer; backstage supporting of customers and offsite stage supporting employees.
- Consider outsourcing services that are not core competencies to your business. Significant savings can be achieved by outsourcing cleaning, engineering, maintenance and personnel-related services such as payroll and recruiting.
Cost cutting is inevitable in today’s economic climate. To be fair, the budget for customer experience is not exempt from budget cuts. However, the delivery of compelling and memorable customer experiences need not be compromised even with said budget cuts. Business leadership must look both ahead and behind the scenes in order to ensure which costs can be reduced while ensuring profitability.