Customer experience as a driver for e-commerce growth
E-commerce continues to steadily increase its share of retail sales. McKinsey says:
The unprecedented increase in online retail spending in 2020 is due to the lockdown effects of the COVID-19 pandemic. Regardless, the share of e-commerce is increasing in all merchandise categories. Consumers are increasingly opting for omnichannel shopping.
The increasing relevance of the customer experience positively influences this growth. Customer service is a key principle for the customer experience. Customer Experience Management" combines best practices and methods for the continuous improvement of the customer experience, also in CRM.
What is the customer experience?
What role does customer service (customer care) play in a customer experience?
What are the success factors for customer experience management by and with Customer Care?
Relationship between profitability in e-commerce and excellence in customer experience management
Profitability in e-commerce depends directly on the customer experience. Many e-commerce businesses are not profitable. The key to profitability lies in returning regular customers. These are defined as Active Customer with >= 1 purchase in the last 12 months. Customer Experience Management as a craft is driver.
A study by Ipsos reveals: > 50 percent of e-commerce decision-makers see investment in digital customer experience and omnichannel commerce as top priorities for 2022. A Salesforce study recognizes: For 80% of customers, the customer service experience is just as crucial as the product or service. The survey from CRM platform Zendesk found that 50% of customers switch to another brand after a bad experience. A full 80% leave a brand permanently after two bad experiences.
Customer experience is critical to the success of any e-commerce business and product.
What is customer experience management and why is customer experience driving growth in
e-commerce?
Customer experience (CX) describes the sum of all experiences a customer has with a company. This includes the brand experience as well as the experiences customers have with all touchpoints and channels. Many CEOs and marketing executives consider customer experience a top agenda item. Companies that get it right are rewarding themselves financially. Customer experience management is a challenge for companies.
Companies with a high level of maturity in customer experience management grow 4-8% faster in terms of revenue than other companies. This was the conclusion Bain & Company in a study. Since the beginning, Zalando has focused on a strong convenience proposition in logistics, returns and customer care.
Well-known DTC startups, like Warby Parker, grew through ad spend at a time when that made sense. Instead, the next generation of e-commerce leaders is growing more through a world-class customer experience. They focus on customer loyalty, upselling, and referrals.
Customer Experience Management recommends best practices from competitors and use cases. At the same time, CX management brings together a bouquet of methods to optimize the customer experience along the journey and touchpoints.
What is Customer Care and how does it benefit your e-commerce business?
The term "Customer Care" means customer service in German, mistakenly equated only with the "call center". This department has a much greater significance: Customer Care encompasses all tasks to achieve a high level of customer satisfaction. Customer Care is not limited to service before and during the purchase. It also includes customer service after the purchase. A Customer Care Concept ensures customer-centric and at the same time economical processes in customer care.
Since we started 2019, we've been on the Beyond ecommerce journey: The Team and I have been spending our days with ecommerce merchants like you. To figure out how we can best help you on your entrepreneurial journey to success. So far, we've done that by helping you create an exceptional customer experience. With a special focus on operational excellence in logistics, payment and customer care.
Along the way, we realize that measures such as omnichannel contact management, 360-degree customer view are means to an end: more sales through returning regular customers. We would like to share our knowledge a bit in this article.
How do e-commerce companies better serve customers and improve the overall customer experience to drive growth?
Excellent customer care is important for any business, but it's especially important for an online store. Customers who have had a positive experience with your company in the customer journey are more likely to come back and recommend your products or services.
There are principles that e-commerce companies follow to improve the customer experience and customer care:
Put the customer first: put the needs of your customers above all else. That means putting yourself in their shoes, what they want and need from your business.
Be responsive: Customers today expect companies to be responsive to their inquiries and concerns. A modern customer service team is available on weekdays including Saturdays, even in the evening hours.
Be proactive: Companies should not only react quickly, but also proactively respond to potential problems before they arise. Current examples are supply chain and delivery issues. It's all about providing actionable information to the customer. Duly informed, many customers demonstrate patience and understanding. Screening social media channels for negative sentiment optimally supports these efforts.
Tips on how to set up a customer experience management system in your own e-commerce business
Virtually every D2C brand would agree that customer experience (CX) is a top priority.
We all want:
inspire our customers,
offer them a smooth shopping experience and
leave a positive impression on them.
Customer Care makes the difference between a customer who comes back and one who looks elsewhere.
Too often, CX is an abstract ideal model that is discussed but not implemented. CX advice is too vague to be actionable.
Three barriers to online purchasing that a superior customer experience breaks down
Practical experience, supplemented by evidence from studies, identifies relevant barriers to online purchasing. A superior customer experience helps to overcome these for the customer. Sales increase!
Fulfillment: Customers want delivery and pickup options with traceable, clear costs
In many e-commerce sectors, fast and free delivery is the norm. Customers pay close attention to shipping costs and factor them into pricing. They want to be able to weigh the tradeoffs between delivery speed and price. This desire for transparency is an opportunity for brands to build an emotional connection with customers. Consumers don't like to be surprised by shipping costs.
Returns management: customers are concerned about the effort involved in returning items purchased online
One of the best ways to ensure a user experience for online shoppers is to exceed expectations. The return process is a great opportunity to do this. Cleanly informing your customers about your return and refund policies leads to more online purchases. You can build emotional connections through transparency. Plus, an understandable return policy saves unnecessary customer service inquiries.
Customer Care: Customers want a competent contact person if something goes wrong with a purchase. Then they want their problem to be solved directly at the first contact.
This is where the Customer Care Concept comes into play, based on the following pillars:
Omnichannel contact management
Continuous process improvement
Competence levels
First, make sure you have the right team in place for Customer Care. This team responds to customer inquiries and complaints in a timely and professional manner. It proactively identifies issues and takes action to resolve them before they become problems.
Communication via multiple channels is becoming more important for companies. Customers want to be able to contact companies in different ways: Companies should offer multiple channels. This includes both online and offline channels, such as telephone, e-mail and chat.
The best way to achieve a good customer experience is to categorize customer inquiries by skill level. In this way, the system quickly assigns concerns from simple to complex questions to categories. The more complex the question, the more skill is required on the part of the employee. By matching the categorized complexity of the request with the available employee skills, efficient routing of the request is possible (so-called skill-based routing). This measure enables modern customer care to combine both dimensions of lean management: the fact that more inquiries can be processed in a given amount of time (= increase in throughput) increases customer satisfaction with the customer experience. At the same time, the efficiency of the overall system is increased and can be operated economically. This is customer experience management at its best!
Established methods such as lean management help to achieve the goal of operational excellence with a philosophy of small steps.
Last but not least, take the time to train your employees in these procedures. Only then will they be able to handle customer inquiries and complaints with confidence. With these tips, you can create a self-reinforcing customer care system that contributes to an outstanding customer experience.