Do You Know The $-Value Of Improving CX?
We just updated our calculations for how much business growth you can expect from improving CX. We did this for the 14 industries we cover in our Customer Experience Index (CX Index™) survey. For all the details, you can check out our new report, “How Customer Experience Drives Business Growth, 2020.” But for now, here’s a …
Sneak Peek Into The Results
- Benefits of improving CX can be massive. For mass-market auto manufacturers, improving CX by 1 point can lead to more than $1B in additional revenue.
- Benefits of improving CX increase exponentially when going from “good” to “excellent” for many industries. CX pros in firms where this relationship holds true are better off trying to make their already happy customers even happier instead of focusing on making their unhappy customers less unhappy.
- The effect of recommendations on the business upside of CX is small. For each of the industries in our analysis, acquiring new customers via recommendations accounts for less than 7% of the overall business benefit from improved CX.
Three Steps For Calculating The Impact Of Improving CX
Here are the steps we took to arrive at our findings. You can apply them to your company:
- Calculate the business impact of each customer’s loyalty. Our CX Index survey measures CX and customer loyalty — including intentions to stay, buy more, and recommend. We supplement this data with data from other CX Index survey questions, like data about the customer’s purchasing behavior. We also consider information from other Forrester studies and secondary research. We then calculate the business impact of each customer’s loyalty, depending on how companies in various industries make money.
- Build industry-specific models that show how CX drives growth. We then build models that describe how CX drives business growth across a range of CX Index scores.
- Apply the models to calculate the upside of improving CX by 1 point. Using the insights from the model, we predict what the impact of improving the industry’s CX Index score by 1 point would be. We then multiply that per-customer upside by the average number of customers a big brand in the industry typically has.
Check Out More Resources On Making The Case For CX At Your Firm
- Capturing The ROI Of CX: a complimentary step-by-step guide and ROI calculator
- How To Prove The ROI Of CX (Video): a video that demonstrates how a solid CX business case leads to meaningful and measurable business results
- CX Leaders: Get Funding Or Get Fired!: a report that can help CX pros create a business case that will resonate with executives — even those who have previously passed on CX because they see it only as a “nice to have”
- The Top 14 Hacks For Your CX Business Case: a report that lists and describes 14 tactics that galvanize decision-makers into action and that help CX professionals overcome common hurdles when gathering and analyzing data to link CX improvements to business results
Thank you for your major contributions to this research, James Williams, Niraj Patel, and Michelle Yaiser!