How CX Excellence Can Help Build Brand Loyalty

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CCW Europe Digital
03/18/2024

It used to take more than a one-off bad experience for a customer to abandon a brand. But now? Now customers are prepared to walk away after experiencing even the slightest inconvenience. A malfunctioning chatbot, an unanswered customer email, a poor onboarding – that’s all it takes.

But even if the brand loyalty landscape has changed – it hasn’t disappeared forever. It just requires a new approach. And businesses in tune with the needs of their customer base have started to find that investing in a better customer experience (CX) is the trick. In fact, a recent CCW Europe report, The State of Customer Management in 2024, uncovered that 67% of customer management leaders are increasing their CX budget, with 63% saying improving CX strategy is “high” or “very high” on their C-suites list of priorities for 2024.

The reason CX is in the spotlight? Because adopting best-in-class CX principles can empower brands to sow the seeds of brand loyalty, which if nurtured correctly, can grow into long-term business success.

The changing landscape of brand loyalty

Let’s rewind a bit. What has changed when it comes to brand loyalty?

Well for starters, buyers have more choice than ever and can pick, choose, and change the brand they go with as they see fit. Of course there are exceptions. Phone choices are relatively small, for example, and brand inertia with companies like Coca-Cola or Pepsi is certainly a thing. It’s the same when you need a new pair of trainers – rarely will you trial a new brand if you already have one you like.

But for most brands and industries, customers aren’t feeling as loyal as they once were. Businesses and individual consumers are also more cautious with their money. Lingering economic uncertainty and continued cost of living pressures are affecting the discretionary spending power of many, while businesses are increasingly under pressure to do more with less. That means both B2B and B2C brands need to be very intentional about attracting, and then retaining, their customers.

Merkle’s 2024 Loyalty Barometer Report shows that customer service and a consistent CX are two of the most crucial aspects of B2C loyalty. And unlike certain factors, including the impact of mobile apps and corporate values which are more important among younger demographics, customer service and a consistent CX remain of almost equal importance for all generations. Over in the B2B ecosystem, customer loyalty is driven by delivering not only an exceptional product but an exceptional experience. Build brand loyalty, and your customers turn into advocates who not only use your services but recommend them to others. And that’s crucial. Research shows that 60% of B2B buyers rely on independent, third-party reviews and referrals over the corporate content found on company websites.

What’s clear, then, is that for both B2C and B2B brands, it’s time to move towards CX excellence or risk getting left behind.

5 strategies to help deliver CX excellence

Achieving CX excellence is a tough task. Case in point? After just one negative interaction with a chatbot, 30% of consumers will walk away. But get it right and 61% of consumers will make a repeat purchase or recommend your brand to others.

Indeed, one of the most efficient ways to improve your CX – and in turn boost brand loyalty – is through the intelligent use of digital architecture. Enabling better CX through technology is a top priority for 40% of CX teams right now owing to the way it can help place the customer at the centre of everything your brand does. And by creating experiences around them – rather than expecting them to adapt to your existing processes – doesn’t have to be difficult.

Here are five strategies to do that:

1. Harnessing the power of AI

Artificial intelligence (AI) has changed the CX landscape. Companies that leverage its power – in the right way – can gain an advantage over their competitors. Natural language processing tools like ChatGPT can be used to create chatbots that offer almost instant answers to customer queries, provide personalised experiences, and anticipate their needs faster than humans.

Companies need to tread carefully when it comes to AI, though, and they must rely on human oversight if they’re to avoid expensive AI hallucinations. It’s a lesson Air Canada learned the hard way after its AI chatbot told a customer they were entitled to a refund when they weren’t. The controversy ended up in small claims court where Air Canada had to pay the customer damages and court fees.

The use of AI doesn’t just stop at chatbots. It can also be trained on contact centre transcripts. Imagine pulling out insights, uncovering marketing improvements, analysing customer sentiment, summarising conversations, and carrying out customer profiling in mere seconds. With AI, it’s possible. Other benefits of integrating AI into your CX strategy include improved efficiency, reduced operational costs, increased agent productivity, and improved customer insights.

Crucially, AI can also free up your CX team to focus on the kind of value-add services that help boost loyalty.

2. Adopting an omnichannel 2.0 model

Many companies have adopted an omnichannel model, making it easier for their customers to interact across different platforms.

But for true CX excellence, this isn’t enough anymore.

Rather than just ensuring availability across multiple channels, brands need to get intentional about their communications. And that means it’s time to move towards omnichannel 2.0. This adds even more personalisation across all channels, offering a fully comprehensive CX that troubleshoots and resolves any friction points. But this strategy also needs to consider how to integrate customers who rely on traditional channels over digital channels.

Key features of Omnichannel 2.0 include:

Advanced Data Analytics and AI: Utilising big data, AI, and machine learning to analyse customer behaviour across all touchpoints in real-time, enabling more personalised and predictive customer engagement.
Integrated Customer Experience: Beyond seamless experiences across channels, it focuses on harmonising these channels so that they work together more effectively, sharing data and insights to improve the overall customer experience.
Personalisation at Scale: Leveraging data insights to deliver highly personalised content, recommendations, and services to each customer, at scale, making each interaction as relevant and engaging as possible.
Real-time Engagement: Employing real-time analytics and communication tools, such as messaging platforms, to engage with customers at the right moment, enhancing customer satisfaction and loyalty.
Enhanced Customer Journey Mapping: Using advanced tools to create more detailed and dynamic customer journey maps, allowing businesses to anticipate needs and intervene positively at every stage of the customer lifecycle.
IoT and Smart Devices Integration: Incorporating Internet of Things (IoT) technologies and smart devices to gather more data and insights, and to engage customers in innovative ways (e.g., smart home devices, wearables).
Cross-Functional Collaboration: Breaking down silos within organisations to ensure that all departments (marketing, sales, customer service, IT) work together seamlessly, driven by a unified view of the customer.

CCW Europe found that even though most brands engage with their customers over at least 10 different channels, phone and email interactions are still the primary means of customer engagement. As a result, brands need to carefully consider how to incorporate these traditional interactions into their omnichannel 2.0 strategies while still maintaining frictionless CX across all touchpoints.

Using CX software that integrates with your existing tech stack is one way to ensure continuity across your communication ecosystem.

3. Creating deeply personalised experiences

Personalisation is a key driver of marketing and CX success today. It’s table stakes, no question. That’s because customers, whether they’re in the world of B2C or B2B, expect relevant, tailored brand experiences that give the ‘wow’ factor.

This process starts with segmenting your customers and then creating tailored journeys for each segment. During this process, AI can help by creating unique interactions based on a customer’s preferences and history. Customer data can also be used to provide personalised offers, content, and services that resonate with each customer’s unique needs. These interactions boost each customer’s experience, leaving them with a positive lasting impression. They also build an emotional connection with your brand, helping to boost satisfaction and loyalty.

4. Blending technological efficiency with a human touch

Many customers are comfortable interacting with AI and chatbots – but it’s important to compliment this efficiency with a human touch. In an increasingly digital world, it’s these human interactions that can really help your brand stand out as one that values empathy and connection.

In some industries, for example, the human touch is paramount to a successful customer-brand relationship. Think of when you need help with your finances or have questions about a utility bill. Sometimes all you want in those moments is to speak to a human who can understand your situation and give you an immediate, empathetic answer.

By balancing automated and human interactions, brands can solve many friction points within the customer journey. They can also ensure that highly trained customer service representatives are on hand to work on complex operations. These transitions from human to digital interactions, or vice versa, should be seamless so that your customers always feel heard and valued.

5. Making better use of customer insights

Sometimes the process of gathering and analysing customer insights – never mind acting on them – can feel overwhelming. But these insights have the power to transform your CX processes.

Making better use of customer insights is a key priority for 17% of customer management leaders today, and 11% also want to reduce the volume of calls and messages coming into their contact centres – something that can be achieved through the intelligent analysis of those insights. AI is increasingly being used to collect and analyse this information, and then offer suggestions for what actions to take next. For example, AI can analyse buying patterns among customer segments and make recommendations on what products to push to them next. It can also recommend offering a discount or sending a follow up email after a complaint or issue was raised.

How to boost customer loyalty, retention, and engagement

Working towards establishing CX excellence helps drive customer lifetime value (CLV). And with research showing that it costs five times more to acquire new customers than it does to retain existing ones – placing CX at the heart of your customer retention strategies makes total sense.

But knowing how to promote and encourage this kind of long-term advocacy is a daunting prospect. We’ll be covering this, and more, at the CCW UK Summit from the 13 - 15th May 2024.

Here’s a sneak peek at what we’ll be discussing:

Lessons in loyalty and engagement

Looking for ways to encourage your customers to return time and time again? Join our panel discussion to discover how to:

Create loyalty programmes that resonate with your audience
Offer incentives that attract new customers while also retaining existing ones
Tailor customer interactions that foster stronger bonds and create a sense of exclusivity
Implement feedback loops that uncover customer sentiment