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The Relationship Between CX & ROI

Many consumer surveys suggest people expect a recession in the coming weeks that will last months. Companies are planning for a downturn, exploring ways to insulate themselves from the worst effects of a shrinking economy while still generating ROI for investors. So, what’s the right strategy?

Customer Experience (CX) is the best path

CX-leading companies fared better during the last economic downturn (Watermark Consulting). Companies with high CX ratings aren't immune from recessions, as demonstrated through the 2007-2009 Great Recession, but they clearly fared better than other firms. The broader market, which you can say represents "average" CX companies, and the CX-lagging companies lost significant market value during the contraction, while the CX-leading ones notched positive investor returns. (see chart)

 

"CX-leading firms appear to be cushioned from the most severe impacts of a recession, and they seem to bounce back faster when a recovery takes hold." Jon Picoult, Forbes Media

So how to use CX to shield your company? Here are some of the things we're doing at Value Connect:

  • Give customers a reason to return: We're not in a recession yet, and both consumer and business spending remains strong. That means Value Connect continues to have many opportunities to shape customer impressions. We go out of our way to ensure all our customers, including mortgage lenders, mortgage sales experts, and real-property appraisers, have a world class experience. And our Google Reviews showcase just how far ahead of our competitors we are.

  • Pre-empting avoidable customer inquiries: It's possible to lower costs while enhancing customer experience. The key is in focusing on improvements that eliminate downstream, cost-inflating customer inquiries. Automating more of our initial ordering steps to make it easier on customers is something we're working on.

  • Re-examine what's relevant to our customers: As economic conditions change, so too may our customer's needs, wants, fears, and aspirations. Product features and/or services that were important yesterday may not be as important today. We regularly ask our Customer Success and Sales teams what they're hearing from customers so we can pivot appropriately.

One thing is clear from our research: Competing on price (or rate) isn't a good long-term strategy in business. Looking for ways to improve or maintain your margins is, and that usually happens when your customers receive experiences from you that they simply can't live without.

This article was based on an article written by Jon Picoult, Forbes Media: What The Great Recession Teaches Us About Surviving The Next Downturn (advisorstream.com)

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