What is Customer Experience and why does it matter?

Author - Ennova

In its essence, Customer Experience (CX) is about the relationship between a company and its customers. But why is this relationship so important, and how does it impact your business? This article will cover this and more.


In today's competitive business landscape, where customers have more choices than ever before, companies must find ways to stand out and build lasting relationships. Central to this are the experiences their customers have with the companies.

Customer experience (CX) has emerged as a key element of successful business strategies, even rivaling the importance of product quality and pricing. Rather than sticking to the traditional proverb that "the customer is always right," it is more accurate to say that "the customer's perception becomes your reality." No matter what you believe you offer to your customers, what truly matters is how they perceive and experience your brand.

Today, businesses are not just selling a product or service. They are selling an experience – a journey that begins the moment a customer interacts with a brand for the first time, long before a purchase is made, and continues well beyond the point of sale.

But what exactly is customer experience, and why should it be considered a critical aspect of your business strategy?

Read on and learn more about the following:

  1. What is customer experience management?
  2. Why is customer experience management important?
  3. What is the difference between CRM and CEM?
  4. Examples of CEM metrics

What is Customer Experience (CX)?

Customer experience, at its core, encompasses every interaction a customer has with your business throughout all the stages of the customer journey – from the moment they learn about your company (awareness) until they complete a transaction (if they choose to do that), and even afterwards (post-purchase). This journey can involve various touchpoints, such as visiting your website, visiting a store, speaking to customer service, receiving your product or service, paying the invoice, and accessing post-purchase support.

Thus, customer experience is the perception the customer creates based on all their interactions with your company – both directly and indirectly.

Direct customer experience includes the customer speaking with a customer service representative from your company, and indirect customer experience can be the customer reading online reviews of your business, products or services.


What is the difference between customer experience and customer service?

Even though the terms "customer experience" and "customer service" are often used interchangeably, they have distinct meanings:

  • Customer service refers to specific touchpoints within the broader customer journey where the customer interacts with the business – for example, asking a question about a product feature or requesting a refund.

  • Customer experience, on the other hand, encompasses the entire spectrum of interactions a customer has with a brand. It's the overall impression that shapes the customer's perception of the business, influencing whether they will become a repeat customer or advocate for the brand.

In short, customer service is part of the customer experience, but not all customer experience is based on customer service interactions.

Why is cX so important?

The significance of customer experience today cannot be overstated. Products and services are becoming increasingly commoditized, and the experience your business delivers is therefore often a key differentiator, driving customer loyalty, retention, and word-of-mouth marketing.


  1. Customer experience + brand loyalty

    What keeps customers coming back to your business is not just the quality of your product or service, but the experience they receive. A positive customer experience can create a strong emotional connection with your brand, leading to increased loyalty. This loyalty often translates into repeat business and a higher likelihood of customers trying other products or services you offer.

  2. Customer Experience + Customer Retention and Acquisition

    Retaining your existing customers is generally more cost-effective than acquiring new ones. A positive customer experience can dramatically improve retention rates, as satisfied customers are more likely to continue doing business with your brand. Plus, happy customers often become ambassadors for your brand, recommending it to friends and family, and in this way playing a central role in new customer acquisition.

Customer Experience + Word-of-Mouth Marketing and Brand Reputation

  • Today, customer opinions can be shared widely online and significantly impact your brand's reputation.
    Positive customer experiences can lead to favorable word-of-mouth marketing and positive online reviews that can enhance your brand's image and attract new customers.

  • On the other hand, negative experiences can quickly damage your brand's reputation, which demonstrates the need for providing an exceptional customer experience.
The implications are clear:
Customer experience should be central to every business strategy. Not only can it lead to more loyal customers and improved retention, but it can also boost your company's reputation and bring in new customers, in this way contributing to business growth and success.

You can read more about the importance of customer experience in this blog post.


the Quantitative and qualitative value of customer experience

Providing great customer experience makes good business sense in several tangible and intangible ways.

Quantitative benefits

If your business is able to provide extraordinary customer experience, you will see direct impacts on your bottom line. This is because happy customers are more likely to become loyal, repeat customers, which boosts the customer lifetime value (CLV).

Reduced churn, the rate at which customers stop doing business with a company, is another benefit of great customer experience. Reduced churn rates decrease your cost of customer acquisition, since it is generally cheaper for you to keep an existing customer than to acquire a new one.

Additionally, a strong customer experience can lead to increased sales, because satisfied customers are often willing to buy more from your brand if they trust and like it.

Qualitative benefits

Even though they are harder to measure, the qualitative benefits of good customer experience are just as valuable as quantitative benefits.

Examples include enhanced brand image and reputation, which can make your business stand out in a crowded market and attract new customers. Offering a great customer experience also gives your company a competitive advantage. Today, products and services are often very similar, and therefore, the experience a customer has can be the determining factor in their decision to choose your brand over one of your competitors.

Summed up, the business value of good customer experience is diverse and complex, offering both measurable financial benefits and less tangible but equally important advantages. Prioritizing your customer experience is not just about satisfying customers – it’s also a strategic move that can significantly contribute to your company's success.
Do you want to improve your customer experience? Then read our blog post about how synchronized insights can help to achieve just that.

Do you want to improve your customer experience? Then read our blog post about how synchronized insights can help to achieve just that.

Feedback and data analysis: a key strategy to enhance your customer experience


If you want to improve your customer experience, one of the first steps is understanding what your customers need and expect from your business. This involves actively seeking customer feedback and analyzing it to gain insights.

Feedback comes in various forms: It can be direct, through customer surveys and interviews, or indirect, through social media comments, online reviews, and other public forums where customers might discuss your brand. It's crucial that you pay attention to both types of feedback, as they provide a comprehensive view of how customers perceive their interactions with your business.

Learn how to use your customer survey to build strong customer relationships with these 5 steps.

Data analysis also plays a crucial role in understanding your customers' needs and expectations. By examining customer behavior data, you can identify patterns and trends that provide a deeper understanding of what your customers want. For instance, website analytics can show you which pages customers visit the most, where they spend the most time, and at which point they choose to leave or make a purchase.

Data from customer service interactions, such as common issues or questions, can also provide insights into areas where your business could improve. Furthermore, CEM can give you insights into your customer's entire journey with your business.

Armed with this understanding, your business can tailor its approach to meet and exceed customer expectations, leading to an improved customer experience. It's essential to note that this is not a one-time activity but an ongoing process. Regularly seeking feedback and analyzing data ensures your approach to customer experience remains relevant and effective as customer needs and market conditions change.

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