Digital tools now reach across companies (from sales to support) and across the entire customer experience. This span is making running digital channels as silos increasingly costly and difficult to scale.

Organizations that seek to rationalize operations, use data effectively, and personalize smart experiences for clients need alignment around a digital experience plan.

This is the first of a series of posts on why digital experience planning has become a strategic priority of a growing tribe of digital leaders.

If you’re like me, you’ve seen a long progression of “bright shiny objects” in the digital space. Each have their own ecstatic pundits who proclaim it’s time to embrace a transformative new channel or be left behind.

In truth, many of the bright shiny objects have delivered value. Brands have built direct to consumer relationships in social media, gained the always-on access of mobile technology, and increased the relevance and immediacy of their messages through personalization and location-based targeting.

Taken together these channels vastly expand the number and influence of available points of engagement to individual customers.

This plays to what is perhaps the core strength of the digital medium, its ability to support a high number of customer interactions at a very low incremental cost. But too often that promise goes unmet, as channels proliferate when teams from across the company race to staff disconnected initiatives.

This happens with websites, email marketing, social media accounts, and mobile apps. The channels need a plan to rationalize and rule them all. The “ad hocracy” of channel focused departments can frustrate customers, sap resources and silo customer relationships and data in ways that hold companies back.

Happily, I’ve been spending time with a growing number of digital leaders who are making Digital Experience the rallying point to align their efforts at conferences such as J. Boye and Delight. And now this month Forrester Research published its first list of digital experience agencies, which is a genre of consultancy that focuses on joining up channels in to coherant experiences.

And while this takes greater commitment than trying out another new channel, a growing body of data shows the companies that think this way spend less and grow more over the long run.

Get real: customer experience’s ROI is profitability

The reasoning that connects great customer experiences to the bottom line is surprisingly straight forward. When customers are delighted to do business with you, they become promoters.

These are the clients that are the least expensive to serve, they are unlikely to defect, and they amplify their value to firms they love through referrals. 

Companies who have more of these customers grow faster than their competitors, can maintain premium pricing against commoditization, navigate business downturns better, and produce disproportionate value to shareholders than firms with lower levels of raving fans.

Harley Manning of Forrester does a great job of laying out this case in his blog post When it Comes to Returns, Customer Service Leaders Spank Laggards

Likewise, Bruce Temkin has rigorous research that shows how great customer experiences drive loyalty and business results across a variety of vertical industries: 

ROI of Customer Experience Temkingroup 2012 

And over here, Bain & Co calls customer experience “the secret to profitable organic growth”.

This kind of research is a reason for firms to take a serious look at whether the customer is being funded as a durable investment that creates persistent advantage. Or, is skepticism about the “soft” value of brand experience creating an opening for competitors to earn customer preference in your key markets?

According to Forrester, customers who interact with a business across multiple digital touchpoints are often worth five or six times that of a single-channel customer.

They also anticipate that firms with the best customer experience across multiple touchpoints will increase customer retention, while 76% of consumers who have a poor online shopping experience will be unlikely to return.

In addition, 40% of customers said they would be likely to spend more with a brand that offered an excellent customer experience. 

Why does customer experience matter? Companies that earn customer loyalty enjoy longer customer tenure, increased purchase value, relationships that are more efficient to serve, and more referrals which drive additional sales.

These four factors roll-up to increase Customer Lifetime Value. In a world of empowered consumers, customer preference is a strategic factor.

By taking the focus off channels, digital goals return back to the core business

Not long ago, having a digital customer experience strategy meant having an editorial plan for the company website and email newsletter.

Today the digital ecosystem is more diverse and customer expectations have never been higher. Increasingly customers experience and transact their business with brands across a numerous digital platforms.

It requires a more a thoughtful approach for aligning the teams, technology and techniques needed to make a cohesive and useful customer journey.

If you believe customer experience is important, and that digital experiences may be the most cost effective way to build relationships and transact business, then isn’t it time to make digital experiences a top priority?

The next bright shiny object may not be an object at all, it may be a plan that advances your customer facing agenda as the one thing that everyone comes together on.