Customer Experience Management (CXM): How to build loyalty that drives revenue

So, you’ve decided to buy a new laptop and you’re ready to move on from whatever brand you’ve been using.

Now the fun begins.

After browsing Reddit and review sites, you realize you’re spending more time trying to figure out who’s a bot and who isn’t versus actually learning information. So, what do you do? You decide to start doing the research yourself.

First, you visit a publication website that bombards you with pop-ups for everything except computers.

The next keeps asking you to go to the checkout page to know the shipping charges.

Another makes you fill out the same information three times to ask about battery life.

Frustrating, right?

Yet this is exactly how many businesses handle customer interactions and customer engagement in real-time. While companies spend millions on bloated marketing campaigns, they often lose sight of making it easy and enjoyable for customers to interact with their brand.

That's where Customer Experience Management (CXM) comes in.

It's not just about reducing frustration, it's about survival. According to research by Accenture, 64% of customers feel companies should respond faster to their changing needs.

Further, PwC found that 86% of customers will pay more for a better experience.

What is Customer Experience Management (CXM)?

Customer experience management (CXM) is the process of optimizing every detail of the customer lifecycle, from their first encounter with a landing page to their thousandth purchase. CXM connects all individual touchpoints.

But here's what separates actual CXM from basic customer service: it's proactive, data-driven, and touches your entire company.

Let’s stick with the example of purchasing a new laptop. You might decide to order it directly through an online retailer. In that case, the app probably already remembers your purchase history, and local store inventory, and can give you accurate shipping times.

The challenge? Today's customer journey looks more like a spider web. Customers:

• Might start on your mobile app while commuting
• Switch to your website at work
• Ask a question through social media
• Call customer support later that day
• Make a purchase in your physical store

The real challenge? Using omnichannel experiences, ensure they feel like they're talking to the same brand throughout all these interactions. Not just consistent branding and messaging, but consistent understanding of who they are and what they need.

Why CXM matters more than ever...

Remember when Netflix was just a DVD-by-mail company? No? Are we dating ourselves?

Or when Amazon only sold books? No again? Still dating ourselves?

If you’re too young to remember these, just trust us, kids!

These companies succeeded because they understood the evolving needs of their customers and capitalized on the customer experience above all else.

Companies that reduce friction and make the customer experience as painless as possible will always beat out the ones who don’t and it doesn’t matter how amazing your products are.

The way you sell has become as crucial as what you sell. Today's customers expect more, and the numbers prove it. The Aberdeen Group found that brands who get CXM/CEM right see:

• A 10% jump in marketing ROI (because happy customers are more likely to respond to your campaigns)
• 10% more customer referrals (it turns out, people love telling friends about great experiences)
• 5% boost in cross-selling (happy customers buy more)
• A surprising 25% increase in employee engagement (because nobody likes dealing with angry customers all day)

While these numbers are impressive, they're just the beginning. As digital interactions multiply and customer expectations continue to rise, the gap between companies that excel at CXM and those that don't will only grow wider.

The four pillars of a customer experience management strategy

Here’s how to take the initiative and get your CXM strategy and digital experiences on track:

1. Personalization

   Is there a better feeling than walking into your favorite coffee shop and the barista knows your name and knows your order without you saying anything?

   Actually, yeah. When the barista suggests a new blend based on your preferences it totally crushes that pedestrian cold brew you became accustomed to.

   That’s personalization.

   According to recent research, while 92% of marketers believe in personalization, 63% struggle to execute it effectively. The problem isn't lack of data, it's knowing how to use it.

   Great personalization in CXM starts with understanding context.

   

   Source: Blog post 'What is a personalization engine?'

   A customer checking your site during work hours needs a different experience than someone browsing at midnight. So, consider:

   • Time and location of interaction
   • Device and platform used
   • Previous purchase history
   • Current browsing behavior
   • Recent support interactions

   Next comes smart predictions. Don't just react to what customers do, anticipate what they'll need. For example:

   • Suggest complementary products based on past purchases
   • Offer seasonal items at the right time
   • Show help articles before they need support

2. Data Intelligence

   Most companies have almost too much customer data. Here's how to make it work together to create better experiences. Analyze data to predict future customer behavior before it impacts revenue. Implement continuous testing because customer expectations evolve faster than quarterly planning.

   Unified customer profiles:

   • Have a complete picture of every customer that shows:
   • Website behavior patterns
   • Purchase history across channels
   • Support ticket history
   • Marketing campaign responses
   • Social media interactions

   

   Source: Optimizely

3. Customer experiences

   Map every touchpoint and intentionally craft interactions that move customers toward their goals while achieving your business objectives. Companies with strong omnichannel engagement retain 89% of customers versus just 33% for weak omnichannel strategies.
   
   Effective customer experience management means creating experiences that feel natural and helpful, not irrelevant or intrusive. Success lies in balancing both intent signals (what customers are doing) and persona signals (who they are).

   Example:

   • Good: Based on your recent purchase of a printer, you might need ink cartridges soon (uses intent)
   • Good: As a small business owner, you might be interested in our bulk pricing" (uses persona)
   • Bad: We noticed you've been on our site 7 times this week...

   Use cross-channel consistency so your customers feel understood whether they're:

   • Browsing your mobile app
   • Chatting with support
   • Opening an email
   • Shopping in-store

   Make each interaction feel like a natural part of the customer's journey, not like you're tracking their every move.

4. Experimentation

   While many companies collect data and make changes to the entire customer journey, the ones that excel test, learn, and validate every significant change.

   For example, Amazon doesn't just guess what products to recommend. They're constantly running experiments to understand what works best. Companies showing personalized experiences see a 41% higher impact.

   To make experimentation work, start with a clear hypothesis, define success metrics upfront, and be patient enough to get statistically significant results. Your customers' needs and preferences evolve constantly. What worked six months ago might not work today.

How do you build a customer-centric strategy that works?

Here are the key pillars for effective CXM:

1. Customer-centric culture: Building customer-centricity involves aligning incentives, processes, and decision-making around customer value. Break down silos and ensure every team understands their role in the customer experience equation.
2. Intelligent personalization: Use customer data and behavioral insights to deliver relevant content at exactly the right moment. An e-commerce platform using browsing behavior to adjust email content can see higher open rates and an increase in revenue per email.
3. Proactive communication: Anticipate needs and provide timely information before customers ask. Send usage tips to new customers or alert existing ones about service disruptions before they're affected.
4. Seamless omnichannel integration: Customers don't think in channels, they think in experiences. Each interaction should build on the previous one without requiring customers to repeat information or restart their journey.

When implemented effectively, CXM delivers measurable impact and benefits that make CFOs smile:

• Revenue growth: Customer-centric companies are more profitable as loyal customers spend 67% more than new ones, and a slight increase in retention can boost profits by a huge margin.
• Cost optimization: Effective CXM reduces support costs through improved self-service and first-contact resolution.
• Competitive advantage: When products and prices look the same, customer experience is what makes people pick you. Companies good at CXM charge more and still win more customers.

Which tools matter for CXM's success?

Before thinking about tools, think about gathering feedback. Modern feedback collection goes beyond simple surveys.

• Use behavioral analytics to understand how customers actually use your products
• Monitor social media conversations for unsolicited feedback
• Analyze support tickets for common patterns
• Track customer journey drop-off points

And you’ve got to measure and streamline what matters. While there are countless metrics you could track, successful customer experience management programs focus on key indicators that directly impact business results:

• Customer Satisfaction Score (CSAT)
  Measures immediate reaction to specific interactions. Are customers happy with their support experience? Did they find what they were looking for?
• Net Promoter Score (NPS)
  Shows long-term loyalty and advocacy. Would customers recommend you to others?
• Customer Effort Score (CES)
  Reveals how easy (or difficult) it is for customers to accomplish their goals. Lower effort typically means higher satisfaction.
• First Response Time (FRT)
  FRT measures how quickly your team responds to customer inquiries.
• Average Resolution Time (ART)
  ART tracks how long your team takes to resolve customer issues completely.
• First Contact Resolution Rate (FCR)
  FCR shows the percentage of customer issues your team is resolving during the first interaction.

Finally, technology also plays a role in customer experience management. The right technology stack includes:

• CRM systems: Salesforce and Microsoft Dynamics 365 serve as your central hub for customer data and interaction history. Choose platforms that integrate well and provide flexibility, not ones requiring a PhD to operate.
• Customer feedback platforms: Qualtrics and Medallia help systematically collect and act on feedback across touchpoints. Look for real-time alerts and sophisticated analytics, not just survey builders.
• Marketing automation: HubSpot and Marketo enable personalized communication across the customer lifecycle. Focus on tools allowing sophisticated segmentation without requiring rocket scientists to run them.
• Analytics platforms: Tools like Google Analytics and Optimizely Analytics help understand customer behavior and measure CXM impact. Choose tools that connect directly to your data warehouse, so you can test against the metrics that influence business outcomes.

Customer experience management use cases

1. Ecommerce: Quip's previous checkout process pushed users to select a product and choose between a one-time purchase or a subscription. Adding a quantity selector for refills earlier in the process significantly improved average order conversion.
2. B2B software: Customers often struggle with the complex features of software. Companies can implement personalized in-app guidance based on user roles to reduce support tickets and increase feature adoption.
3. Healthcare: Medical providers spend a lot of time taking care of missed appointments. A healthcare network can solve this by creating unified patient profiles and sending personalized appointment reminders with specific prep instructions.
4. Retail: Physical stores lack the personalization capabilities of online shopping. If you're a major retailer, you can bridge this gap by equipping store staff with tablets showing customer purchase history and preferences, allowing them to provide more personalized recommendations in-store.

How do you implement CXM without causing organizational chaos?

Phase 1: Foundation building

Start with a clear vision and comprehensive customer research. Establish baseline metrics and benchmark against competitors—you can't improve what you don't measure.

Phase 2: Journey mapping

Map detailed customer journeys for key segments. Identify moments of truth that influence customer perception. Prioritize improvements based on impact and feasibility, not what sounds cool in meetings.

Phase 3: Design and testing

Design new experiences for high-priority touchpoints. Test with real customers before full implementation as assumptions are expensive. Use A/B testing because data beats opinions every time.

Phase 4: Scale and optimize

Roll out successful improvements across touchpoints. Implement continuous measurement and create processes for ongoing optimization based on feedback and market changes.

What are the biggest CXM mistakes to avoid?

Four customer experience management mistakes you should avoid:

• Don't confuse activity with impact. Collecting feedback without action just pisses people off. Focus on closing the loop between insights and meaningful improvements.
• Don't try to boil the ocean. Perfect one area before expanding everywhere. Excellence in one touchpoint beats mediocrity across all channels.
• Don't underestimate change management. CXM requires cultural shifts throughout your organization. Invest in training and incentive alignment. Great strategy fails with poor execution.
• Don't set and forget. Customer expectations evolve constantly. What delights today becomes table stakes tomorrow. Build continuous improvement into your approach.

Wrapping up...

This is the age of heightened expectations. Your customers don't just want personalization, they expect it at every touchpoint.

Many companies find this overwhelming. They know they need to improve their customer experience but worry about the resources required, the complexity of implementation, and the risk of getting it wrong.

Here's the truth: you don't need to transform everything overnight. Start small but think big:

• Audit your current customer experience
• Identify your biggest pain points
• Choose one area to improve to reduce customer churn
• Measure the results
• Scale what works

When you combine clear strategy with the right tools and a test-and-learn mindset, creating exceptional customer experiences becomes less of a lift. The gap between you and better customer experience management might be smaller than you think.