CustomerThink: $3 Trillion in Sales at Stake with CX in the Center
This article was written by Greg Kihlström for CustomerThink. Read the full article here.
With concerns about the economy among the factors causing consumers to cut back on spending, the quality of customer experience is a key factor to brands’ success and growth in an environment of uncertainty.
A recent study by the Qualtrics XM Institute reveals that poor customer experiences can have a substantial impact, costing businesses nearly $3 trillion in sales globally. This figure underscores that CX more than a merely peripheral function, and instead a critical component of financial risk mitigation and sustained revenue performance. This puts integration of CX management on par with other key areas such as financial planning and operational efficiency.
Economic pressures are intensifying the impact of inadequate customer experiences, directly threatening enterprise revenue. The Qualtrics XM Institute analysis indicates that 34% of consumers reduce their spending with a company after a negative experience, and 13% cease spending entirely. This behavior is exacerbated by inflation and declining consumer sentiment, which render customers less tolerant of service failures.
Some of the key drivers of negative customer experiences include service delivery issues (cited by 46% of consumers), communication problems: (Cited by 45% of consumers), as well as pricing concerns and product quality of failure (both cited by 37% of consumers).
Pricing concerns have also emerged as a significant new friction point in this latest study, with this complaint category jumping 4 percentage points year-over-year. Qualtrics XM Institute’s Isabell Zdatny says, “pricing has become the fastest-growing source of customer dissatisfaction, reflecting how financial stress is redefining consumer expectations around value and fairness — a shift that makes this holiday season particularly high-stakes for customer loyalty.”
While consumers may tolerate operational issues if balanced by lower costs, pricing discrepancies or perceived poor value in uncertain times quickly erode loyalty. Compounding pricing pressure with service failures, communication breakdowns, or product quality issues often triggers customer defection to competitors.
Let’s look at two key principles that winning organizations should take into account.
This article was written by Greg Kihlström for CustomerThink. Read the full article here.