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Uncovering the Link Between CX and Marketing to Achieve ROI

By Kamil Ali, CCXP posted 04-29-2023 09:10 AM

  

Customer Experience (CX) and Marketing are two of the most important foundations for achieving success. They must be integrated to ensure that businesses can survive in today’s competitive market and drive a Return On Investment (ROI). CX and Marketing are like the two wings of a bird. Just as a bird needs both wings to fly and reach its destination, businesses need both CX and Marketing to soar towards success.

CX is the left wing, responsible for building customer loyalty and advocacy by providing a seamless and personalized experience. On the other hand, Marketing is the right wing, responsible for attracting new customers and promoting the brand. Without one wing, the bird cannot fly in the right direction, and without integrating CX and Marketing, businesses cannot achieve ROI or survive in the competitive market.

In today’s fast-paced world, businesses that leverage both wings and integrate CX and Marketing will soar high and reach new heights of success. To illustrate this point, let’s take a look at an imaginary conversation between Marketing and CX as they discuss how their integration is essential for ROI.

Marketing: “You know, it’s like Darwin’s Theory of evolution. For a business to survive and thrive in today’s digital economy, integration between CX and Marketing is key.”

CX: “That makes perfect sense! We are the environment in which brands develop — by creating memorable experiences, we can ensure that consumers have a positive opinion of the brand and build loyalty.”

Marketing: “Exactly! The best way to ensure brand loyalty is to create an integrated strategy that combines both CX and Marketing. With this approach, businesses will be well-positioned for achieving ROI in today’s ultra-competitive marketplace.” 

CX: “That’s true. Our jobs are at stake without ROI! We need to make sure that business is delivering value to the customers and is yet profitable — something that’s essential for long-term progress…but...how do we supposed to do that?”

Marketing: “We’ll reinforce our Brand Positioning through every customer touchpoint: from tone of voice to visual style, packaging, distribution channels, and even our sales team — the way we Look, Talk and Act. That’s how customers will find us, buy from us, and recommend us!”

CX: “That’s a great place to begin! We can use data-driven insights to create experiences that will engage such customers, build loyalty, and drive ROI… But to drive ROI, we should start by understanding the perception of our profitable customers. What experiences do they want and expect, and what kind of messages resonate with them?” 

Marketing: “Yes, but do you see customers are not alone there in the marketplace—a cut-throat competition is waiting for us. If we don’t understand their strengths and weaknesses, and how can we differentiate ourselves? — they will steal our customers, even the loyal ones!”.

CX: “So let’s get this straight! So we’ll gather insights on what our customers and our competitors’ customers are saying”.

Marketing: “Yes, absolutely. And once we’ll have insights from both types of customers. We’ll align the right messaging with our Brand Positioning; and then we can optimize the messaging over time so that it remains effective and relevant.”

CX: “And then we’ll use the same messaging at each touchpoint of the customer journey. So, customers feel like we’re speaking the same language—as you said, ‘Look, Talk and Act’.

Marketing: “That’s right. Now let’s get back to your point that ‘we need to make sure that business is delivering value to the customers and is yet profitable.’

CX: “Yes, that’s the route to drive ROI. We should start by improving ‘profitable’ customers experience, pain points or gain points and then roll out to other customers.”

Marketing: “Right! That’s how we prioritize! So let’s work together to create an integrated strategy that focuses on ROI!” 

CX: “It’s a deal! Let’s get started!”

******

Did I miss something important? Let me know if you have any ideas, thoughts, or questions.

Learn about the following terms here:

What is Brand Positioning?

How to Position Your Brand When You’re Not First To The Mind? 

#CXStrategy 


#MetricsMeasurementandROI

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05-02-2023 02:44 PM

Hi@Mr. Mohammed Aldossary 

Thanks for your comment! It's great to see that you have an understanding of the importance of measuring success in non-profit organizations. I totally agree that ROE is valuable and using the right metrics can definitely make a difference.

The two metrics, ROI and ROE, are definitely important ones. It’s is really important to consider the long-term sustainability of the non profitable organization, which is where ROE comes in. This metric emphasizes the importance of stakeholder engagement and support, which is crucial for the continued success of any non-profit. Thanks again for your input!

04-30-2023 04:04 PM

Great story Kamil. All agreed that CX ROI is the ultimate goal of private sector "profitable organizations" and that segmentations should be customer experience segmentation like NPS or satisfaction, not organization segmentation. However, for non-profitable organizations you can't apply the same ROI, and I think the ROE "Return of Engagement" is the key factor rather than the ROI. The theory is same but the factor is different

04-29-2023 03:45 PM

Thank you for your detailed and thoughtful response,@Lynn Hunsaker, CCXP . I really appreciate you taking the time to share this valuable insight into CX ROI assessment!

You make a valid point about the importance of looking at customer segments and expenditures in order to understand customer perceptions. The Wallet Allocation Rule is an impressive metrics for understanding customer profitability for consumer-focused industries, although I agree that qualitative research across different customer segments is also needed to help us gather important insights.

04-29-2023 12:33 PM

Great points, Kamil, and entertaining. One of the biggest issues with CX ROI is how much cost is required to address mis-steps. So, some good questions for Marketing are: which customer segments have highest cost to serve? Is their high cost due to over-promising or under-delivering? The investment is cost of customer acquisition (COCA) + cost to serve (onboarding + service + returns + refunds + escalations + extra marketing and sales expenses (COCA) to make up for negative word of mouth). This holistic view is often overlooked among Marketing and CX and management in general.

For consumer industries where a middleman makes it difficult to know specific customers' spending and costs to serve, a good place to start is the Wallet Allocation Rule, developed by Timothy Keiningham et al (and presented at a CXPA conference in 2015 as I recall; by the way, my pre-publication review is quoted in the opening pages of the book). Additionally, qualitative research is needed for any sector to understand both the numerator and denominator of ROI among different segments. One more resource readers may appreciate is Gautam Mahajan's "Customer Value Investment: Formula for Sustained Business". 

Thanks for including your links on brand positioning -- great resources!