Customer experience management (CXM) and customer relationship management (CRM) may seem similar, but they are clearly distinct concepts. Exactly what benefits do CRM, which has an older history, and CXM, the rising topic of the recent period, offer to businesses? Where do these two concepts differ from each other?
CRM is more about tracking customers, increasing sales and solving problems. CXM has a more holistic approach to attracting and retaining customers by delivering a great experience.
What is CRM? Which benefits does it offer?
The term CRM (Customer Relationship Management) is used today to describe software solutions developed for customer relationship management needs. In CRM solutions, all customer interactions of the business are recorded in a single source and all sales processes are tracked. Other benefits include better internal communication and better customer service.
The primary goal of CRM is to maintain and improve relationships with customers and increase sales. CRM is a technology in itself (software and platforms) but it also incorporates best practices and strategies to build customer relationships and increase sales.
CRM platforms like Salesforce, Microsoft Dynamics, etc. use the power of data to analyse and track customer behaviour. Data such as how they become customers, how often they shop, how much they spend, what requests they make, etc. are kept in CRM platforms.
What is CXM? Why is it important?
CXM is the whole of the work done to measure, evaluate and improve the total value your customers give you with scientific methods. It stands for Customer Experience Management and has two different abbreviations as CXM or CEM.
Your customers may come into contact with your brand at many points (physical store, product, service, website, call centre, mobile application, online sales channel, etc.). This contact can be before, during or after sales. Customer experience refers to the total value your customers give to your brand at every touch point.
As a result of the emotional evaluations that occur at the touch points, a separate value emerges for each experience, and a total value is created as a result of all experiences. This total value constitutes the total customer experience. The impact of each experience that constitutes the total customer experience may have a different impact depending on time.
CXM focuses on monitoring and measuring all steps of the customer journey from the customer’s perspective. Data is collected through research, surveys, direct feedback and other ways to communicate directly with customers about their experience.
CXM efforts help to increase customer loyalty and prevent customer churn. In addition, the actions taken as a result of the feedback collected contribute to the development of the business.
In short, both CRM and CXM optimise customer relationships. Both CRM and CXM take into account all steps of the customer journey and their interactions.
You can see the difference between CXM and CRM in the diagram below.
To summarise; CXM supports marketing activities while CRM focuses on sales activities.
What benefits do CXM solutions bring to your business?
You have a business that offers great products and services. Your revenues are on an upward trend, and as you grow your business, you may think you understand your customers very well, and you can put yourself in their shoes and empathise with them. According to research by Lee Resources, there is a huge perception gap between businesses and customers. While 80% of businesses think they provide a high level of service, only 8% of customers agree with them. Businesses are unlikely to build empathy without regular feedback.
A study by the White House Office of Consumer Affairs found that the cost of acquiring a new customer is at least 6-7 times more costly than retaining an existing customer. In sectors where competition is intense, this ratio can be up to 13 times higher. The results of the same study show that consumers who have had bad experiences are twice as likely to talk about their experiences than those who have had positive experiences.
Many research results similar to the above reveal that businesses that want to stand out from the competition need to manage their customer experience. Managing the customer experience becomes even more vital as any feedback needs to be taken into account. This is the time to adopt a CXM approach and address gaps in your systems and internal business operations before they really start to impact your business or you fall significantly behind your competitors.
Meet Wiseback
If your business wants to start or improve customer experience management, Wiseback offers you an advanced solution to manage end-to-end customer experiences.
Measure customer experiences with popular customer experience metrics such as NPS. Collect feedback via SMS, email, kiosk, website, mobile app. Create your analytics with AI-powered text analytics service. Whether B2C or B2B, Wiseback will meet your CXM solution needs with the features it offers
