What is customer experience and why you should improve it

Great CX requires a customer-centric mindset...and a lot of careful work. This guide is your introduction to the basics: why CX is important, how to improve it through customer feedback and surveys, plus tips from 100+ CX experts and a report with plenty of CX trends and stats—so you have everything you need to start delivering an exceptional experience for your customers.

What is customer experience?

Customer experience, also known as CX, is your customers’ holistic perception of their experience with your business or brand.  

CX is the result of every interaction a customer has with your business, from navigating the website to talking to customer service and receiving the product/service they bought from you. Everything you do, whether it’s providing responsive real-time support or maintaining seamless omnichannel messaging, impacts your customers’ perception and their decision to keep coming back or not—so a great customer experience is your key to success.

Why is CX important for your business?

Delivering a great customer experience is important for any business. The better experience customers have, the more loyal customers and positive reviews you'll receive, while simultaneously reducing the friction of customer complaints and returns. Moreover, providing a great customer experience gives you a competitive advantage over businesses that maybe aren’t doing so hot with their own CX.

The benefits of delivering a great CX include:

• Increased customer loyalty

• Enhanced customer satisfaction

• Improved customer engagement

• Better word-of-mouth marketing, positive reviews, and recommendations

All business models can benefit from improving customer experience: subscription businesses can increase customer retention and reduce customer churn rates; ecommerce marketplaces can facilitate purchase decisions, increase repeat customers, and reduce returns; and service industries can elevate customer interactions, gain recommendations, and reduce complaints.

In fact, we challenge you to think up a type of business that doesn't benefit from providing a positive customer experience. 

We believe that putting customers first is always good for business (and we also have the data to prove it in the 'CX stats and trends' chapter). 

What is the difference between customer experience and customer service?

In short, customer service is just one part of the whole customer experience.

As we mentioned, customer experience is a customer’s overall perception of your company, based on their interactions with it. Comparatively, customer service refers to specific touchpoints within the experience where a customer requests and receives assistance or help—for example, calling an operator to request a refund, getting support from a chatbot, or interacting via email with a service provider.

In other words: CX is broader than customer service. It includes every touchpoint a customer ever has with your company, from the moment they first hear about you in a blog post they found on Google, all the way through to the time they call your support team to ask for help with inside your product (and hopefully get a prompt response).

What is a good customer experience?

There’s no universal checklist to follow to guarantee good customer experience: your business is unique and so are your customers. However, we've found a number of common principles by polling 2,000 CX professionals across many industries. You can read the full results of our survey here, but we've included some of the key takeaways below.

In short, good customer experience can be achieved when you:

• Make listening to customers a top priority across the business

• Use customer feedback to develop an in-depth understanding of your customers

• Implement a system to help you regularly collect, analyze, and act on feedback

• Reduce friction and solve your customers' specific problems and unique challenges

It's not rocket science: a good customer experience comes from asking your customers questions, listening to their responses, and acting on their feedback.

6 things that cause bad customer experiences

Bad customer experience comes in many shapes and sizes, but we noticed a number of commonly-reported issues in our customer experience stats.

Bad customer experience is primarily caused by:

• Long wait times

• Employees who don’t understand customer needs

• Unresolved issues/questions

• Too much automation/not enough of a human touch

• Service that doesn’t provide a personalized experience

• Rude/angry employees

If you need any more ideas, just think about the last time you were frustrated as a customer—it's quite likely that one (or more) of the above was the cause. 

Ultimately, though, what counts as a poor customer experience in your business will be unique—and you'll only learn about it by opening the door to customer feedback, then working to minimize the impact of factors that cause a bad experience. Collecting customer feedback is an essential jumping-off point in developing your overall customer experience strategy. 

→ Check out the chapter with all the CX stats and trends or learn more about improving your CX strategy

Why you should use customer feedback as part of your CX strategy

You may know some theory behind what makes good and bad CX, but for it to make an impact on your business, you need to have a reliable method of collecting insight from your customers so you can take action and make impactful changes.

Customer feedback is information you collect from your customers about their experience with your product, service, website, or business as a whole. You can use this feedback to improve customer experience by removing or reducing areas of friction, cultivating positive touchpoints, and creating pleasant in-store or digital experiences.

You're probably already collecting customer feedback without realizing it: when a customer sends an email, calls your customer support team, or leaves a review on social media, that's feedback. The problem is, if that feedback and other valuable customer data is not measured and analyzed, you're missing out on the opportunity to use it to improve customer experience and leverage its growth potential.

→ Read more about the CX surveys you can run to collect feedback from your customers

How to measure and analyze customer experience

From what we've described so far, customer experience might sound like a subjective concept that's difficult to measure. That's why you need to rely on a number of different customer experience metrics that can be used individually or together to get an indication of CX in your business (you can also get more detailed feedback on customers’ expectations by engaging them in interviews—and Hotjar can help you connect with customers without lifting a finger).

By having a measurable indicator of CX, you can track how it improves (or worsens) over time and use customer analytics to evaluate the success or failure of changes you make that might be affecting your customers. Here are four top metrics used by CX professionals and customer relationship management (CRM) teams to track customer experience over time, at different points in the customer journey:

• Customer Effort Score (CES)

• Net Promoter Score® (NPS)

• Customer Satisfaction Score (CSAT)

• Time to Resolution (TTR)

Customer Effort Score (CES)

Customer Effort Score measures the experience with a product or service in terms of how ‘difficult’ or ‘easy’ it is for your customers to complete an action.

CES surveys are usually sent out after an interaction with customer service, with questions such as "How easy was it to get your issue resolved today?" and a rating scale going from "1: very difficult" to "7: very easy". They also work well after customers reach important milestones in their journey, particularly the customer activation moments when a customer actively engages with your product or service (for example, after they sign up for a free product trial or successfully conclude a transaction).

Net Promoter Score® (NPS)

Net Promoter Score® is a customer loyalty score derived from asking customers a simple closed-ended question: “On a scale from 0 to 10, how likely are you to recommend this product/company to a friend or colleague?” 

You can choose to adapt the question slightly to better suit your business and use a follow-up NPS question to get more insight, but the point of NPS is to get a simple numerical score on a scale from 0 to 100 that represents customer experience or brand loyalty.

We use NPS as a primary CX metric at Hotjar—you can give our built-in NPS software a test drive yourself.

Net Promoter, Net Promoter System, Net Promoter Score, NPS and the NPS-related emoticons are registered trademarks of Bain & Company, Inc., Fred Reichheld and Satmetrix Systems, Inc.

Customer Satisfaction Score (CSAT)

CSAT surveys measure customers’ satisfaction with the product or service they receive from you. They can be expressed with a 5- or 7-point scale (with1: very unsatisfied and 7: very satisfied), or through binary yes/no questions.

Unlike the Net Promoter Score®, which asks customers to consider their overall feeling towards the brand (and thus, their likelihood of recommending it or not), CSAT focuses the customer’s attention on specific touchpoints they were satisfied or dissatisfied with. Taken in context with CES and NPS, customer satisfaction is a meaningful indicator of whether your customers are cultivating a pleasant emotional connection with your business, or what product teams like to call customer delight.

Time to Resolution (TTR)

TTR is the average length of time it takes customer service teams to resolve an issue or ticket after it’s been opened by a customer. It can be measured in days or business hours, and is calculated by adding up all times to resolution and dividing the result by the number of cases solved.

In our CX stats and trends, we found that the leading cause of customer frustration is a long wait/response time. For that, TTR is a crucial metric to track and improve: the shorter your TTR, the higher the chances your customers won’t experience frustration when they reach out for help.

A great customer experience example using NPS

Here’s a practical example of what tracking a CX metric and acting on the insight can do for customer experience.

One of our customers, jewelry ecommerce Taylor & Hart, specializes in bespoke engagement rings—not the kind of product people usually think about buying online, and also not the kind of product customers typically buy more than one of.

The company’s goal was to turn reluctant visitors into one-time buyers, and one-time buyers into lifelong promoters who would recommend the same service to their family and friends. After choosing Net Promoter Score® as their primary CX metric, Taylor & Hart identified two essential customer touchpoints  and set up NPS surveys at each milestone:

1. The moment a customer places an order

2. The moment the customer receives their order

The resulting NPS numbers were kept visible on metrics dashboards in the office, and everyone's focus was on improving the scores. It wasn't an easy feat, but the team used each piece of negative feedback to fix parts of their business, from manufacturing to shipping methods, to give customers the best experience they could (if you're curious about the logistics, you can read a full write-up of this NPS case study).

With a focus on providing a better customer experience, Taylor & Hart grew their NPS score to over 80 (the highest in their industry); annual revenue followed suit and doubled to €4.5M. 

→ Find more inspiration in these tips from 100+ CX experts on what else you need to deliver a great customer experience

7 more ways to understand and improve customer experience with Hotjar

1. Identify high-drop off pages

Use Funnels to identify unusually high churn rates in your most important flows, and watch recordings of users who didn’t make it to the next step. Uncover the pain points in their user journey and improve their customer experience.

2. Discover how users engage with your page

Heatmaps help you understand how users click, scroll, and move on a page. With Engagement zones, see which areas of your page users most interact with. If you notice some rage clicks on a non-clickable element, improve user experience by making it clickable, or revisit your page’s design.

3. Watch session replays of frustrated users

Filter session recordings by Frustration score to dive into sessions where users rage clicked, u-turned, or generally had a bad time on your site. Or use the ‘error’ filter to review sessions in which users encountered a JavaScript error.

4. Gather in-the-moment feedback

Floating or embedded widgets let you collect feedback from users as they experience your site. Discover how they feel when running into blockers or interacting with something they love on your site, then review their feedback to spot pain points and ‘aha moments’.

5. Interview users for nuanced feedback

When written feedback from users leaves you wanting more, give Engage a spin to get to the bottom of why users love their experience with your business, or are instead struggling to interact with it. Gather insights on how they would improve their experience so you can better meet their needs by implementing user-led changes.

6. Test changes made to improve CX

Speaking of changes, of course you’ll want to know what CX updates to make, and how each one performs, based on all the user feedback you collect. Hotjar integrations make it easy to act on that feedback: conduct effortless A/B testing with Optimizely or Omniconvert, then filter your session recordings and user feedback by experiment to understand how users interact with different versions of your site.

7. Share findings with your team

Last but not least, spread the word: you’ll be sitting alone on a mountain of information unless you clue in your team. Share live CX insights and use them to collaborate on initiatives by integrating Hotjar directly with Slack or Microsoft Teams.