As businesses look to differentiate themselves, the digital experience is a key battleground where loyalty is won and lost. So it’s natural that more and more businesses are investing in maximizing its business impact, taking steps to optimize the website and app funnel so customers can complete the next milestone in their journey.
Even though there are huge volumes of data available within digital channel analytics, brands often have a hard time identifying what steps will drive a meaningful impact on the business. That’s because traditional analytics don’t tell you the whole story. It’s impossible to see the human on the other side of the data point.
Traditional digital funnel metrics don’t tell you enough
Tracking the performance of digital metrics usually involves examining traffic (number of visitors) and the number of times the milestone (or call to action) was completed. Getting a customer to convert is the ultimate goal of the brand – but is it really your customers’ goal to complete this action? Not necessarily.
Let’s take the example of a customer who’s browsing and learning about your company for the very first time. They might use a search engine, find their way to your site, and browse through the products available. The customer enjoyed learning about the variety of offerings, and the look and feel of the website resonated with them but is not quite ready to purchase.
Maybe they don’t need the product just yet? Or they just received a text message and got distracted. Though this wouldn’t be counted as a conversion according to traditional metrics, it was still successful because you made a great first impression.
Without the context of understanding customers as individuals, and only looking at macro-level analytics, digital teams find themselves driving optimizations to two levers of funnel metrics: visitors and website conversion rate.
However, there are problems with using these two levers alone:
Driving visitors to your website or app is expensive. As we all know, not all traffic and website visitors are created equal. SEO and paid traffic can be costly – more likely than not, the traffic you pay for results in low conversion rates. Merely getting eyeballs on the landing page may not be enough to propel your business outcomes in the long term.
Driving conversions can be incredibly labour-intensive and time-consuming. Macro numbers can be limiting when you can’t segment by the audience, meaning you’re never looking at the full picture. Conducting tests to find statistical significance and large conversion rate swings can take quite a bit of time, too.
By using these two levers alone, brands are missing out on a very important point of view: the individual customer and the context of their experience. In the digital experience, when it’s nearly impossible to replicate in-person interactions, customer loyalty is on a knife-edge. Over 60% of consumers say that they’ll buy more from brands that show they care about them. The experience you offer customers could be the difference between success and failure.
What do they want to get out of interactions with your brand? What would make them spend more - and why?
Deeply understand customer interactions with DX Metrics
This is why we’ve developed DX Metrics, a new approach that brings data-driven human connection to digital experiences and delivers huge business impact. DX Metrics is proven to help you link customer sentiment and behavior directly to conversion, adoption, and customer lifetime value – ultimately driving revenue and customer loyalty.
Using in-depth research from the Qualtrics XM Institute annual XMI Customer ratings we identified three critical aspects of the digital experience. We found that improving these had a huge improvement on revenue:
Emotion: As measured by customer satisfaction (CSAT) scores, how do customers feel about your brand?
Effort: As measured by customer effort scores (CES), how easy is it for customers to complete their task on your digital platform?
Success: As measured by task completion, how successful are customers’ experiences with your brand?
Brands often complete CSAT and CES scoring to create internal benchmarks for comparison over time. However, understanding the interconnection between these metrics and the specific economic value of the results is where DX Metrics comes into its own.
Improve the digital experience, improve your ROI.
Improving emotion, effort and success has a huge impact on the bottom line.
Extremely satisfied customers spend 37% more than extremely dissatisfied customers.
Customers who have an extremely easy experience spend up to 23% more with each transaction than those who have an extremely difficult experience.
Here’s what it means for you:
1. Emotion is king, and leads to increased cart size and lifetime value
An overlooked lever is increasing cart or purchase size by building emotional connections. Do you have a loyalty program? Do you send your customers a discount code on their birthday?
By rewarding customers in the moment of the transaction helps to reinforce your connection with them and encourages them to come back. Offering benefits to customers at key moments of truth will also go a long way in creating a memorable and meaningful interaction.
What is the benefit of emotional connection in real-terms?
For illustrative purposes, let’s assume you get 100k visitors with a 2% conversion on an average cart size of $100. This results in 2,000 converted customers and a $200,000 revenue as shown below.
Now, what happens if you create experiences that resonate emotionally? You’ll increase the average cart size to $137, as our study shows that extremely satisfied customers spend 37% more than extremely dissatisfied customers.
This results in the same volume of converted customers, but with $274,000 revenue.
When experience resonates emotionally, customers tend to purchase more – and then tell their friends – driving high-intent organic traffic.
2. Hone in on effort (not to be confused with success, which is table stakes)
Effort translates to conversion. By getting ahead of what customers need, you can make their experience effortless and quicken their decision making – moving them to convert faster.
To do this effectively, you need to be able to identify and meet these customers' needs at scale. Experience ID can help you segment customer profiles including their preference data, to identify individual customer budget requirements or interests, enabling you to send reminders or surface the products that are most interesting.
Using our initial example, we’ve increased the conversion rate to 2.46% (up 23% from 2% conversion) as our study shows that customers who have an extremely easy experience spend up to 23% more with each transaction.
This results in an increased volume of converted customers and a subsequent increase of revenue to $246,000.
3. Track in real-time
The difference here is being able to understand what needs changing very quickly - because customers are telling you. Our platform helps you prioritize customer feedback, ensuring you make changes that will drive the highest business impact. This results in fast time to value and knowing exactly what you need to improve upon.
Of course with any metrics, the key is to track them over time. It’s important to benchmark these metrics to see how you stack up with industry peers and tie these metrics to operational data like cart size to see the trend over time and make iterative improvements.
Take advantage of our innovations below to get the most business impact using DX Metrics:
Scientifically-validated questions to ask customers at each touchpoint in the customer journey, all easily accessible in our certified library and available in 13 languages
Benchmarks that illustrate how your digital experience KPIs compare to others in the same industry
Combine this data with customer feedback across support conversations, social media posts and other unstructured channels from XM Discover to create competitive advantages
Deliver personalized experiences at scale with Experience ID, our intelligent database that pulls in all experience and operational data shared by customers and then organizes it into unique individual profiles to create a 360-degree view of each customer’s journey
Outpace your competitors with a digital-first customer strategy
Successful task completion is now table stakes. It’s 2022 and brands cannot survive if their customers and prospects can’t successfully complete what they set out to do online. Analyzing and optimizing for traditional funnel metrics is not enough. You need to be able to deliver experiences that resonate on an emotional and human level, while improving your bottom line at scale.
That’s why we created DX Metrics, a science-based approach proven to do just that.
Content credit Qualtrics
Qualtrics, the world’s No. 1 Experience Management (XM) provider and creator of the XM category, is changing the way organisations manage and improve the four core experiences of business—customer, employee, product, and brand. Over 13,500 organisations around the world are using Qualtrics to listen, understand, and take action on experience data (X-data™)—the beliefs, emotions, and intentions that tell you why things are happening, and what to do about it. The Qualtrics XM Platform™ is a system of action that helps businesses attract customers who stay longer and buy more, engage employees who build a positive culture, develop breakthrough products people love, and build a brand people are passionate about. To learn more, please visit qualtrics.com.