Creating powerful brands through CX and EX investment

Investing in customer experience (CX) and employee experience (EX) significantly enhances a brand's power by creating a virtuous cycle of satisfaction, loyalty and advocacy. Read on to understand how this investment translates into a stronger brand.

Below are seven key outcomes from such an investment:

1. Enhanced customer satisfaction and loyalty

• Personalized experiences: When you deeply understand the customer and their needs, factors like visibility become critical. Visibility is what makes your brand come to mind in buying situations. “You don’t see that if you’re not market-orientated,” as Mark Ritson stated. Investing in CX allows brands to offer personalized and seamless experiences, to meet or exceed customer expectations. Happy customers are more likely to return, leading to increased customer loyalty.
• Consistent quality: Focusing on CX ensures consistent service quality across all touchpoints, which strengthens trust and reliability in the brand.

2. Positive word-of-mouth and brand advocacy

• Customer referrals: Satisfied customers are more likely to recommend the brand to others, providing powerful word-of-mouth marketing. Big brands share their success with communities, rooting ideas in fan "truths." By focusing on fans and their behaviours, you can unlock ideas that could be taken to a much broader audience. As a result, the language of “fan truths” has proven to be “much more durable inside the business,” as explained in a WARC report on effectiveness trends from Cannes Lions 2024. Investing in CX and developing meaningful relationships with the target audience will increase sales and revenue, as demonstrated by successful marketing from McDonald’s.

• Online reviews: Positive experiences often translate into favourable online reviews, which can attract new customers and enhance the brand's reputation. Kory Marchisotto, CMO, e.l.f. Beauty, leads a brand that has delivered 21 quarters of revenue growth. She attributed this to “an aggressive focus on brand investment, and commitment to its core customer base.”

3. Heightened employee engagement and productivity

• Motivated workforce: Investing in EX ensures that employees are engaged, motivated and feel valued. Engaged employees are more productive, provide better service, and are more likely to go the extra mile for customers.
• Lower turnover: A positive work environment reduces employee turnover, saving costs related to hiring, onboarding and training of new staff, and ensuring organizational knowledge and skills are retained by existing staff.

4. Alignment of brand values and culture

• Brand ambassadors: When employees have a positive experience, they become brand ambassadors, embodying the brand’s values and delivering authentic and consistent brand messages.
• Culture of excellence: A strong EX fosters a culture of excellence and continuous improvement, which permeates through to the customer experience.

5. Innovation and constant improvement

• Feedback loop: Investing in both CX and EX creates a robust feedback loop. Customer insights can drive innovation in products and services, while employee feedback can lead to process improvements and enhanced service delivery. Gráinne Wafer, Diageo’s Global Director of Beer, Baileys, and Smirnoff, pointed to anchoring the creative and new product development strategy in community which influenced new innovations, and also “influenced the way Guinness talked about the quality of its product in their social and advertising work.”
• Adaptability: A strategic realignment around the brand’s most committed buyers is what Guiness credits its last decade of success to, as highlighted in the WARC report. A brand that listens and adapts to both customers and employees is more agile and better positioned to respond to market changes and new opportunities.

6. Strong financial performance and competitive advantage

• Increased revenue: Higher customer satisfaction and loyalty directly impact sales and revenue growth. Loyal customers tend to spend more and be less price-sensitive. Strong brands can charge more, which “makes pricing the secret superpower we don’t talk about,” says econometrician Dr. Grace Kite. Businesses that spend more on advertising and brand development have pricing power.
• Cost efficiencies: Engaged employees and satisfied customers reduce costs associated with turnover, recruitment and customer acquisition. Strong EX and CX also leads to fewer customer service issues, lowering operational costs. Brand building based on precedent, rather than persuasion is the better way to demonstrate cost effectiveness. As noted in the WARC report, “persuading people is hard. Showing them precedent is easier.”
• Market differentiation: We are living in a distinctiveness crisis. The “age of average” poses new challenges for brands that want to stand out. Brands that excel in CX and EX will stand out in the marketplace, gaining a competitive advantage over those that do not prioritize these areas.

7. Resilience and long-term success

• Brand resilience: EY’s Karen Crum has outlined “five levers of brand value: Generating trust, offering protection (especially in a crisis), driving preference, facilitating expansion and impacting perception.” A strong focus on CX and EX builds a resilient brand that can withstand market challenges and economic downturns. Loyal customers and committed employees help to provide stability.
• Sustainable growth: Sustainable growth is achieved through a committed customer base and a dedicated workforce, ensuring long-term brand health and success. A strong brand is like having a “very strong immune system,” says Harjot Singh, the 2024 President for the Creative Effectiveness Lions jury. The WARC report highlights an important takeaway: “Sustaining strategies takes bravery, but sticking to what you stand for can also give a brand a right to a point of view.”

Final thoughts

To sum it up, by investing in both CX and EX, brands create a holistic ecosystem where satisfied employees deliver exceptional service, leading to happy customers. This positive cycle enhances the brand’s reputation, drives loyalty, boosts financial performance and ensures sustainable growth, making the brand more powerful and resilient in the marketplace.

Source: “Creative Impact unpacked: 11 effectiveness trends from Cannes Lions 2024.”