McKinsey Classics | January 2023

How a great customer experience creates value

Executives understand that successful customer-centric strategies create satisfied customers, engaged employees, greater loyalty, and a lower cost to serve. But many of them have no idea how much their customers like or dislike different parts of the customer experience, how these likes and dislikes influence behavior, or how much a company gains or loses as a result. Without that kind of knowledge, customer service transformations probably won’t rack up early wins that help them pay for themselves, build support among functional executives, or earn a place at the strategy table. These transformations stall before they really get going.

There’s a better way, anchored in science, business research, and a structured methodology. For starters, follow customer satisfaction levels over time to quantify the economic outcomes linked to them—for example, analyze the behavior of satisfied, neutral, and dissatisfied customers over a couple of years to learn, among many other things, how much less churn there is among satisfied ones. Then you’ll have a real business case for a customer service transformation program. To learn more, read our 2016 classic “Linking the customer experience to value.”

— Roger Draper, editor, New York