Product Management 101: Customer Experience (CX) and Product Experience (PX)
Both customer experience (CX) and product experience (PX) are critical to your growth, retention, and customer advocacy initiatives. Below, we’ll discuss the basics of each concept and the differences between the two.
What is customer experience (CX)?
Customer experience (CX) is exactly that — how customers experience a product, what kind of impression it leaves on them, and as a result, the lasting feeling they have about the brand. Customer experience happens along a customer journey, often before purchase and continuing after they’ve moved on.
What is product experience (PX), and how does it differ from CX?
In the software industry, product experience (PX) refers to the portion of the customer journey that takes place within the application. It’s a narrower band of the overall customer experience. While customer experience continues after a customer leaves your product (and even after they churn), product experience is specific to their engagements with your product. As SaaS becomes the primary software delivery model, more of the customer’s engagement with a vendor takes place within the product. It’s where users get onboarded, where they learn about new features, and where they ultimately realize value.
For more traditional companies, focusing on the relationship between a web or mobile application and larger business objectives is typically part of a digital transformation strategy. Here, an orientation towards product experience is how companies of all sizes drive a meaningful transformation and take full advantage of digital products as part of their initiatives to modernize and become more data-driven and customer-centric.
How does product experience differ from user experience (UX)?
While user experience (UX) is concerned with the specific interactions a user has with a product, PX looks more broadly at the entire customer journey in the product. In many SaaS products, the complete customer journey from trial to purchase to renewal takes place within the product. Product teams, therefore, need to think not only about usability but also about how the product can facilitate each stage of the journey and ensure that customers realize ongoing value.
Why does CX matter?
Picture the feeling of delight when the software someone’s using for work helps them get something tedious off their desk quickly. That’s customer experience. But so is when someone gets bumped from a flight, and then their app tells them the flight is boarding.
Whether it’s positive or negative, the effects of customer experience linger. Good customer experience gains a company ambassadors, which is more powerful than any marketing campaign. Subpar customer experience can gain a company notoriety — and this is not an example of “any publicity is good publicity.”
Creating a customer experience that delights, engages, and keeps customers coming back is critical to growth. The opposite is also true. Last year, a study from PWC found that 59% of consumers will stop interacting with a brand they love after just one bad experience! The stakes are simply too high to risk giving customers an experience that’s anything short of excellent, at every touchpoint.
Why does PX matter?
Intuitive and personalized consumer product experiences are raising user expectations for business software, while subscription licensing models are making it easier than ever for dissatisfied customers to switch vendors. Usability and good design are no longer enough to meet today’s customer expectations. Software products must educate, engage, and adapt to their users’ needs.
But most companies don’t understand how users derive value or where they encounter friction inside an application. According to Pendo’s 2019 Feature Adoption Report, this means that as much as 80% of SaaS features go virtually unused, costing an estimated $30 billion in wasted R&D — a clear sign of a sub-optimal product experience.
To course-correct, product managers can frame and measure the product experience across five user lifecycle objectives with coinciding actions:
Onboarding new users: Focus on customer readiness and engagement. Automate walkthroughs and in-app guides, targeting personalized messages based on usage and feedback.
Driving product adoption: Design segmented customer journeys. Understand and measure user behavior with retroactive product analytics and user analytics. Employ tooltips to highlight features where and when they’re needed.
Converting and retaining customers: Increase user health and satisfaction. Capture ongoing sentiment and just-in-time feedback with surveys and analyze funnels by cohort and interaction.
Fostering expansion and growth: Focus on utilization and advocacy behaviors. Launch focused expansion campaigns directly in-app and identify, nurture, and reward champions.
Planning and innovation: Determine what to build next based on customer demand. Extend the product experience based on feedback and requests, segmented by user and behavioral data.
How do I measure customer experience?
One of the most common and effective ways to measure customer satisfaction is Net Promoter Score (NPS). This measures how likely a customer is to recommend a product to others, and by doing so determining who are the detractors and who are the promoters. A healthy NPS score is a solid indication that the customer experience has done the job of winning a company promoters, and in turn, new customers.
There are other measurements that give companies a read on how customers experience their products, including CSAT (Customer Satisfaction) and CES (Customer Effort Score), but in software products, one of the strongest indicators that customers are having a positive experience is churn rate. If a customer has had a negative experience, they are unlikely to renew their subscription. That is called churn.
How can I improve my customer experience?
As mentioned above, CX starts well before someone becomes a customer. It may begin with word of mouth, an online review, marketing materials, or a free trial. However, the first post-purchase step in the customer experience is often onboarding. Because onboarding is such a milestone step in the journey, it’s essential that companies make it intuitive, make it brief, and make sure it teaches the user the most important tenets of the product — all to expedite time to value.
Continuous measurement, ideally by using NPS, conveys how a product is performing over time. It can also be an opportunity to capture qualitative feedback, or “verbatims.” This open-text feedback can provide helpful context for quantifiable data.
The Digital Transformation Playbook by David Rogers
This book is a few years old, but its insights are more relevant than ever as the COVID-19 crisis pushes more and more companies to undergo rapid digital transformation.
“Incorporating the Voice of the Customer Into Your Company Culture” by Devon Golla
Those customers who have a positive experience with your brand and your product can become your biggest advocates. Incorporate the VoC into your team culture and product strategy with these eight strategies.
Digital or Death by Dominic Mazzone
Want an entertaining read on the sometimes-dry subject of digital transformation? Then this is the book for you, packed with real-life examples and humorous commentary.
“Why Product Should Care About Customer Churn” by Gordon Cone
Customer churn isn’t solely the purview of the CS team. And while it isn’t the happiest topic to discuss, but it’s definitely something all product teams should care about and track.