Tips & Resources

Customer Perception: What It Is, Why It's Important and How to Improve It

With the latest research showing that customers now choose brands by customer experience (CX) instead of by price, your customer perception is more important than ever before. It’s never been easier for unhappy customers to find your competition online and take their business elsewhere, but studies have shown that companies who add real value see a boost to their customer perceptions, perceived value and brand loyalty.

Below, we explore what customer perception is, why it’s important, and some methods that you can use to improve yours.

What is customer perception?

A customer’s perception of your brand can be created in multiple ways; it often factors in a combination of your branding, advertising, the opinions of others and a customer’s personal experience, or emotional connection with your brand.

Customer perception essentially covers your customers’ opinions and impressions of you, your products and your company. Although the term uses ‘customer’ in the name, it also encompasses the impression your prospects, future customers and previous customers have of you.

Unfortunately, the perception of your business and its products aren’t entirely controlled by you – while your branding, advertising, product quality and customer service have a significant effect on what consumers think of you, the perception is, ultimately, formed by the customers themselves. This means it won’t always represent truth or fact – only an individual’s unique experience and interactions with you.

Why is it important?

One of the keys to customer perception is playing the long game. By creating a customer experience aimed at building long-term relationships, your focus shifts from driving individual sales to adding real value to your customers.

By focusing on creating relationships, you can build a sustainable, loyal and growing customer base. Not only that, but studies have shown that loyal customers are much more likely to buy again from you, trust your brand, and recommend you to friends, family and co-workers.

Beyond this, there’s a strong correlation between positive customer perception and perceived product value. If your brand has a reputation for high-quality goods and brilliant customer service, research has shown that 8 out of 10 consumers would be willing to pay a premium to buy from you.

Improving your customer perception

Step 1. Benchmarking

As with any new initiative, benchmarking the status quo is essential not only to create a starting point to measure success from, but also to understand the effects of your efforts.

NPS

One of the ways to monitor your current customer perception is with your Net Promoter Score (NPS). NPS is a universally acknowledged customer satisfaction benchmark that measures the loyalty of your customers, and the likelihood of them recommending you to their friends or family. Rather than looking at specifics such as customer service or product quality, your NPS is a good indicator of overall customer satisfaction, taking into account all of their interactions with you.

Customer feedback

The easiest way to understand your customers’ impression of you? Ask them for feedback! Create short feedback surveys, polls or questionnaires to gather quick insights and understand trends. You may find that by offering an incentive, a higher proportion of your customers will be more willing to take part, giving you the most accurate insights available, and taking guesswork out of the equation.

Social listening

One of the most regularly overlooked tools when understanding customers is social listening. There are a wealth of online tools you can use to monitor mentions of your brand, competitors and even topics related to your business, giving you a ton of (non-biased) data to better understand your customer perception and the way people speak about your brand.

Step 2. Map out your customer journey

Once you have benchmarking data, the next step is to fully understand your customer journey. This isn’t about the ‘Awareness to Purchase’ high-level sales funnel – you should map out any and all touchpoints and experiences that customers have with your brand. This may include offline advertising, events, conversations with co-workers, PR pieces and more.

If you’re struggling, start by looking at your website and marketing data to better understand your customer journey. Data from other departments (such as your customer service team) may also help you to understand the pinch points, frequent issues faced and regular misunderstandings – and you can include these in your customer map.

Step 3. Address areas for improvement

Now you have the data and a better understanding of your customer experience, it’s important to analyse the expectations versus reality in each step of your customer journey, as this is one of the drivers when a customer’s perception is formed.

At this point, it’s also important to make sure you’re delivering a consistent customer experience across all touchpoints. If your marketing talks all about putting the customers first but your live chat makes it impossible to speak to a human, the customer experience is inconsistent – and will contribute to a poor customer perception.

Some common things that may affect customer perceptions (for better or worse) include:

Pricing

Whether it’s too low, too high or just right, your pricing creates a perceived value of your product or services. The context of your costs is important – cheap rarely means high quality, so your pricing needs to be in line with your marketing and communications to build an accurate perception.

Quality

Although sometimes subjective, the quality of your packaging and of your product itself will create an instant impression of your brand. Customers will compare the actual quality of your product with its perceived value based on the price paid, your advertising and any previous interactions with you, so it’s important your product quality aligns with the impression you’re trying to create.

Customer service

Your customer service interactions are another one of the major contributing factors. While you could be nailing your product design, a poor customer service interaction can truly make or break a customer’s perception of you.

Branding

The imagery you use, your packaging and the words you use in your advertising and communications all work in tandem to create an impression. Think about your colour schemes, brand name, logo and even product imagery – what impression does this create of your product or service.

Step 4: Monitor and iterate

Finally, it’s important to monitor and iterate on an ongoing basis, using the same data sources and methods that you did in Step 1 to benchmark.

Improvements to your customer perception will generally:

  • Increase your Customer Lifetime Value (CLV)
  • Improve brand loyalty and advocacy
  • Increase conversion rates
  • Reduce customer churn rates

However, if you aren’t seeing improvements to your NPS score, customer feedback or your mentions online, it’s worth going back to Step 2 of this article to better understand the pinch points.

Ready to take control of your customer perception?

Your perceptions and brand reputation are unlikely to change overnight. However, by listening to your customers, understanding the journey they take with your brand and addressing the things that aren’t working right now, you can start to improve your customer perceptions.

To find out more about how our customer feedback and survey tools can help you enhance customer perceptions, get in touch with our friendly team today.

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