Managing the customer experience end to end costs money up front, but an old, underperforming service costs more: in customers who leave, and loyalty never won. Judged by the value it creates rather than what it costs, a better experience pays back far more over time.
What does an old customer service set-up really cost?
Every organisation would like best-in-class customer service, and then asks whether it will be expensive. Any significant change of system, process or approach costs money. But so does an out-of-date service that keeps missing chances to delight customers and build their loyalty. Do you know how much?
Many organisations run on a system bought long ago. Things tick along, seemingly fine: the costs, mainly wages, maintenance and a little training, are steady, and scaling is predictable and reactive.
Where is the hidden cost?
In what that set-up misses. Staff are trained for the familiar questions and no further, and an old system forces customers into a call centre, to wait in long queues or be passed between operators.
What looks like a saving has the opposite effect: the chance of an exceptional experience is missed, and customers often don't stay. The mindset has to shift from cost to value, including the happiness good service brings to customers, suppliers and your own team. As Don Peppers, founding partner of Peppers & Rogers Group, says:
It’s not just the out-of-pocket costs that corporate leaders need to consider, but also the opportunity cost of not providing an outstanding customer experience. Every time management thinks they’re saving money by reducing customer service, they’re actually losing customers who can’t be replaced. It’s money that can never be made up because those customers are gone for good—and there are a finite number of customers.
What is a better customer journey worth?
McKinsey found that brands that improve the customer journey can see revenue rise by as much as 10 to 15 per cent, while the cost to serve falls by 15 to 20 per cent. Measuring it means shifting from cost ("dry data") to value ("engagement data").
How is customer experience management different from CRM?
The Harvard Business Review compared the two. Customer relationship management (CRM) tracks what customers have done, after the fact; customer experience management (CEM) captures how a customer responds to each encounter with the company, as it happens.
Knowing what customers think as it happens creates chances to add value. A new system, upskilled call centre staff or AI for the easy questions may seem expensive at first, but over the medium to long term the opportunities they create dwarf the cost.
What difference does it make to a simple problem?
In a traditional call centre, using CRM:
- Staff answer only repetitive questions, and there is no AI.
- The customer is stuck in one channel, often on hold or passed between agents, and time is wasted.
- The system works, but is often slow and behind what today's consumers need. Happiness is low.
- Customer insight is minimal and slow, and changes little.
- Costs seem manageable and steady, but the missed opportunities are damaging and costly.
In an end-to-end customer experience, using CEM:
- Staff are upskilled for more complex interactions, and AI solves the repetitive ones quickly.
- The customer has several ways to reach the organisation, so the experience is quicker and more valuable, and time is saved.
- The system is integrated across the organisation and fast. Happiness is high.
- Customer insight is instant, relevant and shared across the organisation.
- The initial investment is significant, but the value, opportunity and satisfaction it creates keep staff and customers, and build loyalty.
So what should you measure?
The value created, not the cost spent. Implementation, new technology and training are an investment that returns much more over time than it costs. How 4 Roads builds intelligent self-service.
Updated on 19 September 2026.
