What is experience-led growth (XLG)?
XLG helps you to connect with what your customers care about, value, and desire.
So that you can find surprising insights and turn them into clear points of differentiation.
create a remarkable customer experience to fuel growth
McKinsey analysis shows that companies that are CX leaders achieve more than 2x the revenue growth of their competitors
The Problem
Companies that rely on bought growth are not going to survive in the long-term
Cheap money has come to an end, paid acquisition is prohibitively expensive, and people won’t buy without proof from word of mouth. This leaves companies with far less opportunity. You can survive but you need to grow without adding risk.
Paid acquisition is losing its power
Acquisition costs on platforms like Meta and Google have grown. Customers need to spend more over their lifetime to make businesses viable in the long-term.
Cheap money has come to an end
Interest rates have soared over the past few years, so companies must show higher return on growth initiatives. Even when they do, funding is harder to win.
Customers are more sophisticated
Consumers are less reliant on advertising for making decisions. The 2024 Edelman Trust Barometer states that people trust scientists and peers over anyone else.
The evolution of business growth strategies
Brand Leads the Way
The rise of broadcast media, such as TV and Radio brought advertising into people's homes. Visibility and an aspirational image meant commercial success. Brands competed with one another based on media spend. The one who shouted the loudest - would win.
Customer Service Evolves
Businesses began to focus on the end-to-end customer journey. Customer service became the standard as businesses focused on improving their products and service levels in order to keep up.
Hypergrowth Becomes the Norm
Businesses like Airbnb, Paypal, and Uber realised that they could grow quickly by using investment money. This emphasis on growth at all costs was accelerated by low interest rates after the 2008 financial crisis. Businesses didn’t care how much it cost to acquire new customers.
The Pandemic Changes Everything
Direct to Consumer (DTC) Companies believed that this was the new normal and started to forecast huge growth, and proliferated. As the impact from the pandemic passed, these companies had disappointing results and had to become experience-led to survive.
The Era of XLG Takes Off
With interest rates up, businesses are looking for a pathway towards sustainable growth. Everyone accepts that knowing your customer is key, and the wealth of data businesses have is crucial to selecting initiatives. The customer is a co-pilot, helping leadership adjust CX to reduce churn and win new fans.
The Solution
Why XLG now?
Experience-led growth is not new — it is built on the idea that the best path to profitability is to figure out what matters most to your customers.
With companies such as Peloton, Lyft, Farfetch, and many others that were once flying high seeing their share prices collapse, a new generation of investors now see that profitability is not something to compromise on, even in boom times.
XLG enables you to treat your unique customer experience as your key competitor advantage. This means proactively investing in and consciously building a distinctive customer experience across the whole customer journey.
The Challenges
Examples of experience-led companies
We have worked with companies when they were just starting out to turn them into market leaders.
THE BUSINESS BENEFITS OF XLG
Turn actual customer insights into cross-sell, retention, and improved conversion
When you think about CX as a flywheel, you adjust your growth strategy to address the areas that have the biggest impact - removing the blockers that prevent progress, such as silos, unreliable analysis, or misaligned metrics. Then you can truly serve your customers.
Awareness
Word of mouth
XLG companies use exceptional customer experience to benefit from word of mouth, built-in viral loops, recommendations, and paid referrals.
Acquisition
Improved Conversion
XLG companies invest in a smooth purchase process which results in higher conversion rates and more profit for every dollar spend on customer acquisition.
Loyalty & Retention
Stronger Retention
XLG makes retention easier through great first experiences, which means they come back again and join loyalty programs.
Expansion
Cross-sell and upsell
The same cohort of customers can drive the largest share of profits, so upgrading them to premium offerings can increase margins.
Service
Lower operational costs
XLG businesses often have lower operational costs because they have fewer returns, cancellations, or support contacts.
XLG doesn’t just happen
Many businesses agree with XLG even if they haven’t encountered the term before. But, oddly, few businesses have pursued this strategy coherently over a period of time. The reason for low adoption: management likes proven results.
Experience-Led Growth Maturity Assessment
Move from beginner to expert with a proven maturity model
Discover your starting point with a practical model that has worked for global and new businesses. Highlight opportunities, track progress, and improve your customer experience.
Gut feel
There are limited or no XLG capabilities in place. Some customer experience data is used, but decisions are based on gut feel and insight-driven decisions are not possible.
Developing
Some recognition of the need for customer experience data to support decision-making, although customer insight and understanding are incomplete or ad-hoc.
Influencing
A consistent view of what customers think and feel, and a number of teams are consistently acting on this data. The supporting processes are repeatable.
Leading
The focus on XLG delivers a consistently exceptional experience. Unified data across the customer journey gives a complete view of the customer and business metrics.
RESOURCE LIBRARY
How to transition to experience-led growth
The journey to becoming experience-led can be a circular one - it gets harder to maintain XLG adherence as you scale because customer experience decisions are made all across the organization. So here are a few resources to help build a better way to grow.
The essential guide to experience-led growth
Surprisingly few businesses know how to make XLG work in practice. Mikhail Dubov, walks you through how XLG can work for your business.
Delivering XLG - a blueprint for getting started
Principles aren’t enough. You need to get the right insights, align with business objectives, prioritize specific actions, and measure impact.
.jpg)
XLG: Why creating growth from customer experience Is the future of long-term profitability
Customer acquisition is getting harder. Leaders who refocus their strategy to XLG reap many financial rewards.
.jpg)
XLG maturity model
Learn how an XLG maturity model can help you to achieve long-term profitability and exceptional customer experience.
.jpg)
Online XLG maturity evaluation
Our quick online evaluation gives you an initial sense of how far your company has to go to unlock reality and reach its full potential.
XLG certification course
Take our online course and become a certified expert in experience-led growth.
How data and insights drive Experience-Led Growth
Discover why focusing on collecting the right data and delivering accurate insights is key for Experience-Led Growth (XLG) initiatives.
XLG: Taking action to move from gut feel to industry leader
Learn why taking action on customer feedback is a key element for Experience-Led Growth (XLG) initiatives.
Free XLG webinar
Watch the Experience-Led Growth: the business strategy for sustainable, profitable growth webinar, featuring McKinsey and E.ON.
Measuring Outcomes: The vital piece to data-driven decisions
Measuring outcomes after acting on customer feedback is an essential ingredient for experience-led growth (XLG) initiatives. Learn about impact measurement.
How company culture drives experience-led growth
A customer-centric culture is essential to maximize experience-led growth (XLG) initiatives. Find out what it means for driving growth in your organization.
