Customer Experience More Important than Ever

"Eighty percent of companies believe they deliver a superior customer experience, but only 8 percent of their customers agree."

[Bain & Company, Harvard Management Update]

I'm not telling you anything you don't already know, of course. However, there might be a few areas of improvement that have not have crossed your mind yet. First off, let's define what we mean by "customer experience". From Wikipedia:

Customer experience is the sum of all experiences a customer has with a supplier of goods or services, over the duration of their relationship with that supplier.

The sum of all experiences you have with a brand is part of marketing. There is a lot of really good research on this topic.

While in the boom years many companies focused on acquiring new customers with a churn and burn mindset, many are now coming to the realization that there are only a finite number of prospects out there - many of them are their current customers.

You read that right. Often you will know a customer is exploring other services, you may learn they are by tracking their browsing habits on your site.

However, if you haven't cultivated a good relationship with them, they won't buy from you. Part of the good relationship is the ease with which they can do business with you. Would they recommend you to someone else? More importantly, would they buy more from you themselves?

With this information in hand, consider the three components of customer experience as defined by Forrester (in bold) in the Customer Experience Index 2010. My initial thoughts:

1) meeting needs

Think about right place, right time. Being prompt, proactive, and helpful. Then think about not just creating a customer or satisfying that customer, but creating a mechanism for that customer to help you spread the word to other customers.

The price of entry is quite low in many industries, there's plenty of opportunity for a company that is willing to design offers and experiences that move customers to evangelists and advocates.

2) being easy to work with

This is not as easy as it seems. In many companies it means learning to go across the organization. Tracking and measuring the right things helps, of course. Have you thought of your contracts, forms, checklists, and processes as part of your marketing materials? How's their usability?

Does your organization create opportunities to learn what it does well and what it can improve in all its processes? How can you do that by direct feedback and observable behavior? Do you act on it?

3) enjoyability

By and large, this is in the hands of all the people who have contact with your customers. Hiring well, training continuously, supporting your people with useful information, and treating them with respect will translate into more enjoyable customer conversations.

It wouldn't be fair making those support functions accountable without providing the proper resources, processes, and training for them to succeed, would it?

Why is this important?

A recent survey conducted by the Society of Digital Agencies on the 2010 Digital Marketing Outlook [hat tip Scott Monty] uncovered many areas of opportunity for companies. Customer experience, along with getting back to storytelling, is a biggie.

Looking at emerging trends:

• Customer experience will be more important than ever -- we outlined a few areas to consider above. To those, I'll add the importance of the role of the community manager to represent brand experience.

• Storytelling will evolve - location will become a key component; the speed at which stories are developed is crucial; and above all, emotional connections matter -- you cannot fabricate, push, or coerce emotional connection.

• Branded content syndication will replace some paid media -- many organizations need to rethink where they allocate their resources. Producing high quality, hard hitting content is a prized skill and you should not underestimate the time and resources that go into it. Or you're bound to fail.

• The beginning of the end of the banner ad -- we keep seeing this prediction, I'm not sure we have a mature enough alternative to be considered "proven". As you know, companies these days are all about "best practices".

• 40% of opportunity is mobile -- with a caveat. Mobile is much more personal and intrusive. Content and utility for the medium need to be front and center here.

Integration plays a key role in all this. Many companies will have a sense of needing to boil the ocean from day one. In many instances, what this means is taking a fresh look at all processes and systems and prioritizing choices and resources to transform the way they operate.

***

How can you develop capabilities and capacity that will allow you to play successfully into these emerging trends? Who makes the call? Is it product? Is it the line of business? Why not marketing?

[image credit http://www.flickr.com/photos/claylarsen/ / CC BY-NC-ND 2.0]

© 2006-2010 Valeria Maltoni. All rights reserved.

Comments

[Jeannie Walters]

I agree with this totally. The point about boiling the ocean is a good one. Many clients face being overwhelmed at the thought of understanding - let alone changing and improving - their own customer experience. I stress taking whatever steps are necessary to take some steps towards this goal. Social media is a perfect way to dip a toe in the water here. But it's not a one-time initiative that makes a difference. It's an all-out culture change. Thanks, Valeria. Great post!

[John McTigue]

You can't do all this alone. You have to involve your customers in the process. Don't just circulate surveys, ask them what they like and dislike about your company, products and services. Make it personal. This is what drives customer loyalty. Yes, give them a venue for sharing experiences with each other. Stop thinking like a vendor and start thinking like a consumer.

[Valeria Maltoni]

@Jeannie - thank you for the observation. The sense of overwhelm also comes from the fact that resources are just not there anymore. Less is less.

@John - excuse me? Do we have a disconnect? It's my experience that people will say one thing and do another. Do take the time to be aware of your own behavior and you'll notice inconsistencies. It's called being human. Ask + observe. How do you think the research was sourced?

[Akash Sharma]

Some great advice shared up there Valeria, I think as we are shifting more towards customer retention as compared to customer acquisition. This shift is quite right because working on customer retention strategies spreads the word for the kind of work a firm does and gets more clients.
Plus from our employees to the people who are projected to our adverts, one thing has to be common in enhancing the experience that we have to conversate.

[Dan Wedin]

Hi Valeria,
I'm in the restaurant industry and your post is right on. Just relying on customers to provide feedback when they have a bad experience is less than satisfactory. Most customers won't complain, they'll just look for an alternative. I've tried to reach out more and more via social media to my customer base and it's proving well worth the effort.

[Ben Wise]

Great post! Completely agree with the importance of the customer experience in delivering the brand promise. These are too often thought of as separate entities. All the more important as customers have a bigger audience through social media. Here is a post on a similar topic that might be of interest:
http://benwisebranding.wordpress.com/2010/01/25/using-customer-experience-to-develop-brand-advocates/

[Tim Sanchez]

Valeria,

I, of course, couldn't agree more that customer experience is an extremely important aspect of business.

While selling more to your current customers is always a benefit, I think the greater benefit is those customers' recommendations of your company.

As information overload only gets worse, people will increasingly look to trusted sources for advice on buying decisions. All of the advertising in the world can't overcome a bad recommendation from a trusted source.

The recession won't last forever (I hope!), and the companies that have been focused on CX will have the greatest advantage when the wallets start opening again. That, in my opinion, is why CX is more important than ever.

[Valeria Maltoni]

@Akash - consider also that the same mindset should be governing employee relations.

@Dan - that's right, they just won't come again. On the other hand, as you've experienced, learning what is important to them in conversation, by observing what they do, provides great insights.

@Ben - thank you for the link. I wonder though, since so many of us understand the importance of the right experience, why the disconnect? Good thoughts there.

@Tim - think it was Shiv Singh from Razorfish who said the purpose of social media marketing is to create a customer who creates a customer. Trust is a topic near and dear to my heart. And it's what cuts through the clutter.

[Deni Kasrel]

Valeria,

As always, you put things in good perspective. The trends you highlight are all real and true and are becoming ever more important to pay attention to.

I do think that regardless of what the trend, technology, conveyance of message, or whatever, the bottom line is (trite but true) the customer is a real person -- not a commodity, or a target demographic, or a persona. So the best customer experience is one where a company treats a customer like a human being and all touch-points relate/respond in ways that are genuinely human.

[peter]

"Eighty percent of companies believe they deliver a superior customer experience, but only 8 percent of their customers agree."

But 100% bought (based on the implication that they are all customers).

This suggests that the nexus between the experience and purchase may not be as close as it might otherwise seem logical.

My own observations are that many customers come to the experience (of consumption) so clouded in their expectation, that they are incapable of recognising good or bad customer service - essentially the experience of consumption is bad.

I think (one of) the reason for this is that we tend to seek happiness in consumption. But when what we buy doesn't deliver we turn, not on ourselves for being silly, but on the company that supplied the product or service ( this is consistent with the overall pattern of dissatified but still consuming consumers (and humaness)).

In this sense, customer service is in part human compassion for the experience that the customer brings upon himself. Now there's a thought.

As always, happy to be half wrong.
(observe, ask, observe, make stuff up, observe and then forget.)

Peter

[Linda Ireland]

Yes, customer experience is more important than ever. Certainly, integration of the experience is critical. And absolutely not enough leaders act as if they understand the disconnect illustrated by the Bain quote that opens your great post.

Every customer experience begins with a person who has a need, problem or desire they would pay money to have solved. Your post provokes the question: what need are you solving for your customers? Because whether or not it’s solved – and how well – will ultimately be a customer’s definition of a successful experience. So of all the actions you outline, I’d start with a crisp focus on what contributes to solving that need – and stop wasting precious time and money on what doesn’t (like your headline this seems like common sense but is hard work).

In the end, we get a profit payoff for our organizations if we do this well. In research my firm Aveus conducted, we found that organizations who had a focus on customer experience throughout the organization were twice as likely to hit their profit goals. Yes, twice as likely.(Learn more: http://www.ceforprofit.com/evidence.html)

So thanks for the potent reminder that customer experience is indeed more important than ever.
LCI

[Glenn Friesen]

You forecast that customer experience will be more important than ever -- and you will be right. Customer Experience in the era of Super Empowered Individuals is just as important as any Strategic Alliance with formerly Super Empowered Companies, or Trade Organizations. Great article! Thanks!

Glenn Friesen
http://impactlearning.com
http://twitter.com/impactlearning