Customer Experience And Loyalty Starts And Ends With The Product!

Back in 2011 I asked this question: Customer Experience: What About The ‘Product’? And I ended that conversation with the following assertion:

The product is not in one domain and Customer Experience in another domain.  Any serious examination of the Customer Experience has to grapple with the product and how well it does the job that the customer is hiring it to do.  That means designing that product so that it is both useful (does the job) and usable (easy/intuitive) to use.

Today, I stand by that conversation. In particular, the necessity and critical importance of the ‘product’ (the core product or service which calls forth the customer to reach out and interact with the organisation which is selling that product or service) to any serious work on improving-transforming the customer’s experience of the organisation.

I also find that I was wrong. How so?  Today, I’d sum up that conversation differently.  How would I sum it up?  As follows:

 The ‘product’ is not in one domain and Customer Experience in another domain.  Any serious examination of the Customer Experience (as in the customer’s experience) has to grapple with the ‘product’ and how well it does the job that the customer is hiring it to do.  That means designing the ‘product’ so that it is useful (does the job), usable (easy/intuitive to use), and sensuous (evokes the senses and calls forth awe). When you get the ‘product’ right you will learn that in a substantial-meaningful way that the customer’s experience and loyalty start and end with the design of the ‘product’. If you have the right product then you can concentrate on marketing (advertising, distributing) it. Little need to waste your time on the latest corporate nonsense: customer experience management as in customer interaction management across a multitude of interaction channels.

What has led me to this way of summing up the matter?  Apple. In particular, Apple’s latest financial results – the largest quarterly corporate profit of any company.  Let’s look into the quarterly figures a little bit more: revenue of $75bn, profit of $18bn, and Apple sold 34,000 iPhones per hour.  Allow me to share this paragraph with you (bolding mine):

Apple chief executive Tim Cook called the company’s sales “phenomenal” and said the company had sold 34,000 iPhones an hour every day of the quarter. “This volume is hard to comprehend,” Cook said.

I am now going to make my most controversial assertion. Ready?  I say that the field of Customer Experience Management (as in customer interaction management) is attractive to and for the mediocre. Yes, the mediocre!  You know the folks that do not design-sell great ‘products’.  ‘Products’ that do not simplify-enrich the lives of our fellow human beings.  Look if you make a great product then the world beats a path to your door -including overcoming any hurdles along the path.  Only CXM fools ignore the critical importance of the ‘product’. Isn’t the product the reason that the customer takes action – to actual reach out to the business in the first place?

 

If You Can’t Prove The ROI Of Your Customer Experience Effort Then Consider This Option

Where is Customer Experience Management At?

What are the highlights of the Harvard Business Review Analytic Services study: Lessons from the Leading Edge of Customer Experience Management?  It occurs to me that there are many. And for the purposes of this post I want to concentrate on a subset.

According to the study: Less than half of the companies view customer experience management as a strategic priority.  Most are struggling to develop clear and consistent customer experience strategies, support, processes, and metrics across the organisation. 

Put differently, even the 50% who see customer experience management as a strategic priority are finding it hard.

What are the biggest obstacles-hurdles on the path of Customer Experience?

The authors of the study point out three challenges that making the going hard:

  1. Proving ROI – folks are finding it difficult to prove ROI as they are not able to link business outcomes to customer experience effort.

  2. Data & Integration – single customer view turns out to be a lot like enlightenment only a select few have realised it (after years of effort) the rest are having a difficult time knitting together their data and systems.

  3. Customer-focused culture – it turns out that speaking-writing-evangelising about customer focus turns out to be easy, creating an organisation which is genuinely customer focussed is ‘a bridge too far’ for most (if not almost all) organisations.

If you want to access the authors prescription for addressing these challenges then I suggest you read the study. For my part, I find their recommendations rather unsatisfactory. Why?  Their six lessons in Customer Experience Management start with ‘Lesson One: Create A Customer-Centric Culture’!  What genius!  And how do they recommend that you do that?  Rewards and punishments!  Our stupidity never ceases to amaze me.

What Option Is Open To You If You Cannot Prove ROI? 

Three options show up me for me when I consider this question. First, stop flogging a dead horse and do something else in the organisation that you find interesting or which holds the promise of success that you aspire to.  Second, move to another organisation – one which seems to you to be more receptive to the Customer Experience thing.

What is the third option?  Allow me to introduce this option by sharing the following quote:

Under-think your life’s purpose

Finding your ‘purpose’ in life is an attractive ambition, and I’m sure there are plenty of people who’ve simply said “This is what I was born to do,” but not everyone is as lucky as that.  The simple alternative for the rest of us is to ask “What is the next useful action I can take?” Keep it simple – if you notice a problem that needs solving, solve it, and if you meet a person who needs help, help them.

– David Turnball

Looking at this pragmatic advice through a Customer Experience lens, it occurs to the that the third option is as follows:

  • If you meet a customer who needs help, then help that customer;
  • If you notice a problem (that impacts the Customer Experience negatively) and have the capacity to solve that problem, then solve that problem; and
  • If you have an opportunity to do something unexpected-special for a customer then go ahead and do that something special.

Your small actions may get noticed, they may infect your colleagues and through them feed into the larger organisation.  At the very minimum, you have the satisfaction of lived true to your values and made a difference in the lives of some of your customers.

 

 

 

 

 

What powers excellence in Customer Experience Management?

I was one of the four speakers on the speaker panel yesterday at the Technology For Marketing & Advertising conference/Exhibition in London.  Our conversation centred on the shift that IT vendors are making from calling their software CRM to labelling it CEM.  The first question that by Neil Davey (editor of MyCustomer.com) asked centred on what the discipline of CEM involves. That is what I want to grapple with today.

What does the discipline of CEM involve?

It occurs to me that there is a discipline called marketing, one called finance, another called logistics. Is there a discipline called CEM? I say there is not. There is a movement that is sometimes called CEM. And today it is just that – a movement.  It occurs to me that a movement is distinct from a discipline.

So let’s assume that there is a disciple of CEM. Put differently, lets assume that the Tops decide to play the Customer Experience game. So the question arises, what does it take for their organisation to excel at this game and generate happy customers, and profitable revenues?

Looking at the situation simplistically, it occurs to me that it takes the following:

1. Generating rich insight into the needs of buyers/customers;

2. Choosing a value proposition that speaks to (attracts) these buyers/customers; &

3. Designing and delivering a customer experience that fulfils on the promise made in the value proposition.

If we want to get into the detail of what it takes to generate rich insight, shape the value proposition, and deliver the customer experience that fulfils on the promise of the value proposition then I say that the levers are:

Priorities: what matters, what is talked about, what it given attention, what is fed with resources, what gets done, what gets rewarded, what gets celebrated….

Policies: statements of intent, of direction, of position, of fundamental principles that shape behaviour/action

Practices: policies get enacted (lived, carried out) or not through the practices of the organisation; there are practices around decision-making, resource allocation, customer, employees etc

People: it is not sufficiently appreciated that ALL that occurs in an organisation occurs through people and as such the stance, the disposition, the attitudes, the feelings, the behaviours of people matter!

Platforms: platforms are a combination of resources/tools that are brought together to enable the people in the organisation to do what they need to do – budgets, processes, tools, and IT systems are key ingredients of that which collectively make up platforms.

I am clear that whilst all of this is necessary it is not enough. The elixir that gives life and enables all of this to work, to flourish, and thus generate the desired performance is missing. Can you guess what it is?

Does excellence in the game of Customer Experience require a change in consciousness?

I say that excellence in the game of Customer Experience requires a change of consciousness.  Specifically, it requires a step change in consciousness. It occurs to me that the kind of change of consciousness that I am pointing out can be likened to phase transitions: like ice becoming water or water becoming steam.  Notice, that ice, water, and steam are distinct.

So what kind of consciousness is required for excellence in the game of Customer Experience?  The following occur to me when I pose this question to myself:

Consciousness of customers as fellow human beings who are always experiencing, including experiencing whether they are safe, whether they matter, whether they are cared for..

Consciousness of employees as fellow human beings, our team mates and source of all the value that is created by the organisation. And not as resources/objects/commodities that come in the awkward human form and as such have to be manipulated, controlled, coerced, used, discarded…

Consciousness of the fact that the only relationship that really works, in the longer term and leads to high performance, between human beings is that which is an I-Thou relationship as opposed to the default of I-It.

Consciousness of the profound difference between competing at the level of ‘product’ plus service and competing on the basis of the customer experience. A paperback book and friendly service at the counter is radically different from finding a book and seconds later reading it on the Kindle, or iPhone, or iPad, or all of them!

What do you say?

A framework to help you to think about and make sense of Customer Experience Management

A high end retailer and a discount retailer offer the same value for money

I was reading Marketing Week and the following piece caught my attention:

Consumers perceive that John Lewis and Primark offer the same value for money, despite their widely different brand positionings, according to a new retail study.

The “Re-imagining the retail store” report, by Arc Worldwide – part of the Leo Burnett Group, found that both John Lewis and Primark scored 112 on its quantitative scale for value for money, as rated by consumers.

The scores demonstrate that both deliver good value for money, but in different ways. Consumers’ perceptions of Primark’s value stems from its low price, while John Lewis’ value perception comes from its range of choice and quality.”

How do you make sense of Customer Experience?

How do you decide when you have got the customer experience right?  How does the customer experience fit / contrast with customer service?  How does customer experience fit into the bigger picture? Put differently if customer experience is the foreground then what it the background (the context) into which it fits?  I have been grappling with these questions and want to share my thoughts with you and get your feedback.

Here is how I make sense of Customer Experience:

In my way of thinking the focus of enterprise effort should be to create (and communicate) superior value to the customer segments that the Tops have decided to focus upon – to serve.   So that is why “Superior value” sits at the centre of my thinking and this diagram.

Which begs the question: how do you create superior value?  My answer is made up of two parts. First, you have to come up with (and communicate) value propositions that meet customer needs/wants – whether these needs and wants are expressed or not by the customers themselves.  Second, you need to deliver a customer experience that matches the promises implied within the proposition.  And the brand plays a role because there are a set of promised associated with the brand by customers and these are inherent in any value proposition.   For example, you will expect different stuff when you think of Mercedes and say GM.

The key point I want to stress is that in this framework we can think of the value proposition as the promise – the bargain that is being struck between the customer and the enterprise.  And the customer experience is the delivery of that bargain as experienced (lived) by the customer.

If you think about value, value proposition and customer experience then the fact that a high end retailer and a discount retailer as perceived as being par on value makes perfect sense.  They both excel because they have crafted value propositions that speak to their chosen customer segments and deliver the customer experience that goes with the value proposition.

How do you craft the right value proposition and associated customer experience?  This is where insight comes into play.  In my model I distinguish four different types of insight: customer insight – your customers needs, wants, behaviours; competitive intelligence – what your competitors are up to; technology insight – what technology enables and how it disrupts what is taken for granted today; and other insight for example regulation around how you treat customers, privacy etc.

The final point I want to make is that I strive to think like a ‘systems thinker’ and I see all of these pieces as being interdependent.  Each affects everything else.  So customer insight informs the value proposition and the customer experience.  Yet the customer experience will inform/feed customer insight and the value proposition cannot be developed solely based on customer insight: competitive intelligence has to be factored in because we, humans, make sense of things through comparison and contrast.  You may have a great value proposition and customer experience yet if your customer comes up with a better value proposition then you are likely to find yourself in trouble: think Nokia, think RIM.

Customer Experience Management – a tentative definition

I take the view that all knowledge is provisional and as such I offer you my ‘faulty’ yet ‘rigorous’ definition of Customer Experience Management:

Customer Experience Management is the practice of designing, orchestrating and overseeing the efficacy of customer interaction (direct and indirect) such that the phenomena (experience) and outcomes of these interactions as a whole deliver on the promises implied by the value proposition and meet-exceed the expectations (implicit and explicit) of the customer, the customer facing agent and the management of the enterprise.

If you want a much simpler definition then here it is:

all the stuff that you need to do to create happy customers, have them stick with you, incentivise them to ‘recruit’ new customers for you (free of charge) AND to do this in a way which delivers a fair reward for the investment/sacrifice that you make in time, money, effort and risk.

What do you think?

I’d love to get your feedback on what I have written here.  So what do you think?

Easy ways for smaller businesses to improve the customer experience

Over at Focus Courtney Sato asked the following question:  “What are easy ways for small businesses to (almost) instantly improve the customer experience?”  To answer that question it is worth getting clear on what constitutes ‘customer experience’.

One way of looking at Customer Experience Management: effectiveness of interactions

Here is how Richard Snow (VP & Research Director at Ventana Research) defines ‘customer experience management‘:  Customer experience management is the practice of managing the effectiveness of customer interactions so the outcome meets the customer’s and the company’s expectations.

How do you improve the effectiveness of these interactions?

If we accept this definition (and largely I do – there is a piece missing) then the question is what do we need to do to improve the effectiveness of the customer’s interactions with our business?  In his article Richard sets out the four steps:

  • Measure the outcome of all customer interactions (across all media, all touchpoints, all aspects of the customer journey);
  • Identify the reason for the interaction (from the customer’s perspective);
  • Figure out why the outcome was the way it was (root cause analysis); and
  • Make necessary changes to generate more of what works and eliminate/minimise what does not work.

What we can learn from Guy Letts, the founder of CustomerSure and formerly Head of Services at Sage UK

Before he founded CustomerSure, Guy Letts was the Head of Services at Sage UK; Sage describes itself “Sage is a leading supplier of business management software and services to more than 6 million customers worldwide. From small start-ups to larger organisations, we make it easier for companies to manage their business processes.”

As the Head of Services Guy was responsible for improving the customer experience, driving up satisfaction and increasing revenues through repeat and additional business.  This is a goal that Guy achieved and in the process he learned valuable lessons which were the seeds of the business he has founded: CustomerSure.   What are these lessons?

The critical point to make is that the rational approach – the one that is commonly practiced – did not work well.  The response to customer surveys was less than ideal.  The quality of the information that was provided was variable.  Providing statistics – customer satisfaction scores – to his services staff did not leave them inspired to do things differently. And pushing the employees to do more / better / different was exhausting and did not deliver the results.  So how did Guy ultimately improve the customer experience and hit his customer satisfaction and revenue goals?

Guy had an Aha moment when he visited a Richer Sounds store (hi-fi / electronics retailer which won the Which? retail customer experience award in 2011).  What was this Aha?  He noticed that the Richer Sounds customer survey was simple (5 questions) and these questions were focussed on the customer and what mattered to a customer.  Questions like: “Was the item in stock?”; “Did our staff know what they were talking about?”; “Where you served quickly?” etc.

So Guy had cracked the first part of the puzzle: how to assess the effectiveness of the interaction from the customer’s perspective. The answer was cut down the surveys sent to Sage customers down to the essential five or so questions and ask the questions that matter to Sage customer – the key stuff that determined the Sage customer’s experience of the Sage services team.  And to survey these customers immediately after a services engagement or interaction rather than wait for the next annual survey to come around. 

The next challenge was inspiring change within his team.  Here Guy learned that sharing the verbatim (unstructured) customer feedback with his services team made an emotional impact that quoting customer satisfaction scores simply did not do.  Yes, you have to share the customer’s word and emotions with the people who directly or indirectly impact the customer experience.  Why?  Because it is more effective at altering their perceptions, attitudes and ultimately behaviour; numbers simply do not have this effect – they do not touch the Elephant, they they might speak to the Rider.

Sound good so far yet Guy found out that asking the right questions and sharing the verbatim feedback with his services team was not enough.  If any of you have been on any motivational training courses or seminars then you will know how long the emotional high hangs around.  For most people when an emotional high meets resistance (from the powerful) and hard work (of changing ingrained behaviours) that high tends to dive pretty quickly and you arrive back at the status-quo.  So Guy introduced the practice of assigning actions (with specific deadlines) and monitoring to ensure that members of his services organisation did what they had agreed to do / assigned to do. 

Next Guy instigated the practice of sharing and closing the loop.  The first part was sharing with customers: sharing what his team was doing with the feedback provided by customers with a particular focus on actions to address the key issues as highlighted by these customers.  The second part was sharing with his services team: sharing the next round of feedback from customers – thus showing that the actions of the services team were paying off in happier customers and higher revenues through additional business and repeat business.

If you are a small business / medium size business (less than 1000 employees) then check-out CustomerSure

Guy’s customers at Sage UK were small and medium sized businesses and as Head of Services for 4 years he got to know a lot about these businesses – their situation and their needs.  He learned that there was and is plenty of scope for these businesses to improve the customer experience and keep more of their customers.  He learned that these businesses want to keep things simple and were looking for a guiding hand – a simple process and easy to use software tool. And they are only willing to spend so much money on surveying customers to get their feedback.

Guy put together this insight with what he learned leading/managing his service team (described above) and then put his 10+ years of software development experience to work and created CustomerSure – a platform designed to enable small / medium size business to replicate his success.  The CustomerSure platform enables the small business owner or a departmental head to easily survey customers, share that feedback with staff, set up / assign and monitor actions and then share feedback on what is being done and the results of actions taken. Furthermore, CustomerSure has put in place a platform where customer feedback and the actions that the company is taking to address customer issues is displayed and available for the world to see.

If you are are a small / medium sized business and you are looking to improve the customer experience then I wholeheartedly recommend that you give CustomerSure a test.  You cannot lose out as you get a 30 day trail period – at least that is what I got when I tried it out.

A final point: answering the question I started with

I am not sure that there is quick – instant – way of improving the customer experience.  In my world excellence is more like marathon than a sprint.  Excellence in customer experience involved playing the long term game.  It involves the kind of approach the Guy Letts used at Sage UK: open to insight, trial and error, selecting what works and revisiting what did not work, it involves passion and commitment to the longer term – engendering customer loyalty by doing the right things by your customers.  If you want to play the longer term then you can learn a lot from Guy Letts and if you are a small business then the CustomerSure platform will help you to play that game.

Disclosure:  I have absolutely no financial or commercial interest in CustomerSure.  I have no financial or commercial interest in Guy.  Guy and I are not friends – we have never met.  Guy is a reader of the CustomerBlog – actually he was one of the first readers.  Yet we are connected because we are customer evangelists.