Customer experience

From Wikipedia, the free encyclopedia

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. It can also be used to mean an individual experience over one transaction; the distinction is usually clear in context.

Contents 1 Growing recognition 2 Emerging Business Requirement 3 Managing Customer Experience 4 Customer Experience Solutions 5 See also 6 References

[edit] Growing recognition

Analysts and commentators who write about customer experience and CRM have increasingly recognized the importance of managing the customer's experience. ^[1] Customers receive some kind of experience, ranging from positive to negative, during the course of buying goods and services. Thompson and Kolsky say that “an experience is defined as the sum total of conscious events. As such, a supplier cannot avoid creating an experience every time it interacts with a customer” (2004). All interactions involved throughout the process and throughout the customer lifecycle culminate in a positive customer experience if customers go away feeling that their personal needs were met and they were treated with care.

A company's ability to deliver an experience that sets it apart in the eyes of its customers serves to increase their spend with the company and, optimally, inspire loyalty to its brand. "Loyalty," says Jessica Debor, "is now driven primarily by a company's interaction with its customers and how well it delivers on their wants and needs." (2008) ^[2]

The concept of customer experience was first introduced by Pine and Gilmore in their 1998 Harvard Business Review article. They believe that successful businesses influence people through engaging, authentic experiences that render personal value (Pine and Gilmore 1998). ^[3]

[edit] Emerging Business Requirement

With products becoming commoditized, price differentiation no longer sustainable and customers demanding more, companies – and communication service providers (wireline, wireless, broadband cable, satellite) in particular – are focusing on delivering superior customer experiences. A 2009 study of over 860 corporate executives revealed that companies that have increased their investment in customer experience management over the past three years report higher customer referral rates and customer satisfaction (Strativity Group, 2009) ^[4]The customer experience has emerged as the single most important aspect in achieving success for companies across all industries (Peppers and Rogers 2005). ^[5] The goal of customer experience management (CEM) is to move customers from satisfied to loyal and then from loyal to advocate. Starbucks spent less than $10MM on advertising from 1987 to 1998 yet added over 2,000 new stores to accommodate growing sales. Starbucks popularity is based on the experience that drove its customers to highly recommend their store to friends and family. ^[6]

[edit] Managing Customer Experience

Customer experience is the new innovation frontier for business. Companies are focusing on the importance of the experience and, as Jeananne Rae notes, realizing that “building great consumer experiences is a complex enterprise, involving strategy, integration of technology, orchestrating business models, brand management and CEO commitment.” (2006) ^[7] An Enterprise Feedback Management (EFM) system can be used to collect value feedback from customers. Microsoft’s Customer Experience Improvement Program gives all of its customers the opportunity to provide input into the design and development of its products. The program collects feedback on how customers use Microsoft programs and problems they have encountered. The end results are software improvements to better meet customer needs. ^[8]

Customer-centric service providers take care of customer needs at every touchpoint in the customer lifecycle (ordering, fulfillment, billing, support, etc.) and employ all channels (contact center, Internet, self service, mobile devices, brick and mortar stores) and means of communication (phone, chat, email, Web, in-person). They develop experience-based differentiation, which shifts the focus from product features to customer wants and needs. These experience-based providers integrate both internal and external innovations to create end-to-end customer experiences. They evaluate their business models as well as business support systems and operational support systems (BSS/OSS) from the customer’s point of view to achieve the level of customer-centricity necessary to improve customer loyalty, churn and revenue (Lopez, 2007). ^[9]

organizations will calculating customer satisfaction through conducting surveys to assess their capability in serving to the customer. However, customer experience can often be judged based on factors such as process in respect to the purchase , the environment within which the experience is received, and the fit of the transaction or service to an individual channel. In this event, customer satisfaction surveys do not have the depth as a research instrument to fully capture all of the potential issues. Various qualitative and quantitative research methods can be used to understand and measure the quality of the customer experience, although the former is preferred to gain a more in-depth understanding or how experiences are created and affect customers.

[edit] Customer Experience Solutions

According to Bernd Schmitt, "the term 'Customer Experience Management' represents the discipline, methodology and/or process used to comprehensively manage a customer's cross-channel exposure, interaction and transaction with a company, product, brand or service."^[10] Customer experience solutions provide strategies, process models, and information technology to design, manage and optimize the end-to-end customer experience process.

Customer experience solutions differ from CRM solutions. Customer experience solutions address the cross-channel, cross-touchpoint, and cross-lifecycle nature of the customer experience process, whereas CRM solutions tend to offer point solutions for specific customer-facing functions such as, but not limited to, sales force automation, customer analytics, and campaign management. In some cases, solution providers address both customer experience and CRM capabilities.

[edit] See also

• Customer service
• Employee experience management
• The International Customer Service Institute

[edit] References