Oct 23, 2008 8:22am
Posted by: Frank Capek
We've reached the point where most business leaders understand that their organization's ability to effectively acquire, retain, and improve the profitability of customers is a direct result of the nature and quality of the experience those customers have.
There is, however, a fundamental problem with both the literature and management practice surrounding customer experience. The issue is that most business leaders and management gurus focus on how companies "deliver" experiences rather than how people actually HAVE experiences. Without understanding how customers HAVE experiences, companies often end up wasting lots of time and money on improvements that don't generate a real return because they don't fit with and influence how customers think, feel, and act.
If you do a scan on customer experience literature, you'll find that virtually all of the definitions start something like this: "A customer experience results from a set of interactions between an organization and a customer... " In addition, most of the discussion refers to an experience as if it is a characteristic of a company. For example, people discuss the "Disney experience" or the "Starbucks experience" or the "BestBuy experience." All of this represents a highly company-centric perspective.
This company-centric perspective is deeply misguided. It often encourages business leaders to make expensive improvements that are, at best, perceived by customers as "better sameness." At worst, these expensive improvements go unnoticed by customers who are too busy dealing with their own priorities and their own lives to pay attention to the fine details of their interactions with the business.
Over the past 25 years, we've worked with and studied businesses that have effectively innovated and differentiated the experience their customers have... and, as a result, have measurably improved the acquisition, retention, and profitability of those customers. Based on this work, there are a couple of counterintuitive things we've learned:
- Companies don't have customer experiences; only customers do. The customers' experience takes place in one place and one place only; in the mind of the customer. That experience consists of how a customer thinks and feels across the entire behavioral path they follow in pursuit of one or more goals that important to them. Talking about a company's "customer experience" represents a very large step in the wrong direction. It's a company-centric way of trying to be customer-centric. (See: Whose Experience is it Anyway?)
- Casting customers in the role of "customer" can be limiting. This is a subtle distinction with profound implications. When you consider a person or organization to be a "customer," it's very easy to have your focus be on what you do to serve that customer. In the course of doing that, you may not look beyond that customer role to gain a much deeper and broader perspective on who they are, what's important to them, what they're trying to accomplish beyond the scope of your business. The fact that they're a customer of your business doesn't constrain the end-to-end experience THEY'RE having.
- Customers' experiences don't just happen at your touch points. In fact, we've seen that the most important elements of the experience don't happen at your touch-points at all. They happen at the non-touch-points. We've observed that touch-point oriented approaches end up leading to incremental improvements in the service quality that either seem like "better sameness" or, worse, go unnoticed. This is one of the reasons why it's exceptionally easy to make uneconomic improvements in the experience. Alternatively, we've seen that companies that can develop a deep and comprehensive understanding of what customers experience at the non-touch-points generally uncover competitively relevant ways to differentiate the experience in a way that gets the customers' attention. (See: The Customers’ Experience Does Not Happen At Your Touchpoints!)
- You can't fundamentally shift the experience by tweaking surface level cues. The experience customers have with any business is a product of complex and deeply entrenched culture, legacy effects, and unwritten rules that drive the real behavior of the organization. For example, I'm writing this on-board a Delta flight from Atlanta to Los Angeles. Delta's been promoting the new "Delta Experience" which includes cosmetic updates to their website, changes in their pricing policies, a new highly confusing boarding process, more contemporary music during boarding, along with a couple of "signature cocktails," and a few other peripheral cues. Do you think these surface-level improvements have had ANY deep positive effect on the overall experience customers are having? Focusing on surface-level cues is a little like hacking at the leaves rather than striking at the root of the issue. In reality, most organizations are strongly predisposed towards the experience their customers are currently having. Unless you get to the root of how deeply entrenched organizational behavior influences the customer experience, you couldn't possibly know enough about what to do to intervene and positively shift the experience. While those cues are an important, they are insufficient. On their own they are the proverbial "lipstick on a pig."
- How customers feel about your business is a side effect of how their experience with your business makes them feel about themselves. If your business makes customers feel great about themselves they'll, in turn, feel great about your business. Understandably, most business leaders want to influence and measure how customers feel about their business. This strikes me as similar to a line you might overhear on a date... "but enough about me... what do you think about me?" Very often a company can consider their interactions with a customer successful if that customer's orders were taken, problems resolved, and questions answered. In fact, many customer satisfaction surveys simply ask customers to give the company a report card on how well they feel the company did all those things. However, in many ways companies leave the customer feeling disrespected, devalued, stupid, or frustrated. This is one of the reasons why the concept of hospitality in business is so powerful (see: No Matter What Business You’re In… You’re in the Hospitality Business).
- The most common customer experience approaches don't consider how customers actually HAVE experiences. If they did, they would recognize that the vast majority of the experiences people have are subconscious. In most cases, people experience the world using something that can be called "gist processing." In other words, they get a general sense for what's happening without having to pay attention to all the details. In most cases, this gist processing leads to the execution of "automatic behavioral scripts." Alfred North Whitehead said it best, "Civilization advances by extending the number of important operations which we can perform without thinking about them." Our ability to navigate the majority of our experiences on automatic pilot frees us up to focus our relatively limited train of conscious thought on the small number of things that seem most important to us.
In general, the best strategy we've found includes the following components:
- Design for Gist Processing. At the base level, you need to understand the perceptional process and basic constructs customers apply to navigate most of the experience relying on gist processing and automatic behavioral scripts. When a customer enters a bank branch, checks into a hotel, enrolls with a health insurance provider, etc... they have a set of constructs they've learned from past experiences and that operate within a perceptual framework that enables gist processing. Experiences designed based on this perceptual framework and set of experiential constructs become inherently easy to navigate. We use process called Experiential Construct Elicitation to surface and understand the constructs that are applied by different customer personae.
- Deliver Signature Experience Elements. This is all about getting the customers' attention using a small number of high contrast and differentiated "signature experience elements." These signature experience elements catch customers by surprise, are perceived as a difference in kind compared to what they expected, and contribute to the brand story we want the experience to tell. If you listen to customers talk about the Starbucks experience, the Whole Foods experience, etc..., you'll see that customers consistently refer to a small set of experience elements that stand out for them as being the defining elements of the experience. While you can spend a lot of time getting lots of details correct in the experience, having a small set of signature elements are the kinds of things that really resonate with and influence customers.
So, in summary, the essential message is... you need to understand how customers' HAVE experiences before you can possibly know what to do to influence their experience... and ultimately, their behavior.