On Customer Satisfaction and Customer Experience: Part I

  

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You may have noticed that many companies are starting to focus on the customer experience.  While there has always been a customer experience, we tended to think of it more in terms of customer service.  By reframing the dialog as customer experience, we think more holistically about our business and our brands.  Mike Wittenstein, a leader in the area of customer experience design, has produced a white paper that we are delighted to share with you as our TMD guest blogger!

On Customer Experience

There’s certainly nothing new about focusing on the customer experience to differentiate a business. Over the past decades, brands have rocketed to iconic status by doing just that. Think Apple, Virgin, Starbucks, and Disney.

The difference today is that empowered consumers (B2C) and buyers (B2B) are demanding more. Not just in lower price, but in better service as well. According to a 2010 American Express study, Americans are willing to spend 9% more with companies that provide excellent service. The same study showed that 91% of customers believe that customer service is important, but only 24% actually feel they get the service they deserve. It’s no wonder that brands with better customer experiences are outperforming their competitors.

The Benefits

Companies that wholeheartedly focus on the customer experience usually enjoy these benefits:

•   Reduced churn among customers and employees

•   More predictable revenues

•   Less advertising expense

•   Lower new customer acquisition costs

•   Noticeably better internal alignment

•   More unsolicited referrals

•   Greater brand awareness

For all these reasons, companies that deliver better experiences operate more profitably than others in their category.

Great experiences don’t just happen and PowerPoint presentations alone can’t make them a reality! They occur when all functions of the operation align with one another to achieve the outcomes your customers seek.

Good customer experience design starts with understanding what your customers care about most. Understanding which promises are most important to your customers, then aligning your organization to make and keep them, is the leader’s most important role. When what the customers want most is what the business does best, the ‘rising tide effect’ kicks in and everyone benefits.

Which Industries Benefit Most?

Service brands with branded locations, high transaction volumes, multiple channels, and/or many interactions between customers and employees are the biggest users of customer experience design. Retailers (any business with a cash register, really), healthcare facilities, entertainment companies, hospitality providers (including hotels, restaurants, and travel providers), and professional services firms are the fast-adopting users.

Customer Experience can also benefit repetitive-transaction businesses where customers don’t think much about their service provider--until there’s a problem; like utilities, telecom or wireless, and insurance.

Is Customer Experience Design For You?

Your company could probably benefit from Customer Experience Design if you answer YES to three or more of these questions:

•   Is my industry being commoditized? Do I fear having to compete on price?

•   Does my business involve a large degree of customer service in any or all the channels (in-store, phone, web, mobile, face-to-face)?

•   Have competitors introduced positive changes that my customers are noticing?

•   Am I in a highly competitive space?

•   Are new product or service introductions quickly matched by the competition?

•   Has finding best-fit employees and suppliers become more difficult?

•   Am I spending too much time winning back customers?

•   Are your customers, prospects, or employees confused about how your brand’s promises are different from any of your competitors?

•   Does getting everyone on the same page feel more difficult now?

•   Are my processes dictating my customer’s experience?

•   Do different departments and functional areas within my business often seem unsynchronized resulting in disappointed customers? 

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Want to read more?  Check in again next week when we will continue Mike’s post focusing on implementing customer experience best practices.

Check out our white paper!