Within a company, different functional areas coexist that allow its proper functioning: management, finance, administration, production/operations, quality, marketing, human resources, project management, processes, and logistics, among others. To achieve organizational objectives, it is crucial that all of them are aligned with the purpose and business strategy.
Next, we are going to delve into the Customer Experience area: what it is, what its main functions are, its greatest challenges, etc.
What is Customer Experience?
In the current business scenario, most companies must seek and know how to differentiate themselves from competitors, to ensure and guarantee their future. One of the strategic priorities to achieve these goals would be to generate lasting relationships with its customers, that is, to build loyalty.
As a consequence of this trend of customer loyalty, in recent years, new roles and functions have been emerging within the business environment, which have created a new specific area called "Customer Experience".
The Customer Experience are is devoted to establishing a good relationship between the consumer and the brand, trying to provide high levels of satisfaction to customers, so that they become loyal consumers and brand advocates. It is really about putting customers at the center of a commercial strategy, listening to them, and jointly creating a memorable experience, so that they buy our products or services, choose us again, want to continue with us, and recommend us.
Sometimes, there are situations in which the products or services offered are perceived as simple, basic, and undifferentiated merchandise. This is where the development of a Customer Experience department constitutes a strategic proposal. Sometimes, the strategy will be focused on discovering all the points of contact with the customer to manage and optimize them. On other occasions, the focus will be on seeing the sale as helping the customer. The basic thing is not to deviate from the objective: to differentiate yourself from the competition.
What are the functions of the Customer Experience?
- Recognizing all the moments of interaction with the customer.
- Understanding what the customer expects in each of the interactions.
- Knowing what moments or attributes customers value most. Detecting the emotional factors of customer needs.
- Thoroughly investigating how the customer perceives our performance at all times.
- Knowing what the customer expects to receive and designing a value proposition accordingly. Building improvements in productivity and customer experience.
- To achieve those goals outside, we need to do something on the inside first: people in our company need to work together to improve customer experience. This also requires the motivation of a leader to carry it forward.
History and evolution
The management of the consumer experience exists since the beginning of commerce. Before, this experience was only taken into account from the moment of purchase, whereas now it covers the entire journey and the several meeting points between the consumer and the brand.
The challenge of customer experience, as we know it today, had its beginnings decades ago: its first steps were aimed at the brand and its value to survive thanks to the specific experience of each person. In 1972, Al Ries and Jack Trout began to coin the term "positioning" to give a name to a process that consists of three steps: analyze the entire offer of a product or service, determine what the consumer values, and differentiate yourself from the competition.
Another pioneering moment occurred in the mid-1980s when American companies adopted Total Quality Management (TQM) as well as other customer-focused initiatives. The concept of customer satisfaction began to circulate and many market research agencies began to study it.
As early as the mid-1990s, market research firms also became interested in quality management and the consequent need to understand customer satisfaction. Around that time, Bradley Gale published “Managing Customer Value”, a book in which he spread the idea that guaranteeing customer satisfaction is not enough, but that the way of adding value should be improved. The concept of "customer value" indicates other aspects of the experience that drove the value perceived by the customer before, during, and after the purchase. It went beyond quality management and took into account price, and communication, among others.
In 2003, three authors published in the Harvard Business Review a method for assessing opinion that has had a huge impact on current business management. This is the Net Promoter Score (NPS), which raised the concern for the customer experience to the management of companies.
It was probably in 2011 that Customer Experience Management (CXM) emerged as a discipline when the Association of Customer Experience Professionals was founded. The CXPA was established as a forum of experts from different disciplines, which has reinforced its legitimacy.
In the last 20 years, the relationship between brands and their consuming public has taken a radical turn. The directionality of the actions went from the brand to customers through a bombardment of commercials on TV, emails, calls, and flyers, among others. The purpose established by the brands was to be seen as they planned. But, currently, the vector has been inverted and it is the consumers who socially construct the perception of the brands; this happens through their experiences with the brand, told in the first person on social networks and other channels (forums, opinion sites, etc.). That is why the key is to know the interests that consumers have, and based on this, provide emblematic experiences. For the management of valuable information, different software has been created that helps process the opinions that need to be taken into account for strategic decision-making.
Today, a large part of companies operate in mature, hyper-competitive markets, in which the products and services offered are almost identical (at least externally), whose main difference is prices, and that is where the competition lies. Customers are now more and better informed about what they consume, they are demanding and they are looking for customized products. The paradigm shift is before us: the customer is no longer looking only to cover their basic needs, but to make their purchase and consumption processes more sophisticated, taking them to a higher level: that of the emotions and experiences that this product will make them live.
Types of Customer Experience
Depending on whether it is about promoting a company that offers its products and services through a physical store or digital platforms, we will see that some differential specificities arise:
Retail: direct to the public
We refer to the sales process that takes place in physical stores, where you are in direct and face-to-face contact with the public. There, the sales experience will take into account variables of three types: environmental, social, and design.
In the group of environmental variables, non-visible elements such as temperature, lighting, music, or smell inside the store are included. Regarding the second variable, it is important to keep in mind that space can be used for social exchanges. Fostering this linking facet decreases the mercantilist perception, thus humanizing the stores. The last factor, from the visible elements, can be separated into functional aspects such as wide corridors, and aesthetic aspects, which will depend exclusively on the target audience.
We can also add to the shopping experience, two moments that usually remain in the memory of the consumer: the pre and post-visit moments. That memory can positively or negatively affect the decision about where to go shopping in the future.
At present, in most cases, customers' first contact with the brand occurs in online environments, regardless of whether the purchase is made through e-commerce or in a physical store. It is therefore very important how this first interaction is carried out, to which we must pay increasing attention.
There are some critical points that we must take into account regarding the relationship and creation of experiences with the customer (current and potential) in the online environment. They are:
- Search: everything related to SEO positioning in internet search engines.
- Branding: uniform exposure of the brand so that it gains importance.
- Usability: ease of access to the content and products of the brand. Simplicity regarding the design and technologies used to develop virtual platforms.
- Segmentation: how and where we should launch the networks to capture the attention of a certain customer target, showing content that is fully adapted and created based on customers' interests.
- Multi-channel interaction: the challenge of making the relationship transparent, uniform, and satisfactory, with a customer who has multiple channels of communication and interaction with the company, must be faced by studying each channel in particular and the appropriate feedback in each case.
- Conversion: obtaining customers' information that allows us to carry out future marketing actions with them.
- Feedback: the importance of evaluation based on the opinions and ratings of customers on online sites.
Tools for data collection
Around Customer Experience, a series of tools have been developed that allow us to understand the experience that customers live, innovate and design memorable moments. Some of the most popular tools are:
Customer Journey Map
The customer journey map is a methodology that allows tracking the different points of contact with the brand in question, thus tracing the movements of our consumers in a journey through the different available channels (online, television, newspapers and magazines, etc.). Knowing the different routes they take and the points of contact will allow us to propose a strategy to reach them.
The Service Blueprint is the detailed blueprint of the experience in a specific customer journey, which refers to the metaphor of the basic blueprint for the construction of buildings. This contributes to deepening the analysis of the points of contact, mapping the elements that affect the purchase process both in the visible and the invisible layer, about the processes, policies, systems, people, and behind-the-scenes activities that the customer does not see.
Customer Experience management indicators
One of the main challenges for Customer Experience management is to measure the experience and focus on improving it, as an essential step to increase brand loyalty and retention.
Measuring the relationship that customers have with the company is essential to improve the exchange. Establishing a way to measure this relationship will help us to be able to act and make decisions in this regard. Below, we will develop the main metrics to manage the Customer Experience:
Net Promoter Score o Net Promoter System (NPS)
The NPS is undoubtedly the most popular and used indicator when measuring and managing the Customer Experience in companies. In 2006, Frederick Reichheld established in his book "The Ultimate Question", a key question that determines the degree of customer loyalty to a brand: "Based on your experience, would you recommend this brand (product or service) to a friend or family member?”
This question denotes a greater degree of emotional bonding, due to the personal involvement that the person making a recommendation puts into play, responding on a scale of 0 to 10. The answers are grouped as follows:
- 10 and 9: Promoters. Customers with this score will be considered "promoters" since they have a degree of connection and loyalty with the company that leads them to be a supporter of the brand and will communicate its advantages. The challenge will be to keep them.
- 8 and 7: Neutral. This degree of scoring considers customers to be "neutral", that is, their behavior does not imply a link with the company to be taken into account. The challenge will be for them to leave neutrality behind and become promoters.
- 6 to 0: Detractors. In this range, customers will be considered as having certain behavior that decreases loyalty and linkage with the organization over time. The challenge will be to find the flaws that led them not to recommend us and reverse that, as well as make them move on from that bad experience.
NPS is then calculated as the difference between the percentage of Promoters and Detractors. As a result, a value is obtained that ranges from -100, if all the customers were all detractors, to 100, if all the customers were all promoters.
Being so simply stated, this metric has become one of the most chosen in the field of Customer Experience and has been quickly adopted by companies, whether they are small SMEs or large corporations.
Customer Effort Score (CES)
The Customer Effort Score or CES is a metric that emerged in 2010 and proposes a new measurement system. It is based on the idea that companies should not focus on surprising the customer, but on reducing the effort it takes them to solve their needs. This gave rise to the Customer Effort index, which was based on answering the question "how easy was it for you to get what you needed from this company?" It is believed that the less the effort has been, the more satisfaction it will produce in the consumer, and therefore, the loyalty to the company/brand will grow.
This model can be applied in any process that involves the interaction of the customer with the brand and helps companies to identify problems. For example, we may find a problem with an online form (such as personal data to make a purchase) that leads some customers to give up. Then, possible confusion or doubts will be identified and the form will be simplified or clearer instructions will be provided.
Customer experience benchmarks
It is necessary to obtain comparative information on the effectiveness of the customer experience area according to the rankings and comparative studies that evaluate all companies under the same criteria.
In some 10 countries in America and Spain, a study is being carried out that measures the Customer Experience of at least 200 companies, with the idea of providing comparative elements to find out the best practices at an international level. With this, they provide an indicator, known as the BCX or Best Customer Experience.
The BCX is made up of 3 dimensions, based on the three areas through which companies can generate an emotional bond with their customers:
- Product experience. The extent to which the company's products or services add value to the customer's experience by meeting their real needs.
- Experience with interactions. To see whether the interactions with the company are easy and pleasant.
- Brand experience. If there is a feeling of emotional connection with the brand.
What is the Customer Experience area made up of?
The size of the company will determine what and how many will make up the Customer Experience team, depending in turn on the assets that the company offers since it could focus on the digital experience, the person-to-person experience, or a combination of both. Most times, it is not an area that works on its own, but rather constantly interacts with other collaborators and departments, which, working together and with good communication, make the improvement of the customer experience a reality. As in all divisions, the role of a leader who can guide the strategy and delegate the implementation to guarantee the objective of the area is essential.
The following positions are a suggestion, defined by the roles or responsibilities of the members of the area, although not all companies have to carry out the same tasks.
- CX Coordinator (head of the area).
- “Voice of Customer Program Manager” is the person who collects and/or analyzes the data from the surveys and mappings.
- Internal communications operator of the Customer Experience.
- Digital Strategy Analyst (people who focus on the digital experience and know how to manage it across all channels).
- UX designers
Why is Customer Experience important?
As we have developed so far, a better experience will make people prefer us more than any other company; they will be willing to pay a higher price and, even, they will not mind traveling more distance just to be able to get our product or service having other alternatives nearby. A consumer's recommendation multiplies a company's customers and, consequently, its profitability.
The most important objective lies in understanding what opportunities there are to improve the process, taking into account the use of the aforementioned methodologies. From the integration of databases (thanks to CRM platforms that contain all the information of our customers) to the training of our customer service staff to be able to interact with them through the most innovative means of communication. From this objective, we must strive so that the customer experience is always the same, where we know who each customer is regardless of whether they call us, write to us or visit us, and only in this way will we achieve higher loyalty rates.
Information is knowledge, and knowing who each customer is and what they intend to receive from us is information that we must obtain and use responsibly and with the desire to improve, for our economic good and achieve higher levels of customer satisfaction.
The strategy of putting customers at the center and stopping thinking only about the goods or services that are produced requires a great effort: creating conditions so that they are the ones who choose and prefer us. For this to happen, it is necessary to have a well-defined area within the company: a space, a team, objectives, and others. In the long or medium term, this will help us to give that differential value that is sought.
Main problems in the area
Rely too much on the general direction
Within the different Customer Experience projects, there are a series of errors that are repeated. One of them is to leave control of the strategic design in the hands of senior managers (such as the CEO) instead of a team specialized in the subject. The strategic direction that the activities of the CX area can take gives rise to managers wanting to interfere with priorities that are not the ones proposed. The professionals in the area must have the necessary solidity not to give in, to set the course and sustain it based on a plan, data, and projections.
Perceive or treat the area as a "Customer Service" department
Customer Experience is not about making the customer happy, but about understanding what keeps them happy and what are the ways to make them choose us again and again. The customer experience involves customer service, but also the entire journey that the customer makes with the company. Work must be done at all levels: people, processes, policies, procedures, and technology, among other aspects, so that a company goes from focusing on the product, where the performance of its areas is generally measured individually, to becoming one with a customer-centric culture, where everyone is clear about the impact of their role on the consumer experience.
The cultural component that underlies every company
The great obstacle that often goes unnoticed is usually the cultural factor of the organization, being the variable that will most affect the success or failure of the actions that are deployed from the Customer Experience area. The underlying values, prejudices, how the customer and the organization are conceived, and the priorities that are historically managed in the company, have an impact on business management.
The transformations that are required from the Customer Experience imply, in part, that the company's employees synchronize their mindset and their behaviors with the objectives pursued by the area's strategies. It is essential, then, to achieve employee engagement. Many studies have concluded that if workers are engaged, this has a positive impact on the quality of a CX.
Change the typical Customer Service for Customer Experience
A CX strategy must be proactive and planned, not reactive. Many companies focused only on the after-sales follow-up process and their first steps were successful, but as the market, the competition, and customers evolve, it is no longer enough to just do that, but the need to anticipate the customer-business interaction process in a programmed/designed and professional way.
Focus on staff selection and development
It is impossible to have happy customers by having employees who do not feel happy or at ease in the company they work for. If they feel inadequate or uncomfortable in the work environment, with whom will they show that frustration? This challenge is present from the incorporation of each member of the company, taking into account their soft skills, to constant training in the company. Getting employees to feel each interaction with the customer is key, making them know they have the decision-making capacity to help create better experiences and recognize when they manage to do so, will benefit the Customer Experience strategy. You will have to make employees feel like "internal customers", the first customers of the company, those who must recommend the company with total conviction. If they don't feel proud and happy to belong to the company, if they don't feel confident in recommending the product or service it offers, the company has a serious problem to solve. In simple words, you have to involve the employee in the brand.
Since the main objective of commercial organizations is to earn money, customer experience is a strategy that must aim to maximize the benefit of the relationship for the customer and, therefore, for the company. For this reason, it is of the highest priority to have a specialized and professionalized area that implements the pertinent tools for the study, investigation, and measurement of the impact that the brand generates in the public to which it aims to sell. Constantly reviewing and redesigning the forms of interaction with customers and taking into account their specific needs is a complex task that you must be willing to take on if you want to grow in a highly competitive and changing market.