Just before the end of the year, we tend to look back: what went well, what less so – and which phase are we currently in? This applies to our private lives as well as to our profession and business. Also in relation to the area of marketing, it’s why it’s worth pausing for a moment to ask: which era are we in?
A new era has actually recently started in marketing which has radically changed our previous shopping experience. In this era, it’s all about customer experience.
Did you know that this is the third era that marketing has gone through over the past 25 years? We moved from fast-paced product brands, via establishing customer relations using service marketing, to creating an irresistible customer experience.
What exactly does customer experience mean?
Everyone will have heard of this term. But what aspects does it cover? In short, customer experience is a collection of feelings, perceptions and attitudes that forms during the entire decision-making process and consumption chain. It includes a series of interactions with people, objects, processes and the environment. This process leads to cognitive, emotional, sensory and behavioural responses.
Amazon and Google showing the way
Investigating customer experience currently has the highest priority in marketing research. It’s deemed to be one of the major challenges for the coming years. Despite clear theoretical basics, companies such as Google, Amazon and KPMG have already employed chief customer officers, vice presidents and managers. Their responsibility exclusively covers the creation and improvement of customer experience, which is treated as a secret ingredient for loyal customers, long-term competitive edge – and therefore a higher conversion rate.
In general, Customer Experience Management (CEM) focuses on identifying all information a customer receives during the purchasing process and on delivering information which creates added value. Those who want to offer this added value to their customers must first understand every little detail of the customer journey. In marketing research, we talk about three phases a customer goes through: pre-purchase, purchase, post-purchase. These terms are common in other languages, too.
New Customer Experience Management manuals keep appearing that summarise in three to five steps how great customer experience can be created. If you overlay all these instructions, you get one small guiding principle that summarises CEM: it’s about identifying, prioritising and including the right information for customers at the different touchpoints (social media, online shop, local store, press etc.) and across all phases. After that, interactive processes for experience creation can be developed and customer responses measured using suitable performance metrics.
Why there aren’t customer experience instructions here
Customer experience is fair enough, but isn’t it quite vague? There’s a simple reason for that: there’s currently no option for measuring customer experience. And that’s the crux of the matter. Simply put: nobody knows what should be measured if nobody can pinpoint exactly what the structure and dimensions of customer experience look like.
This means there is no “final” definition of “customer experience” yet. Until there is, we make do with measuring customer satisfaction, purchase intent, customer loyalty, recommendations etc. because these aspects all have an impact on customer experience.
But that doesn’t mean that companies aren’t preparing for the era of customer experience today or aren’t trying to implement it. Google and Amazon are just two examples.
How to take account of customer experience
First of all, it’s important that companies of any size are aware that customer experience is a tool that allows them to generate a long-term competitive advantage. It’s an integral strategic process that increases business performance but, in turn, has managers facing many new challenges.
Customer experience can be a combination of rational, emotional, sensory, social, physical and intellectual experiences. That’s why it’s important for managers to have an appropriate understanding of customer expectations and to clearly define the roles these have and the organisation in the customer experience process. Knowledge of all indirect and direct touchpoints between the customer and the company is just as relevant. That’s the only way you can steer customer perception in the direction you want.
Given these manifold aspects, it’s easy to get lost and to rely on strategies that don’t even benefit you in the end. To avoid this, we recommend measuring, at regular intervals, different indicators that impact the perception of customer experience. In this way, you don’t just check your marketing strategy’s influence but you also reveal gaps that prevent a unique customer experience.
This subject may still be a small mystery but it’s very important to take a conscious approach. To what extent do you take account of customer experience? Which touchpoints do you offer your customers and how can you control them more consciously? Which indicators of customer satisfaction are you already measuring and analysing? Perhaps you’ll use the New Year to increase your focus on the experience of your customers.