A differentiated customer experience: a desire or reality for your organisation?

26 October 2010

ORC, an Infogroup company, is a leading global market research firm with offices across the US, Europe and the Asia-Pacific region. At ORC International’s 9th annual customer experience conference, Linda Shea, global managing director of customer strategies, discussed why a differentiated customer experience is pivotal to succeeding in today’s marketplace.

Across all industries, senior management acknowledges that delivering an exceptional customer experience is essential to long-term business success. However, as companies gear themselves up to improve the customer experience they often don’t know where to turn.

• How ready is your organisation to embrace enterprise-wide change to create and deliver a differentiated customer experience?
• Does your organisation possess the necessary DNA to become customer-centric?
• Is it willing to acknowledge a long-term commitment that may require trade-offs?

Linda explained that there are six stages to Customer Experience Management, which, when understood and embraced, can serve as a blueprint for your organisation to deliver a differentiated customer experience.

Stage 1: Benefits of focusing on differentiated customer experience

Product and service evaluation by customers lead to two categories of companies: Leaders and Laggards. Unlike Laggards, Leading organisations recognise benefits in three areas that drive top and bottom-line growth: existing customers buy more, stay for longer, and spread the word about their positive buying experience.

Stage 2: Frustrations of delivering a differentiated customer experience

Many organisations fail to understand the needs of their customers. The absence of a clear customer experience strategy and hard core facts about their customers ultimately lead to a lack of internal buy-in across the company. Without these crucial elements organisations will struggle to retain their customers in the long-term.
In some environments, the irony is that customers express the same level of frustration. Be it online, in-person or by telephone, customers convey it in their feelings when they evaluate their overall buying experience. The complicating factor is that these evaluations, when measured at key points along the lifecycle from prospect to customer, can reveal an inconsistent pattern that may jeopardise future buying decisions.

When you compare this intelligence to some of the latest thinking on consumer buying behaviours, we learn that some of these very interactions are essential to top and bottom-line growth. A report published in McKinsey Quarterly (June 2009) indicates that:

• Past experience has the greatest influence at the time of initial consideration
• Brands in the initial consideration set are typically three times more likely to be purchased
• Brands under consideration during the active evaluation phase may actually expand rather than narrow
• Interactions with your staff have the greatest influence at the decision point

This is all accomplished through consumer-driven marketing research.
Many organisations fail to realise that they way they act upon their customer experience research has the ability to influence and drive retention, expansion and advocacy. So how can organisations maximise their efforts with their customers?

Stage 3: The blueprint for customer experience excellence

There are three principles that ensure you are meeting the needs of your customers.
Principle #1: Obsess about customer needs, not product features – companies need to refocus on the needs of their customers, who may even want fewer product or service features.

Principle #2: Reinforce brands with every interaction, not just communications – branding efforts need to expand beyond marketing communications to help define how customers should be treated.

Principle #3: Treat customer experience as a competence, not a function – a great customer experience is delivered when everyone in the company is fully engaged in the effort.

Stage 4: Customer Experience Management maturity

We can learn a tremendous amount from organisations that have been able to mature over time by way of their attitudes, behaviours and their commitment. Listed below are some of the key characteristics of organisations and the activities they undertake in the pursuit of customer experience excellence:

• Interested. Organisations begin to believe that customer experience is an important part of their business.
• Invested. Organisations recognise customer experience is worthy of significant investment; in both capital and key personnel.
• Committed. Instead of trying to fix problems, the focus turns to redesigning processes.
• Engaged. Instead of re-engineering processes, the focus turns to designing break-through experiences and solidifying the culture.
• Embedded. Nearly every employee feels ownership for maintaining the culture

Stage 5: Timelines for maturity

Most organisations are lucky to reach a committed stage within 3-4 years. Does your organisation possess the necessary commitment over the long-term to recognise the real benefits?

Stage 6: How can we accelerate our progress?

Once you evaluate each stage of maturity you can look to some of the lessons below to propel your organisation forward:

• Recognise it is a journey and not a destination
• Invest in centralised resources
• Get HR involved
• Don’t over-hype your experience
• Keep asking three questions:
• Who are your target users?
• What are their goals?
• How can you help them accomplish those goals?

As Linda explains:

“This level of long-term commitment isn’t easy. Executives must recognise that it requires an enterprise-wide transformational effort”.

Companies that are willing to sustain their efforts will bypass their competitors!