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Customer Experience Management: 10 Big Ideas
Customer Experience Management: 10 Big Ideas
Customer Experience Management: 10 Big Ideas
Customer Experience Management: 10 Big Ideas
Customer Experience Management: 10 Big Ideas
Customer Experience Management: 10 Big Ideas
Customer Experience Management: 10 Big Ideas
Customer Experience Management: 10 Big Ideas
Customer Experience Management: 10 Big Ideas
Customer Experience Management: 10 Big Ideas
Customer Experience Management: 10 Big Ideas
Customer Experience Management: 10 Big Ideas
Customer Experience Management: 10 Big Ideas
Customer Experience Management: 10 Big Ideas
Customer Experience Management: 10 Big Ideas
Customer Experience Management: 10 Big Ideas
Customer Experience Management: 10 Big Ideas
Customer Experience Management: 10 Big Ideas
Customer Experience Management: 10 Big Ideas
Customer Experience Management: 10 Big Ideas
Customer Experience Management: 10 Big Ideas
Customer Experience Management: 10 Big Ideas
Customer Experience Management: 10 Big Ideas
Customer Experience Management: 10 Big Ideas
Customer Experience Management: 10 Big Ideas
Customer Experience Management: 10 Big Ideas
Customer Experience Management: 10 Big Ideas
Customer Experience Management: 10 Big Ideas
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Customer Experience Management: 10 Big Ideas

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Trust & Choice: Essential Customer Experience Ingredients, by Lynn Hunsaker, ClearAction Customer Experience Optimization See http://ClearActionCX.com Contact us at OptimizeCX@ClearActionCX.com

Trust & Choice: Essential Customer Experience Ingredients, by Lynn Hunsaker, ClearAction Customer Experience Optimization See http://ClearActionCX.com Contact us at OptimizeCX@ClearActionCX.com

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  • 1. Customer Experience Management Copyright 2011 CustomerThink Corp.
  • 2. Customer Experience Management: 10 BIG IdeasForewordBy Bob Thompson, CustomerThink Founder/CEOOver the past few years, Customer Experience Management (CEM) has become a key strategy to build customerloyalty. CustomerThink’s research has found that experiences (all the interactions that customers have with acompany’s people and systems) account for as much value as the core product/service purchased.As customers, we can all recount instances of how remarkable experiences motivated us to return to a businessagain and again, spend more of our hard-earned money and tell our friends and families. Conversely, negativeexperiences cause us to look elsewhere and advise our friends, colleagues and complete strangers to do so, too!Forrester Research found that 86% of companies say customer experience is a top strategy in 2011, and that 76percent want to differentiate based on customer experience. Yet when the dust settles a few years from now,only a small percentage of companies will succeed in standing out from their competitors.Why? Because customer experience strategy must be matched with coordinated and sustained execution. CEMsuccess is not as simple as just fixing customer service, vowing to “delight” customers or improving marketingmessages. It takes a commitment from the entire organization, starting with the CEO.That’s why I have compiled this collection of 10 articles from CustomerThink’s most popular authors onCustomer Experience. While it’s a just small fraction of the 500+ posts from these experts in the past year, theseideas will get you started on the road to CEM success.To explore CEM further, please visit our CustomerExperienceOne community. Also be sure to learn more abouteach of the Top 10 Authors (as of Nov. 30, 2011) featured in this guide. Top 10 Authors in Customer Experience Management 1. Stan Phelps, Synergy Events 2. Joseph Michelli, Ph.D., The Michelli Experience 3. Maz Iqbal, Dynamica Consulting Group 4. Bob Thompson, CustomerThink Corp. 5. Tony Zambito, Goal Centric 6. Cheryl Hanna, Service Untitled 7. Colin Shaw, Beyond Philosophy 8. Lynn Hunsaker, ClearAction 9. Chip Bell, The Chip Bell Group 10. Linda Ireland, AveusAll the best on your journey to Customer Experience success! © Copyright 2011 CustomerThink Corp. 1
  • 3. Customer Experience Management: 10 BIG IdeasTable of ContentsLeading Customer Experience for Your Company: Three Imperatives for Success .................................................................. 3Thinking Strategically About Customer Experience: Five Components of Customer Value ..................................................... 5Trust and Choice are Essential Customer Experience Ingredients .......................................................................................... 8Customer Experience Innovation: The Third Phase of Your CEM Journey ............................................................................ 12Giving a Gift Before Purchase Could Increase Your Sales by Over 40 Percent ....................................................................... 16Choosing the Right Customer Loyalty Metric ...................................................................................................................... 18What NOT to Say to the Gift of Customer Complaints ......................................................................................................... 20The Impact of the Digital Buyer Experience on B2B Sales and Marketing ............................................................................. 21Casting Extraordinary Service People to Deliver Artful Performances .................................................................................. 23Customer Emotions Drive ROI of Customer Experience Programs ....................................................................................... 26Copyright NoticeThe contents of this e-book are copyright property of the authors and CustomerThink Corp. A free copy is available to allCustomerThink members. © Copyright 2011 CustomerThink Corp. 2
  • 4. Customer Experience Management: 10 BIG IdeasLeading Customer Experience for Your Company: ThreeImperatives for SuccessBy Linda IrelandLet’s say your CEO just tapped you on the shoulder and asked you to take on a new responsibility:“We need you to drive customer experience strategy and actions for our organization. Define the strategy.Strengthen our customer experience. Differentiate us in the marketplace. Will you do that?”This is becoming a more common story. More and more companies are tapping a leader or team to beaccountable for customer experience strategy and execution. Some are line executives in marketing, service oroperations and customer experience is folded into their work. Some lead customer experience as a discipline –much like Six Sigma – where they train a sanctioned expertise across the organization. Others, like CIGNA’sIngrid Lindberg, are senior level internal consultants, illuminating the way, setting expectations and advising lineleaders on how to achieve customer experience objectives in their areas or business units. Larger companies arenow creating Chief Customer Officers.If you’re like the leader who shared this experience with me, the question isn’t so much will you but rather HOWwill you? His thought was “Sounds like fun. How do I do that?”Regardless of the particular title or box on the organization chart a customer experience leader takes, everyoneI’ve met has had their own “How do I do that?” moment. How can you set yourself and your organization forsuccess? I’ve found three imperatives that – if followed – can be the road map to success for any customerexperience leader:1. Link customer experience to financial performanceEvery customer experience starts with a person who has a problem, need or desire they’d pay money to solve. Ifand how well the problem is solved is the key to any organization’s growth and sustainability. When it comesright down to it, customer experience matters because it drives financial performance. The first imperative ofcustomer experience is to acknowledge this link.If you were to ask most leaders why customer experience matters, they’d probably talk about building customerloyalty, or satisfaction, or the likelihood customers will advocate for a brand. I’d agree, but this is only a tinyfraction of why customer experience matters. It is, however, a large part of why a lot of leaders believe therehas to be a tradeoff between customer experience and financial performance. If I could eradicate one thoughtfrom the mind of every business leader, it would be that one. Research has proven, that organizations with awell-understood definition of customer experience are TWICE as likely to beat their profit targets than thosewho do not.2. Create an ‘end in mind’Stephen Covey espouses it in the venerable classic, The 7 Habits of Highly Effective People: begin with an end inmind. He was right. Imagine what should happen, and how customers should feel as they realize a need, learnabout options to solve it…through each of the six steps common to any customer experience. This is your end.The second imperative of customer experience is to define the ideal, or target experience for your customers. Inorder for your organization to make a breakthrough or substantial change in performance, everyone needs tohave this end in mind. Your target experience ‘end in mind’ is driven by solving a need for the customers who © Copyright 2011 CustomerThink Corp. 3
  • 5. Customer Experience Management: 10 BIG Ideasdrive growth and profit for your organization. It is more than a list of best practices — the things all companiesshould do. It’s different than “more is always better.” Your customer experience is unique to your organizationand the problem it solves for its customers. Do you want to do what everyone else is doing or do what solvesyour customer’s need best?3. Use your target customer experience in decision makingChoosing between dumb things and smart things is easy; everyone is trying to choose smart things. You shouldbe trying to choose between the two or three smart things that will have the biggest payoff for your customer’sexperience and in turn your organization (see imperative #1). I’m advocating that you use your customerexperience as an operating strategy.The third imperative of customer experience is to use your ideal or target experience as a litmus test for dailydecisions and actions across your organization. As we’ve discussed here before, there is a difference betweendeciding and doing. It’s worked for Tony Hsieh and Zappos, and it’s a step CIGNA is taking. Starbucks is famousfor creating, falling down, and getting back up on using experience to drive daily decisions. How can it work foryou?Now what?I’ve shared these imperatives each time I’m asked the “How do I do that?” question. What do you think? Wherewould you start if you were charged with leading an organization’s customer experience efforts?LINDA IRELAND Linda Ireland is co-owner and partner of Aveus LLC, a global strategy and operational change firm that helps leaders find money in the business performance chain while improving customer experiences. As author of Domino: How to Use Customer Experience to Tip Everything in Your Business toward Better Financial Performance, Linda built on work done at Aveus and aims to deliver real-life, actionable, how-to help for leaders of any organization. © Copyright 2011 CustomerThink Corp. 4
  • 6. Customer Experience Management: 10 BIG IdeasThinking Strategically About Customer Experience: FiveComponents of Customer ValueBy Maz IqbalHow do you think about Customer Experience?In my view too many people are thinking about Customer Experience tactically. Or put simply: too many peopleare thinking of Customer Experience in terms of making changes to the interaction channels.Being a strategist, I prefer to think strategically and have been looking for a way that helps me to do that when itcomes to:  Attracting and keeping customers; and  Thinking about, organising and executing Customer Experience.So how do you attract and keep customers? And how should you think about (frame) your customer experienceefforts? I assert that the answer to both of these questions is the same: create superior value for yourcustomers and keep doing it continuously.Which begs the question: what is ‘value’ from a customer perspective?Fifield: customer value equationOne of the most useful frameworks that I have come across is the one developed by Paul Fifield (by building onsome work done by Osterwalder and Pigneur) in his book Marketing Strategy Masterclass. Value = Benefit – Effort – Risk – PriceMaz Iqbal: customer value equationIf it was OK for Newton to stand on the ‘shoulders of giants’ I am more than happy to steal from ProfessorFifield. Yet, I believe that Prof. Fifield’s equation neglects a critical piece of the puzzle. So I have added it in andthus my equation is: Value = Benefit – Effort – Risk – Price +/- TreatmentLet’s take a closer at the six elements of this equation.ValueThe first point to make is that value does not reside in the product or service that you offer. Value is in mind ofthe customer. Put differently, customer value is the value that each individual customer perceives in:  what you are offering including any implied or explicit promises; and  getting the job done in the way that you are proposing in your offer.This means that ‘value’ will occur differently to different customers. So a customer who is housebound is likelyto value the home delivery of their weekly groceries very differently to another customer who is able to andenjoys visiting her local supermarket. © Copyright 2011 CustomerThink Corp. 5
  • 7. Customer Experience Management: 10 BIG IdeasFinally, it is worth stressing that ‘value’ from a customer perspective is much more than price. And it certainly isnot about being cheap. Recent wine tests have shown that in blind taste tests customers rate the same winedifferently: if the wine is priced cheaply then the wine is rated as being of an inferior quality even though it isexactly the same wine in the same bottle!BenefitYour offer must promise and deliver the benefits that the customer is looking for. One way of thinking about thisis in terms of the job that the customer wants done and the outcomes he desires. The closer you offer is to theperfect solution for the job and the desired outcomes, the more benefit it deliver and the more value that youcreate for your customer.Clearly, each customer will have a different perception of the importance of the job, the perfect solution and thevalue of that solution. To make this manageable you must segment your customer base into distinct customersegments.EffortCustomers have been conditioned to want ease and convenience. I would go further and say that ease andexperience are so important to us that once we have found a supplier that delivers this we stop looking for othersuppliers.The desire for ease and convenience spans the process of finding, evaluating, buying, taking receipt of and usingthe product or service. This means that the organisation needs to pay attention to more than the product orservice. It needs to pay as much attention to interaction and distribution channels as it does to the product orservice.It is worth noting that real value, from the customer’s perspective, is only created in the usage process. Toomany suppliers neglect to pay sufficient attention to the customer’s actual usage process. So they fail to comeup with solutions that minimise the effort of using these product or service. This is an area in which Apple hasexcelled and made its fortune. Now compare Apples attention to detail (as regards the user experience) to this:How “wrap rage is hurting the customer experience”As Fifield says “Generally, there will be greater customer value attached to those offerings, where theorganisation has spent time, research, effort and insight into finding new ways of making the old jobs easier.”RiskThe greater the level of risk that the customer sees in you the vendor and your offer, the lower the perceivedvalue of your offer.The perceived risk is much higher when the customer has a lack of knowledge and prior experience in how bestto get his job done. And in particular how to judge the expertise of the supplier and the quality of the offer.It is worth noting that risk is always present: usually at a subconscious level. Customer are particularly sensitiveto things that can go wrong and which make them look stupid in their own eyes (self-esteem issue) or in theeyes of others (social standing). It is the reason that advertising is not dead, will not die and why establishedbrands do well despite doing poorly on other elements of the customer value equation. We are risk averse andstick with the devil we know; brand recognition matters – ask anyone who does not have an established brand. © Copyright 2011 CustomerThink Corp. 6
  • 8. Customer Experience Management: 10 BIG IdeasPriceIn some ways this is one of the more complex components of the customer value equation. Why Because it isnot as simple as the price being too high. From a customer perspective, it cover the following aspects:  Price being too low (wine example under Value heading) and thus leading the customer to think that the offer is of inferior quality or not fit for purpose (increasing the Risk component of the Value equation);  Price being too high;  Seeing the same product cheaper somewhere else;  Depreciation in value – how fast the resale value of the product will fall;  The time/effort trade-off in searching for the lowest price;  Buy now or buy later when price falls etcTreatmentTreatment recognises that customers are people and as such the place a value in how they are treated as humanbeings. Put differently, customers put a high value on ‘service. In particular, they prefer to do business withorganisations that leave them feeling ‘valued’.I have placed a +/- in front of the Treatment component because if customers are treated well (especially by theemployees of the company) then it make a positive contribution to customer value as perceived by thecustomer. If the company fails to do that then the Treatment component becomes negative and decreases thevalue of the rest of the offer.Two companies that excel in the Treatment component are Amazon and Zappos. Here is an example of the kindof impact this has on the customer: “Great Customer Service Build your Revenue and Brand: My AmazonExperience”MAZ IQBAL I define myself as a ‘customer based strategist’. My focus is on helping organisations to generate-define-design- execute customer based strategies that create superior value for customers and competitive advantage for the enterprise. You can access my thinking at The Customer Blog. (www.thecustomerblog.co.uk). © Copyright 2011 CustomerThink Corp. 7
  • 9. Customer Experience Management: 10 BIG IdeasTrust and Choice are Essential Customer ExperienceIngredientsBy Lynn HunsakerThis article describes the 5th of 10 unique characteristics of customer experience relative to more well-known concepts suchas customer satisfaction and retention. The characteristic defined in this article is: Choice — Customer experience is built ontrust and mutual respect for variety; share of budget is more important than loyalty.So you want a relationship with your customer? If one of your greatest hopes is for your brand to be loved byyour customers, think about what it takes for your personal relationships to thrive. Since customers (even B2B)are people, they tend to have similar responses to relationship strengths and weaknesses whether therelationship is personal or with a brand. As you know from your own experiences, trust and respect for yourchoices are at the root of relationship failure or success. Yet, customers’ trust of companies is steadily eroding!In fact, U.S. consumers’ trust dropped a whopping 8 points from 2010 to 2011 in the Edelman Trust Barometerstudy1, and U.S. and U.K. firms rank 8th and 9th in trustworthiness, behind Brazil, India, Italy, China, Germany,and France. (Note: all graphics shown in this article are from the 2011 Edelman Trust Barometer.)Astoundingly, trust of banks dropped 46 points in the U.S. and 30 points in the U.K over the past 3 years. Onlyone in four people in these countries feel they can trust banks to do what is right. In 2008, U.S. automobileswere the lowest ranking industry, but they have managed to bounce back with a 17 point gain. © Copyright 2011 CustomerThink Corp. 8
  • 10. Customer Experience Management: 10 BIG IdeasHindsight may be a great teacher here, as we’ve observed self-centeredness in these industries in recent times.In the interest of maximizing short-term financial performance, these companies seem to have forgotten thatrelationships are a two-way street. Once trust is eroded, any amount of advertising and sweet-talking tends tohave little effect. For so many reasons, it’s essential to maintain high trust with your customers.If you love someone, set them free. Yet, long-term (e.g. 1-year, 2-year) agreements, exclusions, caveats, changefees, extensive fine print, extra steps (hassles), and many other penalties are the norm in several industries.These are examples of bad profits, as described by Fred Reichheld in his book The Ultimate Question:“Whenever a customer feels mis-led, mistreated, ignored, or coerced, then profits from that customer are bad.Bad profits come from unfair or misleading pricing. Bad profits arise when companies save money by deliveringa lousy customer experience. Bad profits are about extracting value from customers, not creating value. Whensales reps push overpriced or inappropriate products onto trusting customers, the reps are generating badprofits. Bad profits provide a distorted picture of business performance. The distortion misleads investors,yielding poor resource decisions that hurt our economy. That tarnished reputation undermines consumer trustand provokes calls for stricter rules and tighter regulations.”2The 2011 Satmetrix Net Promoter® Industry Benchmarks Study reports 1 in 5 U.S. consumers say badexperiences lead them to switch brands. Bad experiences were described by 34% of consumers as interactingwith a rude or disinterested employee, and by 20% as unexpected charges or fees; 20% also listed poor productor service quality as the main reason for switching brands.3 Specific examples are described in a 2010 study byConsumer Reports, which lists the naughty or nice policies of 20 leading consumer companies. (By the way,these concepts apply just as well in B2B, government, non-profit, etc.)4 Don’t let your fear of a few usurpingcustomers lead you to punish all your customers for wanting to give you their money! Re-think the customer-centricity of your sales and service policies, and all your other policies, for that matter. © Copyright 2011 CustomerThink Corp. 9
  • 11. Customer Experience Management: 10 BIG IdeasAs Jeanne Bliss explains in her book I Love You More Than My Dog: 5 Decisions That Drive Extreme CustomerLoyalty in Good Times & Bad, “Consider the story that the collective decisions of your organization tellcustomers, employees, and the marketplace. What story is emerging about who you are and what you value?Are your decisions reflecting what you intended? When you make decisions that respect and honor customersyou will earn their respect — eventually their love. Are your decisions compelling customers to tell others to tryyour products and services? Are customers telling your story?”5 You don’t need fancy technology or campaignsto build highly profitable customer retention. You simply need to consistently provide the value that youpromise.When a company is distrusted, 57% of customers will believe negative information, and only 15% will believepositive information. In contrast, when a company is trusted, only 25% of customers will believe negativeinformation, and 51% will believe positive information.1 © Copyright 2011 CustomerThink Corp. 10
  • 12. Customer Experience Management: 10 BIG IdeasA study by the London School of Economics examined the revenue gains by increasing positive word-of-mouthand by reducing negative word-of-mouth. They found that reducing negative buzz pays off 300% over improvingpositive buzz.If you want ongoing strong financial performance, build trust into your customer retention efforts. Rememberthe golden rule: Do unto others as you would have done unto you. It’s the best rule of thumb for anything in life,and an essential ingredient to reaping high returns on your customer experience investments.1 Edelman Trust Barometer, 2011.2 The Ultimate Question: Driving Good Profits and True Growth, by Fred Reichheld.3 Satmetrix Press Release, February 17, 2011.4 Consumer Reports, November 22, 2010.5 I Love You More Than My Dog: 5 Decisions That Drive Extreme Customer Loyalty in Good Times and Bad, by Jeanne Bliss.See the other posts in this series:Customer Experience Management is Doing the Right ThingStart with Your Customers for Success in Every StrategyFall in Love with Your Customers for Best Customer ExperienceCustomer Experience Management is Uncommon SenseCustomer Experience is More Than EngagementLYNN HUNSAKER Lynn Hunsaker helps companies improve enterprise-wide customer-centricity and profitability through ClearAction customer experience management consulting. She led customer experience initiatives in large companies since 1989, and authored 3 books, including Innovating Superior Customer Experience. See the ClearAction B2B CEM Benchmarking Study and newsletter. © Copyright 2011 CustomerThink Corp. 11
  • 13. Customer Experience Management: 10 BIG IdeasCustomer Experience Innovation: The Third Phase ofYour CEM JourneyBy Bob ThompsonCEM first caught my attention in 2005, which prompted me to launch a major research study in 2006. Based oninterviews of industry experts and business leaders, I defined CEM as “Managing customer interactions to buildbrand equity and improve long-term profitability.” You can learn more about CEM and how it is different fromCRM in my article The Next Generation of Customer Management? Customer Experience Management.Past: Customers have always valued experiences (buzzword optional)Differentiating around the customer experience is hardly a new idea. Nearly 30 years ago, Jan Carlzonengineered a turnaround at Scandinavian Airlines by improving “moments of truth” in passenger interactionswith the airline.Since then, Customer Relationship Management (CRM) has been mainly concerned with how to market tocustomers and get value from them, often leveraging technology. But largely forgotten was the insight thatCarlzon understood intuitively: Customers perceive value based on the experiences they receive and perceive.Or, as he told me in a 2006 interview (paraphrasing)—it’s not about the aircraft! And for some time, we thought if we just had very new and nice and technically developed aircraft, people would regard our company as good. But when we questioned our passengers, it showed that 90 percent of them didn’t even know what kind of aircraft they were flying. Where did they get their impression or perception of the company? We found out that they got the perception in those meetings with human resources, the employees working in the company: a salesman over the telephone; a girl behind the check-in counter; a stewardess on board the aircraft; the captain, the way he spoke over his microphone.If you’re excited about the potential for CEM to improve your business, good! But before you get started, takesome time to read Carlzon’s groundbreaking book, published waaaay back in the dark ages of 1987: Moments ofTruth: New Strategies for Today’s Customer-Driven Economy.Present: Listening to voice of customer, building the business caseIn the past five years or so when we’ve seen CEM emerge as a more systematic approach to differentiate basedon customer experience. The use of survey-based “Voice of Customer” (VoC) programs has also hit themainstream during this period. Frankly, I don’t see how any company can claim to “do” CEM without a strongVoC program as a foundation.For mainstream CEM adoption, of course the “ROI” question must be answered. Executives want to know, “If weinvest in CEM and improve how we listen to and treat our customers, how does the company succeed?”The answer is simple: CEM is important because experiences really do matter to customers in their buyingdecisions. Experiences affect loyalty, which every CEO should be concerned about.In CustomerThink’s 2006 cross-industry study, we found a remarkable consistency in customers valuingexperiences about equally with the core product/service. We also found that leaders in CEM effectivenesstended to achieve higher levels of business performance (profitable growth). Since then numerous studies have © Copyright 2011 CustomerThink Corp. 12
  • 14. Customer Experience Management: 10 BIG Ideasfound much the same thing. For more on the ROI issue, read Jon Picoult’s article Yes, Virginia, There Is A Return OnCustomer Experience Investments.Getting customer feedback is a critical first step towards CEM success. And increasingly companies are turning tosurvey-based “Voice of Customer” programs to get insight into the quality of specific interactions ortransactions, or to assess the quality of relationships. This has created a significant new industry for so-calledEnterprise Feedback Management (EFM) tools.But technology-enabled listening is not enough. In my Can You Hear Me Now? article I wrote about these fivepitfalls:  Pitfall No. 1: Lack of executive support to drive change  Pitfall No. 2: Garbage in, garbage out  Pitfall No. 3: Employees aren’t motivated to be customer-focused  Pitfall No. 4: Listening with only one ear  Pitfall No. 5: Ignoring social voicesIn short, while companies are doing a much better job in asking questions with the support of technology, theyneed to be sure they are asking the right questions and have the organizational support to act on what theylearn.Future: 360-degree listening, experience innovationThese days, most companies are aware of the importance of customer experiences to build loyalty and retaincustomers. In difficult economies or maturing markets, the “easy money” of new customer acquisitions is gone.Over the next few years, companies should expand their VoC efforts to listen to the customers and the marketmore completely. Unstructured and often unsolicited feedback—from social media and many other sources—isa goldmine of insight waiting to be discovered. You shouldn’t wait for the next survey to get feedback!Further, it’s time to stop being reactionary. Yes, it’s important to fix problems because they’re a negative drainon the customer experience. But it’s equally important to proactively create innovative new experiences thatdifferentiate the company.CEM journeyI think one of the biggest mistakes that companies make is trying to run when they should be walking. Your CEMstrategy should be built based on your market position and maturity. Said another way: Don’t try to “wow” yourcustomers with creative experiences when your call center won’t answer the phones.So with that in mind, I would suggest three major phases on a successful CEM journey. Phase 1. Stop the Bleeding If your company is losing customers due to poor customer service or other problems, by all means fix these problems first. A classic example of this sort of recovery is Sprint. In 2007, the mobile telecom company achieved unwanted notoriety by firing its unprofitable customers. That’s good solid CRM-like behavior, but it failed to account for the media backlash and didn’t address the core issues of why those customers were calling and therefore unprofitable. © Copyright 2011 CustomerThink Corp. 13
  • 15. Customer Experience Management: 10 BIG Ideas Well, Sprint has engineered an impressive turnaround by systematically uncovering and fixing customer service problems. In my recent interview of Jerry Adriano, Sprint’s VP of Customer Experience, I learned that the company has dramatically improved its customer satisfaction rating, reduced costs and decreased churn. The process took a couple of years and required top management to get serious about CEM. Well done, Sprint! Phase 2. Focus on (Selective) Touchpoint Excellence Once you’ve fixed the major “dissatisfiers” that cause customer defection or negative WOM, take some time to study the end-to-end customer experience and learn which interactions or “touchpoints” matter most. For example, Sampson Lee’s article reviews research on credit card customer experiences across 39 touchpoints, seven different stages (Image, Application, Card Usage, Promotions, Gift Redemption, Repayment, and Service) and multiple channels. He found that some touchpoints are important in driving customer retention, while others are more important to increase loyalty (NPS). To win at CEM, you don’t need to be world-class in every single touchpoint. Focus on the interactions that matter most to customers and will drive the business outcomes you seek. Phase 3. Innovate in Experience Design Now here’s the fun part! What I’ve described thus far can be summed up as fixing and refining what you’ve got. If your competitors are asleep at the switch, this may be enough to gain a competitive edge. But fixing problems and optimizing touchpoints will only take you so far; probably not to industry leadership. To fulfill the promise of experience-based differentiation, you may need to create entirely new experiences. For example, observe the technologies and services that consumers are using—including social media and smart mobile devices, just to name two. How could these be applied to your business? Read Michael Hinshaw’s recent post on redefining customer experience for a mind-expanding perspective on the possibilities. To get and stay ahead in customer experience, you’ll need to be more like Apple— constantly innovating the experience, not just optimizing existing touchpoints. Apple is known for its products, of course. But go to an Apple store and you’ll also enjoy the shopping experience with well- trained employees and no cash registers up front in the typical retail checkout process. Don’t stop there. Instead of putting on a show for your customers, invite them up on stage with you! As a social/collaborative business, look for ways to create products and experiences with your customers. A provocative example of this sort of “co-innovation” is how Threadless sells t-shirts designed by its community.Tips for SuccessAs you look at expanding your efforts in CEM and VoC in 2011 and beyond, here are a few things to keep inmind. 1. Understand your customers’ complete value proposition. Experiences matter, but so do products and price. In the realm of customer experience, service/support processes carry a lot of weight, because emotions run hot when problems occur. But don’t overlook the value of marketing, selling, purchasing © Copyright 2011 CustomerThink Corp. 14
  • 16. Customer Experience Management: 10 BIG Ideas or consumption experiences. Well-designed VoC programs will keep you on track with all of your customers’ loyalty drivers. 2. “Listen” to customer behavior and existing communications. There’s a wealth of insight to be gained from analyzing what customers are “saying” with their actions or communications. For example, you can use predictive analytics and text mining tools to identify patterns in customer interactions that are likely to lead to attrition, so you can act before it’s too late. 3. Optimize the cross-channel experience. Most large organizations continue to struggle with silos, and this can create huge problems for multi-channel customers, which tend to be more valuable. Make sure that web, phone, social and other channels are working together. This is one area where a Chief Customer/Experience Officer can really help. 4. Reward your employees. Yes, technology is essential to manage large VoC programs, and disruptive technologies can enable innovative experiences. But when we researched what really matter to customers in “memorable” experiences, the top factor was dealing with friendly, capable and empowered employees. 5. Move towards Market Feedback Management (MFM). Social media has emerged as a critical source of insight into what customers, prospects and influencers think about your brand. New social media monitoring tools can help, but generally these are not integrated into one comprehensive overall VoC effort. That must change in the next few years.BOB THOMPSON Bob Thompson is CEO of CustomerThink Corp., an independent research and publishing firm focused on customer-centric business management, and Founder/Editor-in-Chief of CustomerThink.com, the world’s largest community dedicated to customer-centric business. Thompson is a popular keynote speaker, blogger and author of numerous reports, articles and papers, including “CrowdService: Harnessing the Wisdom of Crowds in Customer Service and Support.” © Copyright 2011 CustomerThink Corp. 15
  • 17. Customer Experience Management: 10 BIG IdeasGiving a Gift Before Purchase Could Increase Your Salesby Over 40 PercentBy Stan PhelpsI’ve always been a huge proponent that marketing lagniappe drives 3 strong benefits. By giving little unexpectedextras (GLUE), you can achieve the following: 1. Differentiation – stand out from the competition 2. Retention - increase satisfaction which encourages repeat business 3. Word of Mouth – give your customers something to ‘talk, tweet, yelp, blog and Facebook’ aboutNow a recent study in the International Journal of Marketing Studies has revealed that giving a gift beforepurchase could increase consumer spending by over 40%. Thanks to Ric Dragon at Dragon Search Marketing forforwarding it. Here is a synopsis of the article by Hershey H. Friedman and Ahmed Rahman: An experiment was conducted in a restaurant to determine the effects of a small gift upon entry and greeting customers with a thank you for their patronage. Two types of gifts were used: a cup of yogurt and an inexpensive key chain. The authors found that providing a gift upon entry into a store had an impact on how much was spent, on the performance rating, and on how strongly the establishment would be recommended. This study did not find any differences between gifts: a gift of a cup of yogurt had the same impact as a key chain. The difference in amount spent between the group that was not greeted or given a gift and the group that was greeted and given a cup of yogurt was 46.4%, a considerable amount.The article discusses the underlying principle of reciprocity, the power of surprise and the importance of givingwithout an implicit expectation of return. The conclusions are very interesting: This study demonstrates that there is value in greeting customers who enter a store. Customers who are not greeted will spend considerably less, will rate the store lower on performance, and will also be less likely to recommend the establishment. Providing a small gift upon entry into a store will have an impact on how much is spent, on the performance rating, and on how strongly the establishment will be recommended… The value of a satisfied customer to a business is immense. One study showed that customers who are totally satisfied contribute 17 times more sales to a firm than customers who are somewhat dissatisfied and 2.6 times as much sales as customers who are somewhat satisfied (Whalley and Headon, 2001). If all it takes to improve attitudes of customers is an appreciatory comment and an occasional gift, then organizations should use this approach as part of their marketing communications strategies.From Yogurt to Peanuts © Copyright 2011 CustomerThink Corp. 16
  • 18. Customer Experience Management: 10 BIG IdeasOne of my Hall of Famers in the Project is Five Guys Burgers and Fries. Jerry Murrell and his eponymous five sons(Matt and Jim travel the country visiting stores, Chad oversees training, Ben selects the franchisees, and Tylerruns the bakery). Free is baked into the model at Five Guys: 1. Free peanuts when you walk through the door 2. 15 free toppings for your burger or dog 3. An extra handful or two of bonus fries 4. Free refills for your soda or ice tea 5. Free of logo’s and excess decorThe free peanuts you can shell are my favorite. According to Todd at cheese-burger.net: While you wait for your order to be prepared, there is a mountain of peanuts just inside the front door to munch on. Free peanuts have become the trademark “thing” that Five Guys is known for. I saw over fifty bags, 50 pounds apiece, waiting to be opened and devoured. They have signs at the door to serve as fair warning for folks with peanut allergies, and they’re pretty strict about not letting you take any peanuts to go as a safety precaution. But it’s a pretty cool thing: order your cheeseburger, scarf down a handful of salty, ballpark-style, still-in-the-shell peanuts.By my rough calculation Five Guys gives away over 2 million pounds of peanuts per year. Do little things make abig difference? For a company that does little to no advertising, here is the mantra from founder Jerry Murrell: We figure our best salesman is our customer. Treat that person right, he’ll walk out the door and sell for you. From the beginning, I wanted people to know that we put all our money into the food. That’s why the décor is so simple — red and white tiles. We don’t spend our money on décor. Or on guys in chicken suits. But we’ll go overboard on food.How do you stand out in the sea of sameness like Five Guys Burgers and Fries? How do you win repeatcustomers and influence word of mouth? Are you Giving Little Unexpected Extras?What’s Your Peanuts or Yogurt?STAN PHELPS Stan Phelps is Chief Solutions Officer at Synergy Events. Synergy is an award winning experiential marketing agency specializing in the creation of signature brand experiences. Stan believes the ‘longest and hardest nine inches’ in marketing is the distance between the brain and the heart of your customer. He is fascinated by the concept of lagniappe and is currently writing his first book, ‘What’s Your Purple Goldfish?’ [Launching 1.11.12] © Copyright 2011 CustomerThink Corp. 17
  • 19. Customer Experience Management: 10 BIG IdeasChoosing the Right Customer Loyalty MetricBy Joseph Michelli, Ph.D.Recently I mentioned a Harvard Business Review article entitled, “Stop trying to delight your customers” and Iintroduced the concept of a single item CES or Customer Effort Score. That score is calculated based oncustomer responses to a question that asks for a rating (on a 1-5 scale) based on how much effort customersmust exert to get their needs met at your company. Also in that post I suggested that my next installment wouldcompare the power of the CES for predicting customer loyalty to the more commonly used metrics of customersatisfaction (CSAT) and customer engagement (Net promoter score or NPS).So let’s dive right in with an obvious truth, customer satisfaction measures have virtually no ability to predictcustomer loyalty. They can predict customer churn but not loyalty. If you ask your customers, “how satisfied areyou with our service or our business?,” their answers will simply indicate whether customers think you arecompetent to perform your function. Low levels of satisfaction indicate that customers are not confident in thebasic viability of your offerings. Good to excellent satisfaction scores simply mean you are competent and assuch remain a contender for future business. So low satisfaction predicts attrition but high satisfaction does notpredict retention.Now on to a question that Fred Reichheld called “the Ultimate Question” in his book of the same name.“How likely is it that you would recommend this company to a friend or colleague?”As you probably know, that question produces a metric called the Net Promoter score, or NPS for short, which iscalculated on a 0-10 scale using the following formula: P — D = NPSWhere P is the percentage of customers who are promoters and D is the percentage who are detractors. Butwho is a promoter and who is a detractor? It’s as simple as:  Promoters (score 9-10) the loyal enthusiasts who keep buying and referring others, fueling your growth.  Passives (score 7-8) those satisfied but unenthusiastic customers who are vulnerable to competitors.  Detractors (score 0-6) are the unhappy customers who can damage your brand and prevent your growth through negativity.So in other words, the NPS equals the percentage of your 9’s and 10’s minus the percentage of your 0-6’Bain & Company’s analysis of the NPS shows that businesses that achieve long-term profitable growth-have NetPromoter Scores two times higher than the average company. Additionally, NPS performance leaders outgrowtheir competitors in most industries-by an average of 2.5 times.So head-to-head, how does the single item NPS score compare to the single item Customer Effort Score (CES)?According to the authors of the Harvard Business Review “Stop trying to delight customers” article, “Weevaluated the predictive power of three metrics—customer satisfaction (CSAT), the Net Promoter Score (NPS),and a new metric we developed, the Customer Effort Score (CES)—on customer loyalty, defined as customers’intention to keep doing business with the company, increase the amount they spend, or spread positive (and © Copyright 2011 CustomerThink Corp. 18
  • 20. Customer Experience Management: 10 BIG Ideasnot negative) word of mouth. Not surprisingly, CSAT was a poor predictor. NPS proved better (and has beenshown to be a powerful gauge at the company level). CES outperformed both in customer service interactions.”While I encourage the use of NPS and CES in varying applications with my clients, a single question can NOTunravel the mystery of customer loyalty.More importantly, what are your customers saying about you when it comes to NPS and CES inquiries?JOSEPH MICHELLI, PH.D. Joseph Michelli, Ph.D., an organizational consultant and the chief experience officer of The Michelli Experience, is a #1 New York Times Bestselling author of The Zappos Experience: 5 Principles to Inspire, Engage, and WOW, The New Gold Standard: 5 Leadership Principles for Creating a Legendary Customer Experience Courtesy of The Ritz-Carlton Hotel Company and The Starbucks Experience: Principles for Turning Ordinary Into Extraordinary. © Copyright 2011 CustomerThink Corp. 19
  • 21. Customer Experience Management: 10 BIG IdeasWhat NOT to Say to the Gift of Customer ComplaintsBy Cheryl HannaCustomer feedback should be revered by business owners. What better way to findout if you are continuously meeting the needs of your customers in the mostefficient and best respected ways? It’s a rare business that never has a complaint,but the negative connotation of the word tends to bring down our spirits, so whynot use the positive spin and label it “feedback?” After all, it’s not to be taken as acriticism; it’s meant to keep us informed and help us improve.Of primary importance is not to get defensive. Take notes and ask questions. Findout what frustrated your customer because if you don’t, how will you ever be ableto elicit more positive feedback? Of course, you don’t want to offer excuses orblame. Customers really don’t care why it happened; they just want you to fix it.Start with apologizing, and take the responsibility for moving past objections byfinding a solution. You want to recognize the customer was hurt, and you want to photo credit: La Citta Vitaassure someone you will do all that is possible to correct the problem.Recently I asked some of my colleagues for examples of what not to say when dealing with customer“feedback.” See what you think:  Don’t ever say, “I’m sorry that you feel that way.” According to Rebecca S., manager of The Limited, a clothing store, that kind of statement translates into telling a customer you don’t care they’re unhappy. Rebecca changed that statement to say, “I’m very sorry this happened. I will correct this problem for you.”  Don’t ever say, “We’ve seen worse.” You might as well be waving good-bye to your customer. Address the problem immediately, and make sure you have apologized. How you are going to remedy the situation is the solution; not that your staff has done worse.  Don’t ever say, “This has never happened to us before.” Margie M., owner of a shoe boutique received an Italian designer shipment of expensive shoes. She sold a pair to a new customer, and within a week the customer was back because the entire side of the shoe had separated from the platform. “It never did happen before,” Margie said, “but I told the customer how sorry I was, went into the back and gave her a replacement pair. I didn’t want to make excuses; I just wanted her to be happy. My boutique is extremely upbeat, and I actually love that designer. Mistakes do happen, but I thought discretion was the better part of my sales presentation.”  Don’t ever say, “I can’t do anything about it.” Again, just wave good-bye as your competition greets your previous customer at the door.In the end, thank your customer for the feedback. Since 90 percent of customers never complain, and just don’tcome back, feel privileged someone has taken the time, and let them know you appreciate how they have goneout of their way to help you do better. If you want to keep your customers and build customer loyalty, don’t letyour customers down.CHERYL HANNA Cheryl Hanna is a successful real estate sales person in Florida and has used her customer service knowledge and experience to set her apart and gain a competitive edge in a very difficult market. Cheryl has been writing professionally since 1999 and writes for several blogs and online publications © Copyright 2011 CustomerThink Corp. 20
  • 22. Customer Experience Management: 10 BIG IdeasThe Impact of the Digital Buyer Experience on B2BSales and MarketingBy Tony ZambitoIn the past decade, we have undergone amonumental shift in how sellers and buyersengage. The digital revolution has ushered in anew age of how products or services reachpeople that were unimaginable just a short tenyears ago. Advancements in technology anddigital media coming in waves causingorganizations to be caught unaware of theimpact the totality of these waves have had ontheir businesses. In many ways, buyers andsellers are attempting to engage as if they arein a department store and sellers are on thedown escalator and buyers are passing themby on the up escalator. This is most notable inthe B2B spectrum of marketplaces. Image by davidking via FlickrIn 1999, B. Joseph Pine II and James Gilmorepublished The Experience Economy: Work is Theatre and Every Business is a Stage. A truly groundbreaking bookthat made a lasting impression upon me around the same time persona development was taking shape. Pineand Gilmore can be characterized as oracles for they offered the premise that we were entering an experienceeconomy where value was created by staging memorable experiences for customers. Many successful B2Centities, such as Disney, leveraged the principle of staging a theme to create memorable experiences.As the digital age takes root into the fabric of our economy, CEOs today, and most appropriately those in theB2B marketplaces, must begin to think about the new era of the buyer experience economy and how it impactstheir organization.Let’s take a look at some areas where the new buyer experience economy will cause rethinking: 1. Buying channels versus selling channels: since the dawning of the industrial and manufacturing age, selling became a downstream endeavor. The mandate being finding channels to push and distribute products or services out to buyers. The digital age has ushered in a new way of thinking. That being, creating channels that are upstream and enabling buyers to find you and engage. 2. New media adoption: for some B2B markets, adopting new forms of digital media that enable buyers to engage and find you is proving to be disruptive. I am going to shy away from using the often used term of content marketing for the moment. While quality content is important, the larger strategic question for CEO’s to think about is what new forms of media are relevant to their buyers? 3. How to organize: This may be especially tough for companies who have a long and rich tradition of large field sales departments where in some cases today even free doughnuts cannot buy an appointment. The old school of compartmentalizing processes into sales, marketing, and service is in serious need of © Copyright 2011 CustomerThink Corp. 21
  • 23. Customer Experience Management: 10 BIG Ideas an extreme makeover. Companies need to discover new ways to organize that allows for exceptional buying experiences and removes barriers. 4. Buyer experience design as a core competency: While experience design and the notion of customer experience have been around for a few years, B2B organizations as a whole have not embraced these as necessary core competencies. Yes, there are exceptions and some B2B companies have done well in reinventing themselves. By and large though, these efforts have been coined under the labels of initiative, project, program, and the like. And we all know what happens to those things called initiatives, projects, and programs after the first year. 5. Buying conversation versus selling conversation: Interwoven into the DNA of B2B organizations is the many years of sales training, sales programs, and sales systems that have as its aim to begin a selling conversation with buyers. Tremendous investments have been made in selling methodologies and sales systems all promising the results of improved sales performance and increased revenues. Additionally, marketing structure and purpose has been oriented towards supporting selling conversations. There seems to be a problem however if organizations continue to be wedded to their existing sales processes and marketing support systems. Buyers, in the new buyer experience economy, appear to want entirely different conversations. This is not a dire prediction about the end of sales. Far from it. What is true in a new buyer experience economy is that there needs to be a new understanding and rethinking of exactly what constitutes a conversation with buyers today.Companies who embrace the notion that the new economic difference maker will be that of the buyerexperience will find themselves as the market leaders of a new era. A new era that not only sets a stage andtheme for experience but also enables buyers to create buying experiences that are unique to them.TONY ZAMBITO Tony Zambito, Founder and Principal of a buyer strategy consulting firm. Goal Centric is the originator of the buyer persona methodology. Tony is launching Buyerology© as a new means of understanding buyer behavior. Tony also served in the role of Vice President in Sales and Marketing capacities for TRW, Knight-Ridder, and Compaq (HP). He holds a B.S. in Business and an M.B.A. in Marketing Management. Read Tony’s blog Buyerology Now for insightful commentary on changing buyer behavior. © Copyright 2011 CustomerThink Corp. 22
  • 24. Customer Experience Management: 10 BIG IdeasCasting Extraordinary Service People to Deliver ArtfulPerformancesBy Chip BellWhat do Michael Curtiz and Martin Brest have in common? They each had the challenge of casting the bestcandidate for a starring role in a new movie. Michael had an exciting new star named Ronald Reagan, who hadscreen tested for the lead male role opposite Katharine Hepburn in a new movie titled “Casablanca.” And Martinhad a similar challenge: a successful, new box office drawing card named Sylvester Stallone had screen testedfor the lead role in a comedy movie titled “Beverly Hills Cop.”Selecting people for customer service roles is similar to casting people for roles in a play or movie. First, bothrequire artful performances aligned with audience expectations. Creating an interpersonal experience thatcustomers remember as satisfactory, pleasant or dazzling is like the actor’s mission of having audiences socaught up in the play or movie they start believing the performer is the person portrayed. Second, both requirea casting choice based on personality. Ronald Reagan in Humphrey Bogart’s slot would have resulted in a moviequite different from the screenwriter’s intent. And, Rambo as Axel Foley?Fair and Accurate CastingHow was casting done without selection being solely “the whim of the director?” Did Michael Curtiz worry thatRonald Reagan would file a grievance with the actors’ guild if not selected? Did Eddie Murphy get the slotbecause Martin Brest had no interest in devoting the hours needed to “build a file?”A challenge that film and customer service professionals share is how to choose fairly and accurately theperformer with the greatest potential for success. Hiring is—and must—be based as much on intuitive feelingsas on analytical judgments. The problem is that imprecise justification of subjective data to explain hiring oneservice applicant over another is risky. And, with good reason.Selection choices based more on the subjective than the objective—more on vibes than facts—are moresusceptible to bias and prejudice. The “I have a gut feeling you just won’t fit in here” rationale has slammed thedoor on too many who may well have become our shining stars. It was and is the justification for bigotry, oldboys’ networks and myopia, which pay homage to a particular race, color, gender, national origin, age or sexualorientation.Be that as it may, the exaggerated effort to exclude interpersonal information from the selection process—tofocus solely on objective information—may lead to hiring decisions that are fair but stupid rather than fair andsmart.Some Casting GuidelinesHow then, do you cast people for extraordinary customer service? Here are four guidelines that will enable youto avoid the conflict between fair and subjective.1. Clearly define the service role and the critical qualities you are looking forThe service for the potential service star begins with a clear view of the service role to be filled. First, define theskills the service person must bring to the job, and the technical aspects of the job that can be learned and youare willing to teach. Then focus on the interpersonal qualities that are important. Be as specific and thorough aspossible. © Copyright 2011 CustomerThink Corp. 23
  • 25. Customer Experience Management: 10 BIG IdeasMany frontline service roles require people who are friendly and courteous. Such behaviors are relatively easy toobserve and document. But, the qualities found in highly successful service employees don’t end there. Equallyimportant are people with a strong need to see things to their end, the ability to withstand irate attack withoutwanting to retaliate or feeling personally affronted, and the ability to demonstrate ingenuity in solving acustomer’s problem.2. Make the selection process match the service outcome.Years of experience have taught Disney World that one of the most important skills for employees in serviceroles is the ability to get along well with others. Managers judge potential cast members—Disney’s term foremployees—through group interviews. The group experience mirrors the contact between cast members andguests. If an applicant appears uninterested in what other interviewees have to say, chances are that he or shewill not be attentive to Disney guests.It is worthwhile to simulate typical service situations during the interview. Just as an actor auditions using linesfrom the play or an athlete tries out in a practice scrimmage, a simulation during the interview will help youaccurately gauge how well the applicant will perform the service role.For example, one previewing technique for call center job candidates is to play excerpts of real calls they’relikely to receive from customers. Hearing the nature of these calls might cause a few candidates to “select out”of the job, even if they have the skills or background.Simulate customer service requests first, and then advance to more difficult situations. For example, tell theemployee or job applicant: “Now, I will be a customer with a problem in how my account was handled. You arethe service rep this customer encounters first.” How the person works out the answer is far more importantthan whether the answer is right or wrong. Put the person at ease initially by letting him or her know you arenot after a “single correct answer.”3. Look for the applicant’s capacity to create a relationship with the audience.From the customer’s standpoint, every performance is “live” and hence unique. It earns the best reviews whenit appears genuine, perhaps even spontaneous. And it should never be rigidly scripted--certainly not canned. Theimplication for selection is that super service people must have good person-to-person skills; their speaking,listening and interacting styles should seem natural and friendly and appropriate to the situation-- neither stiffand formal nor overly familiar.Watch how applicants treat others. Job seekers can teach you a lot about how they are likely to treat customersby the way they treat non-customers. Ask receptionists or administrative assistants for their view on theapplicant. If they took an applicant on a short tour after an interview, how warmly did he or she greet others?Did they ask good questions, and were they sensitive to details important to the role they were applying for?The general manager of a Marriott Hotel described how her decision to hire a new front desk clerk was cinchedwhen she watched the applicant stop and pick up an empty paper cup from the floor in the employee break areaas the two were en route to meet the front desk supervisor.4. Learn how the applicant reacts to pressure and stress.The frontline service person encounters far more stress than most people in the organization. Angry customersvent their frustration on the first person they encounter without regard to whether that person is specifically toblame. The resilience and tenacity of service people—the capacity to “hang in there” when the going gets © Copyright 2011 CustomerThink Corp. 24
  • 26. Customer Experience Management: 10 BIG Ideastough—can be critical for customer care. Customers prefer frontline people who respond with confidentempathy, not calloused indifference or passive weakness.You don’t have to conduct stress interviews to ascertain stress management skills. Simply asking an applicant torecall a time when he or she encountered an irate customer may be adequate. Simulating an experience with anirate customer is another. Be willing to “push” the encounter issue in order to have the candidate demonstratehis or her ability to handle tough situations.Beware of Pollyanna’s who “love all customers.” Customers are not always right, but they are always thecustomer and the primary determiners of success or failure in the marketplace. Choose people who arerespectful of and attentive to customers’ needs and expectations, not those who are naïve. Frontline stress is areality to be understood and managed, not ignored or denied.Performing in the Service RoleCustomer service is first and foremost an interpersonal experience. Service people must bring a mix of skills andaptitudes to the role if they are to be successful. Casting frontline people to perform the art of serving wellrequire gauging both the subjective and the objective. When we recognize and meet that challenge, the conflictbetween subjective and fair, between qualitative and equitable, no longer exists.Effective supervisors and managers make choices about service applicants based on a clear definition of theservice role they are seeking to fill. They use interviews that entail an honest examination of the qualities thatmake up a “service orientation” and offer the applicant concrete ways to demonstrate these qualities.Frontline employees have a major impact in determining what customers experience and how they will evaluatethe organization. As with cinema, making the best casting choice is critical to box office success.A Few Casting QuestionsThere are no magic questions that automatically illustrate an applicant’s character and service outlook. Butthere are questions that work better than others at eliciting the kind of information you need in order to makean informed hiring decision. Here are a few to use or adapt:  What does giving the customer “superior service” mean to you?  Let me give you a typical customer service situation we get at Acme. (Describe the situation). How would you handle this type of situation? (Look for attitude, not the perfect solution).  Tell me about a time when you successfully balanced the best interests of the company with the best interests of a customer?  We all get weary from time to time from the pressure of dealing with people. What do you do to renew yourself so you can stay “up,” fresh and enthusiastic on the job?  I know I sometimes get uptight when I have to deal with an irate customer. You’ve had experience with difficult customers – can you offer an example that illustrates how you might typically handle them?  What do you like most about being in customer service?  If you were asked to coach someone brand new to serving customers, what advice would you give that person? What are the “do’s and don’ts” you would tell them?CHIP BELL Chip R. Bell is the founder of The Chip Bell Group and has offices in the Dallas and Atlanta areas. Chip’s newest book is Wired and Dangerous, co-authored by John Patterson. Chip’s consulting practice helps organizations build a culture that supports long-term customer loyalty. © Copyright 2011 CustomerThink Corp. 25
  • 27. Customer Experience Management: 10 BIG IdeasCustomer Emotions Drive ROI of Customer ExperienceProgramsBy Colin ShawNelson Pascua, Vice President of Client Services for Medallia, Inc., provides a succinct overview of how valuableunderstanding the customer’s experience is in his article “Top 5 ROI Benefits of Customer ExperienceManagement.” Beyond Philosophy’s model is congruent with Pascau’s five points: streamlined customerexperience management (CEM) creates return on investment (ROI) through customer retention, customerengagement, new customer acquisitions, employee engagement and a more cost-effective feedback system.Our list, however, includes a very important sixth point: cost savings.Poor customer experiences cost money. In fact, we’ve always found ways for our clients to save money throughgood customer experience management.For instance, when one of our utility company clients would receive a call at its call center, a field engineerwould automatically be deployed to the customer’s location in order to assess and resolve the situation. Itsounds great in theory, but the plan backfired. Many times, field engineers didn’t have the proper tools to solvethe problem when they arrived. Initial visits required rebooking, which meant customers needed to takeadditional time off work. The frustration and disappointment of not having the problem solved the first timecreated stress for customers. The emotional toll was immense. Then there was the matter of the $200 cost forthe utility to deploy the field engineer a second time.The solution saved an average of $195 per repeat call. Rather than automatically deploying the field engineer,the call center representative spent more time diagnosing the problem over the phone. At that point, a well-prepared field engineer would arrive and do the job in one visit. The utility spent five dollars at the call centerlevel, making the entire process less expensive and leaving customers genuinely happy.Though the article often alludes to customer emotions — a business traveler “frustrated and angry” with ahotel, or the “wow” and “ouch” stories customers tell others — it never uses the word “emotion” or directlyaddresses the subconscious experience. We focus on customers’ emotional experiences, which account formore than half the typical customer experience. When we are working with clients we use proprietary researchmethods that help us evaluate the elements that drive value in a customer relationship.Understanding customers’ emotional experiences ensures a solid ROI. A company that knows how its customersfeel about their interactions is able to take a proactive approach to customer experience. Creating anemotionally satisfying first customer experience can eliminate the need to recover customers lost to negativeexperiences, like frustration and anger over slow service.The old adage “any press is good press” isn’t true when it comes to customers. A customer who finds a salesrepresentative too aggressive, or a call center’s automated system too impersonal, can easily make othercustomers apathetic to the company with their negative stories. Conversely, the capital expended to make acustomer’s experience enjoyable — an unexpectedly quick response to an email or a salesperson that addressesthem by name— is more likely to perpetually engage with the company and drive higher net promoter scores.Such happy customers will also freely advertise their wonderful experiences to other customers.To guarantee ROI through customer experience, the entire company must understand the particular emotionsof its customers. It is not just the duty of the sales agents and call center to take care of the customer; everyone © Copyright 2011 CustomerThink Corp. 26
  • 28. Customer Experience Management: 10 BIG Ideasup to and including the CEO must be fully committed to the customer experience. The entire business must becustomer-centric.Emotions drive our lives, so it is no surprise that emotions drive the customer. The company that understandsthese emotions has a sharp advantage over the competition, and the ROI an emotionally satisfied customerbrings is well worth the small investment the company has to make to provide it.COLIN SHAW Colin Shaw founder of Beyond Philosophy, the leading experts in the customer experience, is an international author of four best-selling books on customer experience. Beyond Philosophy provides consultancy, training and customer insight research from its offices in Atlanta, Georgia in the United States, and London, England Follow Colin Shaw on Twitter ColinShaw_CX © Copyright 2011 CustomerThink Corp. 27

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