A blueprint for future of customer experience
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This was my keynote presentation, delivered on 4th September 2019 in Bali, at the 2nd Global Summit on Customer Experience. It was organised by Airports Council International (ACI World) and attended by over 300 representatives from various airports around the world. If you'd like the full presentation with detailed speaking notes, please get in touch on email at vimal@trace-consulting.com. I'm also happy to consult with your organisation on Customer Experience strategies and implementation, as well as to deliver highly engaging and informative Keynotes focused specifically on matters that concern your audience. Get in touch today.
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A blueprint for future of customer experience
- 1. Business as usual is…Dead
- 2. A Blueprint for the Future of Customer Experience
- 3. 3 Airports are unique Customer groupsBusiness network Non-user stakeholders Airlines Aeronautical business units Non- aeronautical business units Airport Firm Transport network Retail and non- aeronautical services Real estate development Infrastructure and aeronautical services Consultancy and managerial services Activities and events Service packages Aviation trade Individuals Commercial trade Aeronautical revenues Non-aeronautical revenues Non-businessB2B B2C Network relationship
- 4. 4 Why is Customer Experience Important Business Evolution Mass manufacturing The era of the Customer Distribution and information The era of data 1960 Goods Age of Distribution 1900 Commodities Age of Industrialization 1990 Services Age of Information 2019 Excellence Age of Excellence Undifferentiated Competitive Age of Customer 2010 Experiences Differentiated Personalised
- 5. 5 Why is Customer Experience Important? Brands that create extraordinary experiences achieve financial returns more than double the market Digital Physical
- 7. 7 Communities Constant Change Data Transactional Bias YOLO FOMO Experiences
- 8. 8 What is Customer Experience? Close your eyes
- 9. 9 Did any of you think about this? TECHNOLOGY DATA DEPARTMENT PROCESS
- 10. 10 What is Customer Experience? Emotions (Feelings) Interaction Outcome Family Sports Entertainment Work Social
- 11. 11 People will forget the things you do, and people will forget the things you say. But people will never forget how you made them feel
- 12. 12 Emotions Fight-or-flight No language Emotions, Feelings, Memories No language Cognition, Sensory Perception Language, Logic, Reason ~500m years ~250m years ~most recent
- 13. 13 Good or Bad Experience is Determined First by Emotion
- 14. 14 Customers don’t always think or behave logically
- 15. 15 Peak-End Moments disproportionately influence customer Experience People often remember an experience by the way they felt at: The start: Though not that much The Peak Times: The Highs, Lows, Intense and Extremely Memorable Times The End: The Lasting Feeling
- 16. 16 Strategic Plan – Formulation People Purpose Product
- 17. 17 Product
- 18. 18 Purpose “To accelerate the world's transition to sustainable energy.” “Build the best product, cause no unnecessary harm, use business to inspire and implement solutions to the environmental crisis.” 'To create a better everyday life for the many people', Connect People to what’s important in their lives through friendly, reliable, and low-cost air travel “To inspire and nurture the human spirit – one person, one cup and one neighborhood at a time.” “To make people happy”
- 19. 19 Analysis of Airport Vision Statements Frequency and percentage of airport vision statements addressing the following elements 56 20 17 17 15 15 10 8 4 0 10 20 30 40 50 60 Self-concept Public image Customers Philosophy Products/Services Tourism/Place Staff Profitability Geographical Market Source: Airport branding: content analysis of vision statements Rafael Castro Southern Cross University Gui Lohmann, PhD Griffith Aviation
- 20. 20 PEOPLE
- 21. 21 MAKE IMPOSSIBLE I’M POSSIBLE
- 22. 22 People Commercial 3 groups of people: Aviation-related Passengers 3 areas to focus on: Going the extra mileCulture (stories) Metrics
- 23. 23 Because… Of Training Instruction NOT inspiration Instruction(What) Inspiration (Why?)LOW HIGH HIGH Most Customer Service Cultures This is where you need to be
- 24. 24 Daily Actions Stop transacting Stop merely “servicing” Don’t settle for mediocrity Praise willingly Proactive, not reactive Connection Elevation Pride Transformation
- 25. 25 Conclusion – A Really Simple Paradigm for 2020 PURPOS E PEOPLE PRODUCT
- 26. 26 Everything that cannot be digitised and automated, will become extremely VALUABLE
- 27. M: +852 5740 7284 E: vimal@trace-consulting.com W: www.trace-consulting.com #flyvrai Terima Kasih
- 28. 28 Having lived and worked in 8 cities and travelled to countless others, I’m driven by the pursuit of Customer Excellence, particularly within the travel, retail and aviation ecosystem. My career has spanned multiple travel domains including passenger and cargo sales and operations, customer service, inflight products and services, inflight content and connectivity, travel retail, loyalty and most recently, B2B social media and digital marketing. I’m fascinated by the impact of technology on business and consequently on consumer behaviour and experience. I enjoy joining the dots across the travel ecosystem strategically and in an agnostic manner, in the process redefining how sales, marketing, operations, customer service and human resources need to combine effectively in this modern, rapidly-evolving, digital and socially-connected era. #Heartware is of greater concern to me than hardware. Find my content by looking for the hashtag #FlyVrai. Here are just a few of the businesses that I am consulting with or have invested in: • Airbuy – connecting travellers to travel retailers. A B2B, AI-powered, multi-sided customer engagement platform helping airports, airlines, retailers and other channel partners grow ancillary revenues. https://www.airbuyinc.com • Motus – a B2B cross-platform advertising solution; leveraging programmatic advertising powers for offline (inflight) environments, and also for on-ground, in-airport advertising. http://motus.ai • PAX – a B2C & B2B solution creating inspirational, beautiful travel & trip journals. https//go.getpax.io • LEAPS – a B2B & B2C new generation global loyalty and rewards multi-party platform, providing local fulfilment solutions. https://www.leapsloyalty.com • Best Bottle – a B2B & B2C wine lifestyle platform seeking to disrupt the way the world enjoys wine. https://winebestbottle.com • DLA Ignite – the world’s leading B2B social media change management company. We enable and empower organisations to leverage social media for sales, marketing, business development, customer service and HR. https://www.dlaignite.com LinkedIn: www.linkedin.com/in/vimalrai | Email: vimal@trace-consulting.com | Web: https://trace-consulting.com/
Editor's Notes
- “Business as usual is dead – Gerd Leonhard. Video link on Youtube: https://youtu.be/ystdF6jN7hc
- Good morning. Selamat pagi. Business as usual is dead. I thought that was a powerful way to kick off a GLOBAL Summit around Customer Experience… We are now in a world that is not just hyper-connected but constantly changing, digitising. We are plunging headlong into Artificial Intelligence. Deep fakes and honest truth on social media is making it difficult for us to separate fact from fiction. Do we think that just because we are airports, we cannot be disintermediated? Have you heard of Space X and Hyperloop? New York to Shanghai in under 40mins (39 to be preceise). You are either going to be in a rocket through space, or in a narrow metal tube known as Hyperloop, travelling at 1,200km/h. Clearly, we are not going to have much time for duty free shopping… In a survey done recently, ICLP found that Gen X & Millenial travellers (a few of us in the audience here today!), place greater emphasis on things like accessible parking, choice of retail and F&B, efficient security etc than older age groups. In fact they would use these parameters to choose certain airports over others. Regardless of their relevance, airports are like temporary homes for everyone using them. From airport staff, to airline crew to the millions of transitory passengers and sometimes visitors, airports are often iconic institutions and sometimes homes away from home. Today I am going to suggest to you a blueprint for creating the next generation of customer experience at your homes.
- But wait, airports are unique environments like? Nothing like hotels, or restaurants which have a very defined set of stakeholders, usually working for one organisation, with one boss, and not that many competing interests. Airports on the other hand have at least 4 different types of stakeholders – including non-users, airlines, aeronautical and non-aeronautical business groups. There are multiple B2B and B2C relationships, sometimes with the exact same player. There’s a whole host of services and products from real estate to infrastructure to F&B and retail…and at least 3 different customer groups you have to contend with. Think of all this as your SERVICESCAPE. The Ecosystem within which you operate, where everything from the scent & smells, to the spatial layout and functionality, and the symbols and signs have a heavy impact on all these groups of users. Hotels & Restaurants are the same. More importantly, the one common theme all of us have – whether airports, shops, hotels or restaurants – PEOPLE. Both customers and employees. Human beings have needs, wants, expectations and desires. AIR ports may simply become PORTS…their tenants and customers may change, but the experience they will have to deliver is never going to go out of style. As the theme of this conference is: MULTIPLE JOURNEYS – have to be considered. Not just passengers, but security, immigration, airlines, commercial bodies etc.
- Fast forward to this decade, and it’s all about big data, IOT, personalization and more recently artificial intelligence and augmented or virtual reality. As in the video you saw earlier, Science Fiction is becoming Science Fact. We no longer talk about “degrees of separation” or “broad segments” of consumers, we are now focused on granular excellence, targeting and personalization. Remember the scandal caused by Cambridge Analytica? You should watch the Netflix documentary The Great Hack if you like this stuff. Bottom line – we are now in a world with near perfect distribution and democratization of information. Data is the new Gold. Customers are often more well informed about your products and services than you are, mainly because you are still looking at information for the average customer, or information for specific groups, but each customer is aware of what is necessary and relevant for ME. In fact almost 90% of businesses around the world actually say they compete on customer experience today, when it was only 10% back in 2010. (https://blogs.gartner.com/jake-sorofman/gartner-surveys-confirm-customer-experience-new-battlefield/)
- So the likes of Gartner, Forrester, Bain & Co, McKinsey etc. etc. have done loads of research.that shows things like: If you have a positive customer experience you will mention it to an average of 9 people. But if it’s negative, you tell an average of 16 people Customers with a positive experience spend up to 140% more than those with a negative experience Customers with positive experience stay customers 5yrs longer You can reduce your operational cost by up to 33% by delivering a better customer experience The logic that connects customer experience to bottom-line results is simple. If people love doing business with you, they become promoters. Promoters are the customers that every company wants more of. They’re less likely to defect. They buy more products and services over time. They sing your praises to friends, colleagues and complete strangers over social networks, in online reviews, through blogs and in every conceivable channel. They cost less to serve, and they provide constructive feedback. All of these behaviors have direct, quantifiable economic benefits.
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- We have now explored and understood why customer experience is important. AND so we come to a very important question – WHAT EXACTLY IS CUSTOMER EXPERIENCE?
- Show of hands – how many of you thought about any 1 of these 4 things when I asked you to imagine Good or Bad Customer Experience just now? In my interactions with the organizations I have worked for, there are some common themes I have noticed. And the themes largely reflect the attitudes of the people in their siloed departments. Whenever we talk about Customer Experience, these days the topic tends to revolve around technology and data. It’s all about software, AI, VR, testing hypothesis, agile implementation through proto-typing etc. But that isn’t customer experience. Pick any 10 customers randomly in an airport and ask them, and I bet you not one of them will use any word that is related to data, process, AI, VR, agile etc. When I talk to customer service people, customer experience seems like it’s a departmental responsibility. Aftersales, Handling complaints. If I talk to operations and front-line people, customer experience refers to the rules and processes they have to follow. None of these on their own is Customer Experience. These are nothing more than markers, tools or platforms through which you interact with your customers and they connect with you. But on their own, these do not define the totality of the “Customer Experience”. Yet this is frequently the way we approach any discussion about Customer Experience.
- There are 3 key elements that qualify anything as an “experience” for customers. These may be obvious, logical but we often overlook. The question is do they ALL need to be in place? Or just any one? Let’s explore: Interaction – usually this is between at least 2 people, although increasingly technology is smart enough that interaction can now be between an inanimate object and a human being. E.g. bot, machine, hardware (images of smart boarding gate in Bangalore, online chatbot, robot in Seoul airport). Obviously humanity is not yet at a stage where we are concerned about the experience between 2 inanimate objects. 2. Outcome – there has to be some sort of an outcome. Positive or Negative. An outcome is a personal judgement call. Either you get what you wanted or you don’t, or it’s some kind of compromise. Postive outcomes make you happy. Negative ones make you dissatisfied and likely to continue arguing. Compromises can go either way depending on how much you’ve compromised. Impt to also understand you don’t always control all the outcomes. One outcome is the decision you make – provide an answer to the question, offer access to the lounge, etc. – but the other outcome is the customer’s sense of satisfaction. This is something you cannot control.
- Experience is simply this: Customer Experience is about how people feel. It’s not the process, the technology, the app, but it’s all about how people feel when they have interacted with you. It’s their perception of your brand after they have finished their interaction with you. It’s what they say about your brand when you’re not in the room. It’s the stories they remember, and repeat year after year. p.s. https://quoteinvestigator.com/2014/04/06/they-feel/ according to this there is no basis for the origin of this quote to be attributed to Maya Angelou (as is commonly done). Hence no attribution… But WHY? Why is it that Customer Experience is about feelings?
- To understand why customer experience is about feelings, we need to delve a little deeper into our brains to understand how our brains drive our decision-making in any context or situation. Reptilian: 500mn years ago Controls core bodily functions, fight-or-flight behaviours Impulse and survival instincts No capacity for language Responds to FOMO, fear of losing Limbic: Developed 250mn years ago; known as Mammal brain Controls emotions, feelings, memories, trust, loyalty, hopes, dreams Gut feelings, drives innovation & risk No capacity for language Dopamine driven: desires experiences and joy This is why we bungee jump, skydive, travel, buy luxury goods Neocortex: cerebral/human brain, last one to evolve Higher order cognitive thought, sensory perception, abstract thinking Capacity for language, logic, reason, science, art, music Split into Left (analytical, logical) and Right (creative, intuitive) So now that you understand this about the brain, here are 3 key takeaways when it comes to Customer Experience, which can be applied to understanding your staff and passengers equally.
- FIRST: Good or Bad experience is Determined First by Emotions We actually do is make instinctive, 'gut' choices. We judge people in about 3 seconds by the way they look and what they wear – it is unconscious, and because of biases we make judgement calls on them based on that. If I had come up here on stage in t-shirt and shorts, you’d definitely have not had a good experience listening to me because you wouldn’t have believed me. With up to 35,000 decisions to make daily, and being subject to more than 4,000 advertising impressions daily, we suffer from information and advertising overload. This is why for example, we almost automatically smile back at someone who is smiling to us first; we can’t help it! In fact scientists say our Reptilian and Limbic brains are in charge of decision making up to 97% of the time! Example: IKEA. We love it right? Ikea is the epitome of System 1 thinking. Example: traveller stress at airport. Lots of research around how less stressed pax will spend more money at retail & F&B. Example: Spa, stress, massage no music. How would you feel if there was no music, green tea, hot towels etc.?
- SECOND: Customers don’t always think or behave logically. But they do behave predictably in similar situations. This is difficult to accept. Modern economic and financial markets are based on rationality of decision-making. But if everyone were rational, we wouldn’t be flying in Jets, buying luxury goods or travelling in First Class. Customers are frequently driven by unconscious motivation, driven largely by biases (up to 200 of them!) and laziness. We actually do is make instinctive, 'gut' choices and then reverse engineer a set of rational criteria to justify that choice in order to fool ourselves into believing that we are not being unreasonable. Typically, there are 2 systems of decision making that we all use. System 1 – where the brain acts fast, intuitive and without conscious effort, while relying on our associative memory of often-seen words, images, actions and emotions to form quick conclusions and decisions. System 2 is slower, more lazy but analytical, rational and more deliberate way of thinking. To save precious energy, our brain tends to spend as little energy as possible when solving problems and making decisions. However, without analytic and systematic System 2 thinking, we make predictably irrational mistakes all the time. In fact, most of us consciously identify ourselves with System 2, but a vast amount of research shows that System 1 is in charge up to 97% of the time. In other words, our Reptilian and Limbic brains are in charge of most of our decision-making. Illogical behaviour is largely System 1 thinking in action – passengers who get angry with airport or airline staff for the weather; passengers who spend hundreds of dollars buying a flight ticket but missing it because of duty free shopping. Or passengers who won’t donate $1 to Red Cross but will spend $5 on a cup of coffee from Starbucks.
- THIRDLY: And this is probably the most important: Peak-End Moments Disproportionately Influence Customer Experience. The Peak-End Rule is a psychological tool that explains how people remember their experiences. Instead of considering the average or sum of a total experience, the Peak-End Rule says that we remember the highest (best or most positive) or lowest (worst or most negative) points of an experience and how it concluded. Our memories therefore consist of a series of highlights or events rather than a thorough record of facts and events. The bad news about emotions being primary determinants of customer experience is that negative ones tend to dominate over the positive ones. That means for example: a bad flight experience on the way home from a vacation can take away from the overall trip, even if the vacation was fantastic. Last week Sara’s birthday and we went to an Italian restaurant for dinner. We brought our cake but didn’t ask them for anything else. They brought candles, all the servers sang, took a polaroid, gave her a card and a $100 voucher, and gave us parents a complimentary carafe of wine! Did I remember what we ate? No! What wine it was? It’s the highlights that I remembered and particularly because it was an event (birthday). The brain likes beginnings and endings and tends to overlook what’s in between. This is the reason why every “micro-moment” within a customer journey at an airport for example, is an opportunity to leave an indelible, positive imprint on their emotions. In times of trouble, go above and beyond. Do the best service recovery possible.
- So with all that said, how do we craft a blueprint for the future of Customer Experience. I suggest 3 pillars – Purpose, People and Product.
- This is your product. If you don’t have it, if your product is not a Wow, if you don’t amaze people.. Then you’re just “Meh”. Enough said, I’m not going to talk about product. We are often stuck with the “hard” product that we have for 5-10-15 years, maybe more. My intention is to look at how we can practically enhance the customer experience IN SPITE of the HARDWARE. Will focus only on PURPOSE & PEOPLE.
- Purpose: Have a compelling Vision and Distil that into a Mission Businesses want to focus on what is known and in focus: metrics, numbers, dollars, profits, time, resources. These things are measurable (rational), orderly, logical and calculable. They are also to a large extent controllable - this is important. They are subject usually only to how they are used - hence we talk about disciplined application of resources. Ongoing sustainability of performance. Profits and loss as a measure of that. All good, left-brain, System 2 thinking. What businesses forget is you’re dealing with human beings where System 1 thinking and remember: your reptilian & limbic brains are responsible for up to 97% of your decision making. In other words – if your purpose (mission and vision) is not compelling, inspiring, motivational, aspirational, life-changing, it is of no use to your team and staff. Absolutely useless. Nothing more than words on paper. Employee experience, customer experience is FUZZY. On a daily basis at work, System 1 thinking dominates. Your mission needs to be made part of culture, belief systems, INTUITIVELY, not just a process. Not just a “how-to”. I invite you to take a look at some of the most inspirational companies across industries and read their mission and vision statements.
- Source: Airport branding: content analysis of vision statements Rafael Castro Southern Cross University Gui Lohmann, PhD Griffith Aviation And I invite you to compare those missions to your own in your individual airports. A study was done back in 2016 by a PhD student of airport vision and mission statements around the world, and an overwhelming majority of airports focused on who they were rather than their customers or a motivational philosophy. And staff? Just about 10% of airports talk about their staff in their mission statements.
- 2. Align People We’ve all heard companies say that People are our greatest resource. And yet if you think about it, we haven’t changed the way we manage or motivate our people in the last 100 years. Our human resource paradigm has stayed the same even thought business models have changed and the world and competitive ecosystem has changed. From the 1900s to today, bureaucracies, systems, tools have become obsolete and changed. We have reimagined the way we deal with customers. We have reimagined our marketing. But we still treat our employees in the same way. Back in the 1900s they were low-skilled, today no longer. Today they are part of social networks, highly intelligent, mobile, with needs and aspirations – just like our customers. It seems the more change we have on the outside, the more we want to capture and cage and control our people on the inside.
- What if instead we focused on inverting the pyramid – where the lowest paid employees who typically end up having the highest face time with the customer – end up getting proportionately more of both extrinsic and intrinsic motivations? Example of Leicester City in 2015/16 English Premier League Season. They had an outside chance (5000-1) of becoming champions, mainly because they had nearly been relegated in the previous season. New Italian manager (whose English wasn’t great) who had been sacked by his previous club in Italy (which did get relegated…). A team whose total combined value of $35m was just 10% that of some of the traditional “big” teams in the Premier league. They were motivated with hunger, desire, a mission, and lots of pizza as a reward.
- 2. Metrics - Customer service metrics focused on efficiency and cost. Unable to really focus on emotion if just focused on cost efficiency What is the emotionally acceptable amount of time to be spent per interaction? Depends on what outcome is desired by the customer…(example - if want to know which way to the gate: 4 seconds; if have a query or a complaint, then definitely a lot longer). User context is important therefore requiring different metrics. Automation drives efficiency but little else. Need to change the metric mix. Zappos has thrown out the old rulebook around call handling time. CHT is only about understanding what resources are required - commerce related. More time = more loyalty, more ability to cross-sell, upsell etc. (Apply to airport environment). Customer service process design, training is important. A lot of metrics are not actionable - was the agent empathic - yes/no. Like NPS also not useful in terms of actionable insights. DBS losing credit card scenario. Metric is no longer around efficiency (which requires a focus on the core). Metric is around helping the customer. Someone who loses their card also loses their purse/wallet. Much more traumatic. Rejigged process to focus on the whole trauma and help you to connect to everything else you need - info about police, how to replace competitors credit cards, insurance etc. No tech. Only need to change the script, lists of information. Apply human thinking. Understand what customer needs as part of the broader issue in their life. 3. Going the extra mile – INSPIRATION (next slide) Inspiring our people seems to be a really tough thing to do…
- 3. Going the extra mile – INSPIRATION We always think about WIFM instead of WIFO. We train on instruction, not inspiration. Wear, say, think, do etc. this not that. Manuals. Policy and process. Rules and regulations. If you want to learn how to practice WIIFO, have a parent train you. That’s how I learnt to focus not on me but on the other person. Bank post-call survey: would you hire this person? Think about this as a single KPI with some of your top-tier loyalty, First Class members who are top decision makers.
- 2. Stop merely servicing- think of Hospitality ahead of service. Service is the sequence of actions, tasks and procedures done with consistency. Mechanics, The How-To of any transaction. Service is fast becoming a commodity. It is expected to be built into the product. Service is the skill. Hospitality is the spirit. (You can train for any skills but not for spirit). Service is bounded around methodology. Hospitality is open hearted, hopeful, confident, generous. 3. Don’t settle for mediocrity – point out when something is wrong but only with the spirit of making it better. Be KIND. 4. Praise willingly – everyone craves to be recognised, seen and acknowledged. Find an opportunity to praise. People get criticised far more than they are praised. Make the person shine because that person will remember you for it and keep trying that. Verbal memories are given preference in our brains over visual and experiential memories. 5. Be Proactive, not Reactive – remember hospitality instead of merely transaction or service? Service is about delivering needs & wants of guests while hospitality is anticipating their expressed and unexpressed needs & wants. Hospitality is the positive emotional response elicited in guests because of the service delivered. We forget service, but we will forever remember hospitality.
- And on that note I leave you with one concluding thought. If you forget everything else from today, here is the new 2020 Paradigm for the Age of Excellence. It begins with a strong focus and communication of your PURPOSE. This includes not just re-thinking the PURPOSE of your business or operation within your department or team or company, but also being able to communicate this PURPOSE as a MISSION for everyone around you. This is WHY you exist as a company. Communicate your PURPOSE most importantly to your PEOPLE. This includes not only Customers but also your teams, staff, colleagues. When you look after your people, and if there is purpose driving them, you can be sure that everything else naturally finds its place. Only when you have your PURPOSE at your core, and PEOPLE ready to take meaningful action, should we then we talking about our Products (and Services). Behaving in this way (esp in terms of marketing, advertising, HR, operations etc.) ensures that we are prepared in the best way possible for SUCCESS. Remember your customers may not remember your products, or its benefits and features. But they will ALWAYS remember how you made them FEEL. This is powerful. Probably the most powerful weapon you have in your business arsenal.
- Last slide – to remind people of how valuable human empathy, emotion is going to be. As the world becomes more and more technologically-driven, what cannot be digitised will become extremely valuable. Human-to-human interaction – what I call #HEARTWARE - is going to become the only HONEST and TRUSTWORTHY basis for customer experience in the future.
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