What Does Customer Experience Mean to You?

Here's a quick game of word association that can reveal wonders about whether or not your organization is meeting its highest financial potential: I say "customer experience," and you say... "Marketing?" "Expensive?" "Secondary?"

If your choice of responses is any of those, your organization is missing out on marvelous potential for financial gains and stability.

The truth is, leaders who enjoy the greatest gains in profitability and growth have their word-association response down pat. I say "customer experience," and without a blink they say, "operating strategy." These leaders are alert to an unnecessarily well-kept secret: An organization's target customer experience, when used as the dominant driver for every day-to-day operating decision, will yield the highest performance rewards. Conversely, when target customer experience is ignored, or relegated to a marketing or sales silo, organizations receive limited payoffs and put themselves at risk of obsolescence. 

If you're not positioning the customer experience as an operating strategy, you likely fall into one of the following common alternatives: 

You believe customer experience applies only to "customer facing" decisions in marketing, service, or sales. True, your customers will see and encounter your marketing messages, and they will interact with your service and sales personnel. But those same customers may also sign your contract, pay your invoice, receive your shipment, listen to your phone prompts, read your documentation, and try to give you feedback — directly or indirectly — about their experience. So the notion that customer experience is about marketing and service is true, but incomplete. There is no operating function within your organization that does not impact your customers' experience.

You believe customer experience is only about what customers feel. Your intuition may lead you to think of sentiments such as satisfied or frustrated. Certainly your experience includes how customers feel as they interact, buy, get help, and — ideally — advocate for you. Yet it also includes tangible elements, such as:

• the clarity of your contract language;
• your financing options;
• the reliability of your Web-based technology's up-time; or
• the ease of carrying your bulky product out the door. 

These factors of the customer experience should hold equal weight.

A recent study in the healthcare industry asked patients about the factors that contributed to their idea of a "good experience," and revealed that only 41 percent of the factors the study identified were non-clinical intangibles. The other 59 percent were tangible items, such as quality and cost. Therefore, while "feelings" may be important, too, is also an incomplete understanding of the customer experience.   

You believe customer experience is a tradeoff to profitability. This common objection to using customer experience as an operating strategy is the most misleading. When customers realize they have a problem or need, they look for solutions. Somehow, they come across your company and put you on their short list of options and attempt to envision how your solution will work for them. Once they've decided, they'll make the purchase, then apply your solution, and move onto their next need. The closer you can align operating decisions to an experience that solves a need for your customers better than anyone else, the more money you will make because customers value real solutions.

The notion that customer experience is a tradeoff to profitability is most often held by those who practice "more is always better" thinking -- without grounding decisions in what solves a customer need. If you focus daily decisions on a target experience that solves a need, you get a performance reward, proving this notion a myth. 

If none of these statements match the mentality you hold toward the customer experience, and you are using a well-defined target customer experience as a primary driver of everyday business decisions, then you are well positioned for profit and growth even in these tough times. 

Still not persuaded? Try this exercise: Over the next 24 hours, concentrate on every interaction you have with the world as someone's customer: enter an automated parking garage, make a dentist appointment, pay your cell phone bill, swipe your credit card to buy something, call a vendor to set up a meeting. Each time you are using someone else's product or service to meet a need, consider all of the operating actions that had to happen in every one of the producer's functions from manufacturing to legal to sales and service that went into creating the experience.

You may never again hear the phrase "customer experience" without thinking "operating strategy." And you may never again fail to reap the financial payoff that customer experience can offer.

About the Author

Linda Ireland (ireland@aveus.com) is a consultant, serial entrepreneur, and veteran executive. She is co-owner and partner of Aveus, a global strategy and operational change firm. Her new book DOMINO: How Customer Experience Can Tip Everything in Your Business toward Better Financial Performance is now available.

Please note that the Viewpoints listed in CRM magazine and appearing on destinationCRM.com represent the perspective of the authors, and not necessarily those of the magazine or its editors. You may leave a public comment regarding this article by clicking on "Comments" at the top.
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For the rest of the December 2009 issue of CRM magazine please click here.

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