Customer experience is the sum of all experiences a customer has with a supplier of goods or services, over the duration of their relationship with that supplier. It can also be used to mean an individual experience over one transaction; the distinction is usually clear in context.

Growing recognition

Analysts and commentators who write about customer experience and CRM have increasingly recognized the importance of managing the customer's experience. ^[1] Customers receive some kind of experience, ranging from positive to negative, during the course of buying goods and services. Thompson and Kolsky say that ?an experience is defined as the sum total of conscious events. As such, a supplier cannot avoid creating an experience every time it interacts with a customer? (2004). All interactions involved throughout the process and throughout the customer lifecycle culminate in a positive customer experience if customers go away feeling that their personal needs were met and they were treated with care.

A company's ability to deliver an experience that sets it apart in the eyes of its customers serves to increase their spend with the company and, optimally, inspire loyalty to its brand. "Loyalty," says Jessica Debor, "is now driven primarily by a company's interaction with its customers and how well it delivers on their wants and needs." (2008) ^[2]

The concept of customer experience was first introduced by Pine and Gilmore in their 1998 Harvard Business Review article. They believe that successful businesses influence people through engaging, authentic experiences that render personal value (Pine and Gilmore 1998). ^[3]

Emerging Business Requirement

With products becoming commoditized, price differentiation no longer sustainable and customers demanding more, companies ? and communication service providers (wireline, wireless, broadband cable, satellite) in particular ? are focusing on delivering superior customer experiences. The customer experience has emerged as the single most important aspect in achieving success for companies across all industries (Peppers and Rogers 2005). ^[4]

Managing Customer Experience

Customer experience is the new innovation frontier for business. Companies are focusing on the importance of the experience and, as Jeananne Rae notes, realizing that ?building great consumer experiences is a complex enterprise, involving strategy, integration of technology, orchestrating business models, brand management and CEO commitment.? (2006) ^[5] An Enterprise Feedback Management (EFM) system can be used to collect value feedback from customers. Microsoft?s Customer Experience Improvement Program gives all of its customers the opportunity to provide input into the design and development of its products. The program collects feedback on how customers use Microsoft programs and problems they have encountered. The end results are software improvements to better meet customer needs. ^[6]

Amdocs believes customer experiences should be intentional. Its customer experience systems help communication service providers and other enterprises develop an integrated customer management strategy that emphasizes a central focus on customer experiences the way that they?re intended ? consistent, personalized and valuable. ^[7]

Customer-centric service providers take care of customer needs at every touchpoint in the customer lifecycle (ordering, fulfillment, billing, support, etc.) and employ all channels (contact center, Internet, self service, mobile devices, brick and mortar stores) and means of communication (phone, chat, email, Web, in-person). They develop experience-based differentiation, which shifts the focus from product features to customer wants and needs. These experience-based providers integrate both internal and external innovations to create end-to-end customer experiences. They evaluate their business models as well as business support systems and operational support systems (BSS/OSS) from the customer?s point of view to achieve the level of customer-centricity necessary to improve customer loyalty, churn and revenue (Lopez, 2007). ^[8]

Customer Experience Process

Customer Experience Management (CEM) is the business discipline of designing, developing, and managing all aspects of an end-to-end customer experience process. The customer experience process is the sum of all interactions that a customer has with a business. The customer experience process spans all phases of the customer experience lifecycle including 1) sales & marketing, 2) payment, service & delivery, and 3) loyalty, reward, and ongoing communications. The process may span multiple channels offered by a business including physical stores or offices and self-service, call center, and agent channels. The customer experience process may span functions, departments, divisions, and geographies. The process can be broad, iterative, and long-running.

James Martin, the IT Consultant and Author, emphasized the importance of end-to-end processes or value streams and defined them as "an end-to-end collection of activities that creates a result for a 'customer,' who may be the ultimate customer or an internal 'end user' of the value stream. The value stream has a clear goal: to satisfy (or, better, to delight) the customer.?^[9]. The end-to-end nature of the customer experience process is also referred to as a Customer Experience Value Chain, defined as "The organizational culture and process for consistently delivering superior customer experiences."^[10] according to Forrester Research.

Customer Experience Solutions

According to Bernd Schmitt, "the term 'Customer Experience Management' represents the discipline, methodology and/or process used to comprehensively manage a customer's cross-channel exposure, interaction and transaction with a company, product, brand or service."^[11] Customer experience solutions provide strategies, process models, and information technology to design, manage and optimize the end-to-end customer experience process.

Customer experience solutions differ from CRM solutions. Customer experience solutions address the cross-channel, cross-touchpoint, and cross-lifecycle nature of the customer experience process, whereas CRM solutions tend to offer point solutions for specific customer-facing functions such as, but not limited to, sales force automation, customer analytics, and campaign management. In some cases, solution providers address both customer experience and CRM capabilities.

Currently, there are several customer experience solutions that provide a range of products and capabilities:

Amdocs^[12]

Chordiant^[13]

Ciboodle^[14]

ClearBrick^[15]

KnowledgeWave^[16]

RightNow^[17]

Tealeaf^[18]

References

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