Six lessons from European Customer Experience World 2010by
What lessons can we take away from this week's meeting of leading thinkers and practitioners from the world of customer experience?
- Welcome to the experience economy!
As customers became more sophisticated in the 1980s, so businesses had to change and as they began to bundle their products and services together to make them more appealing to customers, so the industrial economy made way for the service economy. Now, another change is taking place, as customers demand transparency, ethics, integrity and trust from the organisations they deal with. This means we are now moving from the service economy to the experience economy.
"People want memorable experiences and organisations must become saviours of great experiences," explained Royston Guest, CEO of Pti Worldwide. "Fundamentally what is the difference between service and experience? Picture going to an RBS branch, we go to the counter and the assistant who engages with us is great, and is jovial and smiling at us. But as you go out the branch, on the floor outside are all the cigarette butts where people have been smoking. Was the service good in the branch? Yes. But what was the experience like when you were leaving? It was tarnished. So service is one dimensional, but experience is five dimensional, it engages all of our five senses. So if people want good experiences, we must become saviours of great experiences."
- …and gaining the edge in the experience economy may not be that difficult!
The good news is that gaining the edge in the new experience economy may not be that difficult – and it has nothing to do with products, services or value proposition. "In terms of customer expectations of customer service in the UK, the bar is set pretty low," said Guest. "What do people classify as being an exceptional experience? I needed a new cheque book holder, and I was sent it within two days. That is seen as an exceptional experience. So gaining the edge is not that difficult. It is about raising the bar, and how you can really differentiate yourself not from a products or services point of view, but from customer experience and the wrapping you put around your value proposition. That gives you the edge."
- Successful companies go the extra mile to ensure they have the right people in their team
Zappos.com has built its reputation on creating happiness for both employees and customers, resulting in a spot in the top 20 in Fortune’s 100 best companies to work for, and a remarkable level of repeat business (75% of business is from returning customers). Its COO, Alfred Lin, believes that its rigorous approach to staff selection is key to its strong company culture and customer experience. And he shared a few secrets.
"We want to make sure that all our employees have the same values that we have. So when we interview people, 50% of the interview is about whether they can technically do the job and the other 50% is about whether they are passionate about what we’re trying to do and whether we have the same values and believe in the same things in what the company is trying to achieve."
He continued: "This may seem crazy to you, but as part of our training process we offer people $2,000 to quit. But think about it this way. If you are really good at interviewing and your interviewing process is really great at screening people you don’t want at your company what is your success rate? If you’re right 60% of the time that means 40% of the time you’re letting someone into the company that doesn’t want to really be there. And we just want a very easy way for people to leave the company gracefully. And there are all these studies about how much a bad employee costs the company – and it is way more than $2,000."
- Mind the generational gap!
Businesses cannot expect to provide a one-size-fits-all approach to customer experience, and those that do will be in danger of satisfying only one or none of the customer demographics. This is because different generations have different value systems, shaped by the social, cultural, political and economic age in which they were each raised.
Dean Van Leeuwen, co-founder of TomorrowToday International explained: "The people before and after 1968 are the greatest generational divide in terms of values. And your marketing teams and customer service needs to be reflecting this."
Either side of this divide are the silent generation and the baby boomers ("They are a generation that feel special, and they want you to make them feel special and recognise that they are individuals") and Generation Y and Generation X ("This generation aren’t sentimental about brands, so you can’t build loyalty from this generation, but you can build relationships. However, you have to earn their trust").
Van Leeuwen emphasised that with each generation having holding a different set of expectations arising from their values, businesses must seek out a greater understanding of each demographic and their value systems. He concluded: "Values really define our attitudes and behaviours. And if you tap into people’s values you can make a very strong emotional connection with the customer."
- Businesses must overcome the internal obstacles to social media
Social media’s role in customer experience management was a popular topic at ECEW. Speakers including Moira Clark of the Henley Centre for Customer Management, and Alan Martin of the Dundee Science Centre emphasised the role of social media as a tool to build trust, gather continuous feedback, share knowledge and engage with followers, identify and engage with key influencers, and create communities.
But while an increasing number of organisations are embracing social media, there remain some that are either still confused about its role or unconvinced by its value. Martin explained how he himself experienced obstacles as he tried to push for his organisation to move into the Web 2.0 world. "A lot of people in companies are feeling that they should be getting involved in social media, but they have to hurdle a lot of objections. I felt this was the right thing for a couple of years but I had to convince the right people."
Kip Knight, president of Knight Vision Marketing, also emphasised the benefits of social media to the customer experience, and urged attendees who were facing opposition to social media from their own management to communicate the benefits – and stress that time is of the essence. "You need to get going! I hear a lot of people saying that their management will never buy that or their lawyers will go nuts. I say scrap all that. You don’t have much time. You will be shocked how quickly this is moving."
- …but don’t forget that customer communities should be offline as well as online!
Customer communities may have become intrinsically linked to the internet, but it is worth remembering that you can build equally as effective – and indeed even better! - experiences and relationships with customers offline as well. One business that has a long legacy of supporting customer communities, predating the advent of the internet, is Harley-Davidson. The motorcycle firm has a famously passionate and devoted customer base, and the manufacturer has arranged meets and events for this community for decades via its Harley Owners Group, which boasts over one million members worldwide.
"Today, when people talk about community you immediately think about a web page, and yes this is important, but for us the physical meet ups remain the most important one," said Markus Kramer, director of marketing operations at Harley-Davidson Europe. "The whole experience is about the real experience, and engaging with the brand. 20 years ago there was no Facebook and Twitter. Those things are important, and we recognise that, but we see it very much as an additional facilitation or you could argue it is an accelerator of connecting people in the digital space. But ultimately where the community lives and experiences is locally and there physically with the product."
Neil Davey is the managing editor of MyCustomer. An experienced business journalist and editor, Neil has worked on a variety of newspapers, magazines and websites over the past 20 years, including Internet Works, CXO magazine and Business Management. He joined MyCustomer in 2007.