This introductory chapter shows that the customer experience is now the key driver in the market, and will be the main competition arena for the next decade. It describes what it means to compete through customer experience in a market where meaning is the new currency, and explains why the trajectory toward the experience-centric organization is one that you cannot avoid.
There’s a transformation under way in organizations, one that puts the customer experience at the heart of the enterprise. Its endpoint is the experience-centric organization—an organization where there is total alignment around experiential delivery. All organizations are on a trajectory toward experience centricity, and it will become the defining characteristic of organizations during the next decade. This book introduces the characteristics of the experience-centric organization, explains its core behaviors, and outlines the steps you need to take to elevate your organization to the final, ultimate level of customer experience.
The market is driven by the customer experience. The first trillion-dollar company in the world has embraced it, experts describe it as the number-one business priority, research in cognitive neuroscience is explaining its importance, and your competitors are putting effort into it. The customer experience has now become the major source of competitive advantage, and one that you cannot ignore.
You’re not going to stand out at customer experience if you don’t prioritize it, and with the bar being continually raised, this means making it your central company mission. It’s time to bring the customer experience into the core of your organization and place yourself on the path to becoming an experience-centric organization. Becoming experience-centric does not mean dropping everything you have done, but rather placing it in perspective, behind what matters most: how customers experience using your products or services.
This book will help you understand why you should embrace the customer experience, what it means to become experience-centric, and how to get there. If you are reading it, then you already have an interest in making this happen. This book describes how to distinguish your organization from your competitors through an experiential offering, and gives you a roadmap to optimize your organization for the future. Together this knowledge will give you a unique advantage that your competitors will be unable to match.
The experience-centric organization builds on a current trend: the customer experience is the key driving force in consumer choice and the key competitive arena in business. Every offering, whether it be a discount airline ticket or a luxury holiday, is judged experientially by customers. Everything is experience, and where there is competition, it is the experientially better service, as perceived by the customer, that wins. As a business, you need to respond to this trend by making the customer experience your number-one priority, and embark on the journey toward experience centricity.
This message is not totally new and you, like me, might ask, “Why have we not fixed the customer experience and moved on?” The reason is as simple to explain as it is complex to implement: experiences have been considered a feature of a product or service instead of an organizational imperative. We have not taken the customer experience seriously enough, assuming that we can just bolt it on at the end of a project, instead of using it as a starting point. Now is the time to move from considering experience simply as a feature to making it your core organizational mission.
In a world where there is competition, customers choose services based on their experience using them.
Recent statistics show that:
These statistics have drawn the attention of CEOs, who have started to consider the lifetime value of the customer experience. David Reibstein, a marketing professor at the Wharton School, has translated customer experience into hard cash value. The lifetime difference between satisfied and dissatisfied customers at Starbucks is estimated at $2,800 per customer. The lifetime value of a satisfied BMW customer is estimated to be $143,500.6
“Oh my God, we have ignored our customers for the past 10 years!”
—Insight from an executive with a national betting company, after realizing that their huge investment in technology platforms meant that they had stopped thinking about the customers.
It seems like we have had a kind of collective amnesia during the past 20 years, as a result of which we’ve ignored the customer in the design of products and services. The commoditization and technologification of services has been the priority, and the customer experience has lost out. The focus has been on digitalization, technology platforms, value chains, and call-center costs, and organizations took their eye off their customers as a result. Demos (a UK government think tank) describes the consequence as “a fundamental disconnect between services and people” and says that society has changed faster than service organizations. When they say this, they mean that customers have embraced brands, luxury, symbolic value, and design when it comes to products, but with services, the offerings simply haven’t been available. More recently the customer experience has been on the agenda in many organizations, but as I’ve mentioned, it has been considered a feature of a product or service—something to be added to the design process, rather than something that drives it. It’s time, therefore, to catch up and focus the organization on the customer and the customer experience.
According to a RightNow Technologies survey, 85% of respondents revealed that they’ve had customer experiences so dreadful that they’ve yelled, cursed, hit and broken things, suffered headaches, felt their chests tighten, and even cried. Only 3% of respondents reported that they have never had a negative experience with a company.7
So why are customer experiences so poor? Because organizations are not oriented toward the customer experience, responsibility for it is fragmented, it is cross-silo, and there are few key performance indicators (KPIs) that target experience explicitly. Jot down who has responsibility in your organization for the customer experience. You will probably find that responsibility is fragmented and lies with a multitude of people, spread across the many silos of your organization. Is there a culture of discussing the customer experience at management meetings or around the coffee machine? Do you listen to what your customers have to say about their experiences? The answer is most likely that it is on the agenda, but it is not the central theme for discussion. A new paradigm for service has arrived, one in which the customer experience is a primary driver of innovation in service organizations. According to a study, 95% of senior business leaders believe that the next competitive differentiator is customer experience,8 and in 2018 the Wall Street Journal pronounced, “Customer Experience Is the Key Competitive Differentiator in the Digital Age.”9
We will soon see the emergence of experience-centric organizations across all areas of business. These are organizations in which digitalization, technology platforms, value ecologies, and business models will all become means to achieve the unique experiences that customers value. Organizations will become experts at orchestrating their offerings in order to co-create memorable experiences with customers. Now’s the time to get a jump on your competitors by embracing the customer experience and making it your main company mission.
This book is the outcome of many years of working in the field of customer experience, through which a logical trajectory, discussed next, emerged. When the main market differentiator is the customer experience, delivering a superior experience becomes increasingly prioritized within the organization. Over time, as competition increases around the customer experience, and organizations focus more on it, it will inevitably become the company’s main mission. The organizational imperative will then be to refocus and align the company around the customer experience. When this occurs, the organization can be termed experience-centric.
Embracing experience centricity allows for an immense clarity of purpose for an organization, and for disparate parts of the organization to understand both this trajectory and their role in making it happen. It simplifies and mobilizes the organization around a simple concept—simple to understand, but requiring ambition and a deft touch to implement.
We are on multiple converging paths toward the experience-centric organization. On the one hand, hypercompetition means that customers have their choice of providers and thus can choose the experience they prefer. Differentiation in the market comes, therefore, from a superior customer experience. On the other hand, companies are investing in improving their customer experience, and there is now a race to differentiate experiences.
A second, parallel development relates to branding. Corporate branding has been emphasized for many years in many organizations, and companies are working hard to combine internal and external branding to create a consistent solution. Branding is moving from promising a customer experience to delivering a customer experience. This shifts the focus of the brand toward customer interactions with your service or product and how to deliver on the experiential promise you make. This new focus requires understanding the interactions that the customer has each and every time they use your service, as well as a different organizational structure. That is, it demands an alignment within the organization around the experience you want the customer to have.
A third experience trajectory is the experience economy itself. This is deepening every day. We have entered a period in which the experiential is central to our lives. We are not rational economic beings; we value experiences, and we seek them out. As Soren Kierkegaard clearly stated, life is not a problem to be solved, but a reality to be experienced. It seems that we, as a society, are in a stage where we have embraced this and are now willing and able to see the experiential in everything.
There are also economic and market explanations as to why the experience economy is expanding and deepening. We have more disposable income than past generations. Earlier, it was a big deal in a household to get a functional product, such as a washing machine or a dishwasher. These appliances are taken for granted now, and we expect more. We have opened our eyes to experiences, and at the same time, better experiences are available. Competition is now evaluated through customer experience.
Finally, technological advances mean that today almost all products and services function adequately. This was not the case 30 years ago, when we often made choices based on technical performance and reliability. We no longer need to expend the effort to do this; we understand when buying a dishwasher that it will wash our dishes, or when buying a toothbrush that it will clean our teeth. This frees us up to focus on how it makes us feel, rather than what it does.
Together these developments have created a new paradigm in society, one in which the customer experience is the main motivator of our choices and therefore the key differentiator in the market. This applies not only to luxury consumption, but to each and every consumer decision we make. We make experiential evaluations of our purchases, and we judge them based on the experiential outcome. As we will see in Chapter 2, our brains are wired to continually estimate and evaluate our experiences—a fact we are only now realizing. Buying a budget airline ticket is a trade-off between experience and cost, and we make a decision based on our perception of the total experience, which includes all aspects of our customer journey: ordering tickets, checking in, traveling, and ending our journey. This doesn’t mean that cost is unimportant, but rather that cost is weighed in terms of experience and we experientially evaluate both the offering and its delivery. The choice, even for low-price solutions, is based on an experiential cost-benefit judgment. This judgment helps us make decisions: we consider how differing competitive offerings rate according to our expected experiences, our earlier experiences, and the opinions of others in relation to price.
Society is well into the experience economy, as described by Pine and Gilmore in their book from 1999. This is an economy in which desirable customer experiences are key to value. The Experience Economy (Harvard Business School Press) was a groundbreaking book for me. It identified one of the central truths of the economy—that we are driven by experiences, not functions. It used Starbucks as an example, showing how it is possible for people to functionally make good coffee themselves for a few cents, but they instead prefer to spend several dollars going to a coffee chain. Why would economically rational people choose to spend over 10 times as much on something like this? Now, we are all familiar with the coffee experience, we understand that Starbucks is not in the business of selling coffee; it is in the business of providing experiences.
It has been 20 years since The Experience Economy was published. The rational economic human being has now been put to rest (see more about this in Chapter 6), and even economists now understand that human behavior, emotions, and feelings are central to how we function as people. This all seems obvious; however, the journey, which in many ways was signified 20 years ago, has not reached its end.
If I asked you when Apple last launched a new iPhone, the majority of you would be able to give me a fairly precise date, and even probably tell me something about the expectations for the one coming up next. If I asked you about when Hewlett Packard last launched a printer, few of you would know. Why? One is desirable, the other not. Desirability is currency, and distorts the normal rules of marketing.
Instead of having to subsidize to get customers over to your service, if you offer a desirable experience, customers will seek you out. They will switch because they want to. You will not have to bribe them, and you will not have to incite them to come over to you. People will gravitate toward your service, because it is something that they want, rather than the solution that may be different, but is no better than a competitor’s. The ability to deliver a consistent and memorable user experience is the most important strategic asset a business can have.
“The minute they set eyes on it, they feel something that they might not be able to define. But it’s something that their hearts and souls identify with. It’s something they want to be a part of.”
—CNET15
Customers are looking for emotional connections through experiences, but ones that they might not always be able to explain, even though they understand and identify with these experiences when they have them. This is a key part of experience-centric solutions: delivering something that “hearts and souls identify with,” and that resonate with something in the consumer’s being. To quote Howard Schultz, CEO of Starbucks, “We are not in the business of filling bellies, we are in the business of filling souls.”11
If such experiences are now a key driver in the market, then delivering them should become the focus of organizations acting in this market. Putting this in the context of the CNET quote, organizations should focus on developing and delivering services that inspire feelings that customers might not be able to define, but that they identify with on some deeper level and that they want to be a part of—desirable experiences. Doesn’t that sound like something your company needs to deliver?
In the experience economy everything is judged experientially, even low-cost solutions. Returning to an earlier example, when you evaluate a low-cost airline, you make experiential judgments based on cost related to the expected experience: Can I live with the discomfort and hassle of the low-cost airline? Would I prefer less transfer time? How difficult is it to change a ticket? All of these are experiential decisions that you consider as a whole based on previous experience and expectations. As stated previously, where there is competition, it is the experientially better alternative that wins. However, some believe that the customer experience is evaluated on the degree of entertainment included. This comes from viewing Disney as a leading provider of experiences and wanting to copy their model. This is wrong and has led a lot of organizations in the wrong direction. There are many situations in which the customer is looking for a functional solution, and focusing on functional experiences can create great value. As we will see later in the book, the “extraordinary ordinary experience” can be low-cost and still offer high experiential value.
The extraordinary ordinary experience (more on this in Chapter 6) is a way of providing exceptional yet functional experiences without adding entertainment. It focuses on getting the job done, and shows that even highly functional solutions can be designed to be memorable. It’s all about knowing the experience you should give, rather than adding entertainment. As we will see later, memorable experiences and entertainment are not always the same thing. For example, I hate having to pick up packages at my (not so local anymore) post office, and if the post office clerk tried to entertain me, I think I would hit them. The experience of picking up a package does not need to be entertaining, but it can be enjoyable and memorable: that is, it can be an extraordinary ordinary experience.
Many organizations confuse customer-centric and experience-centric, and their first instinct when deciding to focus on customer experiences is to look at how they can add something to their existing customer-centric initiatives. This is a tempting thought, but it’s wrong. There is a very different attitude and approach in the experience-centric organization than there is in the customer-centric organization. The following table shows how the experience-centric organization is a step change away from customer-centric:
Criteria |
Customer-centric |
Experience-centric |
Value goal |
Customer satisfaction |
Experiential desirability |
Basic philosophy |
What do our customers want |
What do we want our customers to feel |
Basic approach |
Reactive |
Proactive |
Organizational structure |
Experientially aligned |
|
Key terms |
Value proposition, segments, brand promise |
Experiential value proposition, individuals, brand experience |
Orientation |
Services as products |
Experiences delivered through services |
Broadcasting a brand promise |
Delivering a brand experience |
As you can see, there are very different approaches taken by the experience-centric organization, right down to the value goal of the organization itself. Moving the goal from customer satisfaction to experiential desirability requires a very different approach within the organization—one that has structural implications. The experience-centric organization impacts the ways of both thinking and doing within the organization.
All organizations have internal logics that describe their shared values, beliefs, and practices. These are hard to identify and difficult to describe when viewed from the inside, but often are obvious from the outside. They are a core part of the organization’s DNA, and can be difficult to change. Certain logics can persist in an organization a long time after concerted organizational change efforts.
When working with organizations, I have experienced product-centric logics in a global footwear manufacturer, technology-centric logics in a global telco, and process-centric logics in a major Nordic logistics organization. The experience-centric organization challenges these institutional logics and often requires transforming embedded values, beliefs, and practices. This might seem daunting, but in my experience there is a clarity of purpose that comes with the experience-centric approach. Experience centricity is something that everyone in the organization can identify with, and it encourages organizational alignment.
Common to all of the organizations I have worked with is a recognition that a transformation toward experience centricity is necessary and that the organization needs assistance to achieve it. The book shows different strategies, based on my research and collaboration with many different organizations, that can be applied to change institutional logics.
The theme of customer experience is not new, and you have probably heard about it through several converging areas—corporate branding, cultural branding, the experience economy, design thinking. All of these areas are complementary to the message in this book.
The value of this book is threefold. First, it identifies and gives a name to the phenomenon that we are experiencing in the market and in business. Just giving it a name has great value, and I have seen several light-bulb moments where people have immediately grasped the term and adopted it as a North Star. Second, the book brings different areas together into a unified focus that gives organizations clarity of purpose. Finally, it offers advice on how to transform your organization to become experience-centric. There are clear stages and levels to this process.
Put another way, the book describes the bigger picture, puts it into perspective, and helps you make the transformation that is necessary to embark on an experience-centric trajectory.
Hopefully this book can contribute to important conversations and will help people realize, “Yes, that is what we need to do, and we need to do it together.” Further, I hope it will give you an internal terminology to facilitate those discussions. Finally, I hope the book gives you an approach to and an understanding of how to implement experience centricity throughout your organization.
When we’re at our best, we don’t wait for external pressures. We are internally driven to improve our services, adding benefits and features, before we have to. We lower prices and increase value for customers before we have to. We invent before we have to.
—Jeff Bezos, Amazon ceo12
At this stage, you will have to look carefully for best practices, as there are perhaps only a handful of truly experience-centric organizations. Few organizations could claim to have had an experience-centric approach from the start, but several have arrived there through sheer doggedness. They are the companies that have had a visionary leader who has imposed that vision on the organization. However, many more are on their way and getting close, without necessarily using the term or having the overarching model for how to do it. They all share a clarity of purpose—that the customer experience is the driver of their organization—but they differ in their ways of approaching experience centricity and making the organization work. Some have become experience-centric through strategic and tactical thinking, but most have approached it the hard way. They have developed highly experiential offerings as a start-up, had success, and afterward had to painfully forge an organization that can scale the offering or support it.
I present examples of organizations that I consider to be experience-centric, or at least experience-focused. Some are high-end, such as Aesop, while others are more everyday. Common to all is an attention to detail, and the ability to align around the customer experience. This is the key success factor, and one that is not easily achieved. Apple, unsurprisingly, is the star performer, and although it’s overused as an example, there is an important message here: the first trillion-dollar company in the world has had an experience-centric strategy for about 20 years, and has achieved great success during this period. Apple’s success has not come through luck, but by having a crystal-clear vision of starting with the experience and working backward throughout the organization. This is something Steve Jobs explained in 1997.13
Amazon is another example, and at the time of writing, it is tipped to become the second trillion-dollar company in the world. Jeff Bezos is perhaps the one person who, from the start, has been totally fixated on the customer experience. The largest innovations in online shopping came from Amazon, and now, the greatest recent innovation in brick-and-mortar stores is coming from Amazon too, with the walk-in, walk-out supermarket project. It is no surprise that Amazon is held up as a model, then, because it has done the work to continually improve the experience of its customers. A recent article by CB Insights shows that for Amazon, building a high lifetime value among its customer base through proactive delight has been a powerful differentiator, and it has paid off. The average lifetime value of a Prime customer was estimated at $2,500 in 2017.14
Naming things is really important, and having a good descriptive name for something, when it fits the context, can actually contribute to organizational change. I found this when introducing the basics of service design to one of Scandinavia’s largest insurance companies. Terms such as touchpoints and customer journeys were new, but they rapidly became integrated into everyday conversations in the company and thereby rapidly became a part of people’s way of work. So, terms do matter, and I hope that the following terms help initiate change in your organization by giving different perspectives on some familiar concepts. I introduce them up front so that when you meet them later, you will have some idea of what I mean.
The experiential value proposition (EVP) is the perceived value of your service offering when viewed through an experiential lens by the customer. Since it is a proposition, it has not yet been experienced, and therefore represents expected experiential value. The EVP comprises a mix of functional, emotional, self-expressive, and idealistic factors, which both include benefits but also costs, and risk.
The EVP can be broken down into two main parts: what you want to offer and what your customers perceive as being offered. The first should be your design target, an essential part of every project. The second is what customers think you offer them from an experiential point of view and is the more important of the two. This includes individual, social and cultural factors and can only be understood through dialog with customers.
In this book, I use the term offering rather than value proposition, because it is more down-to-earth and customer-focused. While value proposition might be the academically correct term, it reflects a company-out direction, and encourages you to focus on what you are proposing to the customer. The term offering, on the other hand, is viewed from the customer’s side: “What are you offering me?” When you find people in your organization using the term offering from a customer’s point of view, particularly in terms of experience, then you know your organization has shifted its weight and begun to view itself through the customer’s eyes.
Your experiential DNA is the core building block that your organization uses for working with the customer experience. Similar to human DNA, it defines you and what you can and cannot offer as a customer experience. Your experiential DNA is a mix of who you are, who you have been, and who you want to be. It is balanced between the customer’s perspective and the organizational perspective. In other words, internal culture plays an important part in your DNA, but it is balanced by the external customer view, which is based on earlier experiences and expectations. Experiential DNA is a mix of your mission, vision, and values, your brand strategy and history, how you view yourself, how you are viewed by your customers, and your heritage.
Experiential DNA includes a large degree of storytelling, in which heroes, myths, and key historical events are woven together. But it is not a fiction; it is something everyone within the organization can identify with, because it is authentic, shared, and felt. The term experiential DNA should be well understood and cherished in the organization because it defines what you can and cannot offer. Understanding your experiential DNA is not always easy, and can require considerable soul-searching. However, it is crucial to delivering the right experience, and identifying it is one of the important steps in translation (see Chapter 7).
A question that should regularly be asked within the organization is whether a project, an investment, an offering, or even an employee is a good fit with the DNA of the organization. This can even be turned into a regular organizational mantra: “Does it fit our DNA?” Everything the organization does should fit its experiential DNA.
The experiential journey is the journey that a customer takes in relation to their use of your product or service. It can often be divided into prepurchase, purchase, and post-purchase phases, and further divided up into use phases with discrete experiential moments. The experiential journey can be fine-tuned to incorporate expected touchpoints along the way—the tangible and intangible points of contact between the customer and the service/product. Touchpoints can be direct (e.g., a letter, a welcome package, signage inside a building, a logo, an SMS, a company employee) or indirect (e.g., word of mouth). Understanding the touchpoints along the experiential journey, and the experience customers have when interacting with them, is one of the first stages of becoming experience-centric.
Experience orchestration is pretty self-explanatory. You can imagine an orchestra either playing together or playing discordantly and transfer that thought to your customer experience. There is a need for orchestration within the organization, to get people to work together to deliver the experiential value proposition. A shared company vision, shared direction, and shared humility are required to develop an organizational culture. The company’s leadership is key to developing, sharing, and living this culture. In addition, the term orchestration should be used regularly within the organization—for example, “How do we orchestrate this service experience, and who is responsible for orchestration in this project?”
The company needs to have an orchestrator, a person responsible for the customer experience. That person should be part of the leadership and may be given the title of chief orchestrator, chief experience director, or similar. In addition, each and every project needs to have an orchestrator who is responsible for the experience of that service, and this person should report to the chief orchestrator. Finally, the experience itself requires orchestration during delivery to tailor the experience to the customer and ensure that the experiential journey functions as required.
Infusion refers to spreading a certain way of thinking and doing throughout the organization. Imagine placing a tea bag in a cup of hot water and watching the color and flavor spread in the water. That is what infusion is about in experiential terms—spreading the experiential focus everywhere in the organization. Infusion doesn’t happen on its own and requires constant effort to maintain its momentum. Infusion is a positive process and requires optimism in the organization. Without this optimism, infusion is blocked, so before making the change (i.e., placing the tea bag in the water), you need to make sure the organization is ready for it. This preparedness might come from identifying your place on the path toward experience centricity (see Chapter 2), and moving at the right speed through those steps.
The fastest and shortest way from A to B is a straight line. In an organization, this means getting everyone aligned with and contributing toward experience centricity. This creates a readiness throughout the organization for the experience you want to deliver. Alignment means getting the whole organization behind the experience you want your customers to have. It means everyone giving 100% toward supporting the experience that you want to deliver, and not least, understanding their role in this. Alignment, infusion, and ownership all interrelate. Whereas infusion is about the shared understanding of the experience, alignment is about applying the capabilities to make it happen.
Ownership is an individual and collective feeling of participation in and influence on the experience to be delivered, and is vital to its success. Ownership brings pride, and these two aspects go hand in hand. Ownership and pride motivate people, encourage collaboration, and make people go the extra mile when needed. Ownership has a strong intrinsic element, meaning that people self-motivate toward the common good. However, ownership also requires that the individual is recognized in the organization, that they become visible and are openly rewarded. Ownership can be seen as the result of infusion and alignment working together. When you know and are confident in your role in the organization, then infusion has been successful and you can align your contribution to the whole.
One of the challenges to ownership is that peripheral parts of the organization, those furthest from the experience delivery, might not see their role. This is not because they are not important, but mainly because they themselves cannot see their contribution. Internal symbolic gestures, specific activities, and internal storytelling all help to bring peripheral roles into the organization and encourage ownership.
Behavioral authenticity describes how well the behaviors of your touch-points fit with your experiential DNA. We all know that people have a tone of voice and behaviors, but so do apps, web pages, and almost all other touchpoints. Identifying the correct behaviors for your DNA, and ensuring behavioral authenticity, is a key part of developing and maintaining experience centricity.
Interview with Olof Schybergson
As CEO of Fjord, Olof Schybergson knows a lot about digital transformation. Fjord is a part of Accenture Interactive, and now has over a thousand designers spread over 27 offices. This makes them one of the largest design and innovation consultancies in the world. Olof believes strongly in design as a strategic resource and argues here for its role in the transformation of whole industries.
I agree 100% with the trajectory described in this book. Experience fundamentally is the single trait that most clearly links the most successful companies in the world. Customer obsession and taking a human lens and really delivering a great experience is a red thread that connects the organizations that are winning in the world. At Fjord we simplify the term customer experience and talk just about experience, so that it also includes the employee experience. Business tomorrow is built by delivering excellent experiences, whether toward end customers or employees.
I like the term experience-centric organization. When you say “customer-focused,” it assumes that the constituent is the customer and their purpose in life is to consume and buy things. Experience can be applied to all people and includes the employee, the customer, the patient, the citizen, all categories. It starts with the customer experience, then moves to the customer-facing employees and progressively back through the organization.
At Fjord we have seen a shift at work, where more and more of the requests from clients are looking at the customer and employee experience or purely the employee experience. There is a trend in this direction to compete for talent. You need to offer a strong value proposition for employees and a strong employee experience. When the project focus is upon a superior customer experience, companies realize they also need to change the employee experience. This is especially true for the customer-facing employees, so it is important to enable them. This causes great challenges for companies that are competing for talent.
Q: Do you think organizations are prepared for this transformation?
A: Organizations are wholly unprepared. Woefully. Most large organizations are set up under an industrial model, with business units and KPIs, and the goal is optimizing within them. To provide a fantastic customer experience across everything the customer does, you need to reorient the organization around the customer. Instead of talking about marketing and sales as different business units, you should obsess over customer moments.
“Those who don’t face up to the need for transformation toward an experience focus will disappear and be quickly replaced. It will become a game of survival.”
Most organizations are not set up or organized for experience and are unprepared or structurally incapable of collaborating across business units. The experience needs to become strategic and used to reorient how the organization thinks. Those who don’t face up to the need for transformation toward an experience focus will disappear and be quickly replaced. It will become a game of survival. When we worked with Sprint, [CEO] Marcelo Claure said, “I have never thought of my organization like this. I thought of my organization as 12 different channels to market. Now you have reoriented how I think. To provide the best possible experience, we need to put the human in the center and orient around key moments that matter across channels. That is where it becomes very real.”
Q: What is the experiential DNA of an organization?
A: The evolution of brand DNA is experiential DNA. A brand is built through a set of experiences and the collection of those experiences becomes the brand. If there is a mismatch between the experience and what the brands advertising is telling you, you will intuitively trust your experiences more than the advertising. So marketing and advertising have evolved into becoming experiential.
Many organizations cannot express their org DNA. A lot of CEOs recognize that they have a challenge doing this, and they look toward other organizations that are experience-obsessed. They know that they have to do the same, but don’t know how to go about it.
Instead of “Here are a bunch of products to push out,” the thinking should be “Who are my customers and how can I best be relevant to them and provide an experience for them?” This is a monumental battle and takes time. Short-term crises and the trench warfare of the everyday get in the way of significant, long-term improvements and delay this [shift].
The concept of loyalty is radically changing. Companies should ask, “How can I be loyal to my customers rather than make them loyal to me?” The answer is to sustainably, over time, ensure that every moment and every interaction is relevant and meaningful depending upon customer need and expectation.
1 American Express, “American Express 2017 Customer Service Barometer,” https://amex.co/2VVRvqD.
2 Devon McGinnis, “Research Shows Customer Loyalty Hangs in the Balance: ‘State of the Connected Customer Report’,” Salesforce, October 24, 2016, https://sforce.co/2JHJP9V.
3 David Clarke and Ron Kinghorn, Experience Is Everything: Here’s How to Get It Right (New York: PwC, 2018), https://pwc.to/2XagMio.
4 American Express, “American Express 2017 Customer Service Barometer,” https://amex.co/2VVRvqD.
5 Chris Bucholtz, “The $62 Billion Customer Service Scared Away” (NewVoiceMedia blog), http://bit.ly/2Xafrbd.
6 Knowledge@Wharton, “Connecting Marketing Metrics to Financial Consequences,” November 17, 2004, https://whr.tn/2WcXIU7.
7 RightNow Technologies (later acquired by Oracle), “2011 Customer Experience Impact Report Getting to the Heart of the Consumer and Brand Relationship,” http://bit.ly/2WsfYZa.
8 Colin Shaw, The DNA of Customer Experience: How Emotions Drive Value (New York: Palgrave Macmillan, 2007).
9 Irving Wladawsky-Berger, “Customer Experience Is the Key Competitive Differentiator in the Digital Age,” Wall Street Journal, April 20, 2018, https://on.wsj.com/2HEwqNw.
10 Elle Hunt, “Can You Really Save for a Deposit by Ditching Coffee and Toast?” The Guardian, January 29, 2018, http://bit.ly/30OqgBY.
11 Daniel Schorn, “Howard Schultz: The Star of Starbucks,” CBS News, April 21, 2006, https://cbsn.ws/2I89l58.
12 Jeff Bezos annual letter to shareholders 2012, http://bit.ly/2VSx8e8.
13 Mike Cane, “Steve Jobs Insult Response,” posted June 8, 2011, http://bit.ly/2Xitw6N.
14 CB Insights, “21 Lessons from Jeff Bezos’ Annual Letters to Shareholders,” October 16, 2018, http://bit.ly/2I6BY2B.
15 Chris Matyszczyk, “Why Apple Keeps Winning in Style,” CNET, February 1, 2015, https://cnet.co/2worGFt.