The 12-steps to creating a great CEM program

Customer Experience Management seems to be on everyone’s mind these days.  One of the questions that I’ve gotten asked a number of times is, how to build a great CEM program, what do we need to do, etc.  Based on extensive research, I’ve come up with a 12-step plan which should help in developing your own CEM program.  I’ve helped a number of firms to use these steps in improving their own CEM strategies, and I’m confident that this will be of use to you too.

Step 1:  Experience Mapping. Creating an experience map of what actually is the first thing that a company ought to do.  This will help us to identify all of the various points of interaction a customer has with a firm.  We may also want to find out what the customer thinks of the current level of service being delivered for each of the experience points.

Step 2:  Find out customer expectations. Finding out what the customer expects should be one of the starting point in the customer experience management process.  This will help the organization to understand what the customer desires, and what is of importance to the customer.  Often companies find it difficult to develop effective CEM strategies because they are unable to understand the requirements of their customers.

Step 3:  Examine the competition. A company can not work in isolation.  Knowing what the competition is offering will only help an organization to set goals and targets and figure out where they can meet and exceed the competition.  Customers will always compare a company with others, and hence it becomes imperative that the company know what its competition is up to.

Step 4:  Analyze and Plan. Once a company knows what level of service it is providing, the level that customers expect, and the level that the competition is providing, it should be ready to develop its own plan.  After analyzing the three types of data, it should be easy for companies to devise their own plans and set levels of ‘quality’ that each experience should deliver to the customer.  If the company is looking to provide memorable experiences, then the company should try to set high goals, where the standards in critical functions exceed both customer expectations as well as competitors.  This is similar to the delight concept for customer satisfaction.

Step 5:  Communicate the Brand Experience. Before a customer actually comes in contact with a firm, the customer gets to experience the communications about the brand.  Hence it is imperative that the various marketing communications media should reflect the brand experience that the company wants its customers to have.  It is important that not everything is given away in the advertising, as this may lessen the impact of the surprise elements within the experience framework.  However, all of the different communications media, including advertising, commercials, web sites, public relations activities reflect the brand experience that the company want to portray to the customers.  If this first level of experience is good, the customer will be attracted to continue to the next stages.

Step 6:  High Quality Product / Service: The experience is of little use if the actual product or service is not of the high quality.  It is imperative that companies work to make sure that the product / service on offer meets the customer’s expectations.  No level of customer experience can help sell a poor product.

Step 7:  Motivated Employees. Numerous researchers have called for having motivated and or satisfied employees.  The first step is to hire right employees and then to train them so that they are highly committed to providing the level of customer experience that the organization expects of them.  Making sure that the employees are satisfied and motivated will ensure that in the long run the customer receive a good experience, and can eventually lead to customer loyalty.

Step 8:  Customer Interface. The customer interface needs to embed the planned level of experiences.  This includes the physical aspects of the customer’s interactions and appeal to the five senses of customers.  Focusing on the right décor, the appropriate music, color schemes, the design of the equipment etc. will help customers to feel comfortable and make the experience an enjoyable one.  Technological aspects of the experience can also be included in this step.  This would include things such as ATMs, payment points, automated call centers, and web sites.

Step 9:  Senior Management Focus. Like other areas of management, senior management’s commitment to and focus on the desired strategy is imperative for its success.  Hence, for CEM too, the senior manager’s commitment is imperative.  Senior managers can not only set examples for the rest of the employees, but will also be more focused in the whole CEM process.

Step 10:  Integrate Functions. It is important that the whole organization is working towards providing a high quality experience for their customers.  The back office as well as the front end employees need to work together, so that the customer can have the best possible experience.  Companies have been cutting back costs by shifting some of their back office work overseas to lower cost centers.  Jaiswal found in a research (2008), many of these have not been able to provide the right level of customer experience as desired by the customers.  Although this may result in short term savings in cost, in the long run it results in customer defections.  Hence, it is imperative that companies make sure that all operations are working towards the same goal.

Step 11:  Post usage. The customer needs to have great post usage experience.  This can include things such as after sales service, warranties, upgrading, installations, etc.  Good after sales service is a way of reminding the customer, long after he/she has used the product or service that the experience with the firm was great.  This encourages the customer to return to the firm and to recommend it to others.

Step 12:  Continuous Innovations. Continuously innovating and improving the experiences is one of the ways that the company can make sure that it stays ahead of competition.  It is also one of the ways that will help the firm to make sure that the customer receives the best possible experiences, and perhaps even help to design memorable experiences.

The Customer Loyalty Lifecycle!

We’ve all heard of the business life cycle, however today I wanted to introduce you to a different type of life cycle, i.e. the customer loyalty life cycle.  When managing a business it is imperative to know what sort of a life cycle the business is likely to go through, and hence we can make appropriate strategies.  Similarly, when wanting to manage loyalty, it is important to understand what type of a life cycle a loyal customer is likely to go through, so that we can make appropriate plans.

Going back to one of my earlier blogs, we must remember that there are three distinct types of loyal customers (http://blog.cibmp.org/?p=32).  Keeping this in mind, we know that the most profitable ones are the emotionally attached customers, and the least profitable are the behaviorally loyal customers.  Moreover, the longevity of the relationship also differs from one type of loyal customer to the other.  Based on research into these types of customers, I have developed a customer loyalty life cycle.

As you can see from the figure, the life cycle is based on two main factors, time and profitability.  While my drawing skills are not great, you can make out the basic concept behind this model.  Customers that are behaviorally loyal will stay lesser time with a firm and not be very profitable.  Attitudinally loyal customers will stick for longer, and eventually they will leave the firm.  Emotionally loyal customers will stay with the firm for as long as they are alive, or as long as they remain to purchase from that product category.  These customers are the most profitable for a firm.  The time factor differs from one industry to another.  However we can now put time figures to this graph.  We can estimate the number of years it will take a customer to become emotionally attached!  The numbers written in the figure above are only for illustration purposes.  My research into this continues, and hopefully in the near future I will be able to publish the time scales, along with estimated profitability figures.

What is important is that we need to realize that all customers start from the same place.  It is up to us to ensure that they end up in the right place.  For example, companies that are committed to providing better customer service and quality will be the ones that will get more customers to go further on this life cycle.  Those that ignore the customer’s true needs will be the ones that see most of their customers end up in the behavioral loyalty sector.

As always, please do let me know what you think about this.  Your comments here, and in various linked in groups are always appreciated.

WOM still the most powerful tool for a marketer

Word of mouth, or recommendation, is the most powerful tool marketers have in their arsenal for attracting and retaining customers.  Despite this being the most powerful of the tools, it is one of the most overlooked, and hence I thought I would devote this blog to the importance of WOM.

Research indicates that customers are more likely to purchase a brand / product based on recommendation from a trusted source than from any other means.  This includes advertising, PR, online marketing, etc.  Moreover, researchers have found that those people who purchase a product based on recommendation from a trusted source are more likely to become loyal than those that went there as a result of other sources.  Interestingly there is further research which states that more customers are likely to purchase a product based on recommendation than even their own past experience!

My research indicates that emotionally attached customers are the ones that are most likely to recommend a brand, and are the ones that will do it most frequently.

Recommendation is also a free tool for marketers.  Usually you don’t spend money on this.  However some companies have started to realize the importance of recommendation and reward their customers who recommend others with vouchers, discounts, and free gifts.

Social media has enabled our customers to use the power of the web to broaden their scope of friends.  This now allows for our customers to reach a wider number of people, and much faster too.

The only problem with recommendation is that it is not really in the control of marketers, or at least not until now.  Companies need to develop strategies, devote budgets, and create teams that will look after recommendation.  With it being a very powerful tool, we must learn to take advantage of this, and not to let it evolve on its own.  Companies need to devise strategies that will assist their customers in being better at WOM.  Various rewards that are being used by firms is just one way to encourage customers to start recommending the company to others.  However there much more to be done.  Companies that can harness the pwoer

Back from a long break

Hi everyone.  As you can see, I had been away for a while.  Much has been happening since.  Presenting at a number of conferences, consulting work, and a number of other interesting projects.  One of these involves being a director for a non-profit organization called Children Education Society (CES).  CES is involved in providing education to under-privileged children in hot spots around the world.  Some of the work they do is with children from war torn Afghanistan, as well as those that had been affected by the floods in Pakistan.

I’m also now working as a Director for the Center for Innovations in Business & Management Practice.  This organization aims to spread innovatory business and management practices, by bringing together academics and managers.  Their first event attracted people from 20 countries from all over the globe.

I have also been working on a book on Customer Loyalty.  I will be posting more details about this in the future.  Now that I’m back,  I will try be more regular at blogging.  Take care and have a good weekend.

7000 visitors and counting

It appears that my recent trip to the US has made a strong impact on my blog visits.  While the US had overtaken the UK, in terms of visitors, after my recent visit the numbers have shot up.  Visitors from the US now make up more than double the visitors from the UK!  Once again, thanks everyone for visiting the blog and for the comments.  Will try to cover some of the suggested topics.  Do keep the comments coming.