Posts Tagged ‘CRM software’

Why is customer experience more important than service?

November 23, 2009 Leave a comment

Some recent research indicated that the customer experience is now a more important competitive differentiator than customer service.  I twittered this and got an interesting response from Nigel Dean that raised the question: “Surely Service is a massive part of the customer’s experience? Can the experience be good if the service isn’t?” 

Admittedly I have found it hard to think of an example of when a customer experience would be considered good when the service wasn’t but, on the other hand, quite often the customer experience can be poor even when the service is good.  Essentially service is one contributing factor to the customer experience but it is wrapped up in many other factors many of which are not directly in the control of the provider.

Consider the interaction with the customer. On one side the provider presents things to the customer: quality, a brand, trained staff, service and so on.   They provide these things in the hope – even the strong belief – that they will delight the customer. On the other side of the deal the customer takes away an experience. 

But this means the focus of the service provider is on what they provide and not on what the customer actually sees, feels, touches and emotes about.  These reactions constitute the customer experience and they are the factors that will affect the result or outcome of the experience.

Understanding the customer experience is an exercise in empathy.  What is their emotional point when they first deal with you? Are they angry, desperate, indifferent etc?  These are emotions generated before contact and quite often be less than rational.  What does the customer expect from your brand? I expect different things  from a Ramsay restaurant than my local greasy spoon where frankly the service is often better but my experience at Chez Ramsay is better.     

How did they react to your way of doing business – remember, it may not be theirs. Was their issue resolved, be it service or purchase?   Did they get value for money? 

And finally how was the transaction loop closed – what was their emotional reaction to what happened?  What was the outcome of those reactions? Will they promote you or be a detractor? In the age of social networking the voice of the customer travels at the speed of light through a network of millions so this is crucial.  Do their peers think the experience/outcome was cool? (Peer pressure is a surprisingly powerful motivating force from kids with the latest gadget to business people and their BMWs?)

For a time there was a philosophy around called Customer Relationship Management (CRM) that attempted to round up this ‘experience issue’ but it suffered from two flaws.  It suggests you can control the relationship with the customer – the customer is now in control.  And the second problem is that CRM is about making managers look inwards at how they do things:  structure,  technology, processes etc and not at the customers’ experiences.  Having said that, CRM software tools are great at collecting massive amounts of raw data and we are now seeing some clever analytical tools work that data to give tremendous insight into customer activity and behaviour.  There is a caveat there, of course, that previous behaviour is no guarantee of future behaviour.

One other route to understanding the customer experience is to carry out a customer satisfaction survey but that will give you a figure for “how much” – it does not give any real insight into “why?” or “what was the outcome?” which are much more important if you are to keep doing the right things and put right the bad.

There are some real experts in this area – not just an old hack blithering on – and the one I would recommend is Colin Shaw at Beyond Philosophy.