Customer Experience Management

As we now know customers interact with the company through various touchpoints.

Understanding the customer journey is very critical for companies to try and pre-control the customer experience, which can be called customer experience

management. Customer experience management is the company’s way to control the customer experience in a way that it will create value both to the customer and the company. To enhance customer relationships and build customer loyalty is the main purpose of customer experience management. It is important to highlight that customer experience management focuses on the customer’s current customer experience rather than the history of the customer encounters as it does in customer relationship management. (Verhoef et al 2009) Customer experience management has gotten a lot of research attention, it is said to be one of the most promising marketing approaches in consumer industries.

Parandker & Lokku (2012) as many other practitioners alike state that managing the customer journey through various touch points will lead to overall customer

experience and the key is to be able to manage the interaction at each of the touchpoints They also highlight that customer experience is ultimately about minimize the gaps between the customers’ perceptions and the company’s understanding of these perceptions. It is vital for companies to understand their customers, why they use the services and how they choose among other competitors in the industry. Touch point experience is the key to understanding the overall

customer experience. Companies should determine if they have succeeded in meeting the customer expectations in every touchpoint and therefore evaluate customer satisfaction and possibility of repurchase.

In their research Frow & Payne (2007) posit that organizations wanting to improve customer loyalty and profitability should concentrate on achieving superior customer experience. It is important for companies to do research on their customer’s

perceptions of the service experience, recognize the problems areas for improving the customer experience. This will ultimately increase customer loyalty and improve financial returns. Co-creation of value is the key in this issue, it is vital for companies to realize that the superior customer experience is created together with the customer.

There are several tools to use to point out critical points and underline the

opportunities for the improvement of customer experience e.g. process mapping, service-blueprinting, customer activity cycles and customer-firm touch point analysis.

Managing the customer touchpoints is crucial for companies pursuing superior customer experience. This way companies can map out the customer journey and recognize the most critical touchpoints. Measuring customer experience at each step of the customer interaction allows companies to truly hear the customer and identify problem areas and implement new techniques and processes. Most used measure is the net promoter score that will tell companies how likely is the customer willing to recommend the company to family and friends. No matter the channel the customer should always get consistently as good customer service. Multi-channel integration strategy offers a bigger scope for understanding customer’s channel preferences and this way enhance the company’s attractiveness and better their customer experience.

Customer have different needs depending on which stage of relationship cycle they are. Recognizing customer needs yet not forgetting that superior customer experience needs to be delivered no matter the stage of the relationship cycle is critical for companies wanting good recommendations from their customers. A deep knowledge

of the customer can only be achieved when cross-functional manner has been undertaken, this means that all staff and departments collaborate in sharing all information about the customer and all the service encounters. Different customer segments have different desired customer experience as well as different levels of profitability. Different profit contributions mean different feasibility of delivering superior customer experience. Communications and services across different channels should be relevant, coordinates and coherent. This way brand communication is consistent and customer. Superior customer experience and employee experience go hand in hand. Motivated and satisfied staff are not only willing but will enjoy creating superior customer experience for their customers. (Frow & Payne 2007)

Ryder (2007) posit that there are three key elements to customer experience

management and successful long-term sustainable competitive advantage. People are people first: It is important to realize that no matter if you are management, first row employee, customer or supplier it is a human reaction that counts when creating any kind of experience. Understanding how people feel in different situations is important, otherwise the company is in risk of losing their business, customers or even

employees. Manage the reality gap: Understanding the expectations of customers as wells as the reality of current customer experience is relevant. Its common that companies might think they create superior customer and/or employee experience when in reality, they do not. Create trust and relevance: Trust is the key element of any experience. Companies making promises and not delivering them is sadly very common. Delivering what is promised is the main element of successful customer experience. (Ryder 2007)

Berry&Carbone (2007) emphasize the importance of emotional connections in customer experience, which requires systematic customer experience management.

Organizations and their employees send different clues to their customers. Companies cannot manage customers’ emotions but they can manage the clues that they send.

These clues carry different messages, which tell the company’s story: does the organization care about its customers and how does it want their customers to feel?

Customer experience management is about telling customers the right story

exceptionally which creates the value for customers and emotional connection with the company.

Johnston & Kong (2011) state that systematic planning of customer experience is a challenge in every organization. They have responded to the challenge by developing a road map (figure 4.) that will help companies to improve their customer experience and achieve triple bottom line. They identified ten stages of engineering the customer experience. In the first stage the company should instigate and set objectives for their customer experience following the creation of the business case and coordination and overseeing the changes made. In the fourth stage the company should do customer research and then define the experience. In the sixth stage areas of development should be prioritized and after that undertake action research followed by developing and piloting the changes. In the last two stages, it is time to change the support systems and asses the impacts.

Figure 4. The customer experience: road map for improvement (Johnston & Kong 2011)

Hwang & Seo (2016) identify in their model (figure 5), of conceptual framework of customer experience management research, antecedents of and consequences of customer experience. Antecedents are divided in internal and external factors. Internal factors are socio-demographic factors (e.g. motives, knowledge and personalities), past experiences, familiarity of the service and customer engagement highlighting the co-creation of value.

External factors are service/product quality, physical characteristics (eg. atmosphere and service interface), social/online environment (e.g. social interactions, service platforms), employee characteristics, economic factors and service technologies.

Consequences of the created customer experiences can be emotional (e.g. enjoyment), behavioural (e.g. purchase decision), brand related (e.g. brand loyalty) or other

outcomes such as customer values. (Hwang & Seo 2016)

Figure 5. Conceptual framework of customer experience management research.

(Hwang & Seo 2016)