“By applying the 80/20 rule to differentiate customers, needs, touch-points and sub-processes, you will be able to make a paradigm shift from efficiency to effectiveness in customer experience management.”
Nowadays, the challenge of customer experience management is that delivering a good experience is not good enough. You need to deliver an effective experience. Only when you’re delivering effective experience, can you survive, grow, and create customer loyalty. Effective Experience Framework 1.0 aimed to address the limitations of the conventional experience management approaches and render a pragmatic framework for the creation, delivery and assessment of effective customer experience. 2010 Effective Experience Framework 2.0, added findings of the 2009 global customer experience researches on luxuries, furniture manufacturer, mobile network operators, and retail stores, to further validate its underlying principles.
Why Good Companies Deliver Ineffective Experience
Why are conventional approaches not effective in managing customer experience? Here are the reasons to highlight the loopholes and limitations of traditional methods and tools used in measuring and managing customer experience:
* Conventional approaches usually focus on individual / uncorrelated satisfaction scores and are process-centric to improve the efficiency of operations; they typically ignore the emotional feelings of the customer;
* Conventional approaches usually drive enterprises to deliver homogeneous and non-branded experiences as they try to comply with the quality level set by renowned standards organizations or to achieve top grade customer satisfaction scores;
* Conventional approaches usually aim to excel in all aspects of an experience;
* Conventional approaches usually demand extra resources to enhance customer experience (given severe competition and the rapid increase of possible touch-points that a customer could interact with a brand or a company);
* Conventional approaches usually collect a huge batch of uncorrelated data and scores, and measure too many metrics;
* Conventional approaches do not usually provide a systematic way to guide resource allocation among multiple touch-points; and
* Conventional approaches do not usually provide an integrated way to assess, design and measure a branded customer experience, with no integration or synergy among different functions especially between touch-point operations and brand.
An Experience is Not Effective Unless it’s Remembered, Branded and Contrasted
The worst companies make customers feel bad with BAD experiences. Average companies make customers feel good with GOOD experiences but these experiences are not effectively remembered or branded. They are just wasting resources. The best companies never forget about delivering their target brand values while they make customers feel good with EFFECTIVE experiences. So what is an effective experience?
Noble prize-winning psychologist Daniel Kahneman pointed out that people remember only two things during an experience: how they feel at the peak (whether the ultimate experience was good or bad) and at the end. These peak-end feelings summarize the whole experience process and are stored in the brain at a subconscious level. These feelings will eventually direct the next buying decision. The proportion and duration of pleasure or pain throughout the whole experience do not affect memories. People remember only the peak and the end.
A branded customer experience works to amplify your brand through intentional and consistent delivery of on-brand experiences across all touch-points. Only when you are branded can you differentiate, only when you are differentiated can you have loyal customers. To optimize the branded experience, you have to deliver your most unique brand values and meet (or exceed) the most critical needs and expectations of your target customers through peak and end experiences.
Carl Jung said, "Even a happy life brings some darkness and the word happy would lose its meaning if it were not compensated by some sadness." People are comparison animals. Whether we feel good or bad are largely the result of comparison, our experiences cause us to set our anchors differently. We benchmark against different experiences (inter-experience). We also benchmark within an experience (intra-experience). People need pain to contrast with pleasure. The same pleasure feeling will be amplified once we go through some pain. Pain is a necessary "angel" when you design the customer experience. Not only does it help to contrast with the pleasures of the experience, but also to free up resources and release constraints.
An effective experience creates positive emotions and memories, delivers differentiated brand values to target customers, and optimizes resource allocation.
An Effective Framework Helps You to Focus on the Essentials and Set Priorities
The skeleton of the Effective Experience Framework is based on the four core elements of the Branded CEM Method— X-VOC, X-MOT, X-Anchoring and X-Effectiveness—it provides a management framework with four modules in 12 components for the creation, delivery and assessment of effective customer experience.
Module I. VOC—Understanding Customers
Simply listening to the voice of customers is far from enough. To truly understand your customers, you have to understand the value contributed by each customer, their most critical needs and their current experience levels across multiple touch-points. This understanding will help you to formulate an effective experience strategy.
Global Louis Vuitton case study: Far beyond just listening to the voice of your customers . . .
Module II. Strategy—Making Choices
Strategy is about making choices. Designing an effective customer experience strategy means making choices about your target customers, brand values and needs positioning. These choices help you to allocate your limited resources at various customer touch-points.
IKEA the Netherlands and IKEA Mainland China case study: Why good managers formulate bad strategies . . .
Module III. Touch-Point—Allocating Resources
When allocating limited resources to deliver effective experience, you have to synergize multiple touch-points, optimize single touch-point, and map the experience gaps. All companies have multiple touch-points and limited resources. The ideal resource allocation paves the way to deliver effective experience across all touch-points.
Mobile network operator case study: Distinguish your touch-points and sub-processes. . .
Module IV. Execution—Delivering Results
To deliver results requires dedicated effort to align the capabilities of people, product and technology, a roadmap with phased implementation, pilot projects for effective change management, and measuring the results of customer profitability and experience effectiveness. A successful execution fulfils the objectives of your company. Are you delivering effective experience?
Retail stores case study: Are you delivering the expected results. . .
A Closed-loop Management System
Customer experience management is a journey, not a destination—it starts from understanding customers to formulating effective experience STRATEGY, allocating resources at TOUCH-POINT to delivering results—the feedbacks and outcomes of EXECUTION will be routed back to VOC for continuous improvement and development.
2010 Effective Experience Framework 2.0 White Paper
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