What Exactly Is Customer Experience Management?

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A few months back I penned a short blog post entitled 'What Exactly Is CRM?' [1]. It was based upon the wrong-headed definition of CRM on Wikipedia. I offered my own simple CRM framework - the C4EB Model - as a way to look at CRM in a joined up way. The post gathered a lot of interest from CustomerThink's readers. Apparently, many of you are as confused about the many definitions of CRM as I am.

Right now, I am getting that deja vu feeling all over again. Not about CRM this time, but about Customer Experience Management (CEM). Just for once, the reference for CEM on Wikipedia is an empty category leading off in 23 different directions! One of the directions leads to the same old CRM definition, which now says, "To comply with Wikipedia's quality standards, this article may need to be rewritten!" Not exactly progress.

So what exactly is CEM. And how does it differ from CRM?

CRM, But Much More Than Just CRM

Although many seem desperate to dissociate themselves from CRM, this is pointless, especially in the case of CEM. CEM is clearly built on top of CRM. Just as CRM is based upon a deep understanding of what customers want and building the capabilities that deliver those wants profitably, so at a different level is CEM. The difference is in how CEM does this.

There are four core differences between CRM and CEM. The first one is how CEM takes a much broader end-to-end customer lifecycle view than CRM. The second one is how it looks at value delivery throughout the customer lifecycle. The third one is how it takes a much deeper customer touchpoint view. And the final one is how it brings the whole experience together in service of customers.

Stitching Touchpoints Together into an End-to-End Experience

CEM is much more than just CRM. Whereas CRM is usually focussed on individual marketing, sales or service transactions, CEM integrates all these touchpoints into an end-to-end experience that delivers value for customers as well as for the organisation. Creating mutual value throughout the customer experience is the key. The founding father of CEM, Lou Carbone of Experience Engineering, describes in his book ‘CluedIn’, how looking at the customer experience from an end-to-end perspective has enabled many organisations to radically improve the experience customers have doing business with them. And the value they receive. It is this value accumulated at many touchpoints over a period of time that leads to increased customer satisfaction, loyalty and profitability.

Delivering Value Over the Entire Customer Experience

Looking at the entire customer experience introduces the second difference. Whereas CRM focusses on delivering value at the point of sale (and minimising the organisation's costs after the sale), CEM recognises that the sale is just the start of value delivery for the customer. Most value for the customer is created using the product in the weeks, months or years after the sale. Just think of the summer holiday experience which can last months from planning to enjoying. Or the automobile ownership experience which can last for many years. Organisations must be prepared to support customers during the entire ownership experience, not just upto the point where the customer has paid. After all, customers think they already bought post-sale support if they need it. They just hope they won't. Vargo & Lusch describe this as the 'Service Dominant Logic of Marketing' in a recent seminal article in the Journal of Marketing. It is an idea that is revolutionising marketing.

Looking at Touchpoints Through the Heart & Mind of the Customer

The differences don't stop with the end-to-end customer experience either, CEM also looks at each touchpoint differently too. Whereas CRM is usually focussed on the end result of a transaction, CEM brings together all the factors that drive a successful transaction from the customer's perspective. As Berndt Schmitt describes in his definitive book on CEM, ‘Customer Experience Management’, CEM looks at how customers sense, feel, think, act and relate to the individual touchpoints in the customer experience. To groups of touchpoints that are experienced together in the experience. And to the experience as a whole. Just think of the feelings the smell of freshly roasting coffee generates in Starbucks. Or the feelings associated with your first ride on a Ducati motorbike. Sampson Lee's Experienced Emotion Maps are a great way to look at this.

Creating an Experiential Brand Fit for Customers

There is one last big difference. Whereas CRM often focuses on customer equity at the expense of brand equity, CEM is uniquely placed to grow them both at the same time. This is often mistakenly done using the marketer's view of the brand as the starting point. The goal of these 'experience the brand' programmes is for the customer to experience what the marketer thinks the brand should be. But the brand usually isn't what marketers think it should be, instead, as Tom Asacker descibes in his book, ‘A Clear Eye for Branding’, the customer’s view of the brand is often very different to the marketer's. Often in a negative way. And that is a problem that often leads to failure in CEM. A more honest approach to CEM is to start with customers and their wants and then to build a branded customer experience that delivers them reliably at a profit, and, and this is a big and, creates an experiential brand fit for customers.

What do you think? Is CEM more than just CRM? Or is it something entirely different?

Post a comment and get the conversation going.

Graham Hill
Independent CRM Conisultant
Interim CRM Manager