Customer Experience Management
Successful Implementation and Examples
The perfect customer experience—you can read that a lot nowadays and it is also high on many companies’ list of goals. It is crucial to put the interests and wishes of your consumers first and to align all activities and actions of the company accordingly. Customer needs should be the benchmark for your marketing and all communication strategies.
Regardless of the way in which the customer comes into contact with the company, they should always receive information that is tailored to their needs. The “Customer Experience” describes all points of contact between the customer and the company, from offers to service. The resulting assessment of this experience by the customer is the basis for subsequent decisions regarding further possible interactions with the company. This is where customer experience management comes into play—because, in order to make the customer experience as positive as possible, suitable measures and strategies are needed to promote and maintain customer relationships over the long term.
Table of Contents
Definition: Customer Experience Management
Customer Experience Management (aka CXM or CEM) encompasses the entirety of all processes during the entire customer life cycle that a company uses to monitor, accompany, and organize interactions with customers. The goal of CXM is to optimize customer experiences and thereby promote customer retention.
Tasks and Goals of Customer Experience Management
Customer Experience Management is a holistic approach with the aim of perfecting a company’s customer dialogue with consumers. In addition, the focus should be on precisely adapting processes and strategies to customer needs and wishes. It requires a targeted conception and constant further development. Companies should then establish a mission statement and gradually implement all the relevant requirements.
Customer experience management should build long-term relationships with your own customers. It even goes one step further, because the CXM aims not only to meet consumer needs but to exceed them at all times. In addition to improvements in product delivery, in dealing with service questions, or in product development, it is also important for marketing to recognize customer demands.
Companies that always succeed in creating positive customer experiences can set themselves apart from the competition. This not only influences the buying behavior of customers but also brand loyalty. With an emotional bond to the company, customers can develop into brand ambassadors and recommend a product or service on their own initiative. Such consumers are a real treasure for companies because a satisfied customer recommends on their own and acts as free advertising.
What is the Difference between CXM and CRM?
Although the two terms sound very similar at first, they are two different components of customer retention management. Customer Relation Management (CRM) looks at the customer from the company’s perspective and aims to optimize customer relationships. This includes, for example, marketing communication and complaint management. Customer Experience Management, on the other hand, empathizes with the customer and aims to exceed customer expectations. This can be achieved, for example, through new and optimized processes or an optimized website layout. Thus the two areas complement each other, but they differ in their tasks and goals.
6 Steps: How Customer Experience Management Works
For CXM to be successfully implemented in the strategies and processes of a company, the following six steps are recommended:
- Target / actual analysis from the customer’s perspective
- Experience perception
- Efficient cost allocation and cost savings
- Definition of measures and creation of an action plan
- Implementation
- Evaluation based on key performance indicators
It makes sense here that this order is adhered to. The six steps can also be represented as a cycle, as the individual processes start again after the Customer Experience Management measures have been evaluated. For a better understanding, we will go into the individual steps in more detail below.
1. Target / Actual Analysis from the Customer’s Perspective
Before you can rush into optimizing the customer experience, it is important to analyze the current status in detail. Which structures are already in place? At which points do customers contact the company? The internal elaboration of a customer journey is now particularly important in order to better understand the customer’s path. Only those who can understand the individual touchpoints of customers with the company or a brand can improve them sustainably. Reviews on online portals can be a little help here to collect opinions from customers. A comparison between the actual and the target state makes it even clearer which points have potential and where there is a need for action.
2. Experience Perception—Recognizing Customer Needs
In this step, business owners have to put themselves in the shoes of their customers. Within the customer experience, customers come into contact with different touchpoints, which link in turn to different expectations. In order to optimize the experiences of their own customers, the companies must, first of all, know exactly what expectations and desires their own target group now has. There are various options for this, for example, the conception of a buyer persona as part of the buyer journey. This enables you to empathize with the target group and define their intentions and wishes.
- How do we offer our customers and interested parties the best possible support?
- Where can we support our customers even more?
- What change requests do my customers have?
If these questions are answered successfully, it can also be determined to what extent the customer’s expectations correspond to reality. The fact is that customers use the last experience and thus the last contact with the company as an anchor for their customer satisfaction. Previous experiences are also rated more positively in retrospect if the last experience was positive. Small surprises and special services can reinforce this effect. This can generate enthusiasm and further expand the customer’s sympathy for the company. If the customer’s expectations are exceeded, the customer experiences a positive customer experience. If the expectations have been met, the experience is neutral. If they couldn’t be fulfilled, the customer experience was negative for the customer. Direct surveys on customer satisfaction can provide an initial indication of how the customer experience turned out.
Determine Customer Satisfaction with the Net Promoter Score®
Departments and employees give their all every day to provide customers with a perfect experience. You can only find out whether the strategies developed are really effective or not if you ask the customers directly about their satisfaction. Companies that want to find out what customers think of them can take advantage of the Net Promoter Score. This key figure—which is used to measure customer loyalty—gives companies the chance to determine the current state of customer satisfaction.
3. Efficient Cost Calculation
Of course, there is no way of constantly creating positive experiences that exceed customer expectations with every interaction. This is also not expedient. In short, all customer interactions with the company should first be made as simple and straightforward as possible. After that, it can make sense to focus on a few important touchpoints and optimize them in order to create a wow moment. For this, it should be calculated how high the costs of this optimization are and whether the measures are ultimately cost-effective. In order to identify the most important touchpoints, the creation of a customer journey map and a touchpoint analysis can be of great help.
4. Define Measures and Create an Action Plan
Based on the steps taken so far, it is now time to develop an action plan. Which touchpoints should be optimized with which measures? Which people have to be involved in the planning and execution? This phase should focus on the potential that can still be exploited and the insufficiently satisfied customer requirements. All employees should understand this plan and contribute to its implementation.
5. Implementation
It is finished: You understood needs and expectations of customers, defined the goals, and developed the methods required. Now comes the harder part—putting the theory into practice. It will be exciting, as the first customer reactions can indicate how successful the individual measures are. Was the customer experience management successful?
6. Evaluation Based on Key Performance Indicators
Certain indicators can be used to evaluate how successful the CXM has been. But as already mentioned, the process of customer experience management is not complete. If it is unsuccessful, the individual steps start from the beginning again. In addition, customer requests are subject to current styles, which is why companies that want to keep up with the times should constantly pay attention to changing trends. Customer experience management can and should be refined regularly in order to meet the changing requirements of customers.
How You Can Improve the Customer Experience
Which channels, touchpoints, and measures are important for a company cannot be determined by a universal rule. For example, Facebook, Instagram, and Co. are more relevant for B2C companies than for B2B companies that rely more on traditional newsletters or the like. The content also differs depending on the industry, product, or service. Basically, however, every measure that contributes to increasing customer satisfaction belongs, strictly speaking, to customer experience management. Classic areas of application are, for example:
- (Personalized) email marketing
- Personalization of website content
- Customer interaction (live chat, comment functions, or social media channels)
- Personal customer communication
4 Examples of Creative Customer Experience Management
CXM aims to integrate as many points of contact and perception as possible of the customer. All customer-oriented processes and interactions should generate positive and seamless customer experiences. Some companies have already developed clever and effective methods to make the customer experience special and to meet or even exceed the needs of the customers.
IKEA: Self-Service Checkouts
To shorten the waiting time at checkout, the furniture giant has been offering self-service cash registers for some time. In order to prevent chaos and, in the worst case, even longer queues, employees on-site support this process and give customers a hand. The service staff are friendly and competent and help to make shopping even more pleasant. Why is that so special? Most self-service checkouts are only equipped with alarm systems that are activated as soon as the customer makes a mistake or there is a problem. IKEA has recognized that this is an additional stress factor for buyers and is now making the customer experience much more positive thanks to the small additional effort for customers.
Dunkin’ Donuts: Store Locator
Dunkin’ Donuts has also recognized the needs and wishes of its customers and consequently optimized its own processes and service. The typical customer does not want to enjoy his donut comfortably with a cup of cappuccino. Rather, most customers are “on the run” and visit a Dunkin’ Donuts store, for example on their way to work, to quickly get a small breakfast and a coffee. Equipment, modern interiors, or free Wi-Fi are not important for customers. Little time and little appetite for a small snack—what customers really want is information about where the nearest store can be found so that they can get their donut as quickly as possible. Dunkin’ Donuts recognized this need and developed an app that actually only has this one goal: to tell the customer the nearest branch. Small extras such as information on opening times or mobile coupons naturally also contribute to customer satisfaction.
Media Markt: Delivery Information
We’ve all been there – you order a product and the delivery should be coming today. You spend the whole day at home so you don’t miss it. If you are unlucky, the delivery won’t even be carried out for unforeseeable reasons and you have waited all day in vain.
Media Markt recognized the customer’s wish to receive up-to-date information on the status of the delivery and acted. Customers who have made a larger delivery at the electronics retailer receive detailed information on the status of the shipment. A call a few days before delivery informs you of the current status and transmits the delivery day and time. In addition, the service provider reports 30 to 60 minutes in advance so that customers can prepare for the delivery. In addition, he receives a link for shipment tracking, which enables him to track the exact location of the van and to see the number of customers in front of him. In this way, customers can plan accordingly and assess whether they still have time to pop out for smaller errands—and don’t pointlessly waste their day.
McDonald’s: Order via Touch Screens
The American fast-food chain McDonald’s recognized some time ago that there is still great potential for improvement in the ordering process in the local branch. That is why there are now more and more branches offering touchscreen displays, allowing customers to place their orders. These accelerate the ordering process, relieve the staff, and at the same time allow customers to easily personalize the menu, for example by being able to put together burgers themselves. This also minimizes the frequency with which errors occur with complex orders since customers enter them directly into the system themselves. In this way, the customer experience is enriched with digital methods and increased customer satisfaction.
Customer Experience Management as a Competitive Advantage
For a successful CXM, companies need a 360-degree view of the customer experience. You need data on customer satisfaction in real-time and should always think about their wishes and needs. In order to improve the customer experience, it is important to understand every customer in detail and to build an emotional bond with them. Companies that manage to offer an outstanding customer experience will be able to demonstrate long-term competitive advantages in the future – because only resolute customer orientation makes it possible to bind customers to a brand through positive experiences.
Managing Customer Experiences with zenloop
