September 25, 2012
By Paul Greenberg, founder and managing principal, The 56 Group

Customer Experience Finally…and Once Again

It's fascinating to me that starting a little over a year ago, the concept of how to think about customer experience finally began to rear its lovely head.

Which is great. Actually, it's utterly fantastic.

What isn't so great or fantastic is that it's being seen as a "departure" from CRM, something new and maybe even superseding CRM. We're hearing about customer experience management as a new way of approaching customers, following closely on the heels of the maturation of social CRM as the new format in the evolution of CRM.

Let me pop a bubble or two, while at the same time emphatically cheering and advocating for customer experience as a core strategy for contemporary businesses.

POP. POP.

Customer experience as a core approach is nothing new at all. When CRM—even traditional CRM—has been done right, a great customer experience has always been the desired outcome businesses were focused on.

The very first words I ever said about CRM's definition, published in the first edition of my book, CRM at the Speed of Light, in 2001, were: "So, you ask, what is CRM…CRM is a complete system that (1) provides a means and method to enhance the experience of the individual customers so that they will remain customers for life…."

Yes, customer experience was at least the theoretical centerpiece of CRM as far back as 11 years ago. Trust me; it has been the centerpiece longer than that.

So when you hear it's new, it's not.

But customer experience has emerged as part of the strategic core of customer-facing activity. It is being seen in a different light than in the past. While it has existed as a theoretical centerpiece of CRM for a long time, CRM had been somewhat bastardized to become a transactional- and operations-focused technology effort instead of what my definition rather simply tried to make it. It became a measurable, efficiency-based at the least and effectiveness-focused at the best system designed to improve the processes and automate the operational aspects of sales, marketing, and customer service. It was, for example, for a long time, a technology used by management to track information about employees' activities in customer-facing departments—thus the functions like pipeline management, campaign management, and case management. But it also operated as a system of record when it came to customers. In fact, the holy grail of historic CRM was a 360-degree view of the customer, made available to those employees who needed to access it. Even now, only 38 percent of Fortune 1000 companies feel that they've achieved this, according to Bill Band, head of Forrester Research's CRM practice.

But today's rise of the social customer is changing this, because these customers have an empowered outlook. Keep in mind one important facet of the social customers' lives: They are communicating not only in channels that you don't own, but in channels that they feel that they do own, even though technically they don't. They are communicating with peers, not you, unless you and your business come to them. They are talking about things in an unstructured, conversational way that impacts you directly and indirectly. They are aware that those they communicate with, those "like them," will listen to them more often than not when it comes to their opinion about something relevant—which could be your brand or area of focus.

There is one other facet that drives their feeling of empowerment—and I don't use the word feeling lightly here. It's that, now more than ever, they have extensive choices of brands that are like yours—and the cost of these brands to them is pretty much the same, whether the company they're dealing with is giant or small. So they think about what else a company can provide beyond the products and services that are available widely via old-fashioned brick and mortar and also e-commerce. Plus they have access to tools that make their decisions and actions easy. For example, how hard do you find it to shop on Amazon? I rest my case.

So, given that, what they are looking for is consumable experiences and information to help them shape how—or if—they want to interact with you. The consumable experiences, along with the products and services—not one or the other—help to differentiate you from the pack and draw them to you as a business. Think of the experience of shopping at Mattel's American Girl stores, which might cost Mommy and Daddy $400 above the price of the doll when you go there, but that they wouldn't give up for the world. It is a half-billion dollar business for Mattel, and not because of the doll, but because of the consumable experience.

If social customers want to interact with you, they need access to information to decide how they want to interact. Do they want to engage casually, buying something once in a while in an easy fashion, or intensely, say, at the level of an Apple fanboy?

Here's an example. I buy refrigerator water filters from an online company called Fridgefilters.com. As the result of a notification I set up when I bought the ones I needed originally, I get an email every six months with a link that tells me that I need to buy new ones. I click on the link, go to the page, do a little more clicking, am notified when the filters are shipped, and they arrive. The end. That's all I want from them, and they deliver it perfectly. I will never leave them, unless they screw up royally, which is unlikely. All in all, a casual interaction and perfect customer experience.

For that casual interaction, Fridgefilters.com had to:

1. Develop a strategy on how it would interact with its customers.

2. Develop a plan/program based on that with the constraints on what it could and couldn't provide.

3. Implement the technology that allows me to look at its catalog; identify the right product via a knowledge base; enter the data I need to enter to buy the product; save that data; order the product; send a note to its shipping department that I did order the product so the order would be fulfilled; provide a notification engine that is customizable by me as an individual to some extent; generate an email with a link to the exact product and my account log-in; rinse and repeat.

4. Scale as its business grew and still maintain or improve the individual's experience.

The net result is a customer experience that makes me feel that I'm getting what I want, which is of course what I need to keep coming back.

I have a mantra: "You don't have to have luxury; you just have to feel luxurious." This is a contemporary customer's power: the ability to choose a company not just because it offers the products and services customers need—because those are available from many places—but because it makes them feel great about their experience. Provide me with what I need/want to feel good about how I interact with you and we're golden, and it means gold to the company doing that.

Paul Greenberg (@greenbe on Twitter) is president of consultancy The 56 Group (the56group.typepad.com) and cofounder of training company BPT Partners. He is also the conference chair of CRM Evolution (www.destinationcrm.com/conference). The fourth edition of his book, CRM at the Speed of Light, is available in bookstores and online.