Customer Experience Management

In my last post I discussed the need for an overarching customer strategy. In order to even think about an email campaign, companies must have a defined approach to how they plan to extedn the customer experience in order to get, keep and grow customers.

Communication from the brand is very much a part of the customer experience. It needs to be an extension driven by following the details of the customer strategy. Companies need to know what they’re trying to do, why they’re trying to do it, and how it translates into tactics.

After defining that customer strategy, I think companies need to drastically improve their understanding of the customer lifecycle. All customers are not the same. If you’re a fashion retailer you have the high-end occasional shopper who is distinctly different from the working mom who refreshed her wardrobe every spring and fall. If you’re a casual dining chain you have the happy hour customer who eats, shoots, and leaves by six. This customer is light years away from the Saturday night date customer that comes early for drinks, drops a lot of money on a complete dinner with wine, and then finishes up with a cocktail. An email campaign can influence each different customer group, extending their existing behavior. But the question a company needs to ask is this: Where are you taking them and what are the steps along the way?

This should tie to the overall strategy and move customers from their current behavior to a point where they can be termed a “Best Customer.” Best customer is not defined by open rate and click rate. Best customer is defined by behavior. Email campaigns have to guide customers on that road. And its not the kind of journey marked by “are we there yet?” kind of nagging. Customers don’t buy everything. But they can be influenced on their journey toward fulfilling their potential of buying what they are most likely to want and need.

Example: Let’s go back to that couple at the casual dining chain for a weekend date. If that chain has a database with that customer’s behavior with the ability to analyze what it looks like over time, and if it has data on enough “look alike” customers, it can determine what that customer can be encouraged to most likely do next. Maybe the customer can be encouraged to bring friends next time. Or maybe an email campaign can simply extend a thank you to encourage repeat visits. “We want to be your date spot every time.” But it will alienate that customer if the wrong destination or next action is communicated. Having an off-target offer occasionally is not enough to drive them away, yet doing it regularly will. For example, An email campaign offering discounts is not necessary, because they’re spending money. An offer that encourages you to “bring the family” is probably irrelevant if this customer is dating.

Companies have to know. Guessing is not an acceptable approach for email campaigns. Your marketing department that is responsible for the customer email communications should Ask what that customer can should do next, and should be asked to get them there. The email is not the end goal. It should be a provocative, targeted catalyst to drive your customers to remain engaged and act again.

Talk about a dichotomy. On one side of the customer strategy we espouse at Customer Portfolios, we want clients to get as close as possible to the nirvana of true one-to-one marketing. Your marketing campaign’s message, timing and relevance should be as customized as possible for each customer. But on the other side of that coin, we’re in a business climate in which social networks have conditioned those customers to spread the word, even if that word was specifically designed for them. We start with one-to-one and the customers make it one to many. Even if it’s a simple email.

It’s an element of uncontrolled marketing, but it also provides an opportunity. I call it the “brand amplification effect.” There is a way to plan for it. Look at your company in search results, social networks, and product review sites and you will see the chatter and link sharing that amplifies your original branding and marketing campaign. A few companies have developed specific solutions to try to add some planning and order to the situation. ExactTarget, in collaboration with ShareThis, provides a new way to engage with email subscribers. It enables subscribers to instantly share emails to their entire network of contacts with the click of a button. By using tools like this companies can understand the impact of social networking in the context of your overall marketing efforts. You can also quantify the results of your social marketing efforts and get actionable data to drive future marketing efforts. It also connects social media sharing activity and profile information with the email data mart to execute programs based on a holistic subscriber profile. 

We have our own take on the amplification effect. Customer Portfolios has partnered with hearforward to facilitate rapid integration of social media. If you haven’t heard of hearforward you will. It’s a pure-play social media firm focused on integrated analytics and is designed specifically to provide greater context for email marketing efforts and drive improvements in retention and engagement. It allows you to understand where the email and its message has been amplified through real-time data from thousands of sources including Twitter, Facebook, blogs, forums, news and video sites. It can reduce attrition by leveraging next-generation lights-out marketing programs and at the bottom line it measures, tests, and improves the viral distance of email communications.

I think many companies want to attack social media first. But that beast is hard to manage. All companies can do is plant the seeds for good social networking feedback by having an excellent customer experience and relevant communications. Email is easier to attack. What we need to measure is its effect. That effect is much louder than it used to be. The sound of one-to-one is now the sound of one-to-many. Companies need to listen.

I’ve noticed in a lot of our client talks lately that something is missing from the way companies communicate with their customers. That something is a customer strategy. An overarching customer strategy is necessary before a company can even consider sending email number one.

Here’s what I mean. Suppose a restaurant believes its overall strategy is to attract high-income families with a wide menu and excellent service. That restaurant would never allow a waiter to serve with dirty hands and a bad attitude. Yet, it may allow an email to go to customers with absolutely no knowledge of who the customer is and what that customer’s experience has been. Communication from the brand is very much a part of the customer experience. It needs to be an extension driven by following the details of the customer strategy. Companies need to know what they’re trying to do, why they’re trying to do it and how it translates into tactics.

Here’s three things to consider when crafting a customer strategy for email and other direct customer communications:

1. Acquire customers with an explicit value exchange and promise. For different customers you have to extend different offers without violating the overall strategy. So if part of your strategy is to attract high-income families, make sure your offers are relevant. Discounts may not matter. But something as simple as a family night that offers special desserts for the kids just might make all the difference between a good customer and a highly valuable customer. It depends on the value being promised.
2. Engage by following thru with promise. Customer service and experience should be part of any overall strategy but it often gets left behind when it comes to email. When the restaurant promises great service, and then attracts customers to experience it, it can’t just email them with an offer to come again. Send them and an email asking for them to rate that customer service.
3. Learn from your interactions. Email is among the most measureable marketing tools in the kit. But companies don’t use it. One of the best measures of business success is when customers show repeat behavior, but that doesn’t apply to email. Just because a customer opens an email tomorrow doesn’t mean next week’s email means anything. A company has to learn what the customer wants and know what will get them to take the next step. Think beyond opening the email.

These three suggested steps are not a guarantee. Rather, they are actions to take your customer centric CRM program – or what ever name you may use – forward. Thinking about the customer and their relationship with the brand that includes email, is going to work for you. That’s a guarantee. 

Marketing is like exercise. It needs to be consistent, long-term, and should produce results. For exercise we all have different results in mind, but marketing should be focused on one thing: producing a better customer experience. Results like increased sales, significant revenue and ROI are essential, but take this thinking little further and look at it from the other side. Look at it  from the perspective of a consistent customer experience that is made up of consistent interactions with a brand and the brand’s marketing. For the customer, this is good. Very good. If it is good for the customer, then typically it is good for the brand.

A brand that has on-again, off-again, disjointed and sporadic marketing efforts will miss out on the virtues of consistency and the benefits that come along for the ride. This will create a broken customer experience. For the customer, this is not good. This in turn impacts the brand.

I find that it is often helpful to look at customer experience from a different lens that puts a theory or thought into a real world scenario. In this case, take a brand’s marketing approach and place it into the context of your personal wellness régime. Your regime will have poor results if you approach it with a series of inconsistent, non-related one-offs. For example, if you skip going to the gym this week, have a shake with lunch, get fries in place of a salad, drink beer rather than going running, you will find that your fitness goes down while your weight goes up, producing negative wellness. The same is with marketing and how it is interpreted by the customer. If it is sporadic and not tied together it ends up producing a broken customer experience that is not effective in achieving the end goal of high customer engagement and a satisfying customer experience.

This is a simple idea, yet often tough to deliver on. The first step is to put down that French fry, get off the couch and get your customer experience groove on.
 

Some of us are marketers, but all of us are customers. As customers we have all had a broken customer experience, but as marketers its our job to make sure they don’t happen. But they do despite our best efforts.

For the more unfortunate and maybe even loyal customers in the crowd, it was as recent as today’s coffee, lunch, or online purchase. Regardless of how it happens, we see it all the time. A brand made a promise, got our attention and then when we acted on it. But it fell short. This could have been for a new brand, like an airline that we have never traveled with before. Or it could have been at the supermarket we have been shopping for years. But why did it happen? How can a brand that wants my business and yours drop the ball so badly and break their promise?

I’ve got some ideas. I feel that a broken customer experience has many reasons, and many sources. Yet the two that are top of my list today are as follows. The first is that the brand is more focused on customer acquisition rather than anything else. To do this they will dangle a carrot (metaphorically) out in front of me that is so temping that I cannot stop myself from reaching for it. Here’s an example: $100 round trip airline tickets from Boston to Denver. I like to ski. I want to go to Denver. Yet, when I go to buy my ticket, the offer is designed with blackouts, hidden costs, impossible connections and the like. It does not work for me, or anyone else. Broken customer experience.

The second is that the company doesn’t know it is broken. The grocery store knows who I am. I have a loyalty card. They have all my data and they know my behavior, yet they miss the mark on what they offer me. One recent example of this that I received an offer for baby items recently, like diapers. Yes I have kids, yet they were in diapers five years ago. Don’t appease a CPG client at my expense. Another broken customer experience.

In situations like this, the brand needs to think strategically, and then be able to act tactically, while doing both well. As always it seems to come down to data and the lack of it. Be smart, control your data, think about what it means at the human level and fix that broken customer experience. Nothing is more alienating.

The “customer” is often spoken about by marketers in the same manner as politicians say “the American People.” It sounds like a group of people who now share similar characteristics because they happen to be buying from a company, just the same way a politician thinks that everyone in the electorate is buying from the same party platform. They say it because it makes them sound like they intimately understand whom they are speaking about,, yet they could not be further from the mark.

The customer and the customer experience are critcial to business success. When they interact with a brand, or a product the overall experience from research through purchase is the most important part of your company's value. The actual value of a business is made up of the sum total of their customers. The “customer” is not a faceless group. If this is true, and I believe emphatically that it is, then why do we know so little about this valuable asset? And why are we so frequently not concerned about the customer’s experience when they engage with our business?

I tell prospective and current clients that this concept of the “customer” is both a holistic and an individual entity. For example, when a fashion retailer tallies up the first week of spring collections, it’s easy to analyze who came to the store, what they wanted and how they percieved the same thing: New clothes. The larger the group of customers that can be analyized, the better. Put another way, the more people shopping for those clothes, the more complete the customer data picture can look. Perhaps the “customer” can be compared to a school of fish that all swim the same direction and periodically they will all zig or zag simultaneously and then set off together on a new course.

Yet, within that school we have the individuals. I am different from others and from a different school of thought. I am different from others my same age and same sex. I am different from my neighbor. I am even different from my spouse and my kids. For a business to make me happy, engaged and likely to shop again, they will be well off providing me a relevant and consistent customer experience. They have the data; why don’t they use it? If they understand what I like, when I like it, how I like it and what price or offer type is needed to get me off the couch, then they’ve got me, hook, line and sinker.

Customer data can be fed by the aggregate of customers and then it enables a company to serve individuals. It is not guesswork anymore.

At some point next week the monthly retail data reports will come out and it will most likely show a slight year over year rise over 2009. That increase in sales is coming from several things. First, it is coming back from what we now know was a year on the economic precipice. Also, it is being fueled by cost cutting. Example: A Feb. 5 Wall Street Journal article showed that January results – a 3.3 % rise -  were largely due to reduced inventory,  reduced surplus, limited sales and other discount methods. But at some point retailers are going to have to add value to a part of their business much more important than the spring fashion line. That part of the business is the customer. I have seen very little in retail results about the customer, the person who actually goes in and parts up with hard earned cash. Customers = Revenue.

Look at recent news about retail and even though the economy is showing signs of an uptick, I see big discounts, store closings (Sears), and restructuring (Macy’s). But here’s what I mean when I say that a customer focus tends to follow success. Business Week yesterday cited L.L. Bean as the number one customer service company after a 24th place showing last year. How? By “adapting to the way its customers now shop through the design and features of its Web site and its return policies. It also commended the company for keeping its back-office operations in Maine rather than moving them offshore to save money.”

And Amazon.com was tagged as the most trusted brand in the US yesterday by a Millward Brown study. Why? As quoted in Digiday, Heather Stern VP of Marketing, Millward Brown said: "Jeff Bezos’ customer-first philosophy has been consistent from Amazon’s beginnings.  Consumers have had many years to grow to trust and recommend them because Amazon.com has stayed true to dedication to customer service through recommendation tools, easy return policies and competitive pricing.  This is a key takeaway for other ecommerce brands like Netflix whose TrustR score of 106 demonstrates that while it hasn't been around as long as Amazon, it is building a solid foundation of trust to grow from."

These retailers are always striving to make the customer experience in store better and online better. They innovate. They provide more cool and different items, offers, packages and deals. They know who the customer is. They know me. They know you. Yet, too many retailers are on the outside. We have all given them plenty of information through our interactions. Then why don't I as a customer feel like they have used it to make my relationship with them more engaging?

 Perhaps they could tell me when the things I like are on sale. If they don't know what I like, then ask me. Let me come in at a special time for the deal. Or tell me about a new season product and offer before everyone else. They could even set up a "velvet rope" experience at the store to give me the option of letting them know when I come into the store and they can tell me what is cool, new, different or a deal at that moment.

Customer centric marketing should be engaging where the retailer treats me, their customer, as they would a friend. If I have opted-in, signed up, completed a profile, used a card, made multiple purchases and showed myself to be a good friend and a best customer, don't make me reintroduce myself every time we meet! If you do, I'll come back in January and the rest of the year!

Customer experience came up again this week, rearing its inconvenient head via the established source for expertise in this area, which is Forrester analysts Bruce Temkin’s annual index. Internet ISPs got hit hard, and e-commerce companies didn’t come up as well as they could have. Amazon, sure. But digital content and marketing executives need to pay attention here because there are a few issues lying in wait that could easily be solved by simply paying attention to customer experience. At the core of it is communication. The FTC is rattling the saber about third party opt-in for targeting software, but this could be effectively solved by communicating with customers to show them the advantage of targeting. Imagine what the customer experience would be like for one day online if targeting technology didn’t exist. It’s not a technology issue, it’s a customer experience issue. Same thing with various ad formats for mobile, social, and online. Technology can serve up anything. But the customer has to grow with it and understand that the server is acting in his or her best interest.