17 Nov Why Customer Experience (CX) Matters More Than Ever Before

Want to know what an exceptional customer experience looks like? Look no further than Cappadocia. If you’ve never heard of Cappadocia, you’re not alone. It’s not listed on the travel deals sites. You can’t find a direct flight there from major world airports. You definitely won’t get an email announcing a last-minute deal for a quick trip to this ancient Turkish city.

But if you’re a hot air balloon enthusiast, or if you’re a, shall we say, IN THE KNOW traveler who thrives on getting off the beaten path, then you might be willing to make the somewhat arduous journey — flying into Istanbul and then taking an overnight bus ride on unlit roads that stretch between villages — because you have a clear understanding of what awaits you on the other side. You’re willing to brave the slightly dubious travel experience in order to see firsthand the magnificence of the honeycombed hills, the vineyards, and the incredible boulders that make up this unique landscape, all best experienced from a hot air balloon.

Those who have been to Cappadocia call the experience sublime.

Willing to Give More to Get More Because Above All, What Matters is the Quality of the Experience

The point here, is that the total experience matters — in business, as well as in our recreational lives.

We all want to have amazing experiences. We build our bucket lists based on what we think will give us the best, most exciting, most memorable experiences. The travelers who make the trek to Cappadocia do so because of the incredible payoff they expect to enjoy at the end of the journey. The sublime experience.

Here’s the thing: Regardless of what you sell or offer, your customers are also looking for that sublime experience when they do business with your company. Heck, all of us prefer great experiences over so-so experiences, don’t we? When did you last wake up and hope for a mediocre day? When did you last see “call cable company” on your to-do list and think, “Oooh, I hope I get a rep who reads from a script and can’t really fix my problem!”

Nope. It just doesn’t happen. We want hot air balloon heaven, and we’re willing to ride over bumpy, unpaved roads all night to get there. We want amazing customer experiences, and we’re willing to pay a little more, to share information with our friends and family, to promote a company we love and believe in.

Smart businesses are tapping into an enormous shift I’ll explain in a moment — and I’ll show you how your business can take advantage of this important change.

There’s a Major Shift Taking Place

In the last decade, we have seen more transformations in the way we do business than at any other time in recorded history. The shift to digital, the move to globalization — these are mere components of the revolution. There are changes coming that will make the future look as unfamiliar to us as a rotary phone does to our grandchildren.

The business world of the future is radically different from almost anything we can imagine today, and that’s thanks in large part to the rise of an emergent group of tremendous importance: the empowered customer.

The Power of Social Media? User Experience (UX)? Small Potatoes! Here’s the Real News

We marketers have our favorite topics. We love to sit around debating social media, e-commerce, CRO, UX/UI, Big Data. But these topics are only contributing factors in the rise of the empowered consumer and the revolution those consumers will bring to the business world.

Consider this shift a peaceful transfer of power from retailers to consumers. Where the consumer was once informed, he is now truly empowered. Consumers can tweet a single negative message and if that one message catches fire, it can easily obliterate a brand that’s spent years building up its image. The smartest businesses out there know this, which is why the customer now has the power to dictate change at the highest levels of the company. And the consequences for businesses who fail to grasp this fundamental shifting of the tectonic plates of the marketplace may face extinction sooner than they think.

Let’s take a closer look at just how this transfer of power happens, and why you absolutely must adapt your approach to marketing — or risk a seller journey that leads ever-downwards and out.

We’re All Empowered Consumers

Modern consumers have a world of resources at their fingertips. With all the new tools of the Internet at their disposal, consumers don’t just sit back passively anymore waiting for marketers to push out select information to them and force transactions on them.

In fact, as a descriptor for what’s happening when people buy things, “transactions” hardly fits the bill these days.

Now, consumers are choosing which information they want to pull towards them. Rather than passively sitting back and accepting what’s sent their way, consumers are taking an active role — assuming control of their own buying journey.

We Call This the Customer Journey

As organizations navigate and participate in the multitude of interactive tools available to them — social media, review sites, and more, customers embark upon a self-guided tour of the marketplace, a journey. To understand this journey, you must first understand where that customer is going and the touchpoints they’re landing on at every stage.

1. Internet Research & Mobile

For example, consumers now research their purchases more often and more extensively than before. In fact, 81% of consumers research products online before making big purchases. Which makes total sense, when you consider the resources available.

And that research doesn’t stop once consumers enter a store. In fact, it happens on the fly, too. If you’re careful, you can win every micro moment with a better mobile strategy because 82 percent of smartphone owners research a product they’re about to buy, right there in the store.

Modern buyers actively devour reams more information than consumers did ten years ago, and sales needs to evolve to keep up. The top three preferred content channels for people researching a product are:

1. search engines
2. official brand websites
3. newsletters/emails

Your sales team likely knows this. Recent surveys show that 57% of people who work in sales see that power has shifted to buyers.

Sales agrees: power now lies in the hands of the consumer. Courtesy HubSpot

2. Social Media

Thanks to social media, consumers are also subject to far more passive branding impressions than ever before. In other words, even when Bob the Buyer isn’t considering a purchase, he’s absorbing brand awareness. Marketers involved in PPC ad campaigns already know this: clicks are more likely to happen when consumers already know about a brand.

3. Customer-Driven Content on Review Sites

Customer-driven content has forced marketers into a two-way conversation. Review sites and social media have made sure of that, and the consumer voice in that conversation is louder than ever. You can either ignore the consumer’s voice — and face an uphill battle to market your products effectively — or you can embrace the way consumers are talking with and listening to each other, and join in that conversation. Can you guess which approach I recommend? Hint: It’s the approach successful companies are using.

Whether they’re researching a product or they’re on the verge of buying, about half of consumers rely heavily on product ratings or reviews. Peer experiences also play heavily into the decision-making process, and represent the third-most popular form of content consumers look for during their buyer journey.

All This Adds Up to the “Experience” of Buying for a Customer

Consumers don’t make purchases in a bubble. They interact with others and learn about products, brands, and experiences. They have conversations with retailers and other consumers. They ask questions, get answers, and evaluate those answers carefully. They research. Seeing that journey from top to bottom (or left to right, as it’s presented on a customer journey map), is critical if you’re going to deliver a sublime Cappadocia-level customer experience.

If you’re not yet buying into the concept of “the customer experience” or “customer journey to purchase” you’ll soon be left with precious few buyers who engage with your brand, let alone buy your product.

Customers have expectations today. An awesome product isn’t enough to make up for a less-than-stellar shopping experience. Target might have slightly higher prices than Wal-Mart, but I’m willing to pay a little extra and know that I’ll get a cart with wheels that roll in the right direction. You can probably think of a similar personal example. And that’s why the customer experience — CX — matters so much.

But the Journey Doesn’t Stop There

If you want your business to be a regular stop on your customers’ journeys, you need to think long and hard about the entire path those customers follow. From the beginning to the end — and the end is not the purchase. Far from it. In fact, the customer experience encompasses the buyer’s impressions of the product, the service, and the company long after the purchase has been made.

Loyalty programs are key, as are the cultivating of brand loyalty in other ways, such as post-purchase customer service, carefully constructed and targeted future offers, and other ways new impressions of the brand get formed after the purchase has been made.

All these factors tie into future decision-making processes and are as important to marketers as are factors from the pre-purchase journey.

That’s Why the Old Sales Funnel Doesn’t Work Any Longer

One thing hasn’t changed, though: marketers must still try and reach consumers at the right time, during critical decision-making moments leading up to the purchase. Called “touchpoints,” these moments were once thought to occur mostly during the short time leading up to a purchase, and in-store.

Just to recap, since I’ve covered this in a previous post, in the past, marketers represented the consumer process as one of “filtering.” They imagined that prospective buyers started out with a large number of options (brands), narrowed them down to just a few contenders, and then made a decision close to the time they entered the store, if not in the store — when they were likely to be influenced by salespeople. The old sales funnel was created by looking at the buying process from this sales-oriented view.

But of course the customer journey doesn’t stop there, so the funnel mechanism no longer works. When we talk about marketing, we must think not of the old sales funnel but rather the modern marketing funnel that truly represents what happens during the entirety of the customer experience.

With the modern marketing funnel, the customer journey extends beyond the center of a bow-tie shape, where the purchase is made. Now I want to focus on what happens in the right half of the bowtie funnel: the rest of the customer journey, the full experience of the customer.

Understanding The Entire Customer Experience

The real customer journey is circular, not linear. Research into the customer decision journey from McKinsey & Company shows a circular buying process carried out by extremely empowered consumers that looks something like this:

1. Ongoing exposure
2. A buying trigger
3. The initial consideration phase (might start with a very narrow list)
4. The purchase
5. Back to the ongoing exposure

See how we start and end with ongoing exposure? That’s key, because it’s demonstrating in plain English that the process here is circular. The “ongoing exposure” in step one may include impressions of a brand that were formed during a previous purchase experience.

Here’s how that works, and what it means for marketers:

Consumers are Pre-Initiated to Brands During the Ongoing Exposure Phase

Accumulated impressions lie dormant in consumer consciousness until they become activated when something triggers the impulse to buy. Those impressions — from social media, conversations on and offline, and so on — affect the initial round of options the consumer considers when preparing to purchase. We call this the initial consideration set.

If your marketing efforts have paid off, your brand will be included in that set.

The Customer Journey is One Large Interconnected Feedback Loop

Consumers build expectations based on the experience of their first purchase. Those expectations come into play once they enter the loop again, which is immediately. Yes, immediately, because even if a consumer isn’t actively looking to make a purchase, he’s undergoing ongoing exposure to brands.

Hence, consumers loop back around immediately after purchase, jumping back into the schema at step one, until a new buying trigger pops up. In fact, under this schema, even when we’re not aware of it, we’re in that loop somewhere, and we can usually be found treading water in the ongoing exposure phase, absorbing marketing messages as we go about our daily lives.

In other words, the post-purchase buying experience factors in heavily for all future purchases. The post-purchase experience is just as important as any other part of the customer journey.

It’s critical for marketers and businesses to remember that consumers aren’t “yours” just because they chose your product the first time around. Even when they’re not in buying mode, those customers are still susceptible to impressions of other brands. You have to earn their loyalty. That’s not an easy task.

Capturing Loyalty in the Post-Purchase Phase

Consumers can be swayed – everyone knows that. Sure, they chose you once, but chances are they’re open to considering other brands for future purchases. That’s what the McKinsey report cited above calls passive loyalty.

After a sale, your brand will be included in your customer’s consideration pool next time around, but you probably haven’t turned your buyer into a brand ambassador yet after a single purchase.

And, actually, you can’t take it for granted that you’ve secured a spot in the consideration pool after that initial purchase. Other brands can insert themselves at any point and divert attention away from your brand — even if the customer has chosen your product in the past.

If you miss the boat on hitting the post-purchase marketing touch points, this can happen. Never be satisfied with passive loyalty.

Active loyalty, which I discussed in the Bow Tie Funnel post, is what you’re after. It’s this type of loyalty that elicits sharing, promoting, and positively reviewing your product or service across the multitude of channels consumers can now access. When you have actively loyal customers, their initial consideration phase during the customer journey includes just your brand or a very small handful of brands that includes yours.

The Active Evaluation Phase: What Mad Men Were After

Once the consumer’s purchase desire has been triggered and they have an initial consideration set, he begins actively evaluating the products/brands in that set. We call this active evaluation. 

We all know what happens during active evaluation. This is the what those great ad men focused upon in the golden age of advertising exemplified in the TV show Mad Men. If you’re Don Draper, you focus your advertising dollars on this segment of the Customer Journey. Don would have assumed that his goal was capturing consumers during active evaluation. He’d be narrowing the field (remember the old sales funnel), and a few well-placed TV commercials or magazine ads would cinch the deal.

But in reality, during today’s customer journey, the number of brands under consideration during this phase may actually increase! Again, this obliterates the visual image of the old sales funnel — unless you can picture a major bulge in the funnel.

The idea is that, once a purchasing trigger is activated, consumers might begin noticing marketing they’d never noticed before. That’s when they can become aware of new brands, and the consideration set grows.

Active Evaluation is Largely Based on Consumer-Driven Content

That same McKinsey & Company report cites their own research finding that during the active evaluation phase, consumer-driven content drives the boat. That is: two-thirds of the information gathered by consumers during active evaluation is:

• reviews
• word of mouth
• interactions in the store
• previous purchase experience

Believe It or Not, CX Isn’t Totally New

Nowhere is it easier to see a strong vision of CX principles in action than with the life’s work of Steve Jobs. As far back as 1985, he spoke about caring for the customer, StoryVesting, and ongoing exposure to brands, three basic CX principles.

1. StoryVesting

Shortly after Jobs left Apple, while forming his new company, NeXT, he laid out his vision for the company — a vision that looks a lot like StoryVesting. At a retreat with his small group of startup partners, he told them:

“For NeXT , we want people to know we really care about them. One of my largest wishes is that we build NeXT from the heart and people who are coming to work for us or going to buy our products, that we’re doing this because we have a passion about it.”  – Steve Jobs, on Forming NeXT

Skip ahead to 4:00 to see Steve Jobs talk about StoryVesting for NeXT.

2. Focusing on the Customer

In 1990, Steve Jobs was at it again, focusing on the customer experience. He asked what was driving people at that time to upgrade from PC/Mac to a professional work station. He studied customer behavior and found that people were connecting to mainframe computers to use database-driven apps and predicted that they would love to download those apps onto more powerful computers. So that’s what his company made, targeting very specifically that segment of the population.

Jobs also saw that people would want productivity apps and other custom apps for those machines. Looking even beyond that, he predicted the next stage of personal computing would involve companies’ desire to include more types of personnel in company usage of computer work stations. These would be employees from administration, for example. Then, they would want to be networked. Consequently, he focused on WYSIWYG apps, especially WordPerfect.

3. Ongoing Exposure

Jobs was also right in line with what we’re learning today about CX. He understood about providing ongoing exposure to his brand, even when consumers weren’t in an active buying phase. His “computer camps” brought developers from all over the country to learn his software. By educating them on his products, he knew they’d make favorable comparisons when they eventually received purchasing triggers.

“The best marketing is education.” – A Favorite Steve Jobs quote from Regis McKenna

Jobs also produced video demos for his salespeople to use, demonstrating the productivity apps with their ease-of-use features that would produce much better results than similar products offered by his competitors.

What Steve Jobs believed then, and what I believe today, is that once people move into position to buy, they already have a favorable view of the product from education, demos, software camp, or whatever else a marketing department comes up with to increase exposure before buying triggers even kick in.

Takeaway for Marketers: New Realities

You might have noticed, if you’ve been here before, that I love expounding on modern marketing matters. But you’ll also know that I never rest on theory — and I never leave you hanging. Here, then, are some practical takeaways for marketers who want to heighten the focus on customer experience at their own companies.

Align Marketing With the Right Touch Points Along the Full Customer Journey

Thirty years after Steve Jobs talked about supplying consumers with ongoing exposure to his brand through education and word of mouth, understanding what the customer really wanted, and building a company that had vision and operated from the heart, we’re finally catching on.

So, what should marketers do to ensure they’re playing the right techniques at the right moments during the customer journey? What can they do to improve the customer experience?

1. Continue improving UX.

In my love for CX and my propensity to speak about it, I may have given the impression that the user experience (UX) no longer matters. Of course, I reserve much room in my heart for UX because it’s still very much relevant. Without UX, CX just wouldn’t be that great. UX, together with user interface (UI) is a subset of CX. UX arose from the desire to make the customer’s purchasing experience as pleasant and meaningful as possible, in order to enhance a brand’s status in the eye of the consumer.

Beyond governing how well mobile and website presences function and whether they offer a smooth experience for users, UX can entail actually making life easier for consumers. One example of this is by using Push Notifications (for mobile) with very specific and targeted sequences. They can be event-driven:

• it’s raining
• Superbowl game
• tax season
• hurricane season in Florida

In the weather app in the image below, notice the useful functionality. The initial screen tells basic weather stats, those most likely to be needed on the fly and quickly. The user can then dig deeper, accessing a 24-hour forecast on the second screen, complete with visual graphing of the temperature. On the last screen, the user finds more visuals, of the temperature range this time.

Using various visual ways to represent vital information is a fantastic example of great UX. Here’s what that looks like:

You could also connect your product to an event. Let’s say you sell glasses in a retail store. Using geofencing and beacon technology, you could send push notifications to consumers, who would receive a prompt that allows them to shop for glasses that come with a 2-year warranty and a free eye exam. As far as the consumer is concerned, that’s life made easier.

Indeed, the stats support this: push notification click-through rates can be as high as 40% in some industries.

Another example: animated notification gifs within mobile apps that drive awareness. These don’t take up tons of memory and they’re not hard to create — but they do have high levels of engagement.

UX is so important, in fact, that both Apple and Android have released important guidelines for developers, outlining exactly how these actions should work; make sure your app development team knows about them.

2. Learn about the touchpoints and the micro-moments in the customer journey for your business, then see how they blend across offline and online channels.

Do your customers buy from you after seeing a flier in-store, then visiting a landing page from that flier, then viewing a retargeting ad in social media, prompting them to action? Or does email come into play somewhere? How about organic search?

These are just some of the touchpoints businesses can use to reach consumers along the buyer journey. Combine the powerful forces of mobile and social, and we have more touchpoints than ever. Many of them are now instantaneous, offering immediate contact when the buyer wants it, needs it, or asks for it. In other words, you can now be there in the moment, which is often when consumers are making important decisions.

Google studied data from 42,000 e-commerce websites which had Google Analytics enabled, and came up with a fascinating customer journey interactive tool, showing how the various channels work along the customer journey for different industries. The purpose was to shed insight on what inspires people to purchase online, and when. Channels such as social, email, display click, organic search, paid search, and direct purchase were considered across all types of industries.

Some channels, it was observed, more often play an early and “assisting” factor along with buyer journey, whereas others are more often the last point of contact before the sale.

Different channels work in different ways according to industry, but in general, it appeared that social was almost always an early and assisting touchpoint along the customer journey.

No matter what you end up doing after using the fun tool Google created, or how much you learn about touchpoints for your business, keep perspective: focusing only on the messaging touchpoints within a channel is like working with blinders on. If you have a holistic CX-driven approach as I’ve discussed in this post, all your touchpoints should interface with one another across offline and online channels.

3. Focus on managing customer-driven content.

One recommendation for marketers is to visualize content creation differently. Focus on ways to develop the types of platforms where consumer-driven marketing takes place: reviews and consumer-uploaded personal stories/photos are good examples. That can take place on social media, but the focus should shift away from purchasing media ads to cultivating real content, feedback, education, and service.

For another example, use dynamic tools on your website to provide consumers with assets they can use to make their own purchasing decisions. As we now know, consumers are no longer waiting around for marketers to force-feed them information. They’re pursuing it themselves.

4. Find your weak touchpoints and bottlenecks along the customer journey.

Every company needs to develop specific touchpoints. Some may need to increase brand awareness. Others might have a faltering loyalty program. Many need to shore up their information-giving properties (think: company blog, social media feeds).

If need be, tailor your messaging to address certain weak points along the customer journey.

5. Don’t forget about in-store visuals.

The complex, circular customer journey means that now, more than before, consumers make their purchasing decisions in-store. Therefore, factors like in-store displays and packaging become more important.

6. Connect your segregated marketing modules.

Analysis from the McKinsey & Company study supported the notion that marketers must align ALL parts of marketing with the customer journey. That means companies who separate digital from loyalty programs and from sales must find a way to combine those disparate departments under one marketing chief for an integrated approach.

7. Solidify your company vision to create a unique customer experience.

Because customers seek an enriched experience when they shop, and because they now hold the power, company vision is increasingly crucial to survival and growth. If your company offers shared values, and consumers see a way to enrich their lives through your brand, rather than just a place to buy merchandise, you’re winning. Running the show from the heart is how you begin, and Steve Jobs had that down pat, too:

“More important than building a product, we are in the process of architecting a company that will hopefully be much more incredible than the sum of its parts. One of things that made Apple great was that in the early days, we built that company from the heart and that people knew that.” – Steve Jobs, 1985

8. Make the whole company focused on CX by encouraging StoryVesting

Find a way to integrate your various marketing elements into every part of the organization so that everyone in the company can take an active role in marketing, guided by a healthy company vision that puts the customer journey first.

Whether it’s by providing better customer service, staying late to make sure a freelancer gets her check, or whatever else it takes — employees who believe in the company vision and who become vested in that message will help the company in so many ways. I call this StoryVesting, and it’s part of my overall strategy for growth. For more on growth, my new book The Growth Code offers deeper insight on how companies can work to drive growth at all levels.

9. Give the Consumer an Official Voice in Your Company

Designate a position in your company whose responsibilities include being the voice of the consumer. As Steve Jobs put it in 1985, “there needs to be someone who is the  keeper or re-iterator of the vision”

Conclusion

The rise of the empowered customer and subsequent scrambling of marketers to accommodate that shift in power has brought the customer experience to the forefront of the discussion. Companies who can align marketing efforts with a strong, unique company vision (or story, if you prefer) and educate consumers about their brand at the right moments along the customer journey will fare better in the new era.

What companies are finding, however, is that in order to bring these notions alive and act upon them, they’re looking at massive restructuring within their organizations. The challenge of moving from a traditional channel and tactic-chasing organization to an innovative and modern CX data-driven organization is no easy task, and many have sought help from companies like mine to help them envision, structure, and implement the process.

In the next post, I just may tackle how this is taking place in many modern organizations, and what you can do to begin the process at your company.