THE ART AND SCIENCE OF CUSTOMER EXPERIENCE - Lenati

THE ART AND SCIENCE OF CUSTOMER EXPERIENCE

Paul Conder Kris KleinA COLLECTION OF SHORT ARTICLES FROM LENATI’S CX PRACTICE

with contributions from Clay Walton-House, Jake Bryant, Erin McMonigal and Laurie Meek.

PREFACE

There was a time, not that long ago,

when customer experience was simply

the thing that happened at the end of

an industrial production system.

Factories made products that were

purchased by customers through simple

linear networks of distribution.

Services were delivered on a strictly

person-to-person level. And the

difference between products and

services was completely clear.

2 3

Every layer of that system has shifted

in less than a generation. Distribution

has repositioned its center around the

customer rather than the factory.

Channels have fragmented and

recombined into intersecting digital,

physical and hybrid networks. The lines

between products and services have

been blurred.

4 5

Real time visualization of major internet nodes by PeerOne Hosting iPhone app. peer1.com

Controlled demolition of the abandoned Woodwards department store, prior to redevelopment

Vancouver, Canada 2006. Photo by Tannoy

When changes happen this fast, it’s easy

to get a little apprehensive. At a recent

retail convention, the most common

theme for keynote speeches was “Is

Retail Dead?” How much has been

written about the death of the music or

film industries as their products become

digital? Or about the “death of privacy”

as more transactions go online or

disappear from view completely?

6 7

photo (C)2014 Rebecca Robertson.

We tend to be more optimistic about all

this change. When photography was

invented, many in the art world forecasted

the “death of painting.” In the next few

generations we saw Van Gogh, Matisse,

Picasso, Pollock and Rothko. The same

degree of transformation is happening

now in virtually every business, and the

potential for new ideas to spread quickly

across old barriers is greater than ever.

8 9

Since 2005, Lenati has helped transform businesses to make

stronger connections with their customers. We help our clients

find, acquire and retain customers through a focus on customer

experience, marketing, sales and loyalty strategy. We

emphasize deep research, design thinking and rigorous testing

to prove out new ways to benefit both the customer and the

business. We have worked with a wide roster of global brands,

including Starbucks, Microsoft, Adobe, T-Mobile, Capital One,

lululemon, Expedia, Nordstrom and Google.

This is a collection of articles, written separately, about what

we’ve learned through our customer experience practice.

What’s an Experience Worth?

Building a Business Case for CX Design.

Ten Key CX Principles.

Building a Customer-Centric Business.

The Art & Science of Engineering Experiences.

Design Thinking and CX.

The New CX Toolbox.

Six CX Research Toolsets.

Let’s Get Phygital.

Connecting with Customers in an OmniChannel Universe.

B2B.CX

Understanding the Commercial Customer’s Experience.

The CX/Loyalty Connection.

Human-Centered Marketing.

1.

2.

3.

4.

5.

6.

7.

CONTENTS

INTR

OPR

INCI

PLES

PROC

ESS

TOOL

SPH

YGIT

ALB2

BLO

YALT

Y

1110

All competitive businesses are somehow dependent on their customers’ experience to drive their growth and prosperity. Even businesses that are focused on a basic need, for example healthcare or grocery retailing, use experiential drivers in some way to set themselves apart. Some monopolies are known for neglecting customer experience, but once they are forced into competitive environments they tend to smarten up quickly. For example many telecommunications companies have made this shift, some more successfully than others.

Customer experience is defined as the aggregate of a person's perceptions, feelings, memories and associations around their engagement with a brand. At this personal level, treating your customer well just seems like the right thing to do, for altruistic reasons if for nothing else. While there has been much emphasis placed on insights, analytics and data, customer experience is really about making connections with people in the real world - treating them with respect, with consistency, with dignity, with foresight and with style.

From the business’ side, interactions that happen every time a brand makes a connection with a customer add up to affect much more than the individual transaction. It has been shown that loyalty, brand perception, spending, likelihood to recommend and overall satisfaction are all affected by CX. To make the business case there needs to be a clear way to measure the financial impact of improving customer experience. So at this level the question shifts from “why do we make experiences better for people?” to “how much is an experience actually worth?”

For a question this big, it’s important to get a lot of opinions, so on the next pages we have appended external research with our own to give a top-level view of real-world business impacts from different industries...

WHAT’S AN EXPERIENCE

WORTH?

12 13

INTR

O

A CEI survey found that 87% of customers are willing to pay more for an improved

experience, but only 1% feel vendors are meeting their expectations. (Forbes “CX: the Chicken or the Egg” 2013)

The Harvard Business Review

found that focusing business

activities on a holistic customer’s

journey (as opposed to developing

individual touchpoints separately)

is 30-40% more strongly

correlated with customer

satisfaction - and 20-30% more

strongly correlated with business

outcomes such as revenue, repeat

purchase, reduced customer churn

and positive word of mouth. (“The Truth About Customer Experience” by Alex Rawson, Ewan Duncan, and Conor Jones, HBR, Sept. 2013)

Lenati CX engagements have

resulted in over $2 billion dollars in

new business for clients, and have

connected with over 100 million

customers worldwide. ((Lenati LLC 2014)

86% of leaders interviewed by

Forrester Research place

customer experience as their top

strategic priority. In another

study, Forrester found that better

CX can deliver more than

$1billion in revenue growth to

large businesses. (“Differentiating on Customer Experience” Forrester, 2012. and “Make the Business Case” Forrester, 2014)

Peppers and Rogers found that CX has emerged as the single most important aspect in achieving success for companies across industries - B2B and B2C. (Has the Time Come for “Return on Customer” at Last? Don Peppers, Martha Rogers 2006)

Tesco chairman Sir Richard

Broadbent was quoted as saying

"customer experience is more

important than our products." (Sunday Times, Nov. 2013)

14

INTR

O

Fast Company showed that publicly

traded companies that are identified as

“customer experience leaders” produced

a cumulative total return of over 22%,

while “laggards” dropped by 46% in the

same five year period. (“Why Customer Experience is the Only Thing that Matters” by Harley Manning, 2012)

Starbucks CEO Howard Schultz is

quoted as saying “Starbucks was

not built through traditional

marketing or advertising. We

succeed by creating an experience

that comes to life, in lage part,

because of how we treat our

people, how we treat our farmers,

our customers, and how we give

back to the communities.”(From “Onward” by Howard Schultz, 2011)

TNT express delivery increased

productivity and generated almost

$1Billion in savings over 4 years as

a result of new customer experience

initiatives - all while achieving the

highest levels of customer

satisfaction in the UK market.(TNT case study from businesscasestudies.co.uk)

87% of companies in the process of

implementing a CX strategy who were

surveyed by the Temkin Group in late

2013 saw positive business results in the

first year. In a separate study, Temkin

found that nearly 60% of large

companies have ambitions to be industry

leaders in CX within three years. (Temkin Group Research 2013)

Oracle found that businesses can

lose 20% of revenue from poor

customer experiences yet many are

unable to implement CX strategies

across management silos. (Oracle CX Survey, 2014)

1716

INTR

O

The practice of customer experience

creates value for both the customer and

the business. That value is derived from

the personal connections a customer

makes with a brand. Because brands are

represented across an ever-expanding set

of channels and media, the field is both

changing rapidly and growing at an

exponential rate. As we’ve seen, the

potential to for a business to thrive by

focusing on CX varies by industry and by

scale of the company, but there is a clear

benefit across the board in building a

customer-centric culture in business.Images by Paul Conder, except as noted.

Since 2005, Lenati has helped transform businesses to

make stronger connections with their customers. We help

our clients find, acquire and retain customers through a

focus on customer experience, marketing, sales and

loyalty strategy. We emphasize deep research, design

thinking and rigorous testing to prove out new ways to

benefit both the customer and the business. We have

worked with a wide roster of global brands, including

Starbucks, Microsoft, Adobe, T-Mobile, Capital One,


Find out more at lenati.com

Lenati LLC

Seattle WA, San Francisco CA, Vancouver BC.

[email protected]

1 800 848 1449

18 19

INTR

O

mailto:[email protected]


It seems intuitive that a customer’s personal

experiences are where they derive value in their

relationship with a brand. We define customer

experience in terms of a person's perceptions,

feelings, memories and associations, and so virtually

any aspect of a company can be in question when

considering how it makes a connection with a

customer. New attention on the discipline has

resulted in the propagation of many different

approaches to CX in practice. They have also led to

the propagation of several myths and half truths about

the field and it’s best practices.

This article is aimed at confronting several of the

common misconceptions we have seen about the field

of CX, while highlighting the opportunity that is

presenting itself to nearly every industry, to take a

customer-centric approach to developing channels,

service, product and operations in order to build a

stronger customer connection.

Building a Customer-Centric BusinessPaul Conder, Lenati LLC. 2014

KEY CXPRINCIPLESTEN

20 21

PRIN

CIPL

ES

Customer experience (CX) is a personal thing, and is not something that can be “created” by a company. It is the aggregate of a person's perceptions, feelings, memories and associations around their engagement with a brand. Each customer brings their life’s memories and associations to each interaction, and so it is inappropriate to say that we create specific experiences for each customer. We can only afford the customer the chance to engage. CX is similar to branding in this way. Companies put a lot of effort into creating their brand, but people's perceptions of a company are personal, and belong to the people not the company.

Customers are able to view a company in its entirety; even areas that used to be considered “back of house” are now in plain view. When channel models were more monolithic and uni-directional, companies were able to separate their operations from their customer-facing activities with an opaque curtain between the two. The explosion in digital communication channels, especially social media, means that now people can see the totality of the company including behind the curtain. Every facet of the company needs to be understood from the customer's point of view - it’s all on display. This goes far beyond service interactions with staff or engagement with a product. Customers have expectations that need to be met around a company’s ethics and values, and where and how it conducts its business.

1

2

photo: R2HOX, Digital Art: Ryoji Ikeda, Data Path

23

PRIN

CIPL

ES

A “customer journey” is the framework of customers’ interactions and experiences while engaging with a brand. It includes all the interactions with digital media, social interactions, word of mouth, service interactions – the works. Mapping the customer journey across all digital and physical channels, interwoven as the customer would experience them, is the key to understanding how the experiences can be enabled, communicated and focused.

Touchpoints are only physical or digital enablers in the customer’s journey. Touchpoints afford the customer the opportunity to carry out a certain pattern of interactions. (In the field of design, they are called “affordances.”) Every touchpoint designed into a website, app, retail interior, hospital, office, store fixture, airport, smartphone or table setting is put there to enable certain interactions, carry certain messages, and pattern certain behaviors. Many companies focus on their touchpoints when they speak about customer experience because the touchpoints are the items that the company produces in the end - and there is a lot of thought, effort and money put into building things like websites, mobile experience, sales networks and retail spaces. When the focus is placed too strongly on the touchpoint, the bias is towards the operational aspects of the company – not what the customer is actually thinking, feeling, saying, doing or spending.

3

4

24 25

PRIN

CIPL

ES

Unfortunately, every point in the customer’s journey has the potential to drive the customer away from a company. We have seen companies insist that long service wait times allow customers the opportunity to “explore” and “engage,” when in reality about half of the customers were leaving within a few moments of entry. Some companies backload extra charges at the last page of their ecommerce site - creating an unfortunate surprise for the customer just as they are about to convert. In both these cases, the operational obstacles (or pure inertia) were enough to blind the company’s leadership to the real impact this experience was having on their business. These are extreme examples, but we have seen many companies suffer from similar blockages in connecting with their customers.

The customer’s experience can be directly linked to the customer’s spending. We wrote about this in the previous article we published called “What’s an Experience Worth?” Companies are seeing an enormous upside in revenue and loyalty by framing their products, services and systems around the customer’s experience.

5

6

26 27

PRIN

CIPL

ES

The value in aligning the customer’s experience, brand and sales performance can go far beyond incremental spend. In our projects, we have seen sales increases, improved brand perception, more positive reviews and promoter scores, increased loyalty and retention AND simplified operations by taking a customer-centric view, generating billions of dollars in new business.

There is no such thing as an offline customer. Whatever industry you are in, you can be sure that your customer will be present in several channels, often at once, comparing you to your competition and hearing about what others say about you. A lot of these channels are beyond your direct control; with people tweeting or posting about you in an accelerated word-of-mouth context. For the companies that see every aspect of their business as customer-facing, this is one of their best opportunities to make a connection. For those who cling to old models of broadcast marketing in this space, judgement will be swift.

7

8

28 29

PRIN

CIPL

ES

Customer experience is not about projecting a made-up theme for your company’s brand. For companies that are new to the field of CX, there is a common misconception that the customer should be delighted and surprised at each step of their journey. This sounds great at first, but attempting to make this happen in the real world can often be cumbersome and contrived. Aiming to drive deep engagement at every point can be overwhelming for the customer, creating a brand perception that is fake, insincere and inauthentic. For the customer it can feel like the company is trying too hard, like that kid in school who wanted so desperately to be friends and seemed to stick to you like glue.

In the pursuit of surprise and delight, theatre has often been used as a metaphor for “staging customer experiences” around a brand theme. Service interactions are highly scripted, retail spaces are compared to stage sets, service reps are considered as actors to play specific roles that all align to the theme. This line of thinking comes from some of the most influential early writing about CX. For example “The Experience Economy” by Pine and Gilmore caught on so well that the language in it permeated business and creative culture in North America, but sometimes the original context was missing. For many, the first taste of CX strategy demonstrated the artifice and superficiality of a Broadway theatre production - and often in complete misalignment to the brand or the product. The same authors later wrote a follow-up book called “Authenticity” which was aimed at reigning in this trend.

9

30 31

PRIN

CIPL

ES

There are three key areas for measuring CX. CX measurement is a core component of any CX practice, letting the team know how well their initiatives are performing in the real world, and giving clues for how it can be improved.

Customer input helps build an understanding of what the customer is thinking and feeling - capturing perceptions, opinions, preferences, feelings, associations and reactions. This can also include input on subjects like their likelihood to recommend the company, brand cohesion, or their general satisfaction.

Observational research and analytics help build an understanding of what the customer is doing. It includes everything from field observations, online analytics, traffic and browsing patterns, social listening data, dwell times - anything that can be observed with a minimum of affect to the customer’s behavior.

Financial data helps build an understanding of how the customer is spending. Analytics from this data can be correlated to the first two areas, creating performance or value-based models.

For a deep dive into CX research methods, see “The New CX Toolbox” - available at lenati.com/cx

10

32

PRIN

CIPL

ES

33

CX is a very new field when compared

with other more established business

practices like sales or marketing. From

its small beginnings just a few years ago,

CX has grown to be an important part of

many of the world’s best-respected

companies. With this rapid growth has

come a flurry of misconceptions around

how CX should be practiced. Each of the

guiding principles discussed in this

article are aimed at countering these CX

myths. They can help keep a CX team

on track towards building a customer-

centric culture, and creating an offering

that is relevant to the customer.

photo: Muns

Lenati LLC


[email protected]

1 800 848 1449

Images by Paul Conder, except as noted.












34 35

PRIN

CIPL

ES



THE ART AND THE ART AND SCIENCE OF SCIENCE OF

ENGINEERING ENGINEERING EXPERIENCESEXPERIENCES

There has been a great deal written about “design thinking” in the past few years. Much focus has been placed on its value in helping define business strategy, with industrial design firms around the world claiming that they have evolved beyond their role as developers of products into a new role as business visionaries. It seems nearly every firm with a design practice has a “proprietary and unique” problem-solving process that will unlock the magic combination of customer experience, brand vision and strategy - transforming any company into the next Apple.

This is only half false.

Design is a process that helps people develop systems that other people will use. This process can be applied to software, buildings, space-shuttles, tea kettles and organizational structures. CX design is about applying problem-solving capacity to align a business to face its customers. It needs to work across digital and physical channels and media, making it different from other fields. Software designers make software. Automotive designers make cars. CX designers enable experiences.

No one owns this process. The design process turns up in some form in several disciplines. Its origins are ancient and its effects are ubiquitous in the modern world, permeating every facet of our lives.

This is the story of how this process came to be, how it works, and how it can be leveraged to build a better connection between a business and its customers.

DESIGN THINKING AND CX

36 37

PROC

ESS

“Explore - researchCreation - concept design

Reflection - prototypeImplementation”

- Jakob Schneider, Marc Stickdorn from This is Service Design Thinking

"The seeker after truth is not one who studies the writings of the ancients and, following his natural disposition, puts his trust in them, but rather the one who suspects his faith in them and questions what he gathers from them, the one who submits to argument and demonstration, and not the sayings of a human being whose nature is fraught with all kinds of imperfection and deficiency.

- Ign al-Haytham

"The electric light has caused me the greatest amount of study and has required the most elaborate experiments... I would construct and work along various lines until I found them untenable. When one theory was discarded, I developed another at once. I realized very early that this was the only possible way for me to work out all the problems.”

- Thomas Edison, paraphrased by George S. Bryan 1926

Ign al-Haytham was an eleventh century Persian Scientist who debunked theories on optics developed by such scientific heavy-weights as Ptolemy, Euclid and Aristotle. But just as importantly, he articulated the process behind his work. Empirical evidence drove his ideas, which were tested using an iterative process of experimentation, continuing until he knew his ideas worked in the real world. This was one of the first well-documented examples of the scientific method, and while he wasn’t the only one to work this way, his successes in the field combined with his well-known intellectual rigor helped spread the word.

Some version of this process can be seen in fields as diverse as mechanical engineering, physics, visual art and customer experience design. The basic principles are:

1. Learning as much as you can about a problem or opportunity - We call this area of focus Discovery

2. Asking questions, developing hypotheses to test - We call this area of focus Ideation

3. Testing those ideas to learn from them, feeding back into discovery - We call this area of focus Testing

A version of this process is taught in virtually every design, art, engineering and science school in the first year. The process itself is renamed from field to field, but the components remain basically the same. In science, it’s called “the scientific method”. In engineering, it’s usually referred to as a “problem solving process.” And in design, it’s usually called “design thinking” or “the design process.” No one owns this process and it is flexible enough to adapt into virtually any creative field.

ORIGINS OF THE PROCESS

38 39

PROC

ESS

http://www.chapters.indigo.ca/home/contributor/Author/Jakob-Schneider

http://www.chapters.indigo.ca/home/contributor/Author/Jakob-Schneider

http://www.chapters.indigo.ca/home/contributor/Author/Marc-Stickdorn

http://www.chapters.indigo.ca/home/contributor/Author/Marc-Stickdorn

“Design projects must ultimately pass through three spaces... We label these inspiration, for the circumstances (be they a problem, an opportunity, or both) that motivate the search for solutions; ideation, for the process of generating, developing, and testing ideas that may lead to solutions; and implementation, for the charting of a path to market.”

- Tim Brown, Ideo, Harvard Business Review.

“Children are born true scientists. They spontaneously experiment and experience and reexperience again. They select, combine, and test, seeking to find order in their experiences – “which is the mostest? which is the leastest?” They smell, taste, bite, and touch-test for hardness, softness, springiness, roughness, smoothness, coldness, warmness: they heft, shake, punch, squeeze, push, crush, rub, and try to pull things apart.”

Despite its ancient history and diverse origins, today the design process is usually associated with the fields of industrial design, consumer product development and with the broader field of invention. The focus in these fields is on developing manufactured products. But there is always an understanding that those products have to work for people. At each phase of the process, questions around how people value, purchase, use, store, maintain and eventually dispose of a product sit side-to-side with how the product actually works to satisfy those needs. The question “would the user like it?” has the same weight as “does it work?” For this reason, designers became schooled in how to understand users needs, market trends and cultural frameworks.

As design went beyond the focus on the product to a focus on the user, each phase in the process was affected. Discovery centered around research into a user’s needs, perceptions and wants. Ideation employed techniques like role-play, use-cycle-analysis and participatory-design (bringing users into the creative sessions.) And testing involved taking mock-ups of the product concepts to the users to see how they would interact with it and to capture their thoughts on its value. Each area of focus started to employ techniques to help connect people’s preferences and perceptions to the product. Many of these techniques were borrowed from the social sciences, where practitioners were already working to build an understanding people’s perceptions and behaviors in response to different environments.

“Identify the Problem, Criteria and Constraints. Brainstorm Possible Solutions and Generate Ideas. Explore Possibilities and Select an Approach. Build and test a Prototype and Refine the Design.”

FROM PRODUCTS TO EXPERIENCES

photo: Nic Redhead

photo: Raneko

photo: NASA

- Buckminster Fuller

- NASA engineering process

40 41

PROC

ESS

The design process was later adopted by people who were designing software and digital products. As they worked to make new technologies usable and valuable to a larger audience, they grabbed hold of the tools that had long been employed by industrial designers and applied them to digital products.

One of the most important tools that was adopted by this new group was the “journey framework.” (An example is shown on the next page.) This set up a visual representation of each step of the user’s experience. The product wasn’t the primary focus here. It was about mapping the interactions, experiences and perceptions of a user in the real world, and predicting how the product should intervene in those interactions, patterning the behavior of the user and delivering some kind of value. Larger maps could be constructed that showed the systems that supported the product, the lifecycle of the relationship between the user and the product, multiple users interacting through the product’s connected features, cyclical patterns and repeated interactions, etc.

This tool (often resembling a kind of storyboard or process diagram) helped systematize the design process. Ideas could be worked out as part of a larger system of interactions. It’s hard to imagine the development of today’s software or interactive products without this tool, and without the larger process to enable it. This technique is the origin of customer journey mapping which is a key process for anyone in the field of customer experience.

“Principles for the Development of a Complete Mind: Study the science of art. Study the art of science. Develop your senses - especially learn how to see. Realize that everything connects to everything else.”

- Leonardo da Vinci

“Any system that sees aesthetics as irrelevant, that separates the artist from his product, that fragments the work of the individual, or creates by committee, or makes mincemeat of the creative process will, in the long run, diminish not only the product but the maker as well.”

- Paul Rand

photo: Richard Huppertz

DESIGNING FOR A JOURNEY

42 43

PROC

ESS

https://www.goodreads.com/author/show/13560.Leonardo_da_Vinci

https://www.goodreads.com/author/show/13560.Leonardo_da_Vinci

http://www.brainyquote.com/quotes/quotes/p/paulrand542778.html












http://www.brainyquote.com/quotes/authors/p/paul_rand.html

http://www.brainyquote.com/quotes/authors/p/paul_rand.html

This is an example of a journey framework, where a customer’s experience is visualized using a combination of storyboarding and process mapping. In this case, the project involved a series of orientation, customer service and sales interactions at a mountain resort. Rather than focus on the touchpoints themselves, the framework focuses on how the customer’s experience is fostered by the physical, digital and mobile environment, all from the customer’s point of view. This was used later to develop the physical and digital infrastructure of the resort, from websites to interior spaces to exhibits to customer service and sales strategy; and to ensure each touchpoint supported a positive customer experience.

PROC

ESS

44 45

Within a few years, the process that used to be known for designing tea-kettles was used for designing interactive systems and experiences, even businesses. Its business applications connected marketing and customer insights with operations and distribution, helping entire companies to become more customer-centric. The process was making things work for people, but now, the things were fast dissolving into services, environments, software and media. The people were becoming more and more diverse and inter-connected, and the channels through which people connected were fragmenting and overlapping.

Who could possibly be an expert in all of these fields at once?The simplest answer is “no one.”

Bill Buxton has developed the idea of a “Renaissance Team.” In essence, he said that the design challenges of today are too complex and involve too many disciplines to be solvable by a single expert. The Renaissance Team takes over from the notion of the Renaissance Man. The collective knowledge of a diverse group outweighs the capacity of the lone genius.

The design process, the teams who applied it, and the types of problems it was aimed at solving, all evolved simultaneously. The process became a unifying force for innovation behind extremely diverse teams and businesses. In our work at Lenati, a typical team is comprised of experts in design, analytics, business strategy, marketing, digital and social media, and communications to solve these kinds of problems. Where the process used to focus on physical products, it has become a powerful methodology for developing complex, people-centric systems of any kind. It has shifted the conversation away from the supply chain and towards the customer.

“It’s not a renaissance man or woman that we need to be cultivating, but the renaissance team. In today’s world of specialization, the problems are such as to require a great deal of depth in each of a range of disciplines. We have already mentioned a few: business, design, engineering, marketing, manufacturing and science. No individual can possess all these skills at the level that is required to execute in a competitive way..”

- Bill Buxton, “Sketching User Experiences.”

Hell, there are no rules here - we're trying to accomplish something.

- Thomas Edison.

“Love your experiments (as you would an ugly child). Exploit the liberty in casting your work as beautiful experiments, iterations, attempts, trials, and errors. Take the long view and allow yourself the fun of failure every day.”

- Bruce Mau, “The Incomplete Manifesto for Growth.”

photo: Eddao

photo Cory Doctorow

photo: SparkCBC

DESIGN AS A TEAM SPORT

46 47

PROC

ESS

The design process is usually modeled as a linear sequence. But from our experience, that’s not how we work best in the real world. In this model, the structure of the process - made up of the basic building blocks of discovery, ideation and testing - becomes less rigid. It’s not about following three steps in sequence as much as shifting focus from place to place, depending on the needs of the team and the types of questions they are asking. (Others have pointed this out too, for example, Tim Brown from IDEO.)

Making the process work has a lot more to do with the diverse capacities and perspectives of the team than it does a formalized step-by-step process. Even the team itself isn’t static. Different people - the client, analysts, researchers, stakeholders, and sometimes the customers themselves - come into the process to offer their perspectives when it’s relevant to the problem.

The next three pages examine each of these building blocks to show how they apply and add value to the process of designing customer experiences.

You usually enter here with a hypothesis, question, problem or opportunity in mind.

You should probably exit here. Sometimes you enter here, for example

when a great idea comes your way and needs some research and testing to prove it out. Most literature on the design process tries to play this down because it is difficult to predict when you will have a great idea.

THE BUILDING BLOCKS OF DESIGN

48 49

PROC

ESS

DISCOVERY.Research the opportunity, problem, context, culture,

stakeholder and customer patterns. Use whatever

research tools make sense for your context.

A CX team can employ a wide set of research tools, from ethnography and surveys to internal analysis of sales and marketing efforts, to online analytics and sales performance to build a deep understanding of the customer in the real world - identifying better opportunities to engage, and also building knowledge of the terrain. But jumping into these tools isn’t a good place to start if there isn’t a clear question or hypothesis to answer with all the research.

Additionally, it can be very difficult for companies and teams to align on (or sometimes even notice) real problems or opportunities without substantial evidence being compiled first - leading to a chicken-and-egg question. You can’t start the research without identifying a problem, and you can’t settle on a problem area without research.

To get around all these challenges, a good starting point is to formulate a simple question from what you already know. “How could we make this transaction simpler or more effortless?” “How could we make this touchpoint more engaging?” “Can a new technology eliminate a customer’s time spent waiting for service?” None of these questions pre-suppose a solution, but they put the customer in context and identify a potential opportunity to improve their experience. These are the kinds of questions that can kick off a successful CX project by framing the context, tools and resources needed for the research required. From there, a clear research plan can feed useful information into the process.

50 51

PROC

ESS

IDEATION.Develop conceptual approaches to realize the

opportunity, to solve the problem, build better ways to

do something, and foster a more compelling

experience for the customer.

Ideation often seems to be the moment when the magic happens, when a new concept comes out of all that knowledge, usually out of sight of the client. There has been a lot written about creative techniques that can help spur this along like rapid visualization, generative approaches, free-association, lateral and visual thinking, oblique strategies and brainstorming; techniques to get a group to work up new, more diverse ideas faster. These techniques work by helping to frame new questions about the customer and their context, or to gain a different perspective on an opportunity.

Many say that these tools will be effective in the hands of anyone who has access to them, but we don’t believe that’s the case. Creativity is not something that “some people have and others don’t;” it is a skill that is learned. And it comes in a lot of forms. Many confuse drawing ability with creativity, a mis-conception that has kept many important points of view out of the conversation. Success here comes from being inspired by the group around you, the richness of the knowledge at hand and what you have taken from the people you have worked with in the past. The best approach for CX design is to build a team that is well-informed about the customer’s experience and context in the current state, and one that makes up for each other’s blind spots. The more diverse it is, the better. And once that team is up to speed on the research and the hypothesis to work through, let the group learn their way to a solution together. Foster an open and positive environment that gets all the team members to interact and cross-pollinate their ideas through conversation. Don’t force people to work in visual media if they aren’t comfortable. And make sure you capture all the ideas.

52 53

PROC

ESS

TESTING.

Test your ideas on paper, in the lab and in the real

world. Learn as much as you can from the test. Feed

it back into the system.

The importance testing as a part of the design process cannot be overstated. It is the only opportunity to make a mistake, learn from it, and improve on tactics without exposing them to the entire customer base. Still, it’s amazing how many companies overlook or downplay this critical step. Even smaller-scale initiatives like email campaigns or individual marketing tactics would benefit from accurate A/B testing and measurement to understand their performance before they are rolled out.

The key to getting this activity right is to prototype initial CX concepts quickly - using simple, inexpensive means - and to let them fail. Then, feed the learnings back into ideation and discovery quickly to get new concepts. In a recent Lenati project, we developed a simple set of prototypes that could be tested and modified very easily. The models were tested on site based on customer input and observation, and quickly evolved into designs that delighted customers at a fraction of the cost of the original concept. Input was collected via social media and through email. A crew of digital and industrial designers acted as a dedicated response team - altering prototypes in the field based on customer input. The solutions were nothing like the ones that the design team originally imagined - they were much better. This kind of approach can save an enormous amount of money and effort, and yield far superior results, than simply pushing a concept into the field with limited CX testing. By integrating customer feedback into the process at all points, you have a much better chance of engaging them when the concept is implemented.

54 55

PROC

ESS

Lenati LLC


[email protected]

1 800 848 1449

c

The design process puts a different spin on the

scientific method. It is a self-correcting system, where

hypotheses come in, and validated research comes out

- to be fed back in to inform the next round of new

ideas. A CX designer’s role is one of keeping focus on

how people, products and systems interact - using the

process to explore new ideas before they are brought to

market. Those ideas become the building blocks of

brands because they will be the main touchpoints for

customers. For that reason, they can have a great deal

of value to both the customer and the business.

The difference between CX design and all the other

types of design (architecture, graphic design, UX,

service design, industrial etc.) is that a CX designer is

not tied to a single medium. Architects work in

construction, graphic designers work in 2D media,

service designers create service systems, industrial

designers work in manufacturing. But a CX designer

works hand in hand with all of these professions (and

several others) to create a holistic experience for a

customer across all media and channels. This design

thinking needs to be combined with analytical

horsepower and fluency in business management in

order to understand the financial impact of the work.

It also needs to be mixed with a deep understanding of

research methods to build an understanding of the

customer, their preferences and patterns. In our next

article, “The New CX Toolbox”, we will discuss these

research and analytical methods in greater detail.

REFERENCES AND FURTHER READING

Sketching User ExperiencesBill Buxton, Morgan Kaufmann

Change by DesignTim Brown, Harper Collins

This is Service Design Thinking.Mark Stickdorn and Jakob Schneider. Wiley Press

LifestyleBruce Mau, Phaidon.

Making Ideas HappenScott Belsky, behance.net

Buckminster Fuller Institute - bfi.orgartcenter.org













56 57

PROC

ESS



Six Research Toolsets for Building a Better Customer Connection

CHASING “GOOD”

What makes a customer experience good?

Delivering a “good” customer experience (CX) that is

beneficial to both the customer and the company

behind the brand may be a CX team’s goal. But

“good” is in the mind of the customer. To understand

the above question takes a great deal of insight, and

requires focus on both the personal and the

contextual.

To help answer this question, Lenati’s CX team works

with an arsenal of research tools, which we divide into

six tool sets based on their function, to generate

insights about customers as they interact with brands

in the real world.

We have also developed a set of four lenses to help

flag trouble-spots or opportunities that turn up in the

research data, and filter concepts based on how we

anticipate they will perform.

When used together, the lenses and research toolsets

inform every stage of the design process. This article

is meant to be a snapshot of these tools, how they are

used, and what they can offer a CX project.

THE NEWCX TOOLBOX

58 59

TOOL

S

PERSONAL

PRACTICAL

CULTURAL

PROFITABLE

FOUR LENSES How do you identify painpoints in a customer’s journey? How do you define what constitutes a painpoint and what doesn’t?How do you know if a CX concept will work in the real world? What criteria do you use to assess your ideas?

At Lenati, we have developed a set of four lenses that helps us answer these questions. For us, any interaction in the real world, and any concept we would recommend for implementation in the future, needs to pass through all four of these lenses to be a success. The lenses have been derived by observing existing CX successes and failures. They are design criteria that all need to be satisfied in any project or touchpoint. They are scalable upwards to fit entire brands, or downwards to the level of a single interaction or experience. the four lenses are:

Personal. The customer will be giving their time and their money in exchange for a product, service and experience - they deserve and expect to be engaged in a way that is relevant and valuable to them.

Practical. The company needs to be able to effectively operationalize the approach in the real world.

Profitable. The balance between costs and revenue needs to be positive and worthwhile.

Cultural. For the customer, the experience needs to be appropriate for their cultural framework and how they see themselves in it. From the company’s point of view, the aggregate of all these experiences makes up the building blocks of their brand and its place in the world.

60 61

TOOL

S

SIX RESEARCH TOOLSETSThe CX Toolbox - made up of these six distinct toolsets - is comprised of processes and tools aimed at giving a company a better understanding of how it connects with their customers in the real world, the experiences that customers are having as a result, and how all of this relates to business goals and profit for the company. Toolsets are grouped by their functional characteristics and where they derive insights. It’s typical to use tools from every set in an end-to-end CX design project, from hypothesis through to implementation.

1 INTRAMURAL INSIGHTS

Insights drawn out from stakeholder input & client data.

> What we already know.

Draw out current knowledge and business goals to frame the project.

2 CUSTOMER FEEDBACK

Data derived from customer input.

> What customers say.

3 OBSERVATIONAL DATA

Data derived from observing customer behavior.

> What customers do in a digitally-enabled environment.

TACIT / TRIBAL INSIGHTS

SILO BUSTING

EXISTING RESEARCH

TRANSACTIONAL

CUSTOMER SURVEY

OPERATOR SURVEY

FOCUS GROUP

ONLINE COMMUNITY

CUSTOMER DIARIES

OR PROBES

PARTICIPATORY

CX DESIGN

ETHNOGRAPHIC RESEARCH

PHOTO/VIDEO

ETHNOGRAPHY

FIELD SAFARI

SECRET CUSTOMER

FIELD OBSERVATION

(TABLET ENABLED)

4 ANALYTICS

Patterns in transactional and online data.

> What customers do in digital environment.

5 VISUALIZATION

Visual constructs to help extract meaning from data.

> Correlated data presented graphically to draw out relevant patterns.

6 DESIGN VALIDATION DATA

Test data from iterative prototyping and user trials.

> How well did the concept perform?

ONLINE ANALYTICS

SOCIAL LISTENING

BEACON DATA

AUTOMATED

ETHNOGRAPHY

MOBILE ANALYTICS

APP ANALYTICS

CUSTOMER JOURNEY

MAPPING

PERCEPTIONS AND

EXPECTATIONS

OVERLAY

TOUCHPOINT +

AFFORDANCES

OVERLAY

OPERATIONS +

PROCESSES

OVERLAY

LIFECYCLE MAPPING

CUSTOM DATA VIZ

SOFT AND PAPER

PROTOTYPING

LAB PROTOTYPING

MECHANICAL TURK

WORKING PROTOTYPE

INTERVENTION

FIELD PROTOTYPING

A/B TESTING

THE CX TOOLBOX

TOOL

S

DISCOVE

RY

IDEATION

TESTING

PERSONAL

PRACTICAL

CULTURAL

PROFITABLE

PERSONAL

PRACTICAL

CULTURAL

PROFITABLE

PERSONAL

PRACTICAL

CULTURAL

PROFITABLE

1 INTRAMURAL INSIGHTS

2 CUSTOMER FEEDBACK

3 OBSERVATIONAL DATA

4 ANALYTICS

5 VISUALIZATION

DISCOVE

RY

IDEATION

TESTING

DISCOVE

RY

IDEATION

TESTING

ROLL OUT AND MEASUREMENT

Insights drawn out from stakeholder input & client data.

> What we already know.

Draw out current knowledge and business goals to frame the project.

Data derived from customer input.

> What customers say.

Patterns in transactional and online data.

> What customers do in digitally enabled environment.

Visual constructs to help extract meaning from data.

> Correlated data presented graphically to draw out relevant patterns.

6 DESIGN VALIDATION DATA

Test data from iterative prototyping and user trials.

> How well did the concept perform?

Data derived from observing customer behavior.

> What customers do.

INFORMING THE PROCESS Research informs every step of the CX design process, but different kinds of research are more useful at different stages. The four lenses help guide the team’s decision making at each step, flagging painpoints that come through in research findings, and filtering out concepts based on their expected performance on cultural, personal, profitable and practical levels.

DESIGN PROCESS ACTIVITY LENS RESEARCH

TOOLSET

64 65

TOOL

S

TOOLTACIT / TRIBAL INSIGHTS

(SILO BUSTING)

TRANSACTIONAL DATA

INTEGRATION

EXISTING RESEARCH

INTEGRATION

USES• To draw out existing knowledge from

leadership and key stakeholders.• To build dialogue and directional consensus

within the project team.

• To integrate current transactional data,purchasing patterns, loyalty program data andother available metrics into the research.

• To continuously update CX outcomes.

• To leverage work already done by the companyaround customer patterns and behaviors,service and operational systems.

• To understand past successes and challenges• To understand how the company views and

groups it’s customers, their needs and drivers -providing insight on how to reach out to newcustomers, and better engage existing ones.

APPROACHDevelop and facilitate a set of workshop activities aimed at fostering a conversation between diverse stakeholder groups on key topic areas and project questions. Document and share results across the project team.

Review existing data availability at the start of the project, to ascertain reliability and depth of information to aid understanding of real-world patterns. Inventory and integrate useful data sources, translating as needed.

Inventory past research into customer patterns, segmentation, marketing and sales strategy. Critique and filter by current relevance and alignment with project direction. Integrate findings to guide new research. Assess current customer segmentation, and how useful it is in building a model to acquire or engage customers. If needed, research customer base to offer insights on how to build a more accurate and useful model.

LIMITATIONSCan be more useful for building a cultural understanding of the company than generating new findings or ideas.

Non-compatible and outdated data systems can require investment to translate or lead to limited results.

Existing research can be based on out-of-date customer needs, technographic or cultural criteria. Existing segmentation models, if built for another purpose, might not provide a useful framework for improving customer engagement.

This toolset helps integrate the knowledge that is already embedded in the company into the Discovery Phase of a CX research project. Every company has a set of prior learnings, colloquial knowledge, existing research and financial data that can provide context and key insights for understanding how the company currently connects with their customers. This can give an enormous “bang for the research buck.” These tools can also be used to bring stakeholders into the conversation who otherwise would not be heard, helping break down management silos at a client company. Additionally, these tools can be used to help the company come to grips with any gaps in their understanding of their customer, to better grasp the company’s brand and corporate culture, and to help build consensus amongst the key stakeholders.

1 INTRAMURAL INSIGHTS: What We Already Know.

66 67

TOOL

S

TOOLCUSTOMER SURVEY

OPERATOR SURVEY

FOCUS GROUP

ONLINE COMMUNITY

CUSTOMER DIARIES

OR PROBES

PARTICIPATORY

CX DESIGN

USES• To draw out customer opinions and

perceptions about a company, it’s products and services.

• To build an understanding of theemployee’s experience, with the pretextthat a staff member can only deliver high-quality service if they are empowered andenabled to do so.

• To collect input from a group of either staff or customers to understand theirperceptions of a product or service beforeit is launched.

• Similar in some ways to a focus group, butconducted in an online environment -constraints of time, cost and location canbe greatly reduced.

• To build a detailed personal view of thecustomer’s experience and a document of a continuous customer’s journey.

• To bring the customer’s own insights intothe creative process directly.

APPROACHThrough a combination of surveys (either in person or online) and/or group workshops, record, tabulate and analyze a sample group of customer’s answers to questions about the company.

Similar in approach to Voice of the Customer, above - except with a representative sample of staff instead of customers. Use the opportunity to draw out both insights about the customer’s experience and that of the staff itself.

Assemble a group of representative customers or potential target customers and work through a series of activities aimed at drawing out the group’s opinion around their experiences engaging with a product or service.

Bring a representative group of customers together in an online setting, either by video or simple chat, to engage in an open conversation about their experiences around a brand, product or service.

Distribute either paper or digital (app-based, including photo, video and sound) diary tools to a sample group. Have them record their experiences in their own words as they engage with the brand.

Bring a group of customers into the actual design process through the discovery and creative phases. Encourage their input, especially into new concepts. This usually works best with “expert customers” who are passionate about the end result.

LIMITATIONSMany topics in CX are too subtle to be summed up consciously by a customer in an interview, and need to be discovered in other ways.

There can be an implicit urge for staff to impress their superiors or please the researcher, resulting in some problems being downplayed.

Many customers have difficulty imagining a future state, and so will be better at giving feedback based on existing paradigms only.

Communication, cross-pollination of ideas and empathy between participants in an online environment is limited.

There can be a tendency for inconsistent documentation from person to person - creating a data set that is skewed.

Choose your participants wisely! For an example of a well-constructed project, see the case study: archive.wired.com/wired/archive/14.02/lego.html

This toolset incorporates the customer’s point of view into the Discovery Phase of a CX design project. For all tools shown below, it is critical to work with a sample of customers that is as representative as possible of your actual customer base. As with any survey design, the answers will only be as good as the questions - the quality of the data will be dependent on the sensitivity of the researcher not just to CX, but also their experience of the survey.

2 DIRECT CUSTOMER FEEDBACK: What Customers Say.

68 69

TOOL

S

http://archive.wired.com/wired/archive/14.02/lego.html




TOOLETHNOGRAPHIC RESEARCH

PHOTO/VIDEO

ETHNOGRAPHY

FIELD SAFARI

SECRET CUSTOMER

FIELD OBSERVATION

(TABLET ENABLED)

USES• To build a deep understanding of customer

behavior patterns in the real world.

• Similar to the above, but using photo andvideo to extend the reach of the study anddocument findings in real time.

• To draw out the insights from a group ofcustomers, the first time they engage directlywith a brand - recording both behaviors andpersonal input.

• To document the customer’s journey firsthand, with the benefit of a researcher’s POV.

• To minimize the effect of the presence of theobserver on the outcomes of the study itself.

• Similar to ethnography, above - but using therecording capacity and speed of a digitalhandheld or tablet device to record highvolumes of observational data in real time.

APPROACHDeploy observers into a representative sample of field locations to observe customer behavior in the context of the service environment, without disrupting the customer or context.

Use photo and video to create a more extensive document of customer behavior patterns at several locations at once. This can be augmented with automated systems to show customer traffic.

Bring a target group of customers into a service environment for the first time - record ethnographic observations during the engagement AND customer feedback afterwards to capture first impressions.

Deploy a group of researchers into the service environment, disguised as real customers, and prepared with an observational framework and scenario to engage with the service.

Using a tablet, build a custom framework that records ethnographic data, allowing the researcher to record more data with less encumbrance in the field. Lenati has developed a proprietary tablet-based system (T-BERT) that’s customizable by project.

LIMITATIONSThis approach can yield a very high quality view of the customer’s behavior - but can be expensive to implement across a broad sample.

The collection of video is the least expensive part of this process; reviewing and analyzing it involves significant time and resources.

Similar to customer voice techniques, customers can only give feedback on things they engage with on a conscious level.

The acting ability of the researcher can limit the test. Staff can react negatively to being observed if the test is discovered.

Cost of developing the recording app might not be justified by the potential benefits of having more data. (Lenati’s system gets around this challenge by being pre-built.)

This toolset is used to build a rich set of observations about customer behavior for use in the Discovery Phase of a CX project. Most of these techniques are derived from the social sciences. The term “ethnography” comes from the late 19th century, when Western researchers interested in the cultures of indigenous peoples found that they could only understand their subjects if they made observations up close - observing behavior and interaction in the real world rather than basing their research on hearsay or conjecture. This thinking has been adopted into the field of customer experience, with teams of researchers being dispatched to watch customers in the field, hopefully without significantly altering the terrain as they make their observations. While these techniques were originally developed for the physical environment, they have been adapted to call centers, online and other service areas.

3 OBSERVATIONAL DATA: What Customers Do.

70 71

TOOL

S

TOOLONLINE ANALYTICS

SOCIAL LISTENING

BEACON DATA

+ AUTOMATED

ETHNOGRAPHY

MOBILE ANALYTICS

APP ANALYTICS

USES• To build an understanding of your customer’s

behavior online, particularly in the context of e-commerce.

• To listen in on public channels of social mediato learn what your customers say about you.

• To respond in real time in the customer’smedium of choice.

• To use low energy bluetooth signals from amobile device to track the near-exact locationof customers in a physical environment.

• To use surveillance systems, either through wifipositioning or video, coupled with real timeimage processing, to capture movements anddwell times of customers in a physical space.

• To understand patterns of customer interactionthrough mobile channels.

• To draw out purchase patterns, browsingbehaviors, loyalty data and other behavioralmetrics while using a proprietary app that acustomer has installed on their mobile device.

APPROACHIntegrate search engine analytics, website data, click-through data from online advertising, cookie data and other online sources to understand patterns of interaction around your online brand.

Use available platforms to make real-time observations of public social media channels - searching for mentions of your company, services, promotions or products. Many companies are able to respond in seconds to comments complaints.

Install a network of beacons into the environment, capable of tracking the position of opted-in smart phones. Use the data to understand customer patterns and to push relevant offers and messaging based on customer location. There are several services available (for example Nomi, Swarm, RetailNext and Euclid) that offer customer traffic analytics integrated with sales data.

There are three areas of study to integrate - mobile usage data purchased from telcos, mobile website analytics and wi-fi usage .

Develop and promote the use of an app that provides clear customer benefits (assisted browsing, loyalty programs, offers etc.) and collects usage & purchase data from those who opt in.

LIMITATIONSBlocked cookies, ad filtering and privacy networks can block or misrepresent data for some users, resulting in some skewed results.

Not all social channels are able to be scanned, and each network skews to a different demographic and user profile. You probably aren’t listening to your entire customer base here.

Beacons can only track users that have opted in, and are on the network. Many customers are hesitant to be tracked. While automated techniques can give a lot of useful data, it is not a replacement for field observation which can capture a deeper data set.

Many customers feel that even anonymous tracking via mobile is an invasion of their privacy.

Tracking app usage patterns only works for those who have opted in, and this is typically a very limited and skewed sample.

This toolset analyzes information collected from digital sources and ethnographic research during the Discovery Phase of a project - identifying correlations in the data to help guide business initiatives. For example, links can be found between touchpoint design characteristics, customer behaviors and revenue. Or relationships between online and offline behaviors can be linked with spending across channels. The amount of data that can come from studies like this can be massive, so having the analytical chops to find real patterns in the data is key to a project’s success.

4 ANALYTICS: What Customers Do in a Digitally Enabled Environment.

72 73

TOOL

S

TOOLCUSTOMER JOURNEY

MAPPING

PERCEPTIONS AND

EXPECTATIONS

OVERLAY

TOUCHPOINT +

AFFORDANCES

OVERLAY

OPERATIONS +

PROCESSES

OVERLAY

LIFECYCLE MAPPING

CUSTOM DATA VIZ

USES• To build a clear picture of how groups of

customers interact with your company and your brand, calling out moments of engagement, challenges and opportunities to make a better connection along the way.

• To visualize the customer’s journey fromtheir point of view, layering customer voicedata into the journey map to anticipateexpectations and brand perceptions at eachstep.

• To tie the customer journey to the digital and physical touchpoints that customerencounter

• To correlate painpoints, softspots andopportunities with digital and physical space.

• To map the operational framework behindthe customer journey, accounting for serviceinteractions, the staff journey, operations andcapital costs, workflow. Digital and physical.

• To extend the understanding of the customer journey to include the entire relationshipwith the brand - from first contact tomaturity.

• To enhance the view of specific aspects of thecustomer’s journey - using data visualizationtechniques to find previously undiscoveredpatterns in customer behavior.

APPROACHMap the experiences the customer engages in along their journey, as observed in the research. Base this on real-world findings, not on imaginary personas. Keep your focus on the customer’s POV and use language that emphasizes the subjective and the personal.

Incorporate data from customer voice research around customer perceptions and expectations at each point. Answer the question “What are the customer’s needs and wants here? How are we meeting them?”

Map the digital and physical touchpoints - from large scale (e.g. architecture) to small and personal (e.g. mobile app) into the framework. How are these items helping to enable the customer experience? If they aren’t why are they in the customer’s space?

Repeat the above process to match the service and operational framework to customer journey. How can this be streamlined to improve service and provide a better customer connection?

Zoom out to show the framework of acquisition and engagement pathways for each segment. (Note that this is a much larger scale than the Journey Map described above)

Due to potential cost, this technique should only be used to solve for very specific problems or opportunities to seek out patterns in the data. Example on the next page

LIMITATIONSThis is a fairly abstract view of aggregate data which can confuse some viewers - for a more granular approach, consider storyboarding.

This layer (and others) will only be as good as the data from previous VoC research - but VoC can be very subjective and difficult to obtain.

Overemphasizing this part of the customer journey map can lead to an operational bias in how it is viewed, shifting focus away from actual customer patterns.

Focus needs to be placed on the operator’s journey and associated support systems - not a complete view of every back-of-house system.

Capturing data for a map of this scale - often spanning years of engagement - can be a challenge.

There can be a tendency to create beautiful visualizations from all this data that might not carry much relevant information.

This toolset helps CX research teams during the Discovery and Ideation Phases find patterns and meaning in customer behavior by constructing images from the research data related to the physical, digital and service environment.

5 VISUALIZATION: Correlated Data Visualized to Draw Out Relevant Patterns.

TOOL

S

74 75

Data Visualization Of Customer Patterns In A Physical Environment. Using Lenati’s Tablet-based ethnographic research tool, (T-BERT) an extensive dataset was collected, including customer browsing patterns, pathing, emotional cues, group pattern behavior, and service interactions. This was the mapped to sales data to create a performance-based model of the environment. Using a proprietary visualization system, the data was mapped into an image of the store to reveal density of customer activity and spending. The same technology can be applied to other industries that involve complex customer interactions - for example healthcare, banking, food and beverage and transportation.

76 77

TOOL

S

Customer Journey Mapping A customer journey map is a visualization of customer experiences, aligned to a sequence or process chart. They can take many forms - the one pictured here started as a simple sketch created by the leadership team of an omnichannel retailer and was filled in from data from observational research, web analytics and input from customer surveys. The map starts with the customer experiences laid out in the center, enabled through both physical (orange) and digital (blue) media. Connections are made along likely paths made by different customer groups. The product and service offerings, operational zones, service interactions, physical and digital touchpoints and messaging are layered into the map, bringing focus to bottlenecks, painpoints and softspots in the process. Similar to the data visualization technique on the previous page, customer journey mapping has been adapted to several industries that deal with complex customer interactions and processes.

PRODUCT + SERVICE OFFERINGS

CUSTOMER EXPERIENCES

PATHING

OPERATIONAL ZONES

TOUCHPOINTS + AFFORDANCES

BRAND CUES + MESSAGING

78 79

TOOL

S

TOOLSOFT AND PAPER

PROTOTYPING

LAB PROTOTYPING

MECHANICAL

TURK

WORKING PROTOTYPE

INTERVENTION

FIELD PROTOTYPING

AND A/B TESTING

USES• Using extremely simple and inexpensive means

to test basic concepts for customer interaction.

• Testing a concept in a controlled environmentwithout affecting the perceptions of the generalmarket.

• Testing an interactive system without having togo to the expense of building out the AI ordatabase portions - replacing them with anoperator who is out of sight of the subject.

• Testing a fully functional prototype in a real-world environment, intervening in a customerjourney with a realistic model of a concept.

• More extensive testing in multiple locations,testing for variations by market, geography, etc.

APPROACHDevise the simplest and the least expensive ways to test an idea - for example model an app using a pad of paper and marker to represent the interface, or create cardboard mockups for physical objects or environments. Modify the models quickly as the concepts are assessed. These models should be seen as “sketches” of ideas - disposable, inexpensive and quick.

In a studio or workshop environment, work through test scenarios like service interactions, mock-up environments, digital interfaces, etc.

Build a mock-up of a digital interface on an appropriate hardware platform, but allow the role of the computer to be played by a member of the research team through the back-end of the interface, connected through a network.

Build, implement and test an accurate working model of the concept in the actual environment, this could be an environment, a physical touchpoint, digital interface, website or an app. Use previous toolsets as applicable to gain insights on customer patterns and business impact.

Repeat the working prototype test, but at multiple locations, sampled to be representative of the company’s reach and future target markets. Compare to controls to assess impact of concept.

LIMITATIONSSoft models can be easily misinterpreted by those who aren’t accustomed to mock-ups produced by inexpensive means. This can lead to misunderstandings around the purpose of the test. Also, many features cannot be tested effectively using simple media.

The controlled environment can produce findings that do not replicate in the real world.

Without clear guidelines, it is easy for the operator to overstep the abilities of an actual digital interface, giving a false sense of “do-ability” for a concept.

The cost of building fully-functioning prototypes can seem very high for many types of touchpoints. However, these last two tools represent the last opportunities to eliminate any potential mis-steps before they intersect with the customer. Plan for the cost and timing of a real-world test.

This toolset provides techniques for validating CX concepts during the Testing phase of a CX project. In the process of creating a new CX strategy, this stage is often downplayed due to the high cost of crating a functional prototype - but many lower-cost options are available to get the bugs worked out and inform the research and design teams. The toolset below is arranged in order of cost, from the lowest to the highest. This is usually the same order in which these tools are employed - testing more ideas faster and cheaper at the beginning - and testing the more refined ideas using more accurate methods later in the process after the first ideas were weeded out.

6 DESIGN VALIDATION DATA: How Well Does the Concept Perform?

80

TOOL

S

81

Lenati LLC


[email protected]

1 800 848 1449

REFERENCES AND FURTHER READINGThe research methods discussed in this article are in use across the fields of CX, design, customer insights and marketing. However, the language used to describe these methods is often not consistent from firm to firm. Research for this article included:

This is Service Design Thinking. Stickdorn and Schneider. Wiley Press.Design Research. Brenda Laurel, Editor. MIT Press. Visualizing Complexity. Manuel Lima, Princeton Architectural Press.Massive Change. Bruce Mau & Institute Without Boundaries, Phaidon.Why We Buy - The Science of Shopping. Paco Underhill, Simon and Schuster.

PEOPLE > TOOLS

While these toolsets can be extremely powerful in

the hands of an experienced research and design

team, it’s important to remember that they are only a

means to an end. Their value lies in how much they

help build an understanding of the customer. There

has been a lot of attention paid to “big data” as

customer insights have become more and more data-

heavy. Our analytical capacity has exploded in the

last few years. It has a lot of potential upside for

business, and in turn that has had a lot of press.

With all that attention, we need to guard against the

allure and the power of the tools themselves

overwhelming our industry and relegating something

as broad-reaching as “customer experience” to some

kind of digitally-enabled game of numbers.

But overall our concern is outweighed by our

optimism, fueled by the potential we’ve seen in

these tools to foster good design, good business

practices, and stronger connections with people.













82 83

TOOL

S



TEN WAYS TO CONNECT WITH YOUR CUSTOMERS IN AN

OMNICHANNEL UNIVERSE

LET’S GETPHYGITAL

THE NEW PATHS TO PURCHASE

Customers aren’t connecting with businesses the way they did even a year or two ago. It’s difficult to overstate the enormity of the change as companies adapt to new channels and try to meet their customers on their own ground. And this change is only going to accelerate as new channels come into being and recombine to face the customer. All we know for sure is that most companies (over three quarters of them according to Forrester Research, 2013) are working hard to evolve their approach - and that the approach will probably be partially obsolete by the time it is crystallized into sales and marketing tactics on the ground.

Older models, which are still taught in some form in business schools today, often visualized the customer’s path to purchase as an inverted pyramid or funnel, with customers following a simple linear path. Every point of contact was about moving the customer to the next step, and then driving the sale. A few years ago this was a reasonable way to look at the process.

We could see this changing as early as the mid 1990s as the web was adopted into business and everyday life, but the seismic shift in customer patterns didn’t peak until the online world became simultaneously social and mobile. That’s when e-commerce came off the desktop and collided head-on with other, more mature channels. The physical overlapped with the digital. Now, an entire generation has been raised in a “phygital” culture where anything is accessible, from several sources, through any channel, at any time. We view this shift as an opportunity for businesses to evolve into a position to better connect with their customers. What follows are ten ways to connect with your customers in a phygital way, methods we’ve used first hand at Lenati.

84 85

PHYG

ITAL

1. MAP THE CUSTOMER JOURNEY ACROSS CHANNELS

Think of all the ways your customer connects with your company. How many different moving parts are involved in fostering that connection? Everything from your website, mobile app, and social media presence to architecture and interior design, service design and follow-up all come into play. You even need to consider the operations and infrastructure that supports all these connections: Where are your products manufactured? How much energy do you use? How do you support a customer after-purchase? And then consider how all of these operations can become visible to your customer, especially when things to wrong. As we’ve seen in previous articles, the key to creating a holistic view of your customer’s journey as they come into contact with all these different aspects of your company is to build a map of each of their interactions over time, and across channels, from their point of view. As channel models become more complex, newer models of customer journey mapping have been developed.

Consider two paths to purchase: One typical of a customer a few years ago, and one now. The first path might look like this:

• Awareness was built through traditional media and word of mouth• Interest was reinforced through contact with a sales touchpoint• Consideration usually involved person-to-person consultation.• Purchase was also in person at a physical location.• Follow-through was usually spotty, if it happened at all. A bill

would be sent in the mail, most one-time purchases had no follow-through, large purchases warranted a phone-call.

photo: Garry Knight

86 87

PHYG

ITAL

Our second customer journey might look more like this:• The customer becomes aware of a brand or product via

social media.• She becomes more interested via repeated contact

through multiple channels. She may simply purchaseonline at this point, or....

• She may need first-hand contact with the product orservice - in which case she reserves it online, and visits aphysical location.

• During the visit, she uses her smartphone to connectwith social media. She looks at a competitor’s pricingon the web. She uses the company’s app to access apromotion via their loyalty program.

• The customer decides to purchase. During the process,a second off-site product has caught the customer’sinterest. No problem. It will be ordered and shipped toher directly from the e-commerce site.

• During the process, she has opted in for sharing herinformation with the company. This is used to followup with her in a personalized way.

The first customer’s journey could be visualized on a simple linear path. The second model requires another dimension that tracks options through various channels, many of which are in play simultaneously. As always, it is important to visualize this journey from the point of view of the customer themselves. Painpoints and softspots in the journey should be considered as you go, developing a clear brief for creative. There are many ways to visualize this. The one pictured here is only one example.

For a deep dive on customer journey mapping, see our articles “The New CX Toolbox” and “Customer Journey Mapping” - both available at www.lenati.com.

According to Google’s Mobile In-Store Research (2013) shoppers who use mobile more, spend more in-store:Frequent mobile shoppers spend 25% more in-store than people who only occasionally use a mobile phone to help with shopping. And 1 in 3 prefer to use their phone for self help in store, rather than asking staff.

88 89

PHYG

ITAL

http://www.lenati.com

http://www.lenati.com

photo: Lauren Manning

2. ALIGN MANAGEMENT CROSS CHANNELS

Many companies - and the agencies and consultancies that work for them - take a siloed approach to building out their companies as channel options become available. This probably made some sense at one point; making separate business units for each channel can allow for rapid growth in the short term. But that doesn’t help the customer. Consider what can happen when you lack alignment across channels:

A conversation a customer was having in one channel didn’t carry over to another. “I was on the website - I put all my information in, and then your site crashed my browser - now I’ve been on hold for an hour and you need all my info again!!?? $%*@!!!!”

Prices and promotions don’t align. “It costs how much if I buy it from you? your own website has it for half that!”

After a wonderful, personal experience learning about a service, the experience at purchase is lengthy and horrible. “Why do you need my address from five years ago for me to get a new phone?”

Usually these problems stem from how the company is organized and managed. Each channel is operated separately by people who aren’t co-ordinating with each other around the customer’s journey and the company’s brand. None of them are empowered to work across channels to make a better experience - and the company’s operations and supply chain take precedent over building connections with customers. We’ve seen some companies where each org or department is somehow visible in the design of their website. The result is clutter and disorganization. There is only one way to combat this problem - from the top down. The top leadership of the company needs to have a clear vision for how the brand manifests itself across all channels, and then bring the silos into alignment. From a project perspective, good progress is usually made when cross-functional teams are created to tackle a CX problem.

90 91

PHYG

ITAL

3. SURPRISE!!

There are two competing approaches to cross-channel customer experience - and they are both valid depending on the customer’s context. There seems to be some confusion around which approach best suits each channel.

First is the premise that customers should be surprised and delighted at every step of their journey. Customer service, website, app, and especially in-person interactions should be of the highest quality, personalized, compelling and memorable. This approach likely stems from older service models, where the industry benchmark was high-service, one-to-one interactions. Think of the kind of service you would expect from a high-end tailor. In-person channels can demand personal service.

The second approach relates to how much effort is required on the part of the customer. In his book “The Effortless Experience” Matthew Dixon explains that expensive initiatives on the part of brands to stage compelling experiences often lead to no improvement in loyalty - or worse. According to his research, a customer service interaction is four times more likely to foster disloyalty than loyalty. He found that 57% of inbound calls to call centers come from people who were on the company’s website and couldn’t find what they wanted. If you are booking an airline ticket or paying a parking fine online, the last thing you want is to take the time and effort to be surprised and delighted by call center staff.

Sculpture by Yayoi Kusama, Naoshima Japan.

92 93

PHYG

ITAL

In CX design, the approach you take should be dependent on the channels in question, the characteristics of brand, and on the expectations of your customer. Most transactions or queries, especially those in digital channels, improve with increased simplicity and ease of use. The less information the customer needs to provide, the lower the wait times, the fewer keystrokes, the better. But this isn’t always the case for in-person experiences. A luxury purchase guided by the personal touch of a well-trained sales associate, the brief conversation with a barista, or the extra moment spent with a family doctor can all be worth that extra bit of time and effort. There is a tendency for designers to aim to make every experience this compelling, which unfortunately can lead to a lot of misplaced investment. But sometimes this connection is the essence of the brand.

In architecture, there is a saying “if you can’t hide it, make it a feature.” In other words, anything that is visible to the visitor needs to be meaningful, and everything else needs to disappear completely. The same can be said for CX: reduce the customer’s effort where you can. Everywhere else, align the experience to brand.

94 95

PHYG

ITAL

4. CREATE CONSISTENT EXPERIENCESACROSS CHANNELS

The explosion of communication channels has altered how we interact with brands and with each other on a fundamental level. We can be present in multiple channels at once. We can bring competitors into once-private conversations. We can be extremely well informed. We are in social relationships with thousands of people.We are influenced by many, sometimes without our knowledge.We have a different system of values than we did a few years ago. We have very high expectations.And we are extremely fickle.

People tend to consciously notice the channel they are using only when something goes wrong: a website crashes, there is a long wait in the emergency room, or the call-center drops a call. Once a channel has been adopted and the novelty of it wears off, its use becomes second nature. All of the customer characteristics mentioned above are usually only noticeable from the outside - for example from the point of view of a company that is trying to do business in these channels and needs to build systems to allow people to do what now comes “naturally.” Our customers are way ahead in understanding how this should all work. It’s our job to catch up.

Older communications channels (TV, radio, print) effectively broadcast the same message to a large group - and newer channels (web, social, mobile) enable more of a conversation between companies and people. A critical step for any omnichannel business is to align experiences across channels by being ready to have a consistent conversation wherever the customer is present.

The next points are all hinged on that principle.

96 97

PHYG

ITAL


5. DEVELOP A CONSISTENT MESSAGING STRATEGY

You can assume that the customer has access to an enormous amount of information about you and your company. - So at all points and all channels, you need to be ready with a consistent message about:

•product•service•pricing

Consistent messaging is usually the first place companies fall down in an omnichannel space. Getting this right seems like the “low hanging fruit.” But this goes much further than simply matching messages word-for-word. A few years ago, it was fairly common to see a company use a generic template for its website that was completely incongruous with its brand. That problem was bad enough, but now that same company probably has a few dozen social media accounts, managed by different groups, all of whom are promoting their own agenda in their own voice. They might even be drawing on different pricing databases, despite sharing key clients. That company also might have face-to-face and call center service that has a completely different character and primary message than the rest.

While top-down approaches are not as in-favor as they used to be, they have their advantages here. A strong customer-centric vision from the top management needs to be disseminated through every facet of the company for this problem to be solved.

•fulfillment and delivery•follow-up•operations

98 99

PHYG

ITAL

6. WALK YOUR TALK

With all the information about your company that’s online, and with customers becoming more conscious about who they do business with, the way your company does business is every bit as important as what you are selling. Your brand, your ethics and values, where and how you operate your business are all on display. Window-dressing and a veneer of social responsibility don’t cut it. Your company needs to be everything it claims. This seems like it should come down to a simple code-of-ethics, and that is certainly a good place to start, but it can be far more nuanced and complex than that. Here are some examples:

When K-Mart decided to stay open early on Thanksgiving and right through Black Friday, a social media uproar ensued. K-Mart’s reaction was to post the same rebuttal, word for word, to each of these tweets, making the company sound even more insincere. Was the problem here the approach to social media, or the policy to force employees to work on a holiday? Or both? With all this transparency, customer feedback needs to push back on policy, or else customer won’t feel they’ve been heard. A generic tweet won’t fix the problem.

When the Rana Plaza garment factory in Bangladesh collapsed in 2013, killing over 1100 people and injuring over 2500, the western corporations that purchase the goods manufactured there were immediately put under a microscope. The outcry around the world through social and traditional media was intense, implicating not just the factory, but it’s clients in the west who turned a blind eye to the conditions in the building. The public knew immediately which brands were involved, where to focus their anger, and what brands to boycott. Adding a screen of messaging can no longer drown out the din of bad business practices. Companies in the age of social media have learned that their operations and ethics are visible components to their brands.

100 101

PHYG

ITAL


7. UNDERSTAND YOUR CUSTOMER’S NEED FOR PRIVACY

vs. THEIR DESIRE FOR CONVENIENCE.

There has been an explosion in the amount of data that is collected about your customer’s patterns and preferences. Insights can be collected across channels, from behaviors, pathing, emotional cues and dwell-times in a physical environment (hospital, retail space, or airport) to online browsing, purchasing and social media patterns. There is no shortage of data and analytics available about how your customer is connecting with you. The data being collected is also becoming more granular on a personal level. For example, many retailers are eager to get to a full understanding of individual customer’s patterns across all channels, digital and physical, in order market to them in a truly personalized way. Instead of marketing to a widely defined group, it is now feasible to narrow the segment to a single person. The trade-off for the customer, more than ever, is between the convenience of having services tuned to their wants and needs vs. the sharing of information that was once considered to be personal. In response, customers’ expectations are shifting in two opposite ways:

• Concerns about privacy around how the data is used and collected.• Higher expectations of service now that the data is available.

There is no one-size-fits-all method that will tell you what kind of data your customer expects you to collect and how they expect you to use it. Some industries - for example finance and healthcare - need to be extremely sensitive and cognizant of privacy, but the potential upside to the customer could be enormous (even life-saving) if all the right service providers can get access to the right information about the customer at the right time. This balance needs to be carefully considered for each business, combined with complete transparency to the customer about what data is being collected, and then co-ordinated throughout the organization.

102 103

PHYG

ITAL


8. THINK OMNICHANNEL

In the day-to-day, customers aren’t focused on what channels they are using to engage with a brand. Whether in person, on a smart phone, on a tablet, on a laptop, through traditional media or over the phone, customers tend to see these channels as natural extensions of the brand and don’t tend to give the individual channel itself much thought. Omnichannel thinking is about working beyond the channels to connect with the customer at their own level, and through whatever means make sense for them. While most companies have a “digital” department, omnichannel thinking means integrating the digital with the physical, giving the customer the best of both and cross-pollinating ideas from one channel to another to create a better experience. The digital doesn’t replace the physical, it just makes it better.

Some examples of omnichannel thinking:• Uber implemented an app-based system to hail and pay for limousine

service, bypassing many of the hassles typical in the customer’sexperience while greatly cutting costs.

• American Airlines used social media to alert the public about shut-downs during super-storm Sandy- getting word out quicker and tomore people at less cost. It is now one of the airline’s keycommunication channels.

• Royal Bank of Canada has been questioning the role of their physicallocations as more services go online. The response is a digitally-enabled streamlined service framework in banks that offers highlypersonalized service, with many transactions being accomplishedcheaper and easier online.

• The government of Estonia faced rebuilding its informationinfrastructure after the collapse of communism. It took theopportunity to shift as many services as possible online. Currently thegovernment estimates that this saves one man-week per year ofadministration and paperwork for each citizen while allowingemployees to engage with people in a more personal way.photo of Tibesti Mountains and Tributaries, Chad

Juan Ramon Rodriguez Sosa

104 105

PHYG

ITAL

9. TAP INTO THE POWER OF THE PERSONAL PROFILE

Notwithstanding the previous point about the balance between privacy and service expectations, customers seem to be less and less tolerant of companies that are unwilling to create a personalized experience. For this to work across channels, a secure and robust profile about the customer’s history, preferences and interactions with the company needs to be constructed - with the customer’s permission. It also means that it needs to be shared internally - and very carefully - on an as needed basis - with all services that come into contact with the customer. This can have many benefits:

• Reducing service/wait times by using profile data to pre-enable atransaction.

• Curating and recommending choices for the customer,recommending a “next logical purchase” based on previousbuying or browsing patterns.

• Enhancing sales effort by opening up more channels for acustomer to connect. (e.g. order from mobile, pick upimmediately at a location of their choice, make arecommendation when they arrive, follow up by email.)

• Eliminating the need to provide information repeatedly whenswitching between channels.

• Creating personalized offers, relevant to the customer’spreferences and current level of engagement.

• Providing well-targeted incentives or rewards to increase loyalty.

Personalization allows a brand to deliver only relevant offers, content and products to a customer. The power of this lies in reducing cost and effort, while increasing the impact of your efforts to connect with the customer.

gel electrophoresis of DNA photo: M. Nolf

106 107

PHYG

ITAL

10. OPT-IN

Many data collection methods may look great from a company’s point of view, but can be intrusive (or downright creepy) from the point of view of the customer. Wifi can allow you to track the movements of people in a physical space through their phones, cookies can track people online, cameras can be installed almost anywhere - but for every new technology there is an example of a company that has gotten into a public-relations nightmare by implementing them without the customer’s consent. The safest approach in almost every case, at least until another cultural shift comes our way, is to ask customers to opt-in to the program. Be completely transparent about how the data is being collected and used, and stick to your own rules without exception. It may be appropriate and helpful to provide incentives to the customer who opts-in, in exchange for the information that is collected.

While this seems like a fairly new area of focus, it has actually been in common practice in several industries. For decades, financial institutions, airlines and charities have been designing programs where the customer knowingly exchanges information for rewards. While some industries like banking have a clear advantage by being able to leverage a deep knowledge of personal spending across different vendors, many others are still able to collect enough data to capture an accurate snapshot of a customer’s preferences based on their own sources. Many music or movie services for instance (iTunes, Spotify, Netflix) are able to accurately predict a user’s taste, making recommendations that are far more relevant and engaging with a minimum of intrusion. The same can be done in the context of food and beverage or hospitality, with offers and promotions targeted based on data collected at the POS or via a smartphone app. Virtually any industry can build a better connection with their customer, once they opt-in.

photo: Maximilian Schönherr,

108 109

PHYG

ITAL

Taking an omnichannel approach to connecting with your customers must be driven by the customer’s needs and expectations, followed by a search for better opportunities to meet them. Technology can play a role in this, but for each of the points raised in this article, the most important aspect is how the business faces the customer, not the technology that makes it happen.

The unfortunate tendency is for technology to drive change. According to a study by Altimeter Research called “Digital Transformation”, as corporate budgets for digital marketing, automation, mobile and social media increase, many companies are letting the technology drive the change rather than the customer’s motivations, preferences, purchasing patterns and experience. This can result in a patchwork of technology, which is misaligned to the customer’s expectations and patterns. In all the points made in this article, the focus is on the customer’s wants and needs - and using the technology to learn about them and connect with them. Let your understanding of the customer be your guide.

Designing new ways to meet the customer is a form of intervention in the customer’s life - you are placing a new bridge along their path to allow a connection that wasn’t there before. Map their journey and establish the value proposition to the customer before committing to rolling it out. Constructing the bridge can be a lot of work, but it’s work that’s wasted if it has no value for the customer.

photo of geodesic structure by Michael Day

Lenati LLC


[email protected]

1 800 848 1449

“I am enthusiastic over humanity’s extraordinary and sometimes very timely ingenuity. If you are in a shipwreck and all the boats are gone, a piano top buoyant enough to keep you afloat that comes along makes a fortuitous life preserver. But this is not to say that the best way to design a life preserver is in the form of a piano top. I think that we are clinging to a great many piano tops in accepting yesterday’s fortuitous contrivings as constituting the only means for solving a given problem.”

― Buckminster Fuller













110 111

PHYG

ITAL



The customer experience movement is in full bloom. Companies have awoken to the simple truth that the core driver of consumer behavior isn’t product features or price – its perception. As consumers, it is our experience – the sum of all the ways in which we encounter a company’s brand – that informs our perception of its value, and consequently, our choices about whether or not we incorporate it into our lives.

But what about the experiences of commercial customers? After all, when you pluck the consumer from the context of their personal buying habits and place them in the workforce, it turns out many of them transform into prospective clients for a host of B2B products and services. There, in the course of their professional lives, they have encounters with commercial brands, develop perceptions about their associated value, and ultimately choose which products and services to procure on behalf of their organizations.

How odd, then, that the relatively new field of CX is disproportionately comprised of consumer applications. The success stories and marquee case studies are predominantly drawn from the B2C world. The widely acknowledged pioneers of CX are the likes of Virgin, Apple, Tesco and Starbucks. According to a study that surveyed Customer Experience Management (CEM) leaders in 2013, all of the top 10 companies admired for their customer experience were B2C organizations.i

There is a fascinating conversation circulating through the CX community as it collectively pauses to ask, “Where are we on customer experience in B2B?” - Why is it that commercial CX seems less visible in the industry literature than its consumer counterpart? Do consumers and commercial clients really make decisions so differently as to necessitate different approaches to CX? And, perhaps most perplexing of all, if the potential B2B returns on CX mirror those enjoyed by B2C companies, why does the CX industry place so much emphasis on B2C?

B2B.CXUNDERSTANDING THE COMMERCIAL

CUSTOMER’S EXPERIENCE

112 113

B2B

CONSUMER LEVERAGE There was a time when consumer companies ruled the roost, able to dictate the customer’s experience and constrain the environment and channels surrounding their customer’s purchase decision. That day has passed. Instead, consumers are enjoying newfound leverage afforded by the on-demand information, opinions, and competing alternatives they now have in the palm of their hand. No help available in the plumbing aisle at the hardware store? Google Maps can find another one within minutes of your location. Not sure you’re getting the best price on that new TV? Scan the barcode and RedLaser will show you the best online prices that include shipping. This Age of CX was ushered in by the fluidity of the information suddenly passing through consumer hands. In response, more and more B2C companies are making investments to understand and engage in that experience in more meaningful, value-added ways. The same platform, network, and social innovations that are empowering consumers have also created new, high-leverage opportunities for savvy brands to engage them.

In the B2B sector, historically, “empowerment” has been in ample supply for customers on account of their purchasing power and access to capital. If the steel company felt the freight charges from the railroad were too expensive, simply speaking up might result in a friendly downward adjustment, on account of the sheer volume of business conducted between the two. Imagine the leverage a large airline would have in negotiating the purchase of a new fleet of wide-body planes. You can be sure that the manufacturer would spare no effort to create a compelling experience for the decision makers and influencers in that transaction. The argument that B2B customers can hold more leverage means that B2B companies are (or should be) even more attentive to customer experience, not less. The correlation between customer empowerment and the relevance of CX is direct. A strengthened consumer spawned the Age of CX, and most B2B organizations have been facing empowered customers all along.photo: Jeremy Colpu

114 115

B2B

Even as the origins of consumer CX indicate an enormous practical relevance for B2B applications, commercial clients still seem to be under-represented in the CX literature. But that doesn’t mean that B2B organizations have less-developed CX capabilities than their B2C counterparts - they may just be using different terminology to describe it. B2B organizations may not refer to it as “CX” at all - but they still have sought to understand and optimize the customer experience in a myriad of ways. Many of these tactics pre-date the use of CX as a term in B2C. For example, consider how the notable business innovations, shown at the right, have impacted B2B customer experience over the years.

This diverse group of business methods and processes might not constitute an intentional and well-integrated practice of improving how customers experience a commercial brand. But they are evidence that B2B knows a thing or two about CX.

Chances are that if yours is a commercial organization, it already engages in some form of CX strategy or design, even if you don’t have a CX “department”. This initiative may be every bit as sophisticated and powerful as any from a B2C venture. The good news for the soon-to-be B2B CX pioneers: there is no need to start from scratch. Resist the urge to avoid what looks like a new and foreign approach to customer engagement, and instead embrace and extend the efforts already underway to optimize how commercial clients experience your brand.

HIDING IN PLAIN SIGHT: COMMERCIAL INNOVATIONS IN CX Value Engineering (c. 1945)

A 6-phase multidisciplinary methodology that utilizes an objective function to optimize the value of products and processes by balancing function and cost (Value = Function / Cost).ii

Consultative Sales or Solution Selling (1983)A sales approach that focuses on creating value for customers by solving their problems rather than simply compelling them to purchase a product or service on the basis of its features. iii

Account Planning & Account Strategy (1968)Originally employed by advertising agencies, the process of involving the customer in the vision for how a client-vendor relationship will evolve to accommodate shifting needs of the business. iv

Customer Advisory Boards (1997)Formal structure that convenes key customers with a vested interest in the future of a company in order to solicit feedback, share industry outlooks, and gain competitive intelligence. v

Customer Relationship Management (c. 1970)A system of tools, technologies, and procedures for facilitating, managing, and improving a variety of interactions with customers, prospects, and partners. vi

Sales Excellence (2006)An ongoing discipline that ensures a sales organization understands the customer’s business, advocates for customer needs, and assumes accountability for customer results. vii

photo: GWERN

116 117

B2B

In the fields of sales and marketing, our propensity for segmentation means we are accustomed to drawing an indelible line between consumer and commercial audiences. But to assume their differences render CX tools “non-transferrable” is severely limiting. The CX toolbox contains methods borrowed from psychology, sociology and anthropology that have been long associated with consumer marketing, but are they any less relevant to commercial relationships? Do consumers and commercial customers really make decisions so differently to necessitate radically different approaches to CX?

Bryan Kramer summed it up nicely in his blog article earlier this year titled, “There is no more B2B or B2C: It’s H2H (Human-to-Human).” He’s right. – Recall the empowered customer who makes commercial purchasing decisions by day and personal consumption choices by night. In both modes, he requires brands to be personally relevant before opting to engage.

Of course, we could recount all the ways in in which the commercial customer’s path typically deviates from the consumer’s path as justification that the CX toolbox has little relevance in B2B. While the typical consumer experience has a different complexion than the typical commercial experience, the sweeping generalizations regarding their dissimilarities are not always true, and almost never pertinent when it comes to tools we use in CX design:

FOUND IN TRANSLATION: THE FLEXIBLE CX TOOLBOX

Commercial clients respond to sales, marketing more is effective with consumers.

(Then why does Accenture advertise during golf tournaments?)

Commercial clients make expensive long-term investments, while consumers tend to make small impulse purchases.

(Who is more likely to be impulsive? --1. The executive spending 0.1% of a $30M I.T. budget - or -2. The young couple writing a $30,000 check to buy their first home?)

Commercial buyers behave rationally, consumers make emotional purchases

(How many of us have encountered a client, at the end of their fiscal, saying: “if I don’t spend it, I lose it”?)

Commercial clients demand a higher degree of touch…Commercial clients make recurring purchases…Commercial clients are more risk averse…Commercial clients have multiple decision makers…

It is easy to see how misleading these generalizations can be. Reliance upon them is dangerous, and dismissing the existing CX toolbox on account of how different B2B customers are from consumers is missing the point on CX altogether. To do CX well requires a willingness to embrace the nuance and individuality of your customers, your brand, your unique value proposition, and the many ways they interact with one another in the context of your business. Declaring that a particular CX tool doesn’t have a commercial application is conceding it was probably ill-fit as a consumer CX tool to begin with, because it doesn’t adapt well to context.

Every customer journey is unique, so the best practices are patently flexible. When it comes to methodology, there is an enormous overlap between ‘CX for B2B’ and ‘CX for B2C’.

118 119

B2B

DIVIDED WE FALL SHORT:TAKING AN INTEGRATED APPROACH TO CX. The key to any successful CX strategy lies in taking a holistic view of how a company connects with it’s customers. Unfortunately management groups are often siloed, making integration around a CX practice difficult. If senior management need to get a clear view of the CX terrain, they will only be able to see smaller incremental metrics from each department - not a complete picture of the customer’s experience, or the business outcomes of making a stronger customer connection across channels and at every point in their journey. This applies to B2B organizations as much as B2C.

Building strong communication across the silos is a key part of a CX practice. One important aspect of this holistic view is the ability to calculate a projected ROI from a CX strategy.x To make this happen, researchers are able to make projections of revenue and cost impacts at each stage in the customer’s journey - creating a picture of financial returns based around cross-channel customer patterns and real-world research. This is a much more powerful (and accurate) way to model ROI than benchmarking based on previous cases from other companies because it responds to the context of the relationship between the company and the customer. Each stage can be assigned its own performance indicators connected to revenue events and cost centers - all of which can be optimized through mindful CX engagement. Not every CX initiative spans every stage of the customer lifecycle, but measuring customer lifetime value ensures we assess the full impact of each encounter as it ripples through the relationship.

Looking at ROI in relationship to the customer’s journey and lifecycle goes hand in hand with taking an integrated approach to a company is managed. The benefits can be enormous to both the company and the customer. But first the silos of data and management need to be connected laterally to share their knowledge and insights.photo: Rick Harris

120 121

B2B

The art and science of customer experience is a complex

undertaking, not a simple reconfiguration of an existing go-to-

market approach. It involves not only a willingness to

reexamine the aspects of a company’s offering that have been

painstakingly planned and meticulously stewarded (e.g. product

design, messaging, competitive positioning, distribution), but

also a compulsion to charge bravely into the realm of the

unknowable and uncontrollable (e.g. behavioral psychology,

social power and influence, information ecosystems).

And yet, the CX movement flourishes because the rewards for

knowing, internalizing, and optimizing customer experiences are

rich. And it’s also just the right thing to do – acknowledging

that the customer has the right to own their experience, but

opting to be accountable for it anyway. Consumer marketers are

feverishly mapping customer journeys, building big data tools to

gather touchpoint intelligence, and leveraging social media to

extend and optimize every available moment of omnichannel

engagement.

When it comes to CX, in many ways B2B has been right next to

B2C all along. Not far less developed, but not well-integrated

either. There is no good reason for the disassociation.

Organizations serving both customer segments each strive for

the same thing: a better understanding of customers, and more

meaningful engagement in their journeys. B2B and B2C stand

to benefit from the sharing of tools and approaches. In pursuit

of closer customer connections and better ROI across the board,

it’s time to integrate the segments and find out just what kind

of CX innovation might result.

Lenati LLC


[email protected]

1 800 848 1449

Global Customer Experience Management Survey, Beyond Philosophy, 2013.http://www.beyondphilosophy.com/wp-content/uploads/2013/12/Global-Customer-Experience-Management-Survey-2013.pdf

What is Value Engineering, SAVE International, 2012. http://www.value-eng.org/value_engineering.php

Solution Selling, Mike Bosworth, 1994.http://www.mikebosworth.com/solution_selling.html

How to do account planning – a simple approach, Mark Pollard, 2010.http://www.markpollard.net/how-to-do-account-planning-a-simple-approach/

Customer Advisory Board Strategy Guide, CustomerAdvisoryBoard.org, 2013.http://www.customeradvisoryboard.org/

How do they know their customers so well? T.H. Davenport, J.G. Harris, J.G., A.K Kohli, 2001. MIT Sloan Management Review, Vol. 42 No.2.

Achieve Sales Excellence: The 7 Customer Rules for Becoming The New Sales Professional. Howard Stevens, 2006. Platinum Press.

There is no more B2B or B2C: It’s Human to Human, Bryan Kramer, 2014. http://www.bryankramer.com/there-is-no-more-b2b-or-b2c-its-human-to-human-h2h/

Futures Company. Jay Walker-Smith, 2006.As Quoted in Johnson, Caitlin (2006), “Cutting Through Advertising Clutter.” CBS.http://www.cbsnews.com/news/cutting-through-advertising-clutter/

What’s an Experience Worth? Paul Conder. 2014.http://www.lenati.com/blog/whats-experience-worth

REFERENCES AND FURTHER READING:i CX INTEGRATION:

A WORTHWHILE JOURNEY FOR B2B AND B2Cii

iii

iv

v

vi

vii

viii

ix

x












B2B

122 123



http://www.beyondphilosophy.com/wp-content/uploads/2013/12/Global-Customer-Experience-Management-Survey-2013.pdf




http://www.value-eng.org/value_engineering.php

http://www.value-eng.org/value_engineering.php

http://www.mikebosworth.com/solution_selling.html

http://www.mikebosworth.com/solution_selling.html

http://www.markpollard.net/how-to-do-account-planning-a-simple-approach/

http://www.markpollard.net/how-to-do-account-planning-a-simple-approach/

http://www.customeradvisoryboard.org

http://www.customeradvisoryboard.org

http://www.bryankramer.com/there-is-no-more-b2b-or-b2c-its-human-to-human-h2h/

http://www.bryankramer.com/there-is-no-more-b2b-or-b2c-its-human-to-human-h2h/

http://www.cbsnews.com/news/cutting-through-advertising-clutter/

http://www.cbsnews.com/news/cutting-through-advertising-clutter/

http://www.lenati.com/blog/whats-experience-worth

http://www.lenati.com/blog/whats-experience-worth

CUSTOMERLOYALTYTHE

CONNECTIONEXPERIENCE

HUMAN CENTERED MARKETING LENATI LLC 2014

LOYA

LTY

124 125

FROM THE GROUND UP

Think of the last time you took a trip on a plane. The experience surely involved several steps - from selecting and booking your flight online, to checking in from your phone, getting to the airport, waiting in queue, security, maybe a little shopping to kill the wait time, lack-luster food, dozens of repetitive service interactions... And this is all before you get on the plane. How long did the whole journey take? Was there anything about it that was outstanding? Or disappointing? What was the journey itself like? How easy was it to navigate through a new airport at the destination? Or to get into town? There is an enormous amount of complexity behind a fairly mundane trip.

Now ask yourself this: If you were given the choice, would you take exactly the same journey again? Or would you take another airline, use another booking site or taxi service? Besides price, which factors would influence that decision next time?

The example of an airline flight points to something every customer understands, and something most companies seem to simply ignore: There is a clear, intuitive and direct connection between a customer’s experience and their loyalty to a brand.

We could repeat this exercise any time someone is engaged as a customer or a client. It could be a visit to a doctor or a retail store, an online purchase or browsing new music on a smart phone. The customer could be representing a business (a B2B transaction) or they could be making a purchase for themselves (B2C.) Either way, the company involved likely has two separate strategies and corresponding management teams in place: one to foster a positive experience, one to foster loyalty. And it’s very likely those strategies are completely out of sync with each other. As we shall see, the integration of these two areas of focus is a massive opportunity to build a stronger customer connection.photo: Remco Groeneweg

LOYA

LTY

126 127

BEYOND THE SILOS

Most companies have been organized for growth to replicate a fairly static concept outward in order to penetrate a market. This kind of organization can accelerate expansion by having highly specialized teams roll out the same program over and over. They do not need to communicate between groups very often, if at all, because they are all operating on a fixed program that was established from above. Groups are usually defined by operational criteria (the construction team, the digital team, the sales team, etc.) instead of being aligned around how they contribute to the customer’s overall experience. Even the agencies that serve these companies are often broken up into teams that rarely co-ordinate around a holistic plan.

This is good for speed, but it’s awful for innovation. That siloed model is broken. In a world that is in constant flux, an organization of silos is unable to adapt with any consistency to shifting customer needs, especially across multiple channels. It also causes an over-emphasis on the operational side of the company. How many times have we heard someone say that a mobile POS system or a new iPhone app is the key to customer experience? This myopia usually can be attributed to a narrow area of ownership. If you are only in charge of making ads, the solution is usually another ad. Holistic approaches generally are a tough sell.

In this system, customer experience and loyalty are usually completely separate departments. The two fields are seen as distinct disciplines with different methodologies. But as we saw on the previous page, that’s not how the customer sees it. Loyalty for them is an outcome of a positive experience. And that experience is driven by everything the company does.

photo: Mattingbgn

128 129

LOYA

LTY

While the CX team and the loyalty team may be isolated in many companies, they actually need to share a good deal of research, insights and strategic direction. The diagram below shows a partial list of shared resources between the two fields. And this amount of sharing is common even today, in the siloed and specialized structure we have discussed on the previous pages. Moving these departments closer to each other wouldn’t just benefit the customer, it would (ironically enough) streamline the operations of the company itself.

STRATEGY

Vision

CX Design

Brand Strategy

Disruptive Innovation....

MARKETING SALES RETAILPRODUCT MFG. SALES MARKETING DIGITAL RETAIL

PRODU

CT

DES

IGN

DIS

TRIB

UTI

ON

PRODU

CT

MGM

T.

LOGIS

TICS

PU

RCH

ASIN

G

SALE

S O

RG.

INCEN

TIVES

BRAN

D

COLL

ATE

RAL

IDEN

TITY

WEB

SIT

E

SOCIA

L

STO

RE

OPS

NEW

BU

ILDS

A BROADER VIEW

Customer experience (CX) and loyalty both require integration across functional and programatic aspects of a company. This can only be done from the layer at the top of most companies. Without that integration, the people on the functional teams will tend to focus on executing at the layer below.

Without

integration at

this level...

....the people

in these

functional

groups....

....tend to

focus on the

execution of

these

programs in

isolation.

CUSTOMER JOURNEY MAPPING

TECHNOLOGY PLATFORMS

EXPERIENCE DESIGN

CX

CUSTOMER INSIGHTS

BUSINESS GOALS

SEGMENTATION

ANALYTICS

CRM

SERVICE DESIGN

CHANNEL STRATEGY

LOYALTY

LOYA

LTY

130 131

A MATTER OF SCALE

One area that has caused a barrier between loyalty and CX in the past is the way practitioners view the customer. Both fields use similar tools to understand the customer’s behaviors and preferences; they just tend to look at the results at a different scale.

When considering a customer’s loyalty, several factors can come into play, but the long-term engagement between the customer and the brand is the goal. Ideally, this involves moving a customer along an imagined “engagement ladder” from initial awareness through to long-term retention and eventually advocacy for the brand. While smaller moments during this large-scale “customer lifecycle” are important to maintain engagement, the big-picture view is where it’s at for a loyalty practitioner.

In CX, the area of focus can be much smaller: down to individual touchpoints, interactions or transactions. The overall lifecycle is important, but the day-to-day work of the CX designer lies at a more granular level. When a CX practitioner discusses a “customer journey” they can be referring to a series of experiences that can last as little as a minute or two, for example visiting a cafe and purchasing a cup of coffee or chatting online with a representative to sort out a technical issue.

To take an integrated approach, we can consider the large-scale lifecycle to be made up of a series (often with several repetitive elements) of individual experiences or journeys. Loyalty and CX can share the same research this way, and both fields can benefit.

LOYA

LTY

132 133

FROM MACRO TO MICRO

CX may tend to operate on a smaller scale than the entire customer lifecycle. But any CX team is interested in creating experiences that are relevant to the customer, and a big part of that involves understanding the maturity of the customer’s relationship with the brand.

Here is a simple example: A large food and beverage company realized that only a small number of customers ever glance at the menu. Through research, it was fairly simple to understand why: most customers have been through the process several times before and so already know their choices from memory. This should tell the CX team a few things. Firstly, the menu design itself should be designed to be part of a welcoming experience for new customers. Secondly, because new customers tend to take longer to place an order, it’s probably worth testing out a version of the menu that appears earlier in queue, thereby giving the new customer more time to browse and not having to wait till they are at the POS to make a choice.

This example illustrates how customer lifecycle affects individual touchpoints during a brief journey. But this principle affects much more than just touchpoint design. As more and more data is collected about customer patterns, both online and off, many companies are working towards heavily personalized marketing tactics targeted to each customer. Anything from individualized offers and promotions to VIP services to pre-curation of products to specialized content can be used to deliver a personalized experience. Key to this understanding is the simultaneous view of the customer’s journey on a granular level, and the customer’s long-term relationship with the brand - which up to now has resided with the loyalty team. It’s clear how the CX team could benefit from the perspective of the loyalty team. But how does it work in the other direction?

photo of grape leaf: Zbysek Nemec

134 135

LOYA

LTY

FROM MICRO TO MACRO

Customer loyalty is a long-term goal, and requires a long view of the customer relationship. But each step taken in that relationship happens at the micro-level. The relationship with the customer, and in turn their loyalty to the brand, is made up of small-scale interactions. These are usually in the realm of CX, but customer loyalty is totally dependent on these small steps.

When building a loyalty program, the team focuses on developing customer experiences that drive long-term engagement with the brand. To accomplish this, they research the customer’s patterns and spending and then develop sophisticated models to segment customers into groups based on how they engage with the brand. Next, they devise ways to intervene in the customer’s journey that are relevant to each customer segment in order to encourage them to get closer to the brand. Finally, a program of touchpoints is put in place to enable those experiences. The program is tested, results are measured, tweaks are made if necessary, and the program is rolled out.

This could also be a definition of the practice of CX.

The question at this point is less about “how are CX and loyalty similar?” more about “why are they separate fields in the first place?” Loyalty may have gotten its start with simple points-based rewards programs, and CX may have gotten its start in design. But now that both fields have matured, they are almost indistinguishable in practice. Both are driven by the same technology, both are centered on the customer’s journey as they interact with the brand, and both share the same goal of increasing engagement over time.

photo: NASA

136 137

LOYA

LTY

UP THE ENGAGEMENT LADDER

Today’s businesses find incremental growth and improved customer loyalty through strategies inspired by deep analytics and customer insights. Measuring performance and experiential characteristics at each touchpoint along the customer’s journey provides granular insight into your customer’s experience of the brand. Converting these broad and diverse data points into a model that reveals correlations between brand interactions at the micro-level and customer lifetime value (CLV) at the macro-level is the aim of an engagement ladder.

Engagement ladder models are the new analytics standard for optimizing customer experience and building loyalty. Unlike past analytics models heavily focused on transactional behavior, engagement ladders use the full set of data attributes available to understand how any sort of brand engagement leads to increased (or decreased) patronage of the business. This includes online or in-store visits, discussion of the brand between friends on social media, use of related products/services, participation in rewards or loyalty programs, use of various payment methods, and a myriad of other potential data attributes. Each company’s engagement ladder will look different, as the customer experience and related value propositions are never exactly the same. Just the process of building these tools often reveals interesting and unexpected insights into activities or experiences that correlate to customer value.

It’s tools like engagement ladders that ground companies in the real world connectedness of customer experience and loyalty. A key end-goal of any holistic approach to CX is to make it easier for customers to engage with the brand in ways that are correlated to lifetime value. This same CX-driven approach also aids loyalty marketers in their search for comprehensive strategies that extend beyond the traditional bounds of marketing programs or promotions.

photo: Futurilla

138 139

LOYA

LTY

LOYALTY DRIVEN BY CX: STARBUCKS

Starbucks is so well known as a leader in customer experience that in some CX design circles even referring to the brand can be seen as a cliché. But we feel it’s important to highlight their work here because of an often overlooked aspect of their customer loyalty strategy. “My Starbucks Rewards” (MSR) is an example of a holistic loyalty program that is enabled in-store and through digital, mobile and social experiences. It plays off an improved and streamlined customer experience as a core driver for customer loyalty. The Starbucks mobile app provides a simple, easy and engaging experience on a mobile device in-store, including a mobile wallet feature that currently accounts for approximately 15% of Starbucks’ in-store business. Starbucks is constantly innovating to improve the “phygital” experience around the app, including current testing of app-enabled ways to help reduce wait times in a busy store. This improvement in overall customer experience, coupled with a simple rewards program, drives long-term behavioral loyalty on the part of the customer.

Other brands can learn from this by searching for similar “core experience improvements” they can make. By focusing on ease, speed, simplicity - and then building the loyalty program around those improvements - businesses will find that improving CX and improving behavioral loyalty will go hand in hand. Another key take-away is the integration of experiences across channels. This omnichannel approach takes a holistic view of not just CX and loyalty, but also the integration of digital and physical experiences to better engage the customer.

photo: John Tregoning

140 141

LOYA

LTY

BUILDING AN INTEGRATED APPROACH Through our combined work in CX and loyalty, we have uncovered three key steps to achieving a holistic CX loyalty strategy. These three steps mirror the process behind both practices, and align with the design research process discussed in depth in our previous articles, “The Art and Science of Engineering Experiences” and “The New CX Toolbox.” available from lenati.com. DISCOVERY. The first step to achieving an holistic CX/loyalty strategy is to view the brand from the customer’s perspective. This will scale from the individual interactions online and off, all the way up to an understanding of how a customer’s relationship with the brand evolves over time. In the process, it’s important to identify several key aspects to the customer’s experience in the current state:

• Painpoints in the customer journey that can foster a negative experience and reduce long term loyalty: What is the low-hanging fruit that we can pick off to improve a customer’s brand experience?

• Drivers for long-term loyalty: What factors in the experience can be identified as motivators for a customer to increase engagement?

• Customer behavioral patterns and opinions around digital and physical touchpoints in their journey: How does each touchpoint affect the customer’s experience in the real world? Where does the customer derive value in these experiences?

• Operational frameworks that support these experiences: How does the company currently enable these experiences? How much does it cost to enable them? How can this system be improved operationally?

• Financial data, correlated to the above four points: How do all these things combine to affect the customer’s spending? What is the potential return on investment in making a change?photo: Pavel Ševela

142 143

LOYA

LTY

ANALYSIS & IDEATION.From the data collected in the discovery phase, formulate a model of how the relationship between customers and the brand typically matures. Then consider a future state that increases this motion.

• How do customers segment along this large-scale timeline?

• What could potentially motivate these different groups to increase engagement, loyalty and spend? How can we increase our value proposition to these different groups?

• How could we intervene in the customer journey to increase the likelihood of customers moving along this timeline sooner?

• What services or experiences would differentiate our approach to the customer from our competition?

• What experiences would make our brand more compelling?

• How can you reward and motivate your customers on an experiential level? This goes far beyond “loyalty points” to engage with people in ways that are relevant to their values and lifestyle.

• How does all this balance with operations and infrastructure?

• Based on correlations between the company’s financial data and customer insights, what could be the potential return on investment if we made these changes?

There is a trap to avoid in this stage. The tendency for teams to want to focus on individual touchpoint design. Things like “let’s build an app” or “we need a genius bar” are comfortable places to start for many, but can cut off larger questions like the ones above. Eventually the team will narrow their focus to the micro-level to develop digital tools, service frameworks and physical environments to enable the customer’s journey. But the bigger picture around increasing customer engagement needs to be understood first for these touchpoints to work in the real world with real customers.

144 145

LOYA

LTY

TESTING. Using the projections for potential return on investment as a guide, prioritize your concepts based on the likeliness for success for both the customer and the brand. It is quite likely that there will be some surprises here, as team-favorite concepts need to stand the test of cost/benefit to both parties.

Test out mockups of the concepts, first in a controlled setting using simple and inexpensive means. This could mean simply asking for feedback on the concept from a small customer group or a focus group made up of subjects from outside of the project team. It could mean digital or physical mockups being built and tested. It could even mean including some of your top customers in the process to engage them in the development of concepts directly, helping to replicate the conditions that drove them to become your best customers. If there is negative feedback at this stage, that’s good. You haven’t invested much, and you have learned a lot. Modify the concepts based on this input and test again in this low-risk environment. Filter out the worst performers and prioritize your ideas with the most potential to benefit the customer and the brand.

If possible, try out the concept in a small market, and compare results of the test against a similar control market. (For example, two cities, similar in size and with similar demographics. One gets the test program and the other doesn’t.) Be clear that this is a limited test, so expectations are set with the customers in the test market around limitations of the offering. Watch for shifts in spending and engagement in the test market that didn’t occur in the control. Ask for customer feedback. How has the tested concept changed perception of the brand? In long-term loyalty? In perceived value? What is the potential upside for the company if this concept is implemented? Are there any more modifications to the program that need to be tested and proved out before we can roll this out?

146 147

LOYA

LTY

Some of our most successful tests have used prototypes that could be easily modified in the field, allowing the feedback from the test to guide the next iteration without requiring a lot of downtime in between. For example, a loyalty program that is enabled through an app can have small changes to the app interface uploaded almost instantly. How did those changes affect customer behavior and perceptions? Tests do not always need to be based on totally static concepts, and small improvements to the experience can be found to have enormous effects on customer patterns.

Social media can play a key role in testing at all levels. The ability to listen in on posts and tweets gives the team an unprecedented and nearly instant view of customer opinions, and an opportunity to engage with stakeholders directly. Even the inclusive design approach mentioned earlier can be enabled through social media, cutting costs and speeding up the process.

ROLL OUT & MEASUREMENT.Armed with a strong program concept and real world results to back up the business case, it’s time to build out the operational plan for roll out of the program at full scale. But even after implementation, our job is not done. Measuring the effects of the new program in the same terms used in the discovery phase will show us how to continuously improve the program from the customer’s point of view and to streamline operations.

photo: XPRS

148 149

LOYA

LTY

Lenati LLC


[email protected]

1 800 848 1449

CONCLUSION

According to Forrester’s report “The Business Impact of

Customer Experience” (Maxie Schmidt-Subramanian,

June 10, 2013) a customer’s willingness to repurchase

has a 0.71 correlation to CX, while likelihood to switch

to competitor has a negative 0.42 correlation to CX.

These statistics put numbers on what customers have

known for a long time: that the experience someone has

when they engage with a brand, whether online or in

person, affects the loyalty to that brand. Loyalty

programs that only skim the surface by offering the same

points-based program across all customer segments will

reach a limit to their effectiveness. To reach the goal of

increasing customer loyalty in the real world, CX needs

to be part of the strategy. This means personalizing the

offering made to the customer, ensuring the offering has

value for their level of engagement and personal profile,

driving relevance in content and services to the

customer, and building experiences into the program

that go beyond simply offering items for free. This can

scale all the way up to specialized services and

experiences for top customers, or it can be as simple as

providing a streamlined way to pay for a cup of coffee for

all members.

We’ve seen that this approach has wide-reaching effects, touching virtually any industry with a customer-focus. From hospitality to retail to financial to travel to healthcare, these principles can help business make a stronger customer connection.













150 151

LOYA

LTY



THE ART AND SCIENCE OF CUSTOMER EXPERIENCE

Paul Conder Kris KleinA COLLECTION OF SHORT ARTICLES FROM LENATI’S CX PRACTICE

with contributions from Clay Walton-House, Jake Bryant, Erin McMonigal and Laurie Meek.

Documents

THE ART AND SCIENCE OF CUSTOMER EXPERIENCE - Lenati