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IMPACT TOUCHPOINTS FRAMING THE CUSTOMER EXPERIENCE AN AGENDA FOR IMPACTING THE CUSTOMER: REFERENCES
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Idea in Brief
Championed Best Practice: Organizations enjoy measured success with CRM programs and direct marketing when they embrace Customer Experience Management as an extention of their current customer centric programs. Challenged by Customer Reality: But customers have taken control over their decisions, utilizing more information sources, in particular social media, and making decisions far earlier than the existing techniques can come to bear.
An Agenda for IMPACTing the Customer: An approach and a framework are presented that extend customer experience to include the structured understanding of the entire decision making process, focusing early on differentiated customer needs and touchpoint choices particularly social media then proactively impacting those touchpoints in a process that provides an updated, sustainable customer-organization interaction designed to understand and satisfy customer needs along every step of the customers modern decision-making journey.
Figure1: Traditional Customer Experience Chain A more widely encompassing definition of the customer experience that includes, for example, a structured understanding of needs identification or options awareness, has traditionally not been included in the customer experience chain because the attention paid to these very tangible aspects has proven so important that it provided immediate and marked differentiators, even in mature and highly saturated markets.
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For example, Audi tracks the customers post-purchase experience and ensures that the sales representative can keep abreast of their customers status because at some point they will need a new car. Even in areas where a focus on the customer has not been at the forefront of differentiating strategies, like in the energy industry, there are clear leaders emerging. Lichtblick, the 100% green energy provider in Germany, maintains its leadership not just through a commitment to being green but through an extreme focus on knowing and understanding every point of contact with the customer, defining key metrics to measure them, setting targets, and then checking weekly to ensure they are meeting these goals. It should come as no surprise that Licktblick CEO Christian Friege has accepted the award for Germanys most customer-oriented utility two years running (Deutschlands kundenorientiertester Energieversorger 2009 and 2010). Marketing has focused strongly on early identification of market needs, particularly through use of market research and focus groups. Successful organizations have translated this understanding into programs that help promote their products, services and brands using above-the-line techniques, such as television and print advertising, to reach their general markets and below-theline direct marketing techniques for their target markets. However, they have not typically concerned themselves in a structured way with understanding, capturing and proactively responding to the decision-making process of the individual. Indeed: this has not always proved easy to do. For most organizations, the needs identification and awareness of target markets (handled many times by marketing) and the customer experience of the individual processes (handled many times by customer service) have been separate topics, but todays customer reality, particularly with the take-up of social media, is forcing a change in that approach.
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The customer decision-making chain or the purchase decision making process of a customer is a special form of the cognitive process every human goes through in making any kind of decision. Daniel Kahnemann and Amos Tversky were the first to define this well in their seminal research on decision making and cognitive processes. An individual first becomes aware of a need or a want; then a search is conducted for alternatives that will satisfy those needs. After undergoing a complex mental activity of prioritizing the best possible options, given all inputs, a choice or compromise is then made. The evaluation criteria are not purely rational or logical but contain strong elements of emotion, personal values and risk assessment. After a decision is made, steps are taken to approach and execute on that choice. A take-up and usage phase contributes to the final step, which is to learn from that choice and remember the decision process, along with its conclusions and a chronicle of what took place, for future reference.
Focus on Needs
When it comes to business, there is a tendency to confuse the delivery of a product or service with the satisfying of needs, values or wants. Equally fallacious is to assume that offering a sensational new product or service can self-generate the need for it; such apparent cases in the past were most probably due to a lucky strike that fulfilled an existing customer need. When we define customer needs around the jobs that customers are trying to get done, then we can see that new innovationseven the most radical or disruptive innovationsdo not create a customer need. They simply satisfy a customer need in an innovative way (Bettencourt 2009). For our purposes,
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needs, values and wants are interchangeable: something that is perceived by an individual as being necessary or desirable to having a good/better life. These can be broken down into basic categories.
Figure 4: Categorization of Needs, Values and Wants This clear framework breaks down needs into Utilitarian, Social and Emotional components. On the left side of Figure 4 are the basic utilitarian, functional (or rational) needs. Convenient, Economical and Safe are all what could be called the foundational criteria of any decision. These topics relate to the cognitive function that makes analytical, logical, rational, objective decisions, looking at all parts individually. In todays business world, these elements are not simply hygiene factors: they show basic competence. Failing to fulfill these needs as a company may mean eventually forfeiting the right to continue playing in that market. A spectacular (negative) example of failure to get these very important factors right underlies the global financial crisis, where the perception of the public is that financial institutions neglected to satisfy and, in some cases, blatantly betrayed, their basic needs for safety, economy and trust. Center and right in Figure 4 are the social (Prestige, Identity) and emotional (Pleasure, Sentiment and Spirituality) needs and values, which play an extremely significant role in any decision-making process, as witnessed by the tremendous effort that advertisers, creative marketers and product designers pour into trying to address them. However, the systematic capturing of information about needs has traditionally focused on gathering information about the utility or functional needs typically information that can be gained through market research, focus groups, and surveys. These are used at a very high level to roughly understand a markets needs. When it comes to the soft values of social significance and emotion needs of people, not markets there have been some excellent academic papers,
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but so far, there has been no rigorous capturing of data leading to a comprehensive understanding and structuring of these customer needs. However, identifying, understanding and positively influencing needs can be achieved by looking at a targeted customer segments interaction touchpoints across their entire decision-making process.
When seen from the wider perspective of the Customer Decision-Making Chain (see figure 2), relevant touchpoints can also be informal channels such as chatting with a friend or using a natural sense (such as taste, touch or smell) to gain additional input. While important for some decision-making journeys, these touchpoints are of the kind that organizations have heretofore not been able to monitor or participate in directly, except on the smallest of scales. But even that is changing. The entire topic of social media represents a huge range of additional touchpoints that are readily available and, to some groups, very important for their decision-making process. There is also a trend to surface touchpoints electronically via new platforms which combine social media and traditional touchpoints with new forms of telephony, computing and electronic communication. Applications that scan a bar code while shopping and instantly compare prices, listen to a piece of music and instantly identify both the artist and music or use location-based services to identify alternatives close to the user are just a few current examples of this trend. But the fascination with the new technologies should not detract from understanding that to the customer this is simply another touchpoint that may or may not play a role in their decision making. Whereas in the past, the private conversation between individuals around a product, offering or company remained private, social media and the other new touchpoints now facilitate the exponential sharing of those conversations and opinions, exerting influence in ways that are not only important for individuals, but are critical for business. This means that one customers moment of truth whether negative or positive can be propagated to hundreds of others in a blink of an eye, and again to thousands of others in the next blink. Market-leading companies are already starting to treat social media in this way: as a cheap and effective repeating megaphone. The reality is that social media and other modern touchpoints are no longer merely interesting trends to be watched: in fact, they represent additional, critical touchpoints that must be understood in the context of their relevance to each stage of the decision-making process for targeted customers. And the need to re-evaluate and re-focus traditional channels, particularly television and print advertising, around that same decision-making process is now more important than ever. Once companies understand each touchpoint whether traditional, social media or
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otherwise and its relationship to their customers needs, they can begin capturing information about those touchpoints as the first step in positively influencing the decision-making process towards their product or service.
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the decision making cycle that were not even being used by this very high value segment. And this was just the awareness part of the decision process! If we multiply the missed opportunities in this small example by the myriad new touchpoints that people are using and their different needs, it is no wonder that we do not understand our customers as well as before. Those additional touchpoints need to be tracked and documented.
IMPACT Touchpoints
Customers WANT personalized contact with their chosen suppliers and they demand continuity in their relationships to their vendors across communication types. A recent survey conducted by Genesys found that the ability to communicate across multiple channels is critical to loyalty.
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Consumers wished to, for example, start in voice self-service or the Web and get live assistance from an agent, and to start in e-mail and have better integration with agent-assisted service without having to repeat all their information. And they were not bothered by the concept of their suppliers monitoring their touchpoints and even reaching out to them to improve their experience through extended offers or help during self-service transactions. In fact, 86% of consumers per country said they would find proactive engagement either a strong benefit or would welcome proactive assistance when they were stuck on the Web or in self-service. (The Cost of Poor Customer Service: The Economic Impact of the Customer Experience and Engagement in 16 Key Economies, Genesys, November 2009). In many industries, this has already been implemented for the controllable touchpoints: customer service centers, websites, written communication, self-service contact centers. However, others, such as many of the social media touchpoints, cannot and should not be owned or controlled. Indeed, this fallacy is a tripping stone for many companies who attempt to harness the strengths of social media in all the wrong ways. In Socialnomics: How Social Media Transforms the Way We Live and Do Business, Erik Qualman draws the following pertinent analogy: Now and in the future, marketers need to adjust their way of thinking because its no longer about building out the existing database. Instead, you could be in communication with fans and consumers on someone elses database (Facebook, YouTube, Twitter, etc.). Yet, many companies fail to grasp this new concept. They build elaborate YouTube or Flicker pages, placing callouts and click actions that send the user outside the social network, often to their company website or a lead capture page. These companies still believe they need to get users into their prospecting databases in order to market to them. They are doing a disservice to their loyal fan base and in turn a disservice to themselves. Its analogous to meeting a pretty girl in a bar and asking if she would like a drink. When she responds yes, rather than ordering a drink from the bartender, you grab her and rush her into your car and drive her back to your place; because after all, you have beer in your fridge (Qualman 2009). While it is still important to get potential customers into the database, at the same time there is a need for alternate approaches for those situations where it is not practical, appropriate or possible to simply capture the customer. And a decision on that approach needs to be taken at each touchpoint. At each touchpoint, especially in the uncontrolled/uncontrollable social media channels, it is necessary to determine which types of interaction make most sense and then decide how to engage with the customer appropriately along the decision making journey. We have identified five types of engagement that an organization can exercise with these touchpoints and a fitting mnemonic for them described here in order of increasing level of influence and involvement:
In most cases, the engagement types can be mixed and matched as needed for maximum clientcustomer interaction benefit. The first step is recognizing that a touchpoint exists and may have relevance. From there, these next levels involve making the conscious decision as to whether one should do anything proactive about the particular touchpoint, and if so, what.
Ignore: This is a documented go/no-go decision. For any touchpoint that is currently irrelevant
or of little to no interest to target audiences, any level of proactive engagement can carry a high cost: precious resources should not be spent frivolously. In this case, the best approach is to take the documented, definitive decision to ignore the touchpoint for the present. A good example here is Second Life, the free 3D virtual world. While still an important marketing channel to those organizations offering 3D virtual world products and services, many other organizations have found it not to be relevant for reaching out to and communicating with their target audiences. This could be because Second Life does not figure as a relevant touchpoint during most customers decision making cycles for the targeted products or services. The decision can always be reviewed again at a later time to see if there is new justification for treating that touchpoint in another way.
Monitor: Any touchpoint that plays any significant part in customers decision making
processes should, at a minimum, be monitored. For traditional touchpoints, the methods are well documented: the entire topic of Customer Intelligence has traditionally been concerned with the capturing of such touchpoint data that can be transformed into new, fact-based information about the customer. For other, modern touchpoints such as kiosk, new telephony devices, etc., the same holds true. The data is there and can be captured and monitored if it contributes to a better understanding of the customer. Social monitoring tools are becoming available almost as quickly as new social media touchpoints appear. Sometimes these are standalone tools: Twitter monitors, blog search tools, search analytics and news consolidation services are just some examples. But of even more significance are the emerging tools and services that span ALL social media touchpoints, allowing an organization to tailor its own touchpoint and search criteria through a single interface. Next it is important to decide whether the monitoring should be done as a standalone activity i.e. daily, weekly, monthly, quarterly, reports, etc. or if it should rather be included into a more structured process of data capture and utilization within the organizations existing customer intelligence infrastructure. At a minimum, the monitored touchpoint information should be distributed to those within the organization that have a clearly defined responsibility to take action for that touchpoint. Another
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step could involve taking that new, fact-based insight and feeding it back into a corporate memory of the customer either in the customer data warehouse or the customer intelligence practice so that it can be used to tighten and tune the accuracy of the models for describing the customer or by association the segment that accurately represents this customer.
Participate: The next type of involvement is to participate, which means taking the decision
to assign responsibility within the organization for proactively replying or corresponding through an existing targeted touchpoint that the organization did not create or control. Often, participate will be the right involvement type for an existing social media touchpoint, since the conversation and interaction cannot be controlled or screened and, in general, there is a very wide audience that can listen in to the dialog between any two parties. Examples here include responding to a comment in an existing blog, interacting with Twitter comments or openly joining social networks and communities and participating in the dialog. When participating, it is important to observe four fundamental rules: 1. Any participation must be real. It cannot be a ghost writer or an automated response. Many organizations have spent time and effort building a brand promise for their organization. This is where they need to ensure its authenticity. 2. Participation authenticity can be achieved employing an organizations own staff or specialized external personnel who have been trained to respond in the organizations name. The highest level of authenticity comes through enthusiastic customers who are natural advocates of the organization. 3. Remember that participation is not control; it will not always be possible to predict the course of interactions, or to stop activity that does not perfectly suit. 4. A solid social media policy, based on existing corporate, brand and communications guidelines, is how organizations best steer and guide the participation in touchpoints.
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making is the interaction with their friends in informal settings so the bank occasionally rents the best coffee shop in each town and then simply invites their customers to bring a friend along. In all cases when a touchpoint is activated, the organization is the facilitator not the owner of the mechanism. Many of the best examples of Social Media and Social CRM, whether planned or impromptu, turn out to be very good examples of activation.
ConTrol: There are touchpoints that can be controlled. A call center, an email channel, a web
site, a retail location or direct sales staff are all examples of touchpoints that an organization owns, and therefore can (and should!) control. In fact, there is a danger in not doing so: recently a major European telco was lambasted in the media for having responded to a comment on Twitter within 20 minutes but only because the equivalent email to the official customer support address was never answered at all. Bad press for an apparently good customer service response (quick reply to a Tweet) is unfortunate, but failure to react to customer inquiries that come through the proper, company-prescribed channels is perhaps unforgivable. Touchpoints that we can control are still the most critical in any decision-making process exactly because customers KNOW we own those touchpoints and they expect a professional clientcompany interaction. However, those touchpoints, whether call center, email or physical location, are sometimes expensive to maintain -- which is exactly where alternative controlled touchpoints can come in: Dell has made a huge success of going from email-based to community-based customer interaction, where not only staff but also other, user-rated experts help answer customer questions. Customer satisfaction is up and costs are down all thanks to understanding the IMPACT of alternative touchpoints. Even traditional above-the-line marketing channels such as billboard and television advertising are being refocused based on a better understanding of where they play as touchpoints in target customers decision-making processes. A good example comes from The Economist, who knows that advertising on newsstands around London is extremely relevant as a reminder touchpoint that reinforces its loyal readership with the message I am proud of being a part of this community, which naturally supports customers in renewing their subscriptions but more importantly serves as an occasional prompt to recommend the magazine to a friend. The five IMPACT types of engagement are all valid and relevant. Any given touchpoint type may warrant more than one form of engagement depending on its relevance to the targeted customer group. In addition, it may be appropriate to treat a touchpoint, say, during a customers awareness stage differently than in the purchase stage. Deciding which engagement strategy is right for which touchpoints needs to be made within the context of a Customer Experience Framework and the organizational capabilities that affect the experience.
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Figure 5 Framing the Customer Experience Within such a framework, touchpoint and decision journey elements can be prioritized and described from the customers perspective. Both current and desired future states can be mapped and a gap analysis performed across the organizational aspects to highlight necessary changes. Such a framework is useful for developing scenarios, benchmarks and simulation, or for providing the foundation for trying out new and innovative aspects of customer experience in a controlled and focused manner. Resource allocations, timing and change or implementation priorities can be highlighted and tracked.
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While this can be done manually or with normal computer tools, there are also new software packages that make the process of capturing, documenting and linking touchpoint interactions efficient and effective.
References
Bettencourt, Lance A., Debunking Myths about Customer Needs, Marketing Management, American Marketing Association, January/February 2009, pp 47-52 Boztepe, S., User Value: Competing Theories and Models, in International Journal of Design, Vol. 1 No. 2, August 2007. Kahneman, D. Tversky, A.,(2000) Choices, Values, and Frames, New York: Cambridge University Press. Liebetrau, Axel, Bankless Banking, BankInformation, December 2009. Baxley, B., (2002) Making the Web Work, Indianapolis: New Riders Publishing, 73-90. Surowiecki, J., (2004) The Wisdom of Crowds, New York: Anchor Books, 26-29. Qualman, E. (2009) Socialnomics: How Social Media Transforms the Way We Live and Do Business, Hoboken: Wiley & Sons, 38 - 49.
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