Business Model And Brand: Keys To Customer Experience Innovation

At Forrester, we define customer experience as how customers perceive their interactions with your company.

Over the past few years, my colleagues and I have written a lot about the perceptions piece of that definition. Here’s a quick overview: Customers’ perceptions occur on three different levels, which we collectively refer to as the customer experience pyramid. At the base of the pyramid is “meets needs.” Do customers perceive that you’ve met their basic needs and provided value through the interaction? Then we layer on “easy.” Do customers perceive that you’re easy to do business with or that they have to jump through a bunch of hoops? And at the top of the pyramid is “enjoyable.” Do customers perceive that you’re enjoyable to do business with — that you’re connecting with them on some personal, emotional level?

Now let’s talk about the interactions themselves. Customers interact with your company at all stages of the customer journey: discover, evaluate, buy, access, use, get support, leave, and re-engage. But it’s not enough to know that these interactions exist. If you want to shift your customers’ perceptions, you have to examine those interactions on a deeper level. Specifically, you need to look at the types of interactions customers have and the qualities that those interactions embody. And that’s where your business model and your brand come into play.

Your business model determines the types of interactions customers will have. How can your customers interact with you? Can they buy your products and services directly from your mobile app — or do they need to go to a brick-and-mortar third-party retailer? Do you have self-service customer support on your website — or do your customers call an outsourced call center when they need help? The answers to these questions are deeply rooted in your company’s business model.

For example, Zipcar’s car sharing business model necessitated de-centralized, nonstaffed access to vehicles, which in turn drove a need for keycard (and then mobile phone) vehicle entry — a type of interaction never conceived of with business models based on vehicle ownership or centralized, staffed rental locations. And mobile operator giffgaff built its business model around social platforms and a tiny number of core employees. The result? When customers have questions, they speak to each other — not to giffgaff.

While the connection between business model and customer experience might be obvious, I don’t find that many companies actively consider the two in tandem.

Brand values drive the qualities of those interactions.  What does your customer experience really feel like? Do your sales reps maintain an air of professional distance — or do they chit chat with your customers about their plans for the upcoming weekend? Do you have generic stock photography on your Facebook page — or custom imagery that evokes a particular emotion? The answers to these questions represent the more intangible attributes of your customer experience, and they’re deeply rooted in your brand. They’re what make any given interaction feel like it really belongs to your company — and only your company.

For example, if you walk up to a check-in kiosk at an airport and the word “Howdy!” scrolls across the screen in gigantic letters, you’re likely flying on JetBlue. Or walk into any Westin lobby, and you’ll surely be greeted with its signature white tea scent and tasteful floral displays, both of which reinforce the hotel’s calming, sophisticated brand.

Companies that want to differentiate their customer experience need to go beyond find-and-fix efforts that result in incremental improvements. They need to innovate the customer experience by refocusing on their business model and brand.

I'll be speaking more about innovation, business models, and brand at Forrester's Customer Experience Forum East, June 25th and 26th in New York. Hope to see you there!

Comments

Customer Experience Framework

Hello Kerry,
Interesting to learn about your pyramid approach to defining customer experience. I have a framework of nine factors that define customer experience in my just released book. You can download the framework chapter for free http://bit.ly/11Gmzhq.

Both of our frameworks more or less define the same set of customer experience needs. I have taken this further and have over 30 examples of companies using customer experience to innovate and differentiate themselves in the marketplace. These companies have won big and have won against all odds. That is the power of customer experience.

It would be great to sync up with you sometime and compare our frameworks and research findings.

Best
Jagan

Business Model & Brand Apply to Non-Profits, Too

My Guest Experience clients are in the non-profit world (primarily churches), and many are beginning to see the connection you make here. While many would not call it a "business model," they all operate from some sort of strategy document that guides their decision-making process. As we work with them on a process of recasting vision, clarifying vision, articulating vision, and then advancing vision, we find a growing curiosity about serving their "customer" - Guests and attenders. By following our "Guest Experience Blueprint," they are able to move forward with clarity. Depending on the client, our Branding services are interwoven into the actions as well. Thanks for your continued excellent work in customer service resources!

Internal Customer Experiences

I would like to hear more thoughts on the importance of internal/lateral service experiences in organizations. I am specifically interested in support roles in higher education.

Strategic Service Design

Hi everyone, really interesting discussion. Thanks for the article Kerry. Jagan I read your Shift article and it is really great. I am working on a marketing approach to customer experience called Strategic Service Design. It takes the principles of Service Design and designs a customer experience. Love to connect with you Jagan.

for more information about my service visit
www.strategicservicedesign.com.au

Innovation is not a differentiator any more

Nice post Kerry

Here are my thoughts -

Business model:
Lot of companies seem to be thinking mostly about the 'delivery levers' of value creation within the business model context, and they are leaving out value creation and capture from their customer experience strategy. There was so much talk about omni-channel and seamless experience etc, which is fine, but for continuous Innovation, companies need to focus on the create/capture phase as well.
My blog: 5 Steps To Success on the Customer Experience Management Journey - http://blogs.sap.com/innovation/sales-marketing/5-steps-to-success-on-th...

Innovation is no longer a differentiator, Innovation stickiness is - Time to market has a younger cousin now - Time-in-market
http://scn.sap.com/community/business-trends/blog/2013/05/20/innovation-...

Brand:
Brand managers have to move from message 'communicators' to message 'interaction enablers' and/or aggregators, which means giving up control. This bring market insight into the company instead of going into the market and searching for it. The intersection of intellect and insight is what triggers the Innovation spark.
My Blog: Social CRM Transformation And The Path Ahead http://blogs.sap.com/innovation/sales-marketing/social-crm-transformatio...

-Ramesh
Twitter @Ramesh_Ramki

The art of remembering

Great blog post Kerry.
In this “Age of the Customer” we expect a great customer experience that is consistent across all channels. There is simply no way you can do that without tying the experience to your brand promise and your business model. You are who you are, and maintaining a customer experience that is inconsistent with such fundamental thinking is not sustainable.

I would add that you need to engage with your customers during these interactions in a way that you demonstrate that you remember him or her and recognize them as individuals. On top of an experience that considers the business model and the experience in tandem, you can add a whole new dimension with real-time memory: remembering who your customer is, her preferences, the sentiment, details and context of previous dialogues and interactions. This is essential if you aim for the emotional top of Forrester’s customer experience pyramid. It’s simple really: people will not connect emotionally with your brand/company/product/service unless they feel recognized and appreciated.
In my experience, your CRM or ERP system will be unable to provide you with a real-time, complete and relevant set of customer data that enables you to do this. What you need is a capable People Data Hub to make your business a truly customer centric business.

I work Inde a hospital where

I work Inde a hospital where thé services are paid by thé government. We have plenty of customers but our client services could be improve. Do we approach the same way for à non profit organisation ?

Nice guidelines are provided

Nice guidelines are provided by you to make your business a truly customer centric business. I truely appreciate it...