By Shaun Smith
Do you know what your most profitable customers value and the 3 or 4 most important attributes which drive their intention to repurchase or to refer you?
Without the answers to these questions you may have data, but you do not have insight. A key difference between simply providing ‘good’ customer service and a customer experience is being differentiated in a way that is valuable to target customers. Being different is not enough.
For example, the Fashion Café, the chain of restaurants created by fashion models including Naomi Campbell, was clearly differentiated in its use of fashion memorabilia in the design of its restaurants. However, its offer had no lasting value for people who go to a restaurant first and foremost for the quality of its food and service. As a result, once the novelty factor had worn off The Fashion café saw a decline in business.
Another example is Barclays, the UK based bank that created a very expensive advertising campaign to promote the fact that it is a big bank. The campaign bombed because most retail customers see no value in their bank being big. In fact quite the opposite; ‘big’ stands for impersonal and uncaring.
One more example: Like a number of business people, I use the Platinum American Express Charge Card for its travel service and benefits, yet I receive unsolicited direct mails shots from an organisation called Capital One on a weekly basis. The mail shots all say the same thing and offer me the same credit card promoting a low rate of interest. They always enclose a cheap ball-point pen in the envelope. This bank clearly has not taken the trouble to understand me, what I value, or develop an offer that is likely to appeal to me. It has gotten to the point that now as soon as I feel the pen through the envelope I throw it away unopened.
We can all avoid making this mistake — treating customers as if they are all the same … or worse yet, treating them all as if they were you. When we look at how we can provide value to each distinctly individual customer, we will be moving in the direction of the perfect customer experience.
By Shaun Smith
Richer Sounds is a UK based HI-Fi retailer which achieves the highest sales per square foot of any retailer in the world. Why? Because Julian Richer, the Chairman, believes that the customer and the employee experience are inextricably linked and so he uses uncommon ways to create a great employee experience and reward them for creating an exceptional customer experience. He creates a distinctive employment experience for his best performing “colleagues” by providing these employees with the loan of company Bentleys for the weekend and trips on the company jet.
Yet any other retailer attempting to copy these very unusual employee practices is likely to fail because they would not be linked to the customer experience strategy.
The fact is that unless your customer experience and employee experience are carefully aligned with
the strategy for your brand you are unlikely to stand out from the crowd. The issue is not what these companies do but why they do it? Best Practice assumes that what works for one company will work for another. In our view, it is far more important for organisations to first decide their strategy and then decide how they can bring it to life through creating and managing a customer experience that delivers this every day. Only then can internal processes and policies be designed to reinforce this.
Unfortunately, all too often, it is the technology that drives the strategy or customer experience. Expenditure on CRM systems grew from $20billion in 2001 to $46billion in 2004 yet Gartner Research estimated that 55% of CRM systems drive customers away and dilute earnings.
Most CRM systems are installed without any thought to how they will be used to deliver the customer experience. These powerful data bases allow companies to collect knowledge about the customer that can be used to offer them products and services tuned to their particular needs and preferences yet many organisations (and banks are the worst) use them as a blunt instrument to stalk, rather than woo, the customer: many customers think that CRM stands for Constantly Receiving Mailshots!