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Customer Experience Trends for 2012

It’s that time of the year when you start to draft your New Year resolutions and you want to have a glimpse of what’s ahead to make sure that this time around the resolutions are achievable.

Trendwatching.com have put together “12 Crucial Consumer Trends for 2012”. They provided a brief overview of 12 “must-know” consumer trends to assist companies in exploring creative and innovation opportunities to meet the changing needs of the consumer.

The top 5 consumer trends that we found most relevant to the customer experience are:

  1. Red Carpet
  2. Dealer-Chic
  3. Flawsome
  4. Emerging Maturialism
  5. Point & Know

One of the first consumer trends we thought relevant was— ‘red carpet’

Red carpet as a trend is explained as when businesses tailor their services and perks to pamper customers with (an individual-level of) attention and respect.

I think what they are trying to say is that the customer experience is a highly subjective experience. The customer touchpoints that offers this experience can be identified and staged but the human element at each touchpoint puts a ‘one-size-fits-all’ design out of the question.

If it’s not ‘one-size-fits-all’, then there must be some sort of customisation? So, the key to providing an engaging and memorable moment is through…personalisation. Personal connections can be established when you treat customers like humans and be human when you are serving them as well.

To roll out the ‘red carpet’, you will need to provide your service with personality.

The customer experience is ultimately the ‘sum-totality of how customers engage with your company…throughout the entire arc of being a customer’.

I think what this trend really means is that all customers enjoy being greeted by the ‘red carpet’ and in competitive times, customers, more than ever before; take pleasure in receiving individual attention from you. Customisation and personalisation drives individual customer satisfaction, consequently enhancing the customer experience quality.

You need to help customers feel that they are receiving individual attention, without compromising your productivity goals. The logic of this is described in the concept of ‘mass customisation’ (introduced by Pine 1993) where firms need to strike a balance between standardisation (for productivity reasons) and customisation (for customer satisfaction reasons).

Your job is to make customers believe that the ‘red carpet’ is a unique arrangement for them to individually enjoy, whilst you can safely report to your boss that the carpet is simply a welcome mat resting at the entrance of the company.

Or another way of saying it is to appear as though you are only killing one bird with one stone.

In our next blog post we will be discussing the consumer trend of ‘Dealer-Chic’ where the consumers’ desire for discounts and deals has become a way of life, consequently playing a key role in the customer experience.

In the mean time, here is an excerpt from the trendwatching article.

1. RED CARPET

In 2012, businesses around the world will shower Chinese customers and visitors with even more tailored services and perks, and in general, lavish attention and respect.

China is the new emperor, and outpaced companies, flailing nations and even broke monetary unions are looking to the Chinese to bail them out. No wonder red carpets are being rolled out wherever Chinese politicians and CEOs currently set foot. In 2012’s global consumption arena we see a similar picture: department stores, airlines, hotels, theme parks and museums, if not entire cities, around the world are going out of their way to shower Chinese customers with tailored services and perks, and in general, lavish them with attention and respect.

Some stats:

  • Chinese residents made over 30 million overseas trips in the first half of 2011 alone, up 20% since 2010. For comparison, US citizens made only 37 million outbound air travel trips during the whole of 2010 (Source: China Ministry of Public Security, July 2011; Office of Travel and Tourism Industries, September 2011).
  • And that’s just the beginning: The World Tourism Organization has estimated that the total number of outbound tourists from China will reach 100 million by 2020.

Count on Indians and Brazilians to be on the receiving end of the RED (OR ORANGE OR GREEN) CARPET trend too. Some examples:

  • In July 2011, Hilton Hotels Worldwide created a service targeting Chinese travelers. Called “Hilton Huanying” (Mandarin for “welcome”), the program is available at 30 Hilton hotels across the world, and offers tailored assistance for Chinese guests, including check-in in their native language and in-room facilities such as Chinese tea and television channels, as well as slippers and a welcome letter in Mandarin. There’s also a breakfast buffet available, with congee, dim sum and fried noodles on the menu.

If you would like to read more about ‘Red carpet’ as a trend for 2012, please press http://trendwatching.com/trends/12trends2012/?redcarpet  One of the world’s leading trend firms, trendwatching.com sends out its free, monthly Trend Briefings to more than 160,000 subscribers worldwide in 9 languages.

Is keeping your customers reliably satisfied a good strategy?

Your “average” performance may look pretty good on paper, but to clients’ eyes, consistency is the only measure that matters.

I found this this article off Business Week, (original here) from 2005 and although 5 years old, it still has good advice for anyone in an organisation that is working towards providing their own customers a great service experience.
I heard Jack Welch speak recently when he came to town to promote his new book, Winning. The former CEO of General Electric (GE) said something I’ve been chewing on all week. He told us that customers prefer a consistent experience, vs. an occasionally great one. Frankly, I had never given this idea much thought before.

Welch gave the example of a company shipping parts to a customer. Their packages arrived on Day 5, Day 10, and Day 15. Logically, you could say that the parts arrived in an average of 10 days. In reality, after 15 days, the customer is furious, regardless of the previous quicker deliveries. The pleasure from Day 5′s arrival did not cancel out the anger of Day 15′s.

THE EUREKA MOMENT.  His point is that customers don’t care about your averages. They want less variation and more reliability. Variation, Welch says, leads to “unpleasant surprises and broken promises.”

The same week I heard Welch speak, my friend Georgia Patrick called. She has been an ace marketing consultant for more than 30 years. When I asked her what was new, she laughed as she said, “In your presentations, you talk about the importance of selling as a system. In your conversations with me, you have emphasized that you don’t have a lot of things to remember, but you do need to have a system. You’ve pounded it into me that it’s the ‘sticking to the system’ that works, 100% of the time.” She was so excited about this “eureka” that I took note of it — systems.

Jane Sandlar is a longtime friend who told me something years ago that I have never forgotten. She said a key to success for her award-winning technical-writing company was the power of duplication. That is, she did one thing well and repeated it, vs. doing 50 things one time each. She developed a standard system for selling, creating, and producing the deliverables, and then duplicated it so all customers received a consistent experience and product.

SIXTY-PERCENT SOLUTION.  Consistency. Systems. Duplication. There’s a common denominator from these three experts. If you develop selling and business systems and duplicate what works, you will produce a consistent, reliable customer experience. The result is you’ll have happier customers, more sales, and more referrals. Voila, The payoff from the science of selling!

Now let’s look a little more deeply at consistency. Welch is a huge fan of Six Sigma, the well-respected quality-improvement program. However, he frankly admits just the mention of it makes eyes glaze over, and he even titled a chapter in his book, “Six Sigma: Better than a Trip to the Dentist.”

Welch calls the process “an extremely powerful way to boost a company’s competitiveness.” I’ll spare you the details — he said you’re 60% of the way to becoming a Six Sigma expert if you just understand that “variation is evil.”

WORD OF MOUTH.  Getting 60% of the way there by keeping three words in mind works for me. To see the power of this phrase, just look at how variation is evil in your own buying experiences. When you’re told by the airlines that your flight should arrive at 10:14 a.m. but instead you arrive at 10:44, you may be hopping mad — and you wouldn’t be consoled one bit to hear that last week, this same flight came in a half-hour earlier than scheduled.

Your flight was on time on average, but that’s benefit to you. The next time you’re booking a trip, you’ll probably be more inclined to fly a different airline because of the inconsistent experience you had on the previous flight.

The benefit of consistency shows up very clearly when you consider one of the most profitable sources of sales — referral business. How would you like to have one of your customers recommend you and your outfit and then add: “I’ve bought several of them from Carl, and once I got one that was the best I’d ever experienced. Of course, I also had one from him that was a real dud, and it cost me a lot of downtime and frustration.”

GETTING STICKY.  Or would you rather have her recommend you and say: “I’ve bought several of them from Carl, and every one has worked exactly as I expected. I don’t need any surprises from my vendors. Life has enough surprises. I’ll probably always buy them from Carl.” Just imagine the impact on your sales volume if all your customers spoke this highly of buying from you. That’s the power of consistency on your selling results.

Welch calls this benefit customer stickiness. That is, you want them to stick with you as a vendor and buy from you again and again — and tell their friends about you too. This is much more likely to happen if they can have a reliable, predictable customer experience.

Selling really is part science. Jack taught us the importance of consistent customer experiences. Georgia reminded us to create and follow systems. Jane shared her secret about the power of duplication.

Becoming more consistent, using systems and duplication in all aspects of your selling and business is a good goal. Better yet, as you repeat and improve your systems, you’ll have more customers who are more satisfied, resulting in more sales. Then you’ll blow right through your sales goals and quotas. Happy selling!

Thinking Differently is a choice

Finding new and better ways to do anything requires you to approach whatever it is differently. Apple were the first to capture and promote their approach so publicly. However, thinking differently is not owned by them, it is owned by anyone who wishes to challenge the status quo in their industry or area of focus.

So putting Apple’s approach to innovation way to one side( lets leave others to debate that), just thinking differently when approaching current problems or challenges is a really good start if you want to find new and better ways of solving anything. In our instance, we apply that belief to helping organisations care for their customers better using a Service Design approach.

Enjoy the Think Different Manifesto which Apple have stuck to with great discipline stuck to for decades – not falling for the features and benefits trap of many companies.

Think Different

(Apple Computer Ad Campaign)

Here’s to the crazy ones.

The misfits.
The rebels.
The troublemakers.
The round pegs in the square holes.
The ones who see things differently. They’re not fond of rules.
And they have no respect for the status quo. You can praise them, disagree with them, quote them,
disbelieve them, glorify or vilify them.
About the only thing you can’t do is ignore them.
Because they change things.

They invent.    They imagine.    They heal.
They explore.    They create.    They inspire.
They push the human race forward.

Maybe they have to be crazy.
How else can you stare at an empty canvas and see a work of art?
Or sit in silence and hear a song that’s never been written?
Or gaze at a red planet and see a laboratory on wheels?
We make tools for these kinds of people.

While some see them as the crazy ones,
we see genius.
Because the people who are crazy enough to think
they can change the world, are the ones who do.

Use the ‘Customer Loyalty Formula’ to keep customers coming back

I found this article by Kevin Stirtz which I thought was a pretty good insight into the increasing demands of customers in a tighter economic environment. It is a reminder that although we may have a set of loyal customers, keeping them is not a static equation, it is constantly evolving  and challenging process that requires a new toolset and skillset to solve these service challenges. It is not by using old creativity tools developed for and used by manufacturing organisations.

That’s why using Service Design is so important  in helping Service based organisations that represent 70%+  of First World economies GDP. Over to Kevin…

According to a recent study, many big consumer brands are losing their loyal customers. It revealed that 52% of highly loyal consumers either reduced their loyalty or defected completely from the brands in the study. Further, only 4 out 10 brands in the study retained 50% or more of their highly loyal customers from year to year.

A big reason for this, according to the study is the recession. The economic downturn has caused customers to re-evaluate what they’re getting for their money. Our priorities have changed so what we look for in products has changed too. Many customers are looking for more value in the products they buy. And if the big brands have not changed, at least in the eyes of their customers, then customers will defect. They’ll try other brands that appear offer more value.

A way to look at this is by using what I call the Customer Loyalty Formula. Here’s how it works:

Customer Loyalty = Connection * Value  * Experience

(Or CL=C*V*E for short.)

In this formula, Connection means, as a customer, how connected you are with the brand? Can you easily and conveniently communicate with people who represent the brand?  Value means your perception of what the brand offers you in the context of what you want and expect. Are you getting what you want or more? Do you feel the brand offers you the best combination of features and benefits for the price?

Finally, Experience here means how have you experienced this brand? Have you been treated well by the people involved? Do you have a positive emotional feeling associated with the brand?

This formula tells us where many big brands have failed in this recession.  They have failed to redefine their value. For a brand to keep our loyalty it has to change with us. It needs to show us it offers more value than before.

If you would like to see the whole article, please click here

How to reduce Price Discounting by increasing focus on Customer Experience

Walk around any Shopping Mall in Australia and you will find it hard to find the stock for all the “on sale” and “40% off sale” signs that are plastered across retailers stores. The same goes for airlines, telecommunications and B2C and B2B organisations. Everyone is having to work much harder for the sale and are quickly resorting to price discounting to get their customers to buy from them.

In a recently published research report called “Customer Service Trumps Price,” 4,600 consumers were asked how they choose the companies they do business with across 12 mainstream industries.

In particular, it asked consumers to rate the importance of two criteria: good customer service and low prices. Here’s some of what was found when the data was analysed across five generations of consumers:

* Across all 12 industries (and every generation of consumers), good customer service was selected more frequently than low prices as being important.
* When it comes to the gap between good customer service and low prices, seven industries have double-digit spreads, led by banks (31%) and health insurance plans (18%).

Given nearly everyone has pulled or is close to pulling the price lever, this month I thought I would share with you an approach which is proven to reduce reliance on price discounting.

In a great 12 page mini-book written by Bruce Temkin who is the Vice President and Principal Analyst at the respected Forrester Research focusing on customer experience, he has used his extensive research to compile the 6 laws of customer experience.

1) Every interaction creates a personal reaction.
2) People are instinctively self-centred.
3) Customer familiarity breeds alignment.
4) Unengaged employees don’t create engaged customers.
5) Employees do what is measured, incented, and celebrated.
6) You can’t fake it.

While some isolated situations may not follow these 6 laws, they accurately describe the dynamics of customer experience for large organisations. Anyone looking to improve customer experience must understand and comply with these underlying realities.

With all companies challenged and marketing budgets cut back in this environment, keeping how to keep your customers (and keep them happy) is the key currency.

Whether you lead a service organisation or you are looking to find ways to add services to your product range to generate new opportunities for growth, if you are looking for ideas on how to improve your customer’s experience, I know you will find this article extremely valuable.

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