Tuesday, July 31, 2007
Perception is Reality
byUnless you’ve been living under a rock for the past few years, there is little doubt you’ve read something or at least had a conversation with somebody about CRM, CEM or VOC. Not familiar with all these acronyms? They stand for Customer Relationship Management (CRM), Customer Experience Management (CEM) and Voice of Customer (VOC). Simply stated, all of these areas focus on some aspect of understanding your customer’s wants and needs and then adjusting business practices to ensure you can deliver on those expectations. It seems simple enough...why all the hype?
Let’s start by looking at definitions of each of these.
CRM: In additional to all the usual customer care principles, Customer Relationship Management includes the storing of customer information in a database (or data warehouse) and using the information in a way that improves the customer’s “experience”. Ideally this information is integrated into operational processes.
Tracking and acting upon everything you need to know about your customers...their buying history, budget, timeline, areas of interest, and their future requirements. Ensuring that customers have exactly the right information at exactly the right time and in exactly the right form.
CEM: Customer Experience Management is “the process of strategically managing a customer’s entire experience with a product or a company” (Schmitt, 2003, p. 17).
CEM is about perception, process and brand. CEM is “managing your target customers’ perceptions across the entire experience process to optimize brand and customer equities”. (CEM Guide Book, GCCRM, 2006)
VOC: A term used in business to describe the process of capturing a customer’s requirements. Specifically, the Voice of the Customer is a market research technique that produces a detailed set of customer wants and needs, organized into a hierarchical structure, and then prioritized in terms of relative importance and satisfaction with current alternatives.
They all sound remarkable similar, and they do overlap in a number of ways, but there is a significant difference between them. CRM and VOC both focus on gathering and leveraging customer data; unifying an organization’s view of the customer. Conversely, CEM focuses on learning more about what customers know about the organization. Their perception of your Brand and how they ”feel” when they interact with your organization. While CRM and VOC have been around for years, CEM is gaining awareness as companies and marketers quickly realize consumers are looking for something more than a mere product or service. While cost and quality will continue to play an important part in the decision process. More and more emphasis is being placed on a company’s brand and “the experience.”
In our global economy, it is becoming increasingly difficult to compete on price and quality. Products are duplicated and improved upon almost as fast as they come off the production line. So what’s left? How do I differentiate myself from my competition? Many businesses claim that simply providing excellent customer service is the answer, and to some extent they would be right. Customer service is just a small part of the customer experience though. The customer’s experience starts before they ever walk though the door of an establishment. It starts the first time they are introduced to your brand; the first ad they see; the first press release they read; the first time they see your storefront or talk to an acquaintance about your business. Already they are building a picture in their mind about your company and your products, and more importantly, they start to form an impression about what sort of experience they expect to have when they do business with you. Build the wrong impression or in anyway fail to meet their expectations, and you may lose that customer. This is further complicated by the fact that many establishments now combine their brick and mortar office building with virtual locations through which customers interact. Keeping all these customer touch points in sync is at the core of CEM.
Think briefly about the brands you hold in high regard; brands like Apple, Dell, Starbucks, Amazon, Ebay and Southwest Airlines. None of them offer solely unique products, or even, in my opinion, products so much better than products offered by their competition. The major difference comes not from the product itself, but the positive experience they have provided the consumer with. More importantly, they’ve followed through in delivering that experience consistently across all client touch points. Are they perfect? Absolutely not. But by putting an effort into providing an outstanding customer experience, these companies have established themselves as leaders in their respective markets.
Now put your own client hat on, and “experience” the various client touch points of your own organization. Is it what you expected? If not, implementing some CEM is a good place to start. Its important to be able to manage the “experience” a customer has. In future posts we will look at examples of companies using CEM and discuss how you can start leveraging CEM practices in your own organization.
