The Heaven and Hell of Customer Experience

Comedian Richard Lewis claims to have coined the “_______ from hell” phrase, but Carnival Cruise Lines has lived it. In 2012, Carnival spent $61 million advertising its “fun ship” brand positioning. But by the end of last year, #cruisefromhell was trending on Twitter after one of Carnival’s ships had an on-board fire that left passengers stranded for five days without fresh food, air conditioning or working toilets.

Of course, social media is just one channel among many that affect the overall perception and experience of a brand. The challenge is that each of these channels, from the in-person experience to the website to the call center to post-sales support, are usually developed and managed independently – and often by different groups within the organization. Given the way business units and functional groups are organized and measured inside companies today, most care only about the slice of the experience they’re directly involved with.

That’s why marketing needs to become a champion for the customer experience across all channels. Ensuring that every part of the organization delivers on the brand promise is one of five key responsibilities that we as CMOs must take on to be successful. How do we do this? Here are five ways.

Offer counsel rather than direct management. Marketing can’t own all the customer experience channels, but it can help make the experience consistent. At SAP, we know that if we invite a group of executives to one of our briefing centers for a day of meetings, we are obligated to deliver a consistent experience – from the messaging on the invitation to the car ride in from the airport, and everything else until they’re back in the airport to go home.

Marketing doesn’t manage the briefing centers, but we provide counsel to the facilities managers and the sales teams that run the meetings to help them understand the story they want to tell (ours is “Run Better”) and provide them with the right assets to help them tell the story.

Use data to elevate the customer experience. Without good data it becomes more difficult to consistently improve the customer experience. It’s not enough to have surveys and anecdotal feedback from customers; you must analyze their entire experience over time. For example, last year British Airways created a data warehouse that collects information from every experience a customer has – online, at an airport, in flight – and makes it accessible to customer-facing personnel. The airline equipped customer-service personnel and flight crews with iPads so they can recognize VIP travelers and personalize their experience based on past data. “We are looking at the whole journey, from booking to collecting luggage at the carousel,” said Jo Boswell, head of customer analysis at British Airways.

Enlist experience champions. Carnival’s one saving grace during the Triumph’s troubles at sea was the work of its on-board crew, which maintained a positive attitude and even organized comedy shows and other activities to keep the passengers occupied. “The crew was always smiling,” one passenger told USA Today. “They need a huge raise.” Such praise underscores the importance of training and education to help all employees support the brand experience with customers. Since then, the industry has been plagued by a series of incidents, most recently the Royal Caribbean ship that caught fire on May 27. While companies have traditionally responded to negative events by lowering fares, this most recent incident has sparked a need for a passenger bill of rights. It will be vital to the industry’s future that they take a longer term view with the customer experience at the center.

Calculate the cost of not improving the experience. In The Customer Experience Edge, authors Reza Soudagar, Vinay Iyer, and Volker G. Hildebrand (disclosure: all SAP executives) explain the central paradox of customer experience: Companies want to do right by their customers, but some efforts may be seen as too much of a drain on revenues and profits.

One way to get clarity is to compare the current experience with the cost of not improving it. The authors offer an example:

Let’s say you’re a company with 500,000 customers, and the average lifetime value of your customers is $1,000. … Then, let’s say you force customers to use a self-service capability … and [they] hate it. What is the revenue impact if, as a result, your retention rate decreases by 1 percent? That’s 5,000 lost customers, or $5 million in lost business.”

Clearly, the cost of doing nothing to improve the customer experience can be significant.

How are you helping foster a better customer experience across your company?
I look forward to your comments.

Read more: Marketing’s New Mandate: 5 Core Principles for Driving Business Value

Originally posted on LinkedIn Today – The Heaven and Hell of Customer Experience on May 29, 2013