Defining Customer Experience Management

All of these terms are components of customer experience management (CEM), which is the broadest and deepest way of viewing customers and their role in the success of any organization (for-profit, non-profit, or government). The purpose of any organization is to serve a customer need. The results of serving that need are typically financial (revenue, profit, funding, paychecks). In essence, customer experience is what makes the world go around!

Customer experience management is sometimes confused with the following concepts. Indeed, CEM encompasses all of these practices, and more. They can be categorized by Customer Profitability, Customer Knowledge, and Customer Well-Being.

Customer Profitability (efforts to increase revenue and profit from customers)
— Customer relationship management — use of a database of customer transactions and facts that enable customized communications (1-to-1 marketing), upselling, cross-selling, and data-mining
— Experiential marketing — events and campaigns that build customer advocacy
— Customer advocacy — word-of-mouth promotion (buzz marketing) of a brand by enamored customers
— Branding — creating and communicating a distinctive identity
— Customer lifetime value — profitability of customers’ cumulative purchases
— Customer loyalty — efforts to expand customers’ share of wallet
— Customer community — opportunities for customers to engage with one another
— Customer references — testimonials from customers
— Co-innovation — joint product development efforts with customers
— Customer retention — efforts to extend a customer’s duration of ongoing purchases

Customer Knowledge (ways of understanding customers)
— Voice of the customer — monitoring customer sentiment
— Customer intelligence — integration, mining, and analysis of customer data
— Internal branding — internal understanding by each employee, supplier, and alliance partner of their specific impact on external customer experience
— Internal customer satisfaction — attention to quality and timeliness of handoffs between internal departments

Customer Well-Being (efforts to translate customer knowledge into organizational attitudes and behaviors)
— Customer care — organization’s conscience in favor of customers’ welfare, and outreach to customers accordingly
— Service excellence — delivery of purchased services or remedial services, or post-sale assistance to customers
— Customer-centricity — degree that customers’ welfare is at the center of the solution provider’s decision-making and actions
— Customer experience improvement — process-wide problem resolution and prevention
— Customer complaint resolution — solving issues and communicating solution to complaint originators
— User experience — intuitive and inviting environment for customers’ use of the product or service, or for exploration and purchase of the product or service, e.g. retail store or website
— Customer touch points — opportunities for customers to interact with the solution provider or its messages or products/services
— Customer experience innovation — designing and implementing novel methods to enhance customer experience
— Customer experience management strategy — overall objectives and approach for the enterprise

Customer experience management is a dedication to serving customer needs from their perspective. All organizations can reach higher potential by carefully managing the above dimensions of customer knowledge, customer well-being, and customer profitability. Make sure CEM is integrated in your strategies and culture!

See Customer Experience Management is Doing the Right Thing for a more in-depth definition of customer experience and its 9 essential characteristics.

Contact the author to find out how to customize these tips to your situation.