Session 4: Service as an Experience

1.Intense competition2.Customers have too many choices3.Customers are relatively immune to marketing communications4. Internet is the terrorist weapon

5. Only Very Satisfied

customers are Loyal!

New Business Landscape

The Experience Economy

The Progression of Economic Value

Growing and feeding

MakeGoods

DeliverServices

StageExperiences

Differentiated

UndifferentiatedPricingMarket Premium

Competitive Position

Relevant to

Needs ofCustomers

Irrelevant to

Value-addedDifferentiation

“as goods”

36 bahts per kg

1. CommoditiesSupply chain optimization

1200 baths per kg

2. GoodsQuality

4800 baths per kg

3. ServicesConsistency

4.ExperiencesOrchestration

9800 baths per kg

Customer Experience is the NEW source of

competitive advantage!

Experiences are as distinct from services as

services are from goods Tom Peters

Experiential Marketing Vs.

Service Experience

Goods that are consumed!

Short-single

Sensory

R&D +Factory

Marketing +Engineers

High control on Customer Experience

Goods that are used!

Single-influenced by learning process

Sensory + users experience

R&D +Factory

Marketing + engineers + designers

High / medium

Services as ExperienceMany (blocks of experiences), last longer

Sensory + users experience + social experience

Not in a factory but in a branch, store, at home…

Collaborative work (all business functions involved)

Low Control

The customer experience champions?

Singapore Airlines

NetFlix

https://signup.netflix.com/global

Dell and Microsoft are trying very hard…

The CUSTOMER EXPERIENCEIs how do customers perceive their

INTERACTIONS with a COMPANY

Experience Key Drivers

1. Service Product2. Processes3. People4. Technology5. Environment

Mkg Communications

Marketing Mix

Product Price Place Promotion

The Marketing Mix is Dead

The Meaning of Experience

An event or occurrence which leaves an impression on someone. Oxford Dictionary

Cannot Not have an

Experience!

Experience Experience as a story

Sub-consciousness(set of activities as routines)

Storytelling (Meanings are created by story telling.This is the subjective aspects of an experienceMaking a personal story)

Cognition(require to thinkabout what we are doing)

Narrative(Stop thinking about The experience is formalized in the user’s head)

Meaning

Framework to Understand Customer Experience

Source: J Forlizzi & S Ford 2000

What Experience (as a verb) means?

Creating

WOW!Kensei

Having multiple Experiencesduring a customer journey

To talk aboutexperience as a story

Experience is personal, felt only by the person who has the experience!

It’s the onlysource of emotions

Why to focus on Experience?

Differences between advertising & services experience emotional responses(Cheedar cheese ads vs M Douglas Falling Down movie)

70% of Customer Loyalty is Emotional!

Bill Bernback. DDB Founder

Emotionalbond are

difficult to build

and easy to break!

How emotions are evoked during service interaction

The Emotion Process

1. Emotions have an object...the experience

2. Emotions arise from highly positive or strongly negative appraisal

3. Emotions are associate with automatic physiological activity experienced as feelings. No feelings no emotions…

4. Emotions give rise to a tendency to action

5. Emotions express themselves in involuntary facial display and physiological expression like body posture

Emotion is

always the result of an event that is relevant to the consumer

How customers evaluate an experience?

Enjoyable

Easy to use (usability)

Meets the needs (usability)

Make it fun

Make it intuitive.Quick & easy

Listen & Act

Objectives

Attributes Key actions

Integrate pleasuresthat resonate

Reduce customers efforts during interactions

Deliver what customer needs

Measurements

How much effort do you personally have to put forth to handle your request

Thinking about your recent interactions with this firm, how effective were they at meeting your needs?  

Thinking about your recent interactions with this firm, how enjoyable were the interactions?  

How customers evaluate a service experience

Likelihood to recommend

Reluctance to switch

Willingness to buy more

Correlation between C. Ex and C. LoyaltyCorrelation between C. Exp and attributes

Enjoyable

Easy

Useful

Wireless Post-paid Service Providers in Thailand

Pleasure Vs

displeasure.

Pleasure

Pleasant Feelings

HappinessJoyLoveSurprise RelaxTrustPrideThrilledOk

Sensory pleasures

Psycho-pleasures

The Flow. A Virtual Pleasure

Challenge

Enjoyable

Boredom

Frustration

Flow

Online Pleasures

Intellectual & Ideo-pleasures

Socio-pleasures

Flight mood. Business talk. Easy Chat. Relax.Work

The World’s First Airline Social Seating System

Displeasure

Unpleasant Feelings

AngerRageDisgustContemptFearEmbarrassmentShameDisappointmentSadnessBoredom

Pleasures tend to quickly fall off. Pains usually stick in our brain

A feeling of control orsubmissiveness

How does emotion affects customers?

It depends of its intensity (relevance of the event) and customer control

Emotions influence brand image

Emotions strengthen or destroy customers relationships with a brand

PainsNegativeRejection

NeutralRoutine

PleasuresPositive

WOW

Terrorists Commodity Ready to leave

Type of Customer Experiences

Promoters

How could we listen to customers and deliver what they want ?

What are touch points relevant for customers?

Could we reduce customer efforts? Could we remove all pains?What pleasures to integrate into a

company touch-points? What these touch-points should evoke for

the brand?

Creating a Customer Experience Centric Culture

Managers must understand howtheir decisions affectcustomer’

Emotions!

5 Things to remember about Customer

Experience?

1. An emotional response2. Across multiple touch points3. Are perceived distinctly by different

individuals4. A combination of routine, pains and

pleasures….5. Drive customer retention and

profitability more than satisfaction!

Thank You