As a social media manager, customer experience is always top of mind when it comes to planning a social strategy. That got me thinking – how can I illustrate the value of customer experience in a simple, but effective way? The first example that came to mind was, of course, the “Pepsi Challenge” – the now famous blind taste test run by Pepsi ever since 1975. The test successfully proved the point that there was a difference between what people said they prefered and what they actually chose based solely on taste. This gap was very much influenced by perception and how the consumers felt about the brand itself at the time (later on even confirmed by brain scanning studies).
The challenge stopped running some years ago, however the war of the two “cola” companies still goes on – with an added twist: social media. How can brands differentiate themselves in an environment that lacks the support of all 5 senses? Through the experience they offer.
The 4 levels of value
In their book, The Experience Economy: Work is Theater and Every Business a Stage, Pine & Gilmore identified the 4 levels of value – commodity, good, service, experience. They also use coffee as a clear example of how an offering can fulfill these levels – The first level is fulfilled by companies that harvest or trade coffee; followed by manufacturers that grind, package and sell that coffee; with the third level being the consumer enjoying that coffee in a diner or coffee shop. However, what they focus on is the 4th level, the most important, which really makes a difference in pricing and customer satisfaction – offering an experience. Drinking the same coffee while enjoying a great view on a trip creates a memorable experience. Even though it is not exactly tangible, it stays with the customer and can even influence their next purchase.
According to McKinsey, “70% of buying experiences are based on how the customer feels they are being treated.” Another study by Bain & Co highlights that, “A customer is 4 times more likely to defect to a competitor if the problem is service-related than price- or product-related.” Finally, Accenture noted that “Price is not the main reason for customer churn, it is actually due to the overall poor quality of customer service.” Given that these stats were taken as early as 2008, brands have had almost 10 years to crack the experience formula, but how many get it right?
Bringing social into the experience economy
These days, consumers don’t want to just enjoy a cup of coffee at the local coffee place, they want to interact with the brand. They want the brand to listen to them when they have an issue, answer fast with a pertinent solution, and even add to their day with a competition, an education article, or proactive outreach. A new layer of the experience economy comes into play – The New Social Economy – and the three building blocks that make it up.
#1 – Reactive customer service is what companies have offered so far – answering questions from customers in an adequate time. Social customer service is now the new normal. We expect that brands will be there to cater to our requests – it’s not something uncommon, but a natural part of the customer journey. However, not being present, or ignoring the customers is the fastest way to create a memorable experience – a negative one.
#2 – Proactive customer service can be thought of as skilfully interpreting cues in the customer’s social media behaviour, that can indicate an opportunity, a certain dissatisfaction, or a problem, whether it is directed or not towards your brand or not. This takes customer service to another level, as it requires that your customer care team is finely tuned to the audience, most likely with the help of a listening tool, and a great sense of identifying key moments of intent in the customer journey. Due to the mobile expansion, these moments have accelerated their progression, and can happen anytime and anywhere – the so-called “micro-moments” that Google coined. So marketers need to be prepared on the proactive customer service side to meet the needs as fast as possible before, during, and even after the purchase.
#3 – Community engagement comes into place once the brand steps outside of the realms of its product to inject itself into the customer’s daily social habits, and add to the development of the day through great experiences. This can again be the result of a masterfully used listening and engagement tool that can help marketers see a bigger picture of the customer journey, but still be flexible enough to reach out on a 1-to-1 basis.
All of these stages build on top of each other – you might have great skills in identifying the needs of potential customers and bringing them in, but if you can’t answer their questions in a timely manner, the relationship won’t last. It’s all about getting a stage right and moving on to the next one, until customers feel satisfied and even attached to your brand.