• by Laura Bassett , August 29, 2013

Customer experience management (CEM) crosses the boundary from contact center to enterprise-wide customer care and provides a new way for companies to differentiate and grow. Those who shift their focus to address the new realities of CEM will ride the wave of the generational shift.

CEM is the discipline of managing and treating customer relationships as assets, with the goal of transforming customers into loyal brand advocates. CEM balances customers’ needs -- such as resolution, value, competence and convenience -- with the organization's needs for growth and revenue, efficiency and obtaining the highest customer lifetime value (CLV).

Anticipating customer needs

Consumers have many choices, and switching providers is easy and inexpensive. Many products and services have become commodities. Organizations in this environment have two choices: Compete on price or add value.

CEM is a proactive process through which a customer's needs are anticipated and solved. It requires an understanding of every touchpoint when a customer interacts with the organization and forms an impression. Positive interactions drive customer satisfaction, loyalty and lifetime value, but the cost of acquiring a new customer cannot be ignored. It's cheaper and easier to retain a customer than it is to acquire a new one. Managing the customer experience throughout the life cycle can deliver a higher ROI on initial acquisition costs and increase the CLV.

Adopting a CEM mindset

CEM seems like a natural fit for the customer service department or contact center. However, successful CEM relies on an enterprise-wide commitment. Obviously, customer service representatives should have a CEM mindset, but so should developers, engineers and accounts receivable reps.

Understanding the customer's perspective is critical

Surveys and focus groups can provide a deeper understanding of what customers really think. It's a good idea for employees to do their own shopping or self-service support and report their experiences as a customer rather than an employee. From an internal perspective, an e-commerce site may have streamlined order fulfillment and payment processes, but how does it work for customers? Is it easy to find products and place an order, or is it confusing? What is it like to shop in a retail store?

In addition to surveying customers and walking in their shoes, organizations should identify every possible interaction that a customer will experience. What moments are critical? How can the experience be personalized? This may seem overwhelming, but sometimes all it takes to improve an experience is a small tweak or an acknowledgment of an issue.

As a company moves toward CEM, it’s a good idea to set specific goals and define how success will be measured.

Finally, both front-end and back-end processes need to align to support the CEM initiative. The IT department will play an integral role in CEM; include them from the beginning. Delivering a good customer experience addresses both customer and business needs, resulting in value for both the end customer and the business:

• For the customer, CEM delivers satisfying experiences so that they feel valued and understood. Loyalty for life and positive word of mouth become likely
• For the business, CEM improves CLV and drives higher revenue and improved margins throughout the customer journey. CEM can transform a cost center into a profit center