Customer experience managementexperience with a product or a company" (Schmitt, 2003, p. 17).
Marketing research has shown that about 70 to 80% of all products are perceived as commodities, that is, seen as being more-or-less the same as competing products. This makes marketing the product difficult. Marketers have taken various approaches to this problem including: branding, product differentiation, market segmentation, and relationship marketing.
Relationship marketing, (also called loyalty marketing) focuses on establishing and building a long term relationship between a company and a customer. There are several approaches that have been espoused including customer experience management, customer relationship management, loyalty programs, and database marketing.
|Table of contents|
2 The CEM technique
3 Examples of CEM
4 See also
CEMs critique of traditional marketing
The development of customer experience management originally started with a critique of three existing marketing concepts. It concluded that the following three concepts do not go far enough:
CEM recognizes, as does all of marketing since the early 1970s, that customers are a companyÒs most valuable asset. What makes CEM different from traditional marketing is that it claims that marketing theory has seldom been immplemented adequately.
The CEM technique
CEM is a methodology that tries to overcome the gap between theory and practice by reformulating basic marketing principles. The result is that CEM stresses four aspects of marketing management :
- CEM focuses on all sorts of customer-related issues
- CEM combines the analytical and the creative
- CEM considers both, strategy and implementation
- CEM operates internally and externally
This enables companies to strategically manage a customer's experience with a brand and by doing so, achieve a truly customer focused management concept. To accomplish this, a framework is required based on clearly defined company objectives. So far, the following five steps have been suggested in the litarture that should help managers understand and manage the "customer experience":
Step 1: Analyzing the Experiential world of the customer
- analyze sociocultural context of the customer (needs/wants/lifestyle)
- analyze business concept (requirements/solutions)
- connection between strategy and implementation
- specifies the value that the customer can expect from the product (EVP = experiential value promise)
Step 3: Designing the Brand experience
- experiential features, product aesthetics, Ólook and feelÔ, e.g. logos
- all sorts of dynamic exchanges and contract points with customers
- intangible elements (i.e. value, attitude, behaviour)
- anything that improves end customers' personal lives and business customers' working lives
Examples of CEM
Looking at the current business literature, it appears as if CEM might be following CRM as one of the leading concepts for the years to come. Several books have been written on "Experience" in the last decade and a half, not all of them actually using the term customer experience management. "Experience" authors include Bernd Schmitt, Jerry Zaltman, Pine/Gilmore, Patricia Seybold, Shaun Smith, and Gerhard Schulze to name just a few. The term customer experience management is being used most obviously by Bernd Schmitt. Various leading consultancies now offer CEM Consulting.