The Customer experience management reference article from the English Wikipedia on 24-Jul-2004
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Customer experience management

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Customer experience management (CEM) is "the process of strategically managing a customer's entire experience 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
1 CEMs critique of traditional marketing
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 : Although all marketing management and strategic management does all of these, CEM supporters claim that they have a methodology that will yield better results. Being convinced that the marketing concept is too product-centered, Customer relationship management too focused on quantitative data, and customer satisfaction too functional, CEM looks for another perspective on the relationship of a consumer with a product or service. And what's key? The experience linked to it is the key.

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

Step 2: Building the Experiential platform Whereas steps 1 (Analysis) and 2 (Strategy) form the basis for CEM, steps 3, 4, and 5 are focusing on Implementation.

Step 3: Designing the Brand experience

Step 4: Structuring the Customer interface Step 5: Engaging in Continuous Experiential innovation And finally, to bring all pieces together, a holistic approach is required that provides a linkage between the different steps and connects them with the organization:

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.

See also