The increasing competition puts pressure on companies and the need for differentiation is more important than ever.
Becoming one of the world’s leaders in terms of customer experience is one way to stand out from the crowd. In this article, I will introduce three companies that have made it to the top by providing an outstanding customer experience. We will take a deeper look at them to see what makes them so special, and then take look at what you can learn from these companies and apply them into your customer experience work.
Several studies have proven the great advantages of good customer experience.By making your customers LOVE your company, you will be able to create a competitive advantage and increase customer loyalty. The ultimate target obviously is to increase revenue. Research shows that leaders within customer experience have an average growth of 17% over five years compared to customer experience laggards, which only achieved a growth of 3% over the same period.
In addition to this, Murphy & Murphy estimated that a 2% increase in customer retention (which is strongly linked to customer experience) has the same effect on profits as cutting the costs by 10%. Therefore, for many companies, improved customer retention often provides the most obvious rationale for making customer experience improvements.
There are clear reasons why you should create an outstanding customer experience. However, many companies and organizations are struggling with customer experience. The ones who manage this area well, have therefore a chance to differentiate themselves What can we learn from the companies which are being praised as the customer experience leaders?
Let’s take a look!
This probably doesn’t come as a complete shock for you: Disney World is on the top list of providing a superior customer experience. Many of those who have visited Disney World before, know that there is something special in it. You do not only remember the number of children on a sugar high, running after their favorite Disney characters but you also most probably remember the magical experience, said to be the experience of a lifetime.
A dear colleague of mine did recently an interview with Dennis Snow, who has worked 20 years at Disney in various management positions. If you are interested in reading the interview, you can find the article here: 5 Questions About Building a Customer Centric Culture – Dennis Snow.
What has Walt Disney World done to build their superior customer experience? What makes them so successful is that they have been able to create a timeless customer experience: it’s as valid now as it was 20 years ago. One of the key contributing factors for their success in customer experience is the recruitment and implementation of company culture.
Before focusing on recruitment, Disney World makes sure that they have established a clear vision of how the customer experience should be like, by putting themselves in the shoes of the customer (or “guests”, as they refer to them). They map out and create a superior customer experience in every interaction, by asking themselves, how would the customer feel in this step, starting from when the guests park their car in the parking lot to when they exit the parking lot.
By doing this, they get a clear overview of the customer journey and they can start to modify the experience. When they have established a clear vision of how the customer experience should look like, they recruit people that are able to fulfill those standards and make them part of everyday culture. In the interview with Dennis Snow, he highlighted the importance of recruiting: ”…who you are bringing in to the company will have the longest effect on the culture.
If you get hired at Disney, you go through a very careful training process – about the culture of the organization and what the guest experience is supposed to be. This is necessary to make sure that the experience will look like as planned. ”
Set a clear vision for how the customer experience should look like
Emphasize on recruiting. The people within the company set the ground for the company’s customer experience.
Company Culture – set “everyday culture standards”
Another shooting star within customer experience is Sephora. Sephora is a beauty retailer owned by the prestigious Moet Hennessy Louis Vuitton group. They have around 2300 stores located around the world, and they have a very popular online store Sephora.com. They have also developed their own app called Sephora Mobile.
Thus, don’t be fooled to think it’s just another makeup store, because, as Adweek describes Sephora:
What is it then that makes Sephora so special? Sephora has been able to identify the needs of their customers and develop tools and ways for the customer to overcome the issues when buying makeup in-store or online.
For example, Sephora has reinvented their customer experience with the “Beauty Hub” . The Beauty Hub is a digital-enabled experience helping their customers to find the most optimal products for them. It includes a virtual look book that gives personalized inspiration and Virtual Artist service where you can test looks.
Besides making sure that their stores are in the condition to provide the customers with outstanding customer experience, they also make sure that their online customers receive an experience to remember. Due to increasing purchases made online on phones nowadays, Sephora has developed a mobile app where their customers can easily buy the products that they need. As in the in-store Beauty Hub, the Sephora Mobile App is also able to provide the users with virtual artist service with facial recognition that allows you to virtually try on products. A great solution to a fundamental issue when buying makeup – that I don’t think I’m alone with when buying makeup – I want to see how the makeup looks on me and not on the model.
Increased sales are not the only outcome that they receive from their development in e-commerce. While developing purchase channels like the mobile app, they are also able to get better insights from their customers to better understand who they really are. By doing so, they are able to influence future purchase decisions, but most importantly, they can use the data to develop their customer experience even further.
For example, Sephora noticed from the data they received that almost 70% of the customers who visited their website before heading to the store did so within 24h, and 50% of people visiting their website did that via mobile phone. The new insight gathered made it possible for them to optimize their customer journey and optimize their digital marketing efforts for that specific behavior.
Make sure you understand your customer and their behavior (before, during and after-sales), optimize and develop the customer journey for that specific behavior.
Utilize modern technology.
Everybody knows Amazon. Maybe you know them because you have purchased something from them, or maybe you know them because of their innovative ways of managing retail (and well… it’s one of the biggest online retailers in the world, so you have most probably heard about them somehow).
For many retailers, Amazon has become the number one company to follow when it comes to innovative digital retail solutions – Amazon is the one setting the new standards.
In addition to this, Amazon is also famous for its logistics operations (e.g. for using robots to manage the logistics etc.), and therefore also, used as a frequent example in strategic logistics management courses. Due to their innovative strategies, Amazon has also become a role model in customer experience management.
What exactly is so special about Amazons customer experience? Well, first of all, the fact that they are able to handle the great number of customers purchasing from them, is just alone, a great achievement. But what makes Amazon so special is that they have really managed to focus on customer-centricity. They have recognized the benefits of understanding their customers and their behaviors. This is probably one of the most valuable learnings to take from Amazon.
Jeff Bezos has also said that amazon should not only provide customers with products but also help customers make their purchase decisions.
One way that Amazon manages to help customers when making decisions is by having reviews and pictures of the products from other customers that already have bought the product. In addition to this, most of the products have a comparison table with similar products that the customer can review before making a purchase decision – since this is a behavior that most of us have. For example, if you are about to buy a new TV, you would most probably search for different TV models to compare functions and prices. At Amazon, you don’t need to review the whole web before making your decision. It’s served to you on a silver plate.
Other things that Amazon does exceptionally is making shopping as effortless as possible. Features such as One-Click shopping makes the checkout process effortless. By removing “traditional steps” in the purchase process, they lower the effort needed to complete the purchase, making the purchase experience faster and easier. How many times have you been on the verge of buying a product online, but you didn’t finish the purchase process because you needed to go and grab your credit card that was in your wallet in the other room? By reducing friction in the purchase process, this specific issue would not be an issue anymore (it also reduces the number of abandoned carts).
Amazon has even managed to foresee what their customers want before the customers even know that they want it. It may sound a bit strange, that they are able to predict what the customer would like to buy in the future. Amazon is successful in cross-selling because it manages to how suggestions that are related to the product that you are about to buy, with “frequently bought together with” or “customers also bought” -features. For example, if you’re about to buy a lamp, but it doesn’t include a light bulb, Amazon would suggest you buy a light bulb at the same time. This can be seen as a win-win: customers are happy since they can use the lamp the minute it has been delivered, and Amazon is able to sell more.
Customer centricity – think about what the customers really want and what helps them to make purchase decisions.
Reduce friction in the customer journey- make the customer journey as effortless as possible.
As you probably have noticed (if you still are with me at this point), there are some fundamental factors that the customer experience leaders have in common. Understanding your customer is really the main point to focus on if you want to create an awesome customer experience.
And yes, it may sound like a cliché, but there is a reason why everybody is talking about it. When we say “you need to understand your customers”, we don’t just mean that you need to understand the demographics of your target audience. You need to take a deeper look at them to really understand what they are feeling in specific steps in your customer journey, put yourself in your customer shoes, talk to them, ask what they want and how they feel. Use that as a reference when you develop the customer experience. Good luck!
PS. If you want to get tips of different customer experience strategies, then I recommend you to read the article: 5 Quick-Win Customer Experience Strategies to put into place.