If you’ve read my recent blog post on Customer Understanding (more on this soon), it will come as no surprise that my major concern is that far too many businesses are missing the boat when it comes to understanding their customers and anticipating their needs.
So, I’ve been watching the growing buzz on Experience Management (XM) with particular interest. The term has been catapulted into the headlines, most notably of late with SAP’s acquisition of Qualtrics, a digital research and survey company that built much of its business on customer, brand, and employee experience management.
The Good
The concept of XM, however, is much broader than this deal alone would suggest. XM requires harnessing all of your knowledge about a particular group—say, customers or employees—to shape everything from what you offer them to how you communicate and interact with them. In principle, providing them with experiences and offerings that better meet their needs makes them more valuable customers or more dedicated employees.
This isn’t a new idea. Marketers have always attempted to track customer behaviors, online and elsewhere. They’ve conducted brand equity surveys to determine where their companies ranks in customer perception. For years, human resource departments in large companies have run regular personnel surveys to track employee engagement.
What’s different now is formalizing those inputs and making them part of regular, consistent feedback loops that can inform all kinds of activities and interactions. In the case of customers, XM extends that feedback beyond passive data collection—tracking website traffic patterns or email opens, for example—to actively seeking input from individual customers. This provides an invaluable source of insights into customer priorities and preferences.
Asking customers for their views and input provides a much clearer understanding of their intentions. It tells you far more about their expectations and preferences—the reasons why they do something—than simply identifying what they do. It offers a powerful means of improving customer experience so that every interaction feels as if it were tailored to that individual. (Of course, doing this well requires both qualitative as well as quantitative input, but that’s another subject for another blog post.)
Yes, there are lots of things to like about XM. The label, unfortunately, is not one of them.
The Bad
The first black mark against Experience Management is that it is a misnomer. You simply cannot manage something over which you do not have control. Let’s be clear: companies absolutely can and should shape the experiences of their customers (and their employees) as thoughtfully and effectively as they can. But if you think you can manage them, think again. Experience is in the eye of the beholder. Until you can manage what side of the bed a customer (or employee) got up on in the morning, you won’t be managing their experience. (Seriously, please don’t even try to manage what side of the bed anybody but you gets up on.)
Call me a pedant if you will, but what we’re really talking about here is not Experience Management but proactively seeking customer (or employee) input to better shape their experiences. That holds tremendous value.
The Ugly
The second strike against XM comes from its common usage. Most of the time, the term XM describes a set of capabilities to survey customers or employees and build those insights into a knowledge base. I cannot understate the value in these inputs, especially when combined with other sources of insight such as behavioral analysis.
Yet seeking and analyzing inputs is only half the XM equation. In order to shape an experience (much less manage it!), you need to do something with those insights. That means taking action and making decisions—and not just in corporate headquarters. To do that, you must find a way to put the relevant insights and analysis into the hands of employees so that they can do their jobs more effectively. Even better if you can do so at the most appropriate moment in time.
In the case of customer experience, that could mean giving product managers better feedback on their designs, empowering agents to change customer service policies, helping marketers hone their messages, or providing salespeople with more compelling value propositions and commercial terms. Preferably, all of the above and more.
Applying insights to improve the myriad interactions that form an experience is no trivial task. Interpreting customer feedback is not the same as knowing what to do with it. A given set of insights may fuel different kinds of decision-making in different contexts. Using them effectively requires asking the right questions to determine how and where they provide useful answers.
An airline, for example, might use the same customer feedback to help the marketing team determine what messaging to develop for the next set of campaigns on one hand and the airport staff modify the process for checking luggage on the other. Each of those teams uses different elements of that knowledge base in different forms to do its job.
The tools and processes to apply customer or employee insights are not the same one used to gather and analyze them. Identifying and implementing the former is a much bigger topic—one we’ll address further in detail.
Bottom Line
Contemplating the Pacific from my window, I’m not crazy enough to think that I can overcome the rising tide behind an increasingly popular term. All I ask is that as we use it, we do so with open eyes about what XM really means—and what it doesn’t.
