Total CX

Loyalty Program Customer Scenarios

Working with one of our clients, I recently turned my attention to loyalty programs, trying to identify programs that worked and ones that were less successful. This, of course, led me to think about two very different customer scenarios that so-called loyalty programs address:

• I want to get discounts/free stuff: "rewards"
• I want to feel special and valued: "preferred customer"

Although there are many similarities among the two scenarios, ultimately, what customers want to achieve, how they want to achieve it, and what matters most in each case are different.

Also different are the loyalty results that each type of scenario fosters.

In my next posts, I will look at the two different scenarios and how they impact loyalty.

Seeing the World Through CX-Colored Glasses

I talk…a lot…about customer experience. Since working on Customers.com with Patty in the mid 1990s, the concept of providing a great customer experience has been a perceptual filter through which I evaluate almost all aspects of my life. For example:

• Massachusetts has terrible road signage. Although small side roads typically have a street sign at every corner, main roads often have no signs at all. So, when you come to a main road from a side road, well, good luck figuring out where you are. Bad customer experience!
• Continuing with the driving theme, when I’m on one of these side streets, stuck behind an oil truck that is filling a tank at someone’s house, it doesn’t matter that I don’t use oil from that vendor (at least not now). Bad customer experience!
• When I go to a restaurant to meet friends, and I can’t get a table until everyone in the party arrives, bad customer experience!
• When I’m watching one of my favorite TV shows (“Lost” anyone?) and a news anchor interrupts to tell me the breaking news that the police are still chasing a car they’ve been chasing for several hours, and that there is nothing new to report, bad customer experience!
• When I’m in a public bathroom, and the “Never Out” toilet paper dispenser needs a brand new roll started, and I can’t start the roll without shredding it into a million pieces, bad customer experience!
• I’m on an airplane using my laptop on the little tray table and the person in front of me reclines his seat (which always seems to recline more than mine), and pretty much closes the lid on my computer, bad customer experience!

Yes, these are common petty annoyances that everyone experiences, and comedians make their careers by pointing them out. But they stick with you. And they have consequences. When my condo association recently decided to change oil providers, one of the distributors contacted was Brenner Oil. My reaction was very negative because I have been stuck in my car behind Brenner’s green trucks far too often in my neighborhood of narrow roads. We went with a different company (okay, they offered a better deal, but if it had been a wash, I would have voted against Brenner).

Owning the Customer’s End-to-End Experience

In Customers.com, one of the critical success factors that I believe often gets downplayed in real life is “Own the Customer’s Total Experience.” This means that your job doesn’t start when customers come to your Web site and it doesn’t end when the sale is completed. From the moment the customer even considers acquiring the type of product or service that you offer through the last time in that person’s life that she will ever even think about that product/service, you need to provide a great customer experience.

You have to own the experience even when you aren’t the company providing it. All your providers and partners offer customer experience, and you have to be involved in making sure it meets the high quality standards that you want to offer customers. When you are looking at your supply chain and your demand chain to identify the partners you want to work with, make sure that your evaluation criteria includes a commitment to providing an excellent quality of customer experience, and a shared view of what that means.

Let me share one of my favorite real-life experiences. About 15 years ago, Patricia Seybold Group decided it was time for new lobby furniture for our office. We found a manufacturer’s catalog that had some furniture we really liked, and the distributor had it in stock and could arrange delivery within a few days. But then the customer experience hit the wall. The first time we expected the furniture to be delivered, the delivery people never showed up. The next time, the delivery driver showed up empty handed with a sheepish grin and said that he couldn’t deliver the furniture because he had “parked on a hill, and if I open the back of the truck, the furniture will fall out.” No, really, that’s what he said!

Make It Easy to Stop Being a Customer

In these hard economic times, we keep being reminded how important it is to keep the customers that you have. But sometimes you simply can’t. The customers aren’t moving to another provider, they are simply doing without.

So it is important to also offer a great customer experience for the customers you are losing so that, when things get better (soon, we all hope!), they will be excited about returning to do business with you.

Looking at finances this week—and facing a major construction repair project in my condominium— I realized that I had to cut down on expenses in anticipation of a possibly bleak financial year and continuing investment losses. Just yesterday, I had two very different customer experiences related to reducing my costs.

An Unpleasant Product Cancellation Experience

First, the bad experience:

Months ago, I ordered a beautiful, yet relatively expensive sweater online from an etailer (Roamans.com) with whom I have often done business, and with whom I have a great history. The sweater was backordered, but I was informed it would be shipped before the end of the year. During the holidays, I got an email notice saying “good news, your backordered item has been shipped and should arrive within 5 to 8 business days.” And then I forgot about it as I went about celebrating with family and friends.

Why Are Customer Scenarios Important?

Understanding your customers’ scenarios—what they are trying to accomplish and how they ideally want to reach their goals—is critical to making it easy for them to do business with you. There are several types of Customer Scenarios:

• Customer Lifecycle Scenarios
• Event-Triggered Scenarios
• Outcome-Based Scenarios

Customer Lifecycle Scenarios. There are Customer Scenarios that are closely connected to customers’ discovery, acquisition, and use of your products and services to fulfill a need they have—we call these customer lifecycle scenarios[pbs1]. Examples include:

• Single mother needs to replace her broken washing machine
• Immigrant wants to establish a banking relationship in her new country
• Line-of-business manager wants to upgrade his team to the latest version of productivity software

Event-Triggered Scenarios. There are also Customer Scenarios that relate to life events or business events that customers need to deal with. For consumers, these might include:

• Young couple wants to buy a new house and move in
• Children want to plan and throw a 50th anniversary party for parents
• Couple needs to furnish a nursery for baby on the way

How Do You Create Customer Scenarios?

You can try to put yourselves in your customers’ shoes, start with a Persona (typically defined by your customer insights organization based on market research), put them in a particular context (leisurely planning, emergency situation, trying to get out of a fix, needing to build consensus before they can move forward, etc.), and use your own instincts to describe the customers’ typical conditions of satisfaction (e.g., I don’t want to work overtime on this project, I want my kids to think my choice is cool).

But the best approach is to get your customers to do the work. You’ll gain incredible insights about what really matters to them. They’ll define their ideal outcomes and metrics in ways that will surprise you. They’ll provide rich details about their situations that your product designers, policy-makers and/or business process mappers usually don’t appreciate.

What Are Customer Scenario Patterns?

Over the past decade, we’ve run thousands of Customer Scenario® mapping sessions with both business and consumer customers—asking these customers how they would ideally like to do business with their suppliers, how they’d like to have problems addressed, and how they plan for and address many of their personal and business goals.

Customers’ preferred scenarios are very different for different types of customers (by demographics, psychographics, and roles) in different contexts (emergency, routine, impulsive, planned, etc.). Of course, consumers’ scenarios differ from business peoples’ scenarios.

Recurring Scenario Patterns. Although Customer Scenarios are very role-specific and quite context-sensitive, we’ve discovered a number of recurring themes or patterns that show up over and over again—patterns that cross product categories and industries—from manufacturing to financial services, from commercial real estate to consumer electronics, from capital equipment to groceries, from travel to insurance. In fact, many of the most fundamental of these patterns are identical for both consumer and business customers: for example, business customers buying capital equipment or software share many of the same ideal buying preferences with consumers’ purchasing complex products such as consumer electronics, cars, and kitchen appliances; similarly business customers with broken equipment want the same easy repair process as consumers whose products aren’t working correctly.

Applying Scenario Patterns to Your Business

In one of my Scenario Pattern reports for the Customers.com Research Service, I address a common outcome-based scenario pattern: acquiring a skill. In it, I identify four Moments of Truth that are showstoppers for customers:

• I can’t find training appropriate for me
• The lessons are too expensive
• I can’t keep up with the lessons nor achieve the goals of each lesson
• I am not proficient in the new skill at the level I had hoped within the timeframe I have set

It is a bit fortuitous that this is the pattern I wrote about right now, because we are finally re-launching our Customer Scenario® Mapping Facilitator Training program. The program has been on unofficial hold while we took our customers’ pain points and priorities into account. We recognized that our customers had two major problems with the way CSM training was offered:

1. It was too expensive to achieve the ultimate outcome of being certified to work with customers

2. The certification process was so complex that facilitator trainees couldn’t become proficient in the skill within a reasonable time frame