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Customer Experience
Excellence
How to delight customers and
create wow moments that matter
Customer Centricity
02
Customer Experience Excellence
INSIGHTS
Customer experiences are more important
than features and benefits of a product or
service. They provide stability and orientation
and set clear directions for transformation.
//02
Creating wow experiences for
customers requires strategic design.
Superior customer experiences are
multidimensional.
//01
//03
Customer Experience Excellence 03
Creating superior customer experiences is one of the most important determinants to achiev-
ing competitive advantage in today’s dynamic environment. Customer centricity is the basis
for creating experiences that delight customers. However, plans and results often diverge from
each other in practice. Most companies actually fail to create wow moments that really matter
to customers. This paper explores seven dimensions that enable companies to create superior
customer experiences and explains the levers behind them.
Introduction
Why customer centricity is essential for creating
superior customer experiences
When was the last time you were delighted with a compa-
ny or a brand? How often do you experience moments that
delight you as a customer? This question may not be easy
to answer. It would be different, however, if you were asked
to recall frustrating experiences with a company or a brand.
They might include brand websites that do not respond or
are difficult to navigate, service employees that make no
effort to understand your problem, or impersonal mailings
with irrelevant offers. In fact, Porsche Consulting found that
only a small percentage of customer experiences are rated
as excellent across industries, with the majority of custom-
ers describing their experience as bad, very bad, or at best,
merely average. Why do so many companies fail to create
positive experiences?
The answer is simple: designing a great customer experi-
ence requires a customer-centric approach that designs an
experience with a company from their point of view. There
is, however, an enormous gap between theory and practice.
Although most companies claim “the customer is king,” and
managers proclaim customer centricity as a guiding princi-
ple, these concepts are seldom implemented holistically in
day-to-day business. The reality is often a very low degree
of professionalization, as most often companies continue
to think in silos and maintain rigid internal structures and
processes. Customers are not interested in the reasons why
things take so long or why errors cannot be eliminated; they
only want their issue to be solved quickly and easily. The
needs and wants of customers are rarely at the center of a
company’s activities. The focus on the customer takes an
internal perspective and is equated with the optimization of
the customer’s value for the company. An external perspec-
tive is needed to transform from a product-centric to a real
customer-centric organization (figure 1)¹.
Put yourself in the customer’s shoes!
Customer Experience Excellence 04
ment and all employees—everyone is expected to deliver par-
cels as well as participate and listen in on the call center on a
regular basis. By doing so, they get to know and understand
the needs of their customers. This is the foundation for creat-
ing superior experiences.
It is the customer who pays the wages.
This statement by Henry Ford expresses why customer cen-
tricity is not an end in itself. The ultimate objective of a cus-
tomer-centric company is to achieve customer loyalty that
pays off in repeated purchases, willingness to pay a price pre-
mium, and positive brand advocacy.
Customer satisfaction was long regarded an effective lever
in creating customer loyalty. Satisfaction has a positive im-
pact on customer loyalty, so many companies have made it
a central KPI of their business strategy. In recent years, how-
ever, companies have increasingly found that satisfaction has
a limited ability to create loyalty. Satisfied customers are not
automatically loyal ones. Indeed, Porsche Consulting found
that only about 40 percent of satisfied customers can also
be classified as loyal. Why is this? Customers today have an
abundance of choices. A perfect product or service is there-
Figure 1. Differences between product and customer centricity
© Porsche Consulting
PRODUCT CENTRICITY CUSTOMER CENTRICITY
Performance metrics Number of new products, profitability per
product, market share by product/ sub-brands
Share of wallet of customers, customer satisfac-
tion, customer lifetime value, customer equity
Customer insights Customer data are a control mechanism Customer insights are most valuable asset
Management criteria Portfolio of products Portfolio of customers
Organizational focus Internally focused, new product development,
market share growth; customer relations are
issues for the marketing departement
Externally focused, customer relationship devel-
opment, profitability through customer layality,
employees are customer advocates
Organizational structure Product profit centers, product managers,
product sales team
Customer relationship managers, customer
segment sales team
Product positioning
Highlight product features and advantages Highlight product's benefits in terms of meeting
individual customer needs
Business orientation Transaction-oriented Relationship-oriented
Basic philosophy Sell products, we'll sell to whoever will buy Serve customers; all decisions start with the
customer and opportunities for advantage
Crucial to creating positive customerexperiences is a focus on
individual customers and their specific needs. Customer cen-
tricity must therefore be adopted as a corporate strategy ap-
proach. All business processes—from product development
to after-sales and overall organizational structure—must be
aligned with this approach. Creating value for the company
should be the result of creating value for the customer. Dual
value creation is an essential premise of the customer-cen-
tricityparadigm and a prerequisite to designing great custom-
er experiences. Companies frequently fail, however, because
they are unable to establish a mindset of customer centricity
within their corporate culture. The mindset only takes hold if
it is also adopted by top management. Hence, the CEO plays
a central role. It is essential that customer centricity begins
at the top and executives promote the commitment toward
experience creation, especially when this commitment leads
to investments that compete with short-term financial goals.
A good example of successfully living the top-down concept
is the online fashion retailer Zalando. This company not only
builds its business on deep customer insights, creating rel-
evance and inspiration for customers, but anchors customer
centricity in the corporate culture: from CEO to top manage-
Source: Porsche Consulting based on Shah et al. 2016
Customer Experience Excellence 05
Custumer centricity
TRANSFORM DESIGN DELIGHT BIND
Superior customer
experience
Customer delight Customer loyalty
Figure 2. Success chain of customer centricity
© Porsche Consulting
fore no longer enough to retain customers. Experiences are
needed that delight and thus strengthen the emotional bond
between customers and the company. Customer delight is
defined here as a customer’s intense pleasure brought on
by a company exceeding expectations. High investments
related to this effort, however, mean that it is not simply a
question of surprising customers but continuously fulfilling
expectations. This is the foundation for success; delight is
the icing on the cake.
Creating customer delight requires not only qualitative value
but outstanding performance in the form of superior custom-
er experiences. The interrelationship between customer cen-
tricity, experiences, delight, and loyalty is depicted in figure 2.
Customer experiences are the crux of the matter
Customer expectations have shifted significantly over the
past few decades. The major challenge facing companies
today is the creation of unique and memorable experiences
for customers. The current omni-channel environment of-
fers different ways for customers to interact with companies
and brands, making connectivity the game changer from a
technological as well as a strategic standpoint. Customers
can instantaneously share their experiences with companies
on social media, with a spillover effect on other potential
customers. Companies have the opportunity to benefit from
positive advocacy by creating outstanding experiences. This
is especially important as customers increasingly rely on
recommendations from the f-factor (friends, families, fans,
and followers) and have become more reluctant to accept
communication via marketing.
Indeed, customers now have a more powerful position. They
want immediacy, personalization, and the convenience of
dealing with digital-marketing leaders. Their “instant” men-
tality means companies need to provide everything imme-
diately and everywhere. Customers base these expectations
on the performance of top companies that make their life as
easy as possible. They no longer differentiate between in-
dustries. Web shops of all kinds, for example, are measured
against the functionalities Amazon provides, raising the bar
for unique experiences.
Moreover, and most importantly, customers have come to
expect a product or service’s functional features and ben-
efits, many of which have simply become a commodity.
But customers would rather have experiences that capti-
vate their senses, touch them emotionally, and stimulate
their thinking. These must be relatable experiences that fit
their lifestyles. For their part, companies want customers
to spend time interacting and engaging with them, because
the more time customers spend with them, the more money
they spend. For this reason, ING bank opened cafés with an
engaging environment2, all over the world; Volkswagen built
the Autostadt3; and Adidas successfully involves customers
in the co-creation of personalized shoes and apparel4. Our
daily projects show that experiences that provide a high val-
ue for customers ultimately also provide value to the com-
pany–a win-win situation.
Customer Experience Excellence 06
Recognizing and embracing these shifts in consumer be-
havior, Porsche devised a dedicated customer-experience
strategy. A substantial part of this strategy resulted in the
Porsche Customer Experience Centers (PEC). Porsche
stands for emotion, passion, and real experiences, so the
PECs offer exciting stories about the brand as well as a han-
dling track, driving-dynamic surfaces, and off-road driving
instruction. Customers can thus experience the “Porsche
feeling” and meet the Porsche community. The PECs have
proven to be a successful instrument that wows customers
and creates brand enthusiasts5.
Touchpoints and journeys form the context for
customer experiences
The Herculean task
Customer centricity and a corresponding corporate mindset
are crucial to successfully executing a customer experience.
However, a first step toward achieving competitive strength
is understanding customers, their wants and needs, and em-
bracing this in all corporate activities. Furthermore, custom-
ers must be able to perceive this focus at the touchpoints
they have with a company. Every contact leaves traces in their
minds, whether consciously or unconsciously. These impres-
sions can exert decisive influence on perception and experience.
Managing all touchpoints is a Herculean task. Companies may
have more than 600 touchpoints, not all of which are con-
trollable. Some are merely “earned” touchpoints—third-party
messages and content created and distributed without direct
assignment from the company, such as recommendations
from friends and family, social media postings, or ratings on
comparison portals. To increase the likelihood of positive ad-
vocacy at these touchpoints, companies must create superior
customer experiences at the touchpoints “owned” and con-
trolled by the company.
Assessing touchpoints and understanding the customer
journey
The holistic assessment of a customer touchpoint forms the
basis for strategically managing company experiences at
all touchpoints; it is the first step in creating transparency.
Touchpoints therefore need to be compiled, assessed, and
prioritized. The compilation and evaluation of touchpoints
must be carried out carefully, as they form the basis for sub-
sequent optimization initiatives. The underlying processes
and structures must be examined, responsibilities clarified,
and KPIs defined.
The next step is to bring the individual touchpoints into a con-
textual and chronological relationship to each other, thereby
reflecting the actual customer behavior as realistically as pos-
sible. This step is critical, because positively perceived touch-
points do not guarantee a good customer journey. Simply
looking at individual touchpoints is not sufficient; interfaces
and their underlying processes often form a breeding ground
for frustration.
Porsche Consulting recommends mapping crucial customer
journeys for especially relevant personas—or fictitious cus-
tomers who represent a specific customer segment in terms
of demographics, attitudes, habits, and interests. The objec-
tive of mapping is the discovery of moments that elicit delight
for a persona and unveil those causing frustration, in other
words, the pain points and gain points customers experience
during their journey. Pain points, of course, need to be dis-
covered and eradicated. However, the mapping also allows for
the identification of touchpoints with the highest relevance
during a customer journey. These “moments of truth” are
touchpoints that exert the strongest influence on customer
perceptions and offer companies the greatest opportunities
for differentiation. Gain points eliciting delight must be spe-
cifically created for these encounters.
Figure 3. Dimensions of customer experience and their respective levers 6
© Porsche Consulting
Behavioral experience
Activity
Interaction
Lifestyle Social experience
Trust
Empathy
Affiliation
Symbolic experience
Self-identity
Value congruity
Functional experience
Usability
Findability
Usefulness
Response
Complexity
Sensory experience
Design
Visual districtiveness
Imagery
Vividness
Emotional experience
Emotional appeal
Hedonic value
Intellectual experience
Information
Inspiration
Added value
Brand story
Customer Experience Excellence 07
This is easier said than done. To truly delight customers, it is
essential to understand the key factors influencing their per-
ception of a company at different touchpoints. The phenom-
enon’s complexity is increased by the various types of cus-
tomer experiences, each of which is controlled by a different
lever. A clear understanding of what constitutes experienc-
es, from a customer’s point of view, supports their creation
and strategic management, generating wow moments that
differentiate a company from its competitors and ultimately
bind customers. An experience with a company is the cus-
tomer’s reaction to stimuli at a certain touchpoint. Research
identified seven types of experiences6: sensory, emotional, in-
tellectual, behavioral, social, symbolic, and functional. These
can be provided by the actual offer—that is, the product in-
cluding its design and packaging—or by means of communi-
cation, brand experience worlds, events, communities, web-
sites, and employees. All seven types of experience can be
used to elicit delight and create wow moments for customers.
Creating experiences that wow customers
A customer experience describes the entire experience of a
customer with a company in form of impressions, feelings
and sensations that arise at the company's touchpoints.
Customer Experience Excellence 08
SENSORY EXPERIENCE
Rituals is a company that effectively creates sensory experi-
ences. Relaxing music, pleasant scents, vivid colors of product
packaging, and dark furnishings marked by stark contrasts: the
store’s design exudes an atmosphere that invites the customer
to relax and consciously decelerate. By transporting them to
another world, Rituals creates a memorable sensory experi-
ence completelydistinct from that ofcompetitors like Douglas.
In general, the sensory experience relates to how a touch-
point appeals to the senses of customers. Such an experience
creates value for the customer by appealing to his sense of
aesthetics or guaranteeing him an exciting and attractive ex-
perience with the touchpoint. While the sensual dimension in
a digital context is represented by visual and acoustic factors,
scent, touch, and taste play an additional role in an offline en-
vironment. Nevertheless, sight remains the dominant sense in
either context.
The touchpoint’s design—its colors, shapes, font sizes, and
overall visual appeal—creates a sensory experience. Imagery
also plays a critical role here, as an image’s quality influenc-
es a company’s perceived competence and trustworthiness.
Furthermore, vividness achieved by contrasting colors and
dynamic animations, is essential. Videos can increase the per-
ceived vividness more than static images, and sound can also
heighten the impact. However, there is an inverse U-shaped
effect: dynamic animations and highly contrasting colors can
enhance the vividness of the digital touchpoint favorably up
to a point at which it begins to negatively affect the experi-
ence. A positive sensory experience is generated if a touch-
point’s unique and non-generic design captures the attention
of consumers. Hence, one of the challenges is creating visual
distinctiveness while retaining authenticity.
EMOTIONAL EXPERIENCE
One of the ways Porsche successfully creates emotional ex-
periences is by opening brand pop-up stores. In recent years,
the brand has used this temporary store format in countries
across the globe to generate positive word of mouth. One of
the pop-up store’s most prevalent characteristics is its he-
donic value. The stores are not designed for retail—not one
car is displayed on-site—but along the theme of “The Sound
of Porsche: Stories of the Brand.”7 A sound lab engages visi-
tors with the 911 using sound experiences and virtual rides.
Media stations offer the opportunity to listen to specially
produced emotional stories about the brand. A design corner
provides a communicative space in which visitors can sketch
out their associations with the sound of Porsche. The focus on
entertainment and hedonic value in these pop-up stores have
proven effective in producing a strong emotional bond with
customers. A customer’s emotional experience are the feel-
ings and sensations triggered at a touchpoint. The intensity
can range from vague moods to strong emotions. The emo-
tional appeal and the hedonic value provided by a touchpoint
determine this kind of experience.
The atmosphere created at the touchpoint strongly affects its
emotionalappeal: when perceived as positive, it can stimulate
similar feelings and elicit strong emotions like joy and sereni-
ty. Furthermore, the extent of hedonic value provided to cus-
tomers shapes their emotional experience. Exciting and fun
elements provide entertainment and a sense of playfulness at
a touchpoint. Hedonic elements can also affect a customer’s
sense of time, resulting in a feeling of flow. This is noticeable,
for example, in a website’s ability to increase stickiness.
INTELLECTUAL EXPERIENCE
A good example of a company stimulating intellectual expe-
riences is IKEA. Its stores do not feature classical furniture
showrooms but complete apartments that invite customers
to linger. In catalogues and on-site, IKEA demonstrates how
to successfully combine its furniture and decorative elements
to create a finished design. This distinguishes IKEA from other
furniture suppliers in the same price range.
An experience’s intellectual dimension is the extent to which
a touchpoint evokes customer curiosity and offers cognitive
stimulation.This type ofexperience generates value by encour-
aging customersto thinkabout thecompany,brand,orproduct.
Well-structured, clear, precise, and relevant information sup-
ports this effect. The challenge, however, is to offer customers
the breadth and depth of information most relevant to them
at the respective touchpoint; more is not always better. While
information is most relevant to those customers who want to
“get things done,” inspiration is particularly vital to shaping
the experience of customers whose visit is less task-orient-
ed. Customers appreciate when companies stimulate them
intellectually with inspirational content, such as suggestions
for product use or styling and decoration ideas. An intellectual
experience is also created by providing an added value in the
form of an unexpected benefit to customers, such as an ad-
ditional service that arouses their curiosity. Storytelling—the
stories told by companies and their brands in a digital context,
is another effective tool to stimulate consumers intellectually,
evoke contemplation and initiate problem-solving.
Customer Experience Excellence 09
A further determinant of a social experience is whether con-
sumers perceive the company as empathic. Customers as-
sess a company’s appreciation and respect for them. A critical
driver of this is personalization: the more personal custom-
ers rate the company’s communication, the more they feel
addressed as individuals and the more positive they rate the
customer experience. Companies can interact with consum-
ers on a more personal basis on social media, for example, by
responding to individual comments and showing appreciation
by liking posts.
Companies can evoke feelings of affiliation among consumers
by creating a relationship with them and promoting their in-
teraction with each other. Online brand communities embed-
ded in social networks and moderated by the company can
contribute considerably to this social relationship. A sense of
belonging is crucial to promoting a positive, social customer
experience. An invisible bond can be achieved, for example, by
offering special benefits exclusively to registered members.
Shopping clubs like Best Secret or the online travel agency
Secret Escapes, for which customers must first register or be
invited by a member to receive offers, use exclusivity to pro-
mote feelings of brand affiliation among customers. Loyalty
cards can serve the same purpose. In short, companies are
strongly advised to integrate user-generated content, per-
sonalization, and communities as effective measures to cre-
ate superior social customer experiences.
SYMBOLIC EXPERIENCE
Rolex creates strong symbolic experiences offline and online
by linking the brand to the self-identity of their customer. The
brand’s most prevalent characteristics are prestige, exclusiv-
ity, high quality, and distinction. Every design element in the
store interior and on the website features Rolex’s elegant aes-
thetics. Colors, patterns, and product presentation emanate
precision and attention to detail. Rolex thus relates its prod-
uct to the way their customers see themselves and speaks to
their (desired) character traits, which include sophistication,
power, singularity, and elegance.
Rolex exemplifies a symbolic customer experience arising
from the confirmation of individual personalities at the touch-
point. Consumers tend to prefer and subsequently contact
companies and brands that fit theirself-identity. Forinstance,
customers like, comment on, and share posts of brands that
convey a specific image, such as prestige and exclusivity or
health and fitness, with which they want to be associated. In
this way they express their actual or ideal self-identity and in-
fluence how people see them.
BEHAVIORAL EXPERIENCE
Nike’s website vividly conveys the benefits of a healthy, ac-
tive lifestyle in order to motivate consumers to purchase Nike
footwear and apparel in its online store and to start exercising.
By additionally creating a customer ecosystem that includes,
for example, wearables and apps surrounding their core prod-
ucts, Nike generates a holistic experience to address customer
needs in the entire health and lifestyle segment. Their slogan
“Just do it”perfectlycaptures theirinvitation to join a behavioral
experience.
Behavioral experiences evidently result from activities, in-
teractions, and lifestyles made possible by the company and
triggered at a certain touchpoint. Nike aptly exemplifies how
touchpoints can convey a certain lifestyle and could perhaps
even influence that of the customer. A behavioral experience
can also result from physically consuming a product or using a
service. In a digital context, stimuli on a website can motivate
customers to engage in a particular activity, for example, click-
ing on an appealing ad that leads to more information about an
offerorfrom a brand fan page on social media to its online shop.
Furthermore, a positive behavioral experience often involves
the possibility for interaction with a company. This can take
various forms ranging from content interaction to social inter-
action and can even encompass co-creation with customers.
Companies in a digital context are expected to provide options
for interaction on websites, online shops, and branded mobile
apps, such as chats with customer service. Promoting interac-
tion is especially important as it can translate into regular cus-
tomer-brand engagement, which is necessary to build profit-
able customer relationships.
SOCIAL EXPERIENCE
The German energy supplier innogy introduced a success-
ful customer approach that harnesses customer assistance
to relieve their in-house support: an online platform enables
customers to exchange products, find solutions to problems,
or share alternate uses for a product. Micro-influencers in-
stantly evolved and created an atmosphere of trust. The re-
sult: conversion in the online shop is five times higher among
consumers who visit this community than among those who
do not8. Hence, creating a social customer experience based
on trust can directly translate into sales. Customers trust
their network of friends and family more than firms or brands,
so authentic opinions and recommendations from peers are
valuable for creating an atmosphere of trust at a touchpoint.
A proven means to foster customer trust is the integration of
user-generated content.
Customer Experience Excellence 10
But a perceived congruity to customer values and beliefs can
also generate a symbolic experience. Consumers experience
a company positively if they perceive its presentation at a
touchpoint to be in accordance with their personal values and
beliefs. They are increasingly looking for deeper relationships
with companies and brands. If they have the feeling that the
company affirms their principles in the social, economic, or
environmental realm, the congruence makes the experience
more compelling. When a customer has found a brand that
matches his or her values and beliefs, the company must live
up to its brand promise9.
FUNCTIONAL EXPERIENCE
A functional customer experience, also known as user expe-
rience (UX), provides value to customers by offering conve-
nience and creating a sense of flow that facilitates enduring
interaction with a product or service, without interruption
due to technical issues.
A critical aspect of the functional experience is usability, or
ease of use. The experience is thereby determined by how
easily and intuitively a product, service, website, or applica-
tion can be used by customers and how effortlessly a digital
brand interface functions.
Findability is of equal importance for an experience in a
digital context. The term denotes the navigational struc-
ture and organization of a company’s online presentation. A
site’s structure should therefore have a standard design and
placement of navigational tools, such as buttons. A phys-
ical environment, such as the structure and arrangements
of shelves and goods in a retail store, can also positively or
negatively influence the functional experience.
Usefulness is another central component of the functional
experience. Using a product or service should satisfy a cus-
tomer’s needs and fulfill their expectations. A vacuum cleaner
whose performance is so weak that it does not remove dust is
not useful at all and will negatively influence the experience,
even if it is quiet and easy to handle. The same holds true if
website content is not relevant for customers, does not pro-
vide the necessary information, or appears outdated.
The touchpoint’s response also shapes the user experience.
A prompt response is expected at all touchpoints, whether by
clicking a button in a car or on a website. If the button re-
sponds slowly or not at all, customers can experience frus-
tration. They often leave websites when loading takes longer
than a few seconds, resulting in a missed opportunity to en-
gage a customer.
And finally, complexity plays a role in the user experience.
Digital touchpoints in particular must be clearly structured
and neatly arranged. Sufficient space between images in an
online shop and uncluttered mobile sites are two ways to fa-
cilitate customers’ mental processing and positively influence
a digital experience.
Mix and match
The wide variety of experiences enables companies to
create diverse customer-centric experiences by using
and combining different levers (figure 3). Understanding
what customers expect from a touchpoint helps a com-
pany design the experience that matches their needs and
even exceeds their expectations. Some dimensions might
be more effective in creating a superior experience than
others; it greatly depends on the product or brand, the
touchpoint, the customer and the phase of the customer
journey. While the experience has to fit the brand’s image
from a customer’s perspective, it also needs to fit the type
of touchpoint and its respective channel. For instance, cre-
ating an emotional experience by providing fun and enter-
tainment might be more effective for a company’s social
media touchpoints than for a corporate website, which is
more often used to retrieve information. Hence, customer
insights are essential to truly understanding the custom-
er journey. Customers evaluating different products in the
pre-purchase phase might value a superior intellectual ex-
perience more than those already using a product for whom
the functional experience is of greater interest.
It is crucial, however, for the experience to be consistent
across all touchpoints. Consider Ritz-Carlton hotels, who
constantly wow customers with a personalized experience
throughout their stay in the hotel. Upon entering the lobby,
guests are welcomed by name. Rooms are personalized ac-
cording to past requests, and guests are greeted there by
a handwritten welcome letter. Employees are trained daily
on service dedication and empowered to act independent-
ly in the customer’s interests: a budget of $2,000 can be
spent without management approval to compensate inci-
dents or surprise guests10. It is consistency and coherency
that increase a brand’s clear, positive image in the minds
of customers.
	
` The right combination of experience dimensions that
matchcustomerneedsandexceedexpectations,createwow
moments that really matter to customers and differentiate a
company from its competitors.
Customer Experience Excellence 11
Figure 5. Customer experiences and their direct effects on marketing objectives
© Porsche Consulting
MARKETING OBJECTIVES
COSTUMER EXPERIENCE
Behavioral
experience
Social
experience
Customer
delight
Recommendation Customer
satisfaction
Symbolic
experience
Functional
experience
Sensory
experience
Emotional
experience
Intellectual
experience
Customer
Loyalty
Brand
attachment
Superior customer experiences pay off
Creating superior customer experiences is not an end in it-
self. But it does have a strong effect on a company’s market-
ing and sales objectives, thus contributing to overall goals in
terms of revenue (figure 5). Our projects show that customer
experience leaders achieve revenue gains of 7 to 10 percent
within two to three years.
In addition to increases in final revenue, our comprehensive
studies have shown that each experience dimension is capa-
ble of influencing the perceived customer experience—both
positively and negatively. On the one hand, customer expe-
riences directly influence customer satisfaction and loyal-
ty. The more positively customers perceive an experience
with a company, the more satisfied they are. Because su-
perior experiences provide customers with positive feelings
and pleasure, they seek to repeat them, a decisive factor in
creating customer loyalty. On the other hand, superior ex-
periences appear to elicit emotions that connect customers
with brands in an invisible bond, resulting in brand attach-
ment. Moreover, customers like to share their experiences
with others for social and emotional reasons, so customer
experiences can generate positive word of mouth as a pri-
mary form of engagement. And because recommendations
from the f-factor (friends, families, fans, and followers) are
generally perceived as more credible than, for example, ad-
vertisements, customer experiences result in spillover ef-
fects that influence sales positively.
Who doesn’t love an amazing experience? If it exceeds cus-
tomer expectations and creates a wow moment, client ex-
amples show that companies can profit from customers’
willingness to pay up to 25 percent more for such a delight-
ful experience. Delight is created by combining different
types of experiences across touchpoints, which add up to a
holistic and exceptional customer experience. The basis for
further loyalty!
Customer Experience Excellence 12
Managing customer experiences successfully in the long
term is only possible if the effectivity of experience initia-
tives is measured continuously. This is a critical prerequi-
site for a continuous optimization of customer experience
over time. So far, so good. But how does one measure it? Is
there a single approach or one KPI to track? Unfortunately,
the answer is no. Our experience has shown the need for a
holistic approach to measuring experience. No standalone
KPI is capable of capturing the multidimensionality of an
experience. To further complicate matters, a measurement
approach that is perfectly suited to one company might be
not effective and efficient for another; it depends on its ma-
turity with regard to customer centricity.
But one thing at a time: there are plenty of metrics to mea-
sure customer experiences. However, they are only single
KPIs that measure an indication of a customer experience.
PoS Data, CRM-data, data from customer interaction cen-
ters, or data from digital interactions such as traffic, bounce
rates, and conversion rates offer a brief glimpse into a cus-
tomer’s experience. Common metrics for measuring cus-
tomer experiences are customer satisfaction (CSAT), the
Customer Effort Score (CES), or the Net Promoter Score
(NPS). But the problem with these metrics is that, when
considered in isolation, they only provide a snapshot of an
experience. Knowing how satisfied customers are with a
product, how easy it was to use a service, or if they would
recommend a company or brand to their family and friends
are one-dimensional indicators that are not applicable for
measuring the customer experience at each and every
touchpoint. As important as all these scores are, they are by
no means a substitute for a holistic approach to measure-
ment that captures the customer experience in a differen-
tiated manner. They are individual indicators that must be
linked to other variables in a meaningful way.
	
` A holistic approach to measuring customer experience is
always better than a single indicator.
To develop the optimal approach to measurement, one
must therefore be clear about the objective of measuring
customer experience. Companies often measure several
indicators at various touchpoints but struggle to optimize
the experience on this basis. Why? They often lack a clear
approach to operationalize their customer-centric strate-
gy through defined customer experience metrics. Porsche
Consulting suggests that companies define top-line cus-
tomer experience metrics that are subsequently drilled
down to the level of the customer’s journey. For example, if
top management defines customer delight as the compa-
ny’s main objective, all customer experience metrics along
customer journeys and touchpoints should then pay into
the account of this top-line metric. This implies that the
drivers for the experience need to be identified along the
customer journey and at the individual touchpoints. Even at
touchpoint level, different determinants such as a payment
function’s ease of use while ordering online or a customer
care employee’s friendliness on the hotline can influence
the overall experience and affect the top-line objective of
customer delight. It becomes evident that establishing a
metric like customer delight or satisfaction is only the first
step. The second step must develop a detailed understand-
ing of the metric’s drivers. The metric for measuring the ex-
perience driver at a particular touchpoint must reflect the
different customer needs at each stage of the journey and
the various expectations for a touchpoint. There is no one
metric for measuring customer experience that is applica-
ble at every touchpoint!
One manufactureraimed to create customerdelight through
physical experiences with the brand and established sever-
al brand pop-up stores to achieve this. The pop-up stores’
experience drivers were analyzed to measure the success
of this new kind of touchpoint as well as its contribution
to the overall customer experience. The results showed
that sensory and emotional experiences exerted the most
influence on customer perception of the brand’s pop-up
stores6. These findings and additional qualitative insights
from focus groups among store visitors made it possible
to subsequently optimize the store’s design and hedonic
value in terms of entertaining elements. The result was a
touchpoint that clearly contributed to a positive customer
Making the success of experience
initiatives visible
Customer Experience Excellence 13
experience and the creation of delight. But most important-
ly, the store’s success was continually measured in the pop-
up store via customer surveys, with the outcome used for
improvement initiatives.
Connect the dots
A further factor for success exploits the results of measur-
ing customer experiences to inform key decisions. Data gen-
erated at individual touchpoints must be used to adapt the
design and execution of the customer experience process. A
holistic approach to measurement on touchpoint and journey
levels is a critical prerequisite for connecting customer expe-
riences to action.
An integrated customer experience cockpit has proven to be
most helpful in tracking the quality of the key touchpoints
along the journey and capturing measurement criteria, such
as sensorial attractiveness, emotionality, and processual
performance. In addition to tracking touchpoint quality, it is
advisable to benchmark the results of customer experience
measurement against the most important competitors and
best-in-class companies. This can help uncover an organiza-
tion’s own weaknesses regarding touchpoint quality and pro-
vide ideas for improvement.
For a digital service provider, this meant taking the follow-
ing steps: identify the most important customer experience
measures along the journey, set up an integrated customer
experience cockpit that measures indicators and condenses
them to one reportable Customer Experience Score, as well
as define the process for collecting and analyzing the data and
enable him to react to the feedback. Establishing a systematic
way to measure customer experiences holistically and in an
integrated manner is a supreme discipline—but indispens-
able for operationalizing a customer-centric strategy without
wasting time and money on measures that lack impact.
Customer Experience Excellence 14
Conclusion: Are you ready to wow?
Companies and brands can only be successful if they do not leave wow moments to chance.
To wow customers with superior experiences, Porsche Consulting recommends a six-step approach:
1. Create a mindset for customer centricity
A transformation program needs to ensure the buy-in of the top management and the commitment of
all employees to customer experiences. To successfully manage customer experience, a company must
acknowledge the importance of experiential responses and put the customer first across all processes,
even in the knowledge that the effects on revenue might not be directly measurable.
2. Assessing customer touchpoints systematically
All touchpoints, whether physical or digital, must be collected and systematically assessed. Despite the
considerable effort it may entail, examining touchpoints from an internal and external perspective is
worthwhile. Internal analysis should examine the underlying processes, structures, responsibilities, and
costs associated with a touchpoint. External analysis seeks to understand the preferences of various
customer segments for certain touchpoints as well as their needs, expectations, and actual experiences.
3. Understanding customer journeys
The next step is to bring the individual touchpoints into a contextual and chronological sequence in order
to depict actual customer behavior as realistically as possible. Customer journey maps for defined perso-
nas unveil the key touchpoints and interfaces at which gain and pain points are created and at which the
targeted use of customer experiences is most beneficial.
4. Designing the experiences and creating wow moments
Having identified the touchpoints that really matter during the journeys, customer-experience design
principles and objectives per touchpoint are defined. This forms the basis for the design of holistic and
multidimensional customer experiences using the seven types of experiences: sensory, emotional, intel-
lectual, behavioral, social, symbolic, and functional. Customer insights provide a starting point for com-
prehensive initiatives to improve the quality of key touchpoints and their underlying processes.
5. Measuring and tracking customer experience successes
The next step defines one model for operationalizing the customer-centric strategy. Therefore, identify
a top-level KPI that allows the success of customer experience initiatives to be tracked. This KPI should
then be drilled down to the journey and touchpoint levels by identifying its drivers. The metrics of this
integrated measurement strategy must support understanding what customers value and how to address
their needs. Setting up an appropriate governance model must then follow determining who is respon-
sible for the customer experience at the various touchpoints and for controlling the achieved results.
Customer experience targets should also be part of an incentive scheme.
6. Optimizing the customer ecosystem
Finally, as companies increasingly operate—or at least are part of—a broader customer ecosystem, suc-
cessful customer experience management must look beyond touchpoints on the customer journey and
optimize structures, processes, and resources of the different value constellation propositions across the
ecosystem. This approach helps to consistently delight and wow customers, build true relationships with
them, and provide the company with a real competitive advantage.
Customer Experience Excellence 15
IN BRIEF
01 A customer-centric mindset and strategy is a prerequi-
site to create superior experiences
Customer experiences are multidimensional: they
encompass a sensory, emotional, intellectual, behavioral,
social, symbolic, and functional dimension
02
By using customer insights to create the right mix of
experience dimensions at critical touchpoints along the
journey, highly valuable wow moments can be created
03
Superior experiences pay-off in increased customer sat-
isfaction, loyalty, delight, brand attachment and recom-
mendation
04
Holistically measuring experiences with an integrated
customer experience cockpit is necessary to inform key
decisions
05
3
Customer Centricity
Thinking from the
customer’s point
ofview
Eight steps to a successful
customer-centric business model
Five steps to remain a relevant
brand in the hurricane of
disruption and transformation
Brand Evolution
or Revolution?
Brand and Sales Strategy
Customer Experience Excellence 16
Authors
David
Blecher
Partner
Contact
+49 170 911 3874
Dr. Isabelle
Manger
Consultant
Further reading
Thinking from the
customers point
of view
Brand Evolution
or Revolution
Porsche Consulting
Porsche Consulting GmbH is a leading German strategy and operations consultancy and employs 670 people worldwide. The
company is a subsidiary of the sports car manufacturer Dr. Ing. h.c. F. Porsche AG, Stuttgart. Porsche Consulting has offices in
Stuttgart, Hamburg, Munich, Berlin, Frankfurt am Main, Milan, Paris, São Paulo, Shanghai, Beijing, Atlanta, and Belmont (Silicon
Valley). Following the principle of “Strategic vision. Smart implementation,” its consultants advise industry leaders on strategy,
innovation, performance improvement, and sustainability. Porsche Consulting’s network of 12 offices worldwide serves clients
in the mobility, industrial goods, consumer goods, and financial services sectors.
Customer Experience Excellence 17
Appendix
(1) Details can be found in the white paper “Thinking from the Customer’s Point of View: Eight steps to a successful custom-
er-centric business model”
(2) https://www.ing.com/Newsroom/News/Features/Features-old/ING-Direct-Cafe-Lyon-opens-its-doors.htm
(3) https://www.autostadt.de/en/explore
(4) https://www.adidas-group.com/en/group/strategy-overview/
(5) https://newsroom.porsche.com/de/unternehmen/porsche-experience-center-hockenheimring-grundstein­
legung-
160000-quadratmeter-2019-16287.html
(6) Köhler, Isabelle: Brand Experiences in Physical and Digital Contexts - Investigating Consumer Perceptions and
its Effects on Brand Outcomes from a Brand Ambidexterity Perspective. Diss., Universität für Wirtschaft und Recht,
Oestrich-Winkel, 2017
(7) https://newsroom.porsche.com/de/unternehmen/porsche-oeffnet-pop-up-store-in-new-york-10336.html
(8) Weltmann, Christopher (2019): Schwarmintelligenz hilft - Die innogy Community als zentraler Baustein einer Interactive
Customer Experience. Vortrag am Brand Talk Summit, Mai 2019, Düsseldorf.
(9) Details can be found in the white paper „Brand Evolution or Revolution?” Five steps to remain a relevant brand in the hurri-
cane of disruption and transformation.
(10) https://ritzcarltonleadershipcenter.com/2019/03/19/the-power-of-empowerment/
Porsche Consulting
Stuttgart | Hamburg | Munich | Berlin | Frankfurt am Main | Milan | Paris | São Paulo | Atlanta | Belmont | Shanghai | Beijing
www.porsche-consulting.com © Porsche Consulting 2020

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Customer experience excellence_c_porsche_consulting_2020

  • 1. Customer Experience Excellence How to delight customers and create wow moments that matter Customer Centricity
  • 2. 02 Customer Experience Excellence INSIGHTS Customer experiences are more important than features and benefits of a product or service. They provide stability and orientation and set clear directions for transformation. //02 Creating wow experiences for customers requires strategic design. Superior customer experiences are multidimensional. //01 //03
  • 3. Customer Experience Excellence 03 Creating superior customer experiences is one of the most important determinants to achiev- ing competitive advantage in today’s dynamic environment. Customer centricity is the basis for creating experiences that delight customers. However, plans and results often diverge from each other in practice. Most companies actually fail to create wow moments that really matter to customers. This paper explores seven dimensions that enable companies to create superior customer experiences and explains the levers behind them. Introduction Why customer centricity is essential for creating superior customer experiences When was the last time you were delighted with a compa- ny or a brand? How often do you experience moments that delight you as a customer? This question may not be easy to answer. It would be different, however, if you were asked to recall frustrating experiences with a company or a brand. They might include brand websites that do not respond or are difficult to navigate, service employees that make no effort to understand your problem, or impersonal mailings with irrelevant offers. In fact, Porsche Consulting found that only a small percentage of customer experiences are rated as excellent across industries, with the majority of custom- ers describing their experience as bad, very bad, or at best, merely average. Why do so many companies fail to create positive experiences? The answer is simple: designing a great customer experi- ence requires a customer-centric approach that designs an experience with a company from their point of view. There is, however, an enormous gap between theory and practice. Although most companies claim “the customer is king,” and managers proclaim customer centricity as a guiding princi- ple, these concepts are seldom implemented holistically in day-to-day business. The reality is often a very low degree of professionalization, as most often companies continue to think in silos and maintain rigid internal structures and processes. Customers are not interested in the reasons why things take so long or why errors cannot be eliminated; they only want their issue to be solved quickly and easily. The needs and wants of customers are rarely at the center of a company’s activities. The focus on the customer takes an internal perspective and is equated with the optimization of the customer’s value for the company. An external perspec- tive is needed to transform from a product-centric to a real customer-centric organization (figure 1)¹. Put yourself in the customer’s shoes!
  • 4. Customer Experience Excellence 04 ment and all employees—everyone is expected to deliver par- cels as well as participate and listen in on the call center on a regular basis. By doing so, they get to know and understand the needs of their customers. This is the foundation for creat- ing superior experiences. It is the customer who pays the wages. This statement by Henry Ford expresses why customer cen- tricity is not an end in itself. The ultimate objective of a cus- tomer-centric company is to achieve customer loyalty that pays off in repeated purchases, willingness to pay a price pre- mium, and positive brand advocacy. Customer satisfaction was long regarded an effective lever in creating customer loyalty. Satisfaction has a positive im- pact on customer loyalty, so many companies have made it a central KPI of their business strategy. In recent years, how- ever, companies have increasingly found that satisfaction has a limited ability to create loyalty. Satisfied customers are not automatically loyal ones. Indeed, Porsche Consulting found that only about 40 percent of satisfied customers can also be classified as loyal. Why is this? Customers today have an abundance of choices. A perfect product or service is there- Figure 1. Differences between product and customer centricity © Porsche Consulting PRODUCT CENTRICITY CUSTOMER CENTRICITY Performance metrics Number of new products, profitability per product, market share by product/ sub-brands Share of wallet of customers, customer satisfac- tion, customer lifetime value, customer equity Customer insights Customer data are a control mechanism Customer insights are most valuable asset Management criteria Portfolio of products Portfolio of customers Organizational focus Internally focused, new product development, market share growth; customer relations are issues for the marketing departement Externally focused, customer relationship devel- opment, profitability through customer layality, employees are customer advocates Organizational structure Product profit centers, product managers, product sales team Customer relationship managers, customer segment sales team Product positioning Highlight product features and advantages Highlight product's benefits in terms of meeting individual customer needs Business orientation Transaction-oriented Relationship-oriented Basic philosophy Sell products, we'll sell to whoever will buy Serve customers; all decisions start with the customer and opportunities for advantage Crucial to creating positive customerexperiences is a focus on individual customers and their specific needs. Customer cen- tricity must therefore be adopted as a corporate strategy ap- proach. All business processes—from product development to after-sales and overall organizational structure—must be aligned with this approach. Creating value for the company should be the result of creating value for the customer. Dual value creation is an essential premise of the customer-cen- tricityparadigm and a prerequisite to designing great custom- er experiences. Companies frequently fail, however, because they are unable to establish a mindset of customer centricity within their corporate culture. The mindset only takes hold if it is also adopted by top management. Hence, the CEO plays a central role. It is essential that customer centricity begins at the top and executives promote the commitment toward experience creation, especially when this commitment leads to investments that compete with short-term financial goals. A good example of successfully living the top-down concept is the online fashion retailer Zalando. This company not only builds its business on deep customer insights, creating rel- evance and inspiration for customers, but anchors customer centricity in the corporate culture: from CEO to top manage- Source: Porsche Consulting based on Shah et al. 2016
  • 5. Customer Experience Excellence 05 Custumer centricity TRANSFORM DESIGN DELIGHT BIND Superior customer experience Customer delight Customer loyalty Figure 2. Success chain of customer centricity © Porsche Consulting fore no longer enough to retain customers. Experiences are needed that delight and thus strengthen the emotional bond between customers and the company. Customer delight is defined here as a customer’s intense pleasure brought on by a company exceeding expectations. High investments related to this effort, however, mean that it is not simply a question of surprising customers but continuously fulfilling expectations. This is the foundation for success; delight is the icing on the cake. Creating customer delight requires not only qualitative value but outstanding performance in the form of superior custom- er experiences. The interrelationship between customer cen- tricity, experiences, delight, and loyalty is depicted in figure 2. Customer experiences are the crux of the matter Customer expectations have shifted significantly over the past few decades. The major challenge facing companies today is the creation of unique and memorable experiences for customers. The current omni-channel environment of- fers different ways for customers to interact with companies and brands, making connectivity the game changer from a technological as well as a strategic standpoint. Customers can instantaneously share their experiences with companies on social media, with a spillover effect on other potential customers. Companies have the opportunity to benefit from positive advocacy by creating outstanding experiences. This is especially important as customers increasingly rely on recommendations from the f-factor (friends, families, fans, and followers) and have become more reluctant to accept communication via marketing. Indeed, customers now have a more powerful position. They want immediacy, personalization, and the convenience of dealing with digital-marketing leaders. Their “instant” men- tality means companies need to provide everything imme- diately and everywhere. Customers base these expectations on the performance of top companies that make their life as easy as possible. They no longer differentiate between in- dustries. Web shops of all kinds, for example, are measured against the functionalities Amazon provides, raising the bar for unique experiences. Moreover, and most importantly, customers have come to expect a product or service’s functional features and ben- efits, many of which have simply become a commodity. But customers would rather have experiences that capti- vate their senses, touch them emotionally, and stimulate their thinking. These must be relatable experiences that fit their lifestyles. For their part, companies want customers to spend time interacting and engaging with them, because the more time customers spend with them, the more money they spend. For this reason, ING bank opened cafés with an engaging environment2, all over the world; Volkswagen built the Autostadt3; and Adidas successfully involves customers in the co-creation of personalized shoes and apparel4. Our daily projects show that experiences that provide a high val- ue for customers ultimately also provide value to the com- pany–a win-win situation.
  • 6. Customer Experience Excellence 06 Recognizing and embracing these shifts in consumer be- havior, Porsche devised a dedicated customer-experience strategy. A substantial part of this strategy resulted in the Porsche Customer Experience Centers (PEC). Porsche stands for emotion, passion, and real experiences, so the PECs offer exciting stories about the brand as well as a han- dling track, driving-dynamic surfaces, and off-road driving instruction. Customers can thus experience the “Porsche feeling” and meet the Porsche community. The PECs have proven to be a successful instrument that wows customers and creates brand enthusiasts5. Touchpoints and journeys form the context for customer experiences The Herculean task Customer centricity and a corresponding corporate mindset are crucial to successfully executing a customer experience. However, a first step toward achieving competitive strength is understanding customers, their wants and needs, and em- bracing this in all corporate activities. Furthermore, custom- ers must be able to perceive this focus at the touchpoints they have with a company. Every contact leaves traces in their minds, whether consciously or unconsciously. These impres- sions can exert decisive influence on perception and experience. Managing all touchpoints is a Herculean task. Companies may have more than 600 touchpoints, not all of which are con- trollable. Some are merely “earned” touchpoints—third-party messages and content created and distributed without direct assignment from the company, such as recommendations from friends and family, social media postings, or ratings on comparison portals. To increase the likelihood of positive ad- vocacy at these touchpoints, companies must create superior customer experiences at the touchpoints “owned” and con- trolled by the company. Assessing touchpoints and understanding the customer journey The holistic assessment of a customer touchpoint forms the basis for strategically managing company experiences at all touchpoints; it is the first step in creating transparency. Touchpoints therefore need to be compiled, assessed, and prioritized. The compilation and evaluation of touchpoints must be carried out carefully, as they form the basis for sub- sequent optimization initiatives. The underlying processes and structures must be examined, responsibilities clarified, and KPIs defined. The next step is to bring the individual touchpoints into a con- textual and chronological relationship to each other, thereby reflecting the actual customer behavior as realistically as pos- sible. This step is critical, because positively perceived touch- points do not guarantee a good customer journey. Simply looking at individual touchpoints is not sufficient; interfaces and their underlying processes often form a breeding ground for frustration. Porsche Consulting recommends mapping crucial customer journeys for especially relevant personas—or fictitious cus- tomers who represent a specific customer segment in terms of demographics, attitudes, habits, and interests. The objec- tive of mapping is the discovery of moments that elicit delight for a persona and unveil those causing frustration, in other words, the pain points and gain points customers experience during their journey. Pain points, of course, need to be dis- covered and eradicated. However, the mapping also allows for the identification of touchpoints with the highest relevance during a customer journey. These “moments of truth” are touchpoints that exert the strongest influence on customer perceptions and offer companies the greatest opportunities for differentiation. Gain points eliciting delight must be spe- cifically created for these encounters.
  • 7. Figure 3. Dimensions of customer experience and their respective levers 6 © Porsche Consulting Behavioral experience Activity Interaction Lifestyle Social experience Trust Empathy Affiliation Symbolic experience Self-identity Value congruity Functional experience Usability Findability Usefulness Response Complexity Sensory experience Design Visual districtiveness Imagery Vividness Emotional experience Emotional appeal Hedonic value Intellectual experience Information Inspiration Added value Brand story Customer Experience Excellence 07 This is easier said than done. To truly delight customers, it is essential to understand the key factors influencing their per- ception of a company at different touchpoints. The phenom- enon’s complexity is increased by the various types of cus- tomer experiences, each of which is controlled by a different lever. A clear understanding of what constitutes experienc- es, from a customer’s point of view, supports their creation and strategic management, generating wow moments that differentiate a company from its competitors and ultimately bind customers. An experience with a company is the cus- tomer’s reaction to stimuli at a certain touchpoint. Research identified seven types of experiences6: sensory, emotional, in- tellectual, behavioral, social, symbolic, and functional. These can be provided by the actual offer—that is, the product in- cluding its design and packaging—or by means of communi- cation, brand experience worlds, events, communities, web- sites, and employees. All seven types of experience can be used to elicit delight and create wow moments for customers. Creating experiences that wow customers A customer experience describes the entire experience of a customer with a company in form of impressions, feelings and sensations that arise at the company's touchpoints.
  • 8. Customer Experience Excellence 08 SENSORY EXPERIENCE Rituals is a company that effectively creates sensory experi- ences. Relaxing music, pleasant scents, vivid colors of product packaging, and dark furnishings marked by stark contrasts: the store’s design exudes an atmosphere that invites the customer to relax and consciously decelerate. By transporting them to another world, Rituals creates a memorable sensory experi- ence completelydistinct from that ofcompetitors like Douglas. In general, the sensory experience relates to how a touch- point appeals to the senses of customers. Such an experience creates value for the customer by appealing to his sense of aesthetics or guaranteeing him an exciting and attractive ex- perience with the touchpoint. While the sensual dimension in a digital context is represented by visual and acoustic factors, scent, touch, and taste play an additional role in an offline en- vironment. Nevertheless, sight remains the dominant sense in either context. The touchpoint’s design—its colors, shapes, font sizes, and overall visual appeal—creates a sensory experience. Imagery also plays a critical role here, as an image’s quality influenc- es a company’s perceived competence and trustworthiness. Furthermore, vividness achieved by contrasting colors and dynamic animations, is essential. Videos can increase the per- ceived vividness more than static images, and sound can also heighten the impact. However, there is an inverse U-shaped effect: dynamic animations and highly contrasting colors can enhance the vividness of the digital touchpoint favorably up to a point at which it begins to negatively affect the experi- ence. A positive sensory experience is generated if a touch- point’s unique and non-generic design captures the attention of consumers. Hence, one of the challenges is creating visual distinctiveness while retaining authenticity. EMOTIONAL EXPERIENCE One of the ways Porsche successfully creates emotional ex- periences is by opening brand pop-up stores. In recent years, the brand has used this temporary store format in countries across the globe to generate positive word of mouth. One of the pop-up store’s most prevalent characteristics is its he- donic value. The stores are not designed for retail—not one car is displayed on-site—but along the theme of “The Sound of Porsche: Stories of the Brand.”7 A sound lab engages visi- tors with the 911 using sound experiences and virtual rides. Media stations offer the opportunity to listen to specially produced emotional stories about the brand. A design corner provides a communicative space in which visitors can sketch out their associations with the sound of Porsche. The focus on entertainment and hedonic value in these pop-up stores have proven effective in producing a strong emotional bond with customers. A customer’s emotional experience are the feel- ings and sensations triggered at a touchpoint. The intensity can range from vague moods to strong emotions. The emo- tional appeal and the hedonic value provided by a touchpoint determine this kind of experience. The atmosphere created at the touchpoint strongly affects its emotionalappeal: when perceived as positive, it can stimulate similar feelings and elicit strong emotions like joy and sereni- ty. Furthermore, the extent of hedonic value provided to cus- tomers shapes their emotional experience. Exciting and fun elements provide entertainment and a sense of playfulness at a touchpoint. Hedonic elements can also affect a customer’s sense of time, resulting in a feeling of flow. This is noticeable, for example, in a website’s ability to increase stickiness. INTELLECTUAL EXPERIENCE A good example of a company stimulating intellectual expe- riences is IKEA. Its stores do not feature classical furniture showrooms but complete apartments that invite customers to linger. In catalogues and on-site, IKEA demonstrates how to successfully combine its furniture and decorative elements to create a finished design. This distinguishes IKEA from other furniture suppliers in the same price range. An experience’s intellectual dimension is the extent to which a touchpoint evokes customer curiosity and offers cognitive stimulation.This type ofexperience generates value by encour- aging customersto thinkabout thecompany,brand,orproduct. Well-structured, clear, precise, and relevant information sup- ports this effect. The challenge, however, is to offer customers the breadth and depth of information most relevant to them at the respective touchpoint; more is not always better. While information is most relevant to those customers who want to “get things done,” inspiration is particularly vital to shaping the experience of customers whose visit is less task-orient- ed. Customers appreciate when companies stimulate them intellectually with inspirational content, such as suggestions for product use or styling and decoration ideas. An intellectual experience is also created by providing an added value in the form of an unexpected benefit to customers, such as an ad- ditional service that arouses their curiosity. Storytelling—the stories told by companies and their brands in a digital context, is another effective tool to stimulate consumers intellectually, evoke contemplation and initiate problem-solving.
  • 9. Customer Experience Excellence 09 A further determinant of a social experience is whether con- sumers perceive the company as empathic. Customers as- sess a company’s appreciation and respect for them. A critical driver of this is personalization: the more personal custom- ers rate the company’s communication, the more they feel addressed as individuals and the more positive they rate the customer experience. Companies can interact with consum- ers on a more personal basis on social media, for example, by responding to individual comments and showing appreciation by liking posts. Companies can evoke feelings of affiliation among consumers by creating a relationship with them and promoting their in- teraction with each other. Online brand communities embed- ded in social networks and moderated by the company can contribute considerably to this social relationship. A sense of belonging is crucial to promoting a positive, social customer experience. An invisible bond can be achieved, for example, by offering special benefits exclusively to registered members. Shopping clubs like Best Secret or the online travel agency Secret Escapes, for which customers must first register or be invited by a member to receive offers, use exclusivity to pro- mote feelings of brand affiliation among customers. Loyalty cards can serve the same purpose. In short, companies are strongly advised to integrate user-generated content, per- sonalization, and communities as effective measures to cre- ate superior social customer experiences. SYMBOLIC EXPERIENCE Rolex creates strong symbolic experiences offline and online by linking the brand to the self-identity of their customer. The brand’s most prevalent characteristics are prestige, exclusiv- ity, high quality, and distinction. Every design element in the store interior and on the website features Rolex’s elegant aes- thetics. Colors, patterns, and product presentation emanate precision and attention to detail. Rolex thus relates its prod- uct to the way their customers see themselves and speaks to their (desired) character traits, which include sophistication, power, singularity, and elegance. Rolex exemplifies a symbolic customer experience arising from the confirmation of individual personalities at the touch- point. Consumers tend to prefer and subsequently contact companies and brands that fit theirself-identity. Forinstance, customers like, comment on, and share posts of brands that convey a specific image, such as prestige and exclusivity or health and fitness, with which they want to be associated. In this way they express their actual or ideal self-identity and in- fluence how people see them. BEHAVIORAL EXPERIENCE Nike’s website vividly conveys the benefits of a healthy, ac- tive lifestyle in order to motivate consumers to purchase Nike footwear and apparel in its online store and to start exercising. By additionally creating a customer ecosystem that includes, for example, wearables and apps surrounding their core prod- ucts, Nike generates a holistic experience to address customer needs in the entire health and lifestyle segment. Their slogan “Just do it”perfectlycaptures theirinvitation to join a behavioral experience. Behavioral experiences evidently result from activities, in- teractions, and lifestyles made possible by the company and triggered at a certain touchpoint. Nike aptly exemplifies how touchpoints can convey a certain lifestyle and could perhaps even influence that of the customer. A behavioral experience can also result from physically consuming a product or using a service. In a digital context, stimuli on a website can motivate customers to engage in a particular activity, for example, click- ing on an appealing ad that leads to more information about an offerorfrom a brand fan page on social media to its online shop. Furthermore, a positive behavioral experience often involves the possibility for interaction with a company. This can take various forms ranging from content interaction to social inter- action and can even encompass co-creation with customers. Companies in a digital context are expected to provide options for interaction on websites, online shops, and branded mobile apps, such as chats with customer service. Promoting interac- tion is especially important as it can translate into regular cus- tomer-brand engagement, which is necessary to build profit- able customer relationships. SOCIAL EXPERIENCE The German energy supplier innogy introduced a success- ful customer approach that harnesses customer assistance to relieve their in-house support: an online platform enables customers to exchange products, find solutions to problems, or share alternate uses for a product. Micro-influencers in- stantly evolved and created an atmosphere of trust. The re- sult: conversion in the online shop is five times higher among consumers who visit this community than among those who do not8. Hence, creating a social customer experience based on trust can directly translate into sales. Customers trust their network of friends and family more than firms or brands, so authentic opinions and recommendations from peers are valuable for creating an atmosphere of trust at a touchpoint. A proven means to foster customer trust is the integration of user-generated content.
  • 10. Customer Experience Excellence 10 But a perceived congruity to customer values and beliefs can also generate a symbolic experience. Consumers experience a company positively if they perceive its presentation at a touchpoint to be in accordance with their personal values and beliefs. They are increasingly looking for deeper relationships with companies and brands. If they have the feeling that the company affirms their principles in the social, economic, or environmental realm, the congruence makes the experience more compelling. When a customer has found a brand that matches his or her values and beliefs, the company must live up to its brand promise9. FUNCTIONAL EXPERIENCE A functional customer experience, also known as user expe- rience (UX), provides value to customers by offering conve- nience and creating a sense of flow that facilitates enduring interaction with a product or service, without interruption due to technical issues. A critical aspect of the functional experience is usability, or ease of use. The experience is thereby determined by how easily and intuitively a product, service, website, or applica- tion can be used by customers and how effortlessly a digital brand interface functions. Findability is of equal importance for an experience in a digital context. The term denotes the navigational struc- ture and organization of a company’s online presentation. A site’s structure should therefore have a standard design and placement of navigational tools, such as buttons. A phys- ical environment, such as the structure and arrangements of shelves and goods in a retail store, can also positively or negatively influence the functional experience. Usefulness is another central component of the functional experience. Using a product or service should satisfy a cus- tomer’s needs and fulfill their expectations. A vacuum cleaner whose performance is so weak that it does not remove dust is not useful at all and will negatively influence the experience, even if it is quiet and easy to handle. The same holds true if website content is not relevant for customers, does not pro- vide the necessary information, or appears outdated. The touchpoint’s response also shapes the user experience. A prompt response is expected at all touchpoints, whether by clicking a button in a car or on a website. If the button re- sponds slowly or not at all, customers can experience frus- tration. They often leave websites when loading takes longer than a few seconds, resulting in a missed opportunity to en- gage a customer. And finally, complexity plays a role in the user experience. Digital touchpoints in particular must be clearly structured and neatly arranged. Sufficient space between images in an online shop and uncluttered mobile sites are two ways to fa- cilitate customers’ mental processing and positively influence a digital experience. Mix and match The wide variety of experiences enables companies to create diverse customer-centric experiences by using and combining different levers (figure 3). Understanding what customers expect from a touchpoint helps a com- pany design the experience that matches their needs and even exceeds their expectations. Some dimensions might be more effective in creating a superior experience than others; it greatly depends on the product or brand, the touchpoint, the customer and the phase of the customer journey. While the experience has to fit the brand’s image from a customer’s perspective, it also needs to fit the type of touchpoint and its respective channel. For instance, cre- ating an emotional experience by providing fun and enter- tainment might be more effective for a company’s social media touchpoints than for a corporate website, which is more often used to retrieve information. Hence, customer insights are essential to truly understanding the custom- er journey. Customers evaluating different products in the pre-purchase phase might value a superior intellectual ex- perience more than those already using a product for whom the functional experience is of greater interest. It is crucial, however, for the experience to be consistent across all touchpoints. Consider Ritz-Carlton hotels, who constantly wow customers with a personalized experience throughout their stay in the hotel. Upon entering the lobby, guests are welcomed by name. Rooms are personalized ac- cording to past requests, and guests are greeted there by a handwritten welcome letter. Employees are trained daily on service dedication and empowered to act independent- ly in the customer’s interests: a budget of $2,000 can be spent without management approval to compensate inci- dents or surprise guests10. It is consistency and coherency that increase a brand’s clear, positive image in the minds of customers. ` The right combination of experience dimensions that matchcustomerneedsandexceedexpectations,createwow moments that really matter to customers and differentiate a company from its competitors.
  • 11. Customer Experience Excellence 11 Figure 5. Customer experiences and their direct effects on marketing objectives © Porsche Consulting MARKETING OBJECTIVES COSTUMER EXPERIENCE Behavioral experience Social experience Customer delight Recommendation Customer satisfaction Symbolic experience Functional experience Sensory experience Emotional experience Intellectual experience Customer Loyalty Brand attachment Superior customer experiences pay off Creating superior customer experiences is not an end in it- self. But it does have a strong effect on a company’s market- ing and sales objectives, thus contributing to overall goals in terms of revenue (figure 5). Our projects show that customer experience leaders achieve revenue gains of 7 to 10 percent within two to three years. In addition to increases in final revenue, our comprehensive studies have shown that each experience dimension is capa- ble of influencing the perceived customer experience—both positively and negatively. On the one hand, customer expe- riences directly influence customer satisfaction and loyal- ty. The more positively customers perceive an experience with a company, the more satisfied they are. Because su- perior experiences provide customers with positive feelings and pleasure, they seek to repeat them, a decisive factor in creating customer loyalty. On the other hand, superior ex- periences appear to elicit emotions that connect customers with brands in an invisible bond, resulting in brand attach- ment. Moreover, customers like to share their experiences with others for social and emotional reasons, so customer experiences can generate positive word of mouth as a pri- mary form of engagement. And because recommendations from the f-factor (friends, families, fans, and followers) are generally perceived as more credible than, for example, ad- vertisements, customer experiences result in spillover ef- fects that influence sales positively. Who doesn’t love an amazing experience? If it exceeds cus- tomer expectations and creates a wow moment, client ex- amples show that companies can profit from customers’ willingness to pay up to 25 percent more for such a delight- ful experience. Delight is created by combining different types of experiences across touchpoints, which add up to a holistic and exceptional customer experience. The basis for further loyalty!
  • 12. Customer Experience Excellence 12 Managing customer experiences successfully in the long term is only possible if the effectivity of experience initia- tives is measured continuously. This is a critical prerequi- site for a continuous optimization of customer experience over time. So far, so good. But how does one measure it? Is there a single approach or one KPI to track? Unfortunately, the answer is no. Our experience has shown the need for a holistic approach to measuring experience. No standalone KPI is capable of capturing the multidimensionality of an experience. To further complicate matters, a measurement approach that is perfectly suited to one company might be not effective and efficient for another; it depends on its ma- turity with regard to customer centricity. But one thing at a time: there are plenty of metrics to mea- sure customer experiences. However, they are only single KPIs that measure an indication of a customer experience. PoS Data, CRM-data, data from customer interaction cen- ters, or data from digital interactions such as traffic, bounce rates, and conversion rates offer a brief glimpse into a cus- tomer’s experience. Common metrics for measuring cus- tomer experiences are customer satisfaction (CSAT), the Customer Effort Score (CES), or the Net Promoter Score (NPS). But the problem with these metrics is that, when considered in isolation, they only provide a snapshot of an experience. Knowing how satisfied customers are with a product, how easy it was to use a service, or if they would recommend a company or brand to their family and friends are one-dimensional indicators that are not applicable for measuring the customer experience at each and every touchpoint. As important as all these scores are, they are by no means a substitute for a holistic approach to measure- ment that captures the customer experience in a differen- tiated manner. They are individual indicators that must be linked to other variables in a meaningful way. ` A holistic approach to measuring customer experience is always better than a single indicator. To develop the optimal approach to measurement, one must therefore be clear about the objective of measuring customer experience. Companies often measure several indicators at various touchpoints but struggle to optimize the experience on this basis. Why? They often lack a clear approach to operationalize their customer-centric strate- gy through defined customer experience metrics. Porsche Consulting suggests that companies define top-line cus- tomer experience metrics that are subsequently drilled down to the level of the customer’s journey. For example, if top management defines customer delight as the compa- ny’s main objective, all customer experience metrics along customer journeys and touchpoints should then pay into the account of this top-line metric. This implies that the drivers for the experience need to be identified along the customer journey and at the individual touchpoints. Even at touchpoint level, different determinants such as a payment function’s ease of use while ordering online or a customer care employee’s friendliness on the hotline can influence the overall experience and affect the top-line objective of customer delight. It becomes evident that establishing a metric like customer delight or satisfaction is only the first step. The second step must develop a detailed understand- ing of the metric’s drivers. The metric for measuring the ex- perience driver at a particular touchpoint must reflect the different customer needs at each stage of the journey and the various expectations for a touchpoint. There is no one metric for measuring customer experience that is applica- ble at every touchpoint! One manufactureraimed to create customerdelight through physical experiences with the brand and established sever- al brand pop-up stores to achieve this. The pop-up stores’ experience drivers were analyzed to measure the success of this new kind of touchpoint as well as its contribution to the overall customer experience. The results showed that sensory and emotional experiences exerted the most influence on customer perception of the brand’s pop-up stores6. These findings and additional qualitative insights from focus groups among store visitors made it possible to subsequently optimize the store’s design and hedonic value in terms of entertaining elements. The result was a touchpoint that clearly contributed to a positive customer Making the success of experience initiatives visible
  • 13. Customer Experience Excellence 13 experience and the creation of delight. But most important- ly, the store’s success was continually measured in the pop- up store via customer surveys, with the outcome used for improvement initiatives. Connect the dots A further factor for success exploits the results of measur- ing customer experiences to inform key decisions. Data gen- erated at individual touchpoints must be used to adapt the design and execution of the customer experience process. A holistic approach to measurement on touchpoint and journey levels is a critical prerequisite for connecting customer expe- riences to action. An integrated customer experience cockpit has proven to be most helpful in tracking the quality of the key touchpoints along the journey and capturing measurement criteria, such as sensorial attractiveness, emotionality, and processual performance. In addition to tracking touchpoint quality, it is advisable to benchmark the results of customer experience measurement against the most important competitors and best-in-class companies. This can help uncover an organiza- tion’s own weaknesses regarding touchpoint quality and pro- vide ideas for improvement. For a digital service provider, this meant taking the follow- ing steps: identify the most important customer experience measures along the journey, set up an integrated customer experience cockpit that measures indicators and condenses them to one reportable Customer Experience Score, as well as define the process for collecting and analyzing the data and enable him to react to the feedback. Establishing a systematic way to measure customer experiences holistically and in an integrated manner is a supreme discipline—but indispens- able for operationalizing a customer-centric strategy without wasting time and money on measures that lack impact.
  • 14. Customer Experience Excellence 14 Conclusion: Are you ready to wow? Companies and brands can only be successful if they do not leave wow moments to chance. To wow customers with superior experiences, Porsche Consulting recommends a six-step approach: 1. Create a mindset for customer centricity A transformation program needs to ensure the buy-in of the top management and the commitment of all employees to customer experiences. To successfully manage customer experience, a company must acknowledge the importance of experiential responses and put the customer first across all processes, even in the knowledge that the effects on revenue might not be directly measurable. 2. Assessing customer touchpoints systematically All touchpoints, whether physical or digital, must be collected and systematically assessed. Despite the considerable effort it may entail, examining touchpoints from an internal and external perspective is worthwhile. Internal analysis should examine the underlying processes, structures, responsibilities, and costs associated with a touchpoint. External analysis seeks to understand the preferences of various customer segments for certain touchpoints as well as their needs, expectations, and actual experiences. 3. Understanding customer journeys The next step is to bring the individual touchpoints into a contextual and chronological sequence in order to depict actual customer behavior as realistically as possible. Customer journey maps for defined perso- nas unveil the key touchpoints and interfaces at which gain and pain points are created and at which the targeted use of customer experiences is most beneficial. 4. Designing the experiences and creating wow moments Having identified the touchpoints that really matter during the journeys, customer-experience design principles and objectives per touchpoint are defined. This forms the basis for the design of holistic and multidimensional customer experiences using the seven types of experiences: sensory, emotional, intel- lectual, behavioral, social, symbolic, and functional. Customer insights provide a starting point for com- prehensive initiatives to improve the quality of key touchpoints and their underlying processes. 5. Measuring and tracking customer experience successes The next step defines one model for operationalizing the customer-centric strategy. Therefore, identify a top-level KPI that allows the success of customer experience initiatives to be tracked. This KPI should then be drilled down to the journey and touchpoint levels by identifying its drivers. The metrics of this integrated measurement strategy must support understanding what customers value and how to address their needs. Setting up an appropriate governance model must then follow determining who is respon- sible for the customer experience at the various touchpoints and for controlling the achieved results. Customer experience targets should also be part of an incentive scheme. 6. Optimizing the customer ecosystem Finally, as companies increasingly operate—or at least are part of—a broader customer ecosystem, suc- cessful customer experience management must look beyond touchpoints on the customer journey and optimize structures, processes, and resources of the different value constellation propositions across the ecosystem. This approach helps to consistently delight and wow customers, build true relationships with them, and provide the company with a real competitive advantage.
  • 15. Customer Experience Excellence 15 IN BRIEF 01 A customer-centric mindset and strategy is a prerequi- site to create superior experiences Customer experiences are multidimensional: they encompass a sensory, emotional, intellectual, behavioral, social, symbolic, and functional dimension 02 By using customer insights to create the right mix of experience dimensions at critical touchpoints along the journey, highly valuable wow moments can be created 03 Superior experiences pay-off in increased customer sat- isfaction, loyalty, delight, brand attachment and recom- mendation 04 Holistically measuring experiences with an integrated customer experience cockpit is necessary to inform key decisions 05
  • 16. 3 Customer Centricity Thinking from the customer’s point ofview Eight steps to a successful customer-centric business model Five steps to remain a relevant brand in the hurricane of disruption and transformation Brand Evolution or Revolution? Brand and Sales Strategy Customer Experience Excellence 16 Authors David Blecher Partner Contact +49 170 911 3874 Dr. Isabelle Manger Consultant Further reading Thinking from the customers point of view Brand Evolution or Revolution Porsche Consulting Porsche Consulting GmbH is a leading German strategy and operations consultancy and employs 670 people worldwide. The company is a subsidiary of the sports car manufacturer Dr. Ing. h.c. F. Porsche AG, Stuttgart. Porsche Consulting has offices in Stuttgart, Hamburg, Munich, Berlin, Frankfurt am Main, Milan, Paris, São Paulo, Shanghai, Beijing, Atlanta, and Belmont (Silicon Valley). Following the principle of “Strategic vision. Smart implementation,” its consultants advise industry leaders on strategy, innovation, performance improvement, and sustainability. Porsche Consulting’s network of 12 offices worldwide serves clients in the mobility, industrial goods, consumer goods, and financial services sectors.
  • 17. Customer Experience Excellence 17 Appendix (1) Details can be found in the white paper “Thinking from the Customer’s Point of View: Eight steps to a successful custom- er-centric business model” (2) https://www.ing.com/Newsroom/News/Features/Features-old/ING-Direct-Cafe-Lyon-opens-its-doors.htm (3) https://www.autostadt.de/en/explore (4) https://www.adidas-group.com/en/group/strategy-overview/ (5) https://newsroom.porsche.com/de/unternehmen/porsche-experience-center-hockenheimring-grundstein­ legung- 160000-quadratmeter-2019-16287.html (6) Köhler, Isabelle: Brand Experiences in Physical and Digital Contexts - Investigating Consumer Perceptions and its Effects on Brand Outcomes from a Brand Ambidexterity Perspective. Diss., Universität für Wirtschaft und Recht, Oestrich-Winkel, 2017 (7) https://newsroom.porsche.com/de/unternehmen/porsche-oeffnet-pop-up-store-in-new-york-10336.html (8) Weltmann, Christopher (2019): Schwarmintelligenz hilft - Die innogy Community als zentraler Baustein einer Interactive Customer Experience. Vortrag am Brand Talk Summit, Mai 2019, Düsseldorf. (9) Details can be found in the white paper „Brand Evolution or Revolution?” Five steps to remain a relevant brand in the hurri- cane of disruption and transformation. (10) https://ritzcarltonleadershipcenter.com/2019/03/19/the-power-of-empowerment/
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