Sprint's Palm Pre Experience

On June 6, 2009, Sprint proudly launched their latest flagship product - the Palm Pre. While numerous reports have lauded the success of the launch and the phone itself, a more important storyline is the strides that Sprint has made in their overall customer experience. Sprint's customer experience problems have been well documented. Their ability to effectively address those problems may be the one thing that will make or break the company. Although Sprint's recent performance with the Palm Pre had its pro's and con's, Sprint appears to have done this one right.

Sprint obviously has a lot riding on the Palm Pre. Over the past few years, Sprint's customer satisfaction woes have been well documented and new CEO Dan Hesse has made it clear that improving customer satisfaction is priority number one. While Sprint has been making strides on fixing their problems, no one seemed to notice. Sprint needed to grab the stage - even if for just a short period - to demonstrate that things had changed. The Palm Pre has provided that stage and Sprint's performance is sure to be closely scrutinized. Dan Hesse went so far as to refer to last weekend's launch as a "coming out party" for Sprint.

THE TOTAL CUSTOMER EXPERIENCE

While some may look only at the launch day to determine if Sprint is truly different, a more important barometer should be the overall customer experience. The experience began when Palm and Sprint unveiled the Pre at the Consumer Electronics Show (CES) in January. There had obviously been a lot of pre-work done (pun intended); Sprint had established an exclusive arrangement with Palm to create the most innovative new device since the iPhone. This exclusive partnership alone highlighted Sprint's innovative roots and placed it squarely in the spotlight to deliver something special.

The pre-launch buzz began to build from that point forward. Special blogs were created, tweeters were tweeting, and rumors abound. If Sprint and Palm wanted the spotlight, they surely got it.

How Sprint and Palm would perform in the spotlight would be an important part of the overall customer experience. Fortunately for Sprint and Palm, they performed admirably.

ATTRACT

Building upon the success of the CES event and the subsequent interest in the Palm Pre, Sprint and Palm responded by launching special web pages to try and quench a seemingly unending thirst for Palm Pre news. While Sprint and Palm web sites offered little to any additional information regarding the Pre, the blogosphere was kicking into overdrive.

Hundreds of smart phone enthusiasts began to sleuth every possible angle to learn more about the Palm Pre and its eventual launch date. It became almost a game; the dearth of information from Sprint and Palm only fueled more speculation about pricing, features, and availability. Most companies would pay dearly for such successful viral marketing.

Eventually Sprint launched its own series of 'Now Network' ads that seemed to tease the audience even more by showcasing the Palm Pre at the end of each ad. Even though the phone had not yet been released, the ads whipped up even more anticipation for the eventual launch.

QUALIFY

With the bait firmly set, it was now up to Sprint to determine how to best land as many prospects as possible. In a very smart move, Sprint launched a Palm Pre landing page that contained a simple prompt: "Sign up to be notified when the Palm Pre is available."

It was a simple and brilliant way to allow prospective customers to self qualify themselves for Sprint. As a result, Sprint was able to collect a highly qualified list of prospects that could be used for target marketing to ensure that the prospects were converted to customers when the Pre became available.

That's exactly what they did.

INTERACT

Prospects that self-qualified themselves, as well as existing Sprint customers, received regular email newsletters that informed them of special offers, accessories, new plans, and other products. This simple but effective interaction helped to keep prospects engaged during the waiting period between the CES product announcement and the eventual product launch on June 6.

Unfortunately, the majority of these email newsletters provided few additional details about the Palm Pre. Perhaps the lack of Palm Pre related information was part of their strategy of secrecy, but this is one big opportunity that Sprint may have missed. If they had provided more juicy tidbits through this channel, perhaps they could have significantly grown their prospect list as more and more people were clamoring for information.

Although many people get annoyed with companies that overload their email inboxes, this is a case where I believe that additional and more timely communications would have been welcomed.

SPECIAL TREATMENT

As part of Sprint's drive to improve customer satisfaction, they also have begun to more actively utilize a loyalty program called Sprint Premier, which rolled out in February of this year. Once again, Sprint did this right. Long time Sprint customers were automatically enrolled in the program and notified via email and or direct mail that they were being recognized for their loyalty.

The loyalty program includes perks and privileges like most programs of its kind. For example, one direct mailing included a special $25.00 coupon that could be used to purchase any accessory. Unfortunately, this excluded Palm Pre accessories - at least during the launch weekend.

Perhaps most important to the customer experience, Sprint sent a special notification to Premier members that invited them into stores one hour before opening time on launch day to demo and purchase the Palm Pre. While others were planning overnight camp-outs to be the first in line to get the Pre, Premier customers got special treatment.

Overall, it was a nice touch and a great way to reward some of Sprint's most loyal customers.

BUY

June 6th was an anxious day for everyone. Sprint and Palm were nervous for obvious reasons. Prospective customers were also anxious in light of the rumored short supplies of the Palm Pre. Although some out of stock situations were reported, the supply situation over the launch weekend did not appear to rain on the parade.

Personally, I arrived at a local Sprint store around 10:30am, nearly 2 and a half hours into the launch day feeding frenzy. I arrived with low expectations; I had resigned myself to the fact that I would probably be greeted by long lines and news of inventory outages.

However, my experience was surprising. Upon arriving at the store, I entered my name into a customer waiting queue. If you haven't been in a Sprint store in a while, they've revamped the store environment as well, capped with a large flat screen monitor that shows your place in the waiting queue in real time.

Overall, the in-store experience was good. I waited only 20 minutes to be greeted by a Retail Consultant, who quickly started the purchase and activation process. While the activation process was underway, he successfully up-sold me on a few accessories for my new Pre. The sales and activation process was lengthy, but largely overshadowed by the anticipation of getting my hands on the shiny new Palm Pre.

SUMMARY

The new phone has worked almost flawlessly on the Sprint Network. Although I have experienced a few glitches, the overall experience has been fantastic. The experience started with growing anticipation since the January 8th introduction at the Consumer Electronics Show and has culminated with the launch of the Palm Pre on June 6th. Daily usage of the Palm Pre, which so far has been great, will only expand upon the overall experience.

While many people will look only at the launch day or even certain characteristics of the phone itself to gauge the experience, Sprint and Palm have done a great job of managing the total customer experience over the past 6 months. Although not everything went perfectly, I give the overall customer experience at grade of 3.75 out of a possible 4.0 experience.

Cultivate Relationships to Increase Margins

A critical component of customer relationship management (CRM) - and yet often overlooked - is the cultivation of existing customers. We’ve seen it all too often; companies spend nearly all of their time and scarce resources trying to attract new customers - while existing customers are largely ignored. This practice can be costly in terms of lower profitability and higher customer turnover rates. Companies seeking to improve their CRM practices should look no further than cultivating existing customer relationships.

The Importance of Cultivation

All too often, businesses large and small become focused on one simple thing: attracting new customers. While this is an important dynamic for real business growth, it can become toxic if it is overemphasized and becomes the ONLY focal point for the business.

Customer acquisition is often the most costly and least profitable component of the overall customer experience. Companies throw promotions, price discounts, or free products and services at potential new customers - all of which can quickly hike up acquisition costs and squeeze profitability.

Don’t Make a Loss Leader be a Total Loss

We see examples of high acquisition costs every day. Grocery stores and other retailers are famous for offering loss leaders - popular products or commodities at an unprofitable price - in order to get customers in the door. Mobile phone companies subsidize new phone sales - again unprofitably - in order to land more subscribers. Even car dealers often sell new cars at very narrow margins in an attempt to land longer-term service relationships.

High-cost acquisition programs can be effective in landing new customers. However, in order to make the practice profitable, companies must focus more attention on taking care of existing customers and building meaningful and lasting relationships. Simply put, incremental revenue generated from an existing customer can be achieved at nominal costs. As a result, the cultivation phase - or back end - of the customer experience process can often be the most profitable.

Customer cultivation is important for one very important reason; it can significantly improve the customer lifetime value for your company. Customer lifetime value - simply put - represents the total revenue collected from a customer less any costs to acquire, serve and support the customer over the life of their relationship with your company.

Cultivate Your Relationships to Improve Your Margins

For example, if we commit $140.00 to acquire a customer that buys a $150.00 MP3 music player, we have made a margin of only $10.00. However, if we can develop and nurture the customer relationship at a nominal cost of only $50.00, they may turn around and spend $300.00 dollars on music downloads, gifts for friends, and related products over the next year - a respectable margin of $250.00.

If a meaningful customer relationship was never established after the initial transaction, then the lifetime value of the customer is a measly $10.00. However, by cultivating the relationship and obtaining additional follow-on revenue in our example, we increase the customer lifetime value to $260.00 from $10.00 - a healthy increase of 2600%!

How to Cultivate

Every new customer transaction plants a seed. What your company does with that seed can make a significant impact on future profitability. Will the seed lay there and be forgotten? Or will it be fed, watered, and nourished into a lush asset that bears fruit on a regular basis?

In order to get the most out of your customer relationships, you need to cultivate what you sow:

1. Relate: Relate with your customers through regular and meaningful contact, observations, and ongoing interactions.
2. Retain: Retain your customers by creating barriers to switching to a competitor and create an atmosphere of exclusivity.
3. Expand: Expand your relationship with your customers by offering complimentary products and services on an ongoing basis.
4. Innovate: Keep your customers excited and engaged by surprising them with new product innovations or special bundles that are tailored just for them.
5. Analyze: Analyze your customer behaviors and cultivation activities to predict and anticipate future wants and needs.

Very few companies get customer cultivation right the first time. Doing it effectively can take strong leadership, a clear vision, and an effective measurement system to continuously evaluate customer lifetime value. However, those companies that do it right can reap significant rewards.

Myth #5: CRM Software = Customer Experience Solution

As CRM concepts have matured, the hype-engines have been thrust into overdrive. The resulting marketing noise can make it difficult to differentiate between CRM and CEM. But make no mistake; Customer Experience Management is much different that Customer Relationship Management. Choosing a CRM software solution to solve your customer experience issues can miss the mark. Here’s why:

1. CRM software is typically more functional (rather than process-centric) in nature. Many CRM systems are designed to provide specific point solutions to support CRM functions such as call center support, eCommerce, marketing automation, or loyalty reward management. While each point solution often works well, CRM software solutions alone won’t enable or help to manage the end-to-end nature of the customer experience process.
2. CRM software is limited to the reach of its technology and can’t support or influence all touch points. While CRM software has come a long way over the past decade, there are still customer experience touch points that can’t be directly influenced or managed by CRM software. Touch points such as employee interactions, aspects of direct marketing, and third-party touch points may have a significant impact on the customer experience but may not be supported by CRM software.
3. CRM software is often implemented as a best-of-breed solution and lacks the level of enterprise-wide integration necessary to develop and manage a true 360-degree view of the customer. CRM software solutions are great at managing customer information. The view of the customer can limited, however, if a complete set of customer interactions, behaviors, or preferences aren’t properly captured and analyzed. Interactions such as inbound and outbound communications, campaigns, or customer care interactions are often not tracked and managed by CRM solutions. CRM solution alone won’t solve this problem; businesses must take the steps to engrain CEM concepts throughout all touch points in their enterprise.
4. CRM solutions provide a limited set of customer experience metrics. While CRM solutions often provide key functional metrics, they are often transaction in nature and won’t provide a comprehensive set of metrics necessary to analyze, measure, and manage the end-to-end customer experience.

While CRM software is an important first step for any business seeking to improve their customer relationships, it is not a surrogate for Customer Experience Management. Companies that are seeking to establish or improve their total customer experience should look beyond CRM software solutions and seek customer experience solutions that augment CRM software. CEM specific capabilities include business process management, sophisticated customer experience analytics, and enterprise-wide visibility to customer interactions that can span the total customer experience.

Myth #4: A Centralized Customer Database Provides a 360-degree View of the Customer

Establishing a 360-degree view of the customer has long been the holy grail of any CRM program. Many companies consolidate their multiple customer databases into a centralized customer database and declare victory. Although establishing a single customer database is foundational to a 360-degree view of the customer, a customer database alone often won’t provide your company with a complete view of the customer. Here’s why:

1. A centralized customer database often contains only basic or static data including name, address, account number, demographic and profile information. Although this core information is critical, it often won’t provide historical information regarding transactions or changes to address, account, or profile information. Without historical information, it’s difficult to get a complete picture of the customer.
2. Customer interactions can take place in many forms, at multiple locations, and across multiple channels. Unless the customer database is specifically designed to store interactions, you’ll be missing an important element of your customer’s behaviors.
3. Customer databases are often designed to support operational activities such as transaction processing, order management, and billing. Operational databases often lack robust customer analytics that are necessary to unlock the secrets of the customer experience.
4. Customer feedback is often collected and managed separately from customer information. As a result, correlating customer sentiment to specific customers or customer segments can be difficult.

Although a centralized customer database is foundational to a 360-degree view of the customer, a database alone won’t provide the complete picture. Companies that are seeking to establish or improve their total customer experience should look beyond customer databases to more robust data warehousing capabilities that include a view of historical changes, transactions, interactions, and feedback that can provide a complete 360-degree view of the customer.

Myth #3: Each Channel Should Have a Unique Customer Experience

Thanks to technology and multiple points of presence, business just keeps getting more complex. Innovations in technology have brought new channels such as the call center, Internet, and now mobile channels in many industries. Many businesses, anxious to stay in the game, jump in with new channel offerings without an integrated view of the customer.

Granted, each channel has unique characteristics and can be used in different ways and for different purposes by the customer. Treating each channel experience as unique and independent, however, is a recipe for disaster. Each channel may indeed be different; the customer experience shouldn’t be.

Ever since the day that Ray Kroc began expanding the McDonald’s empire, he set the standard for consistency across each and every location. No matter where you are in the world, the McDonald’s experience is the same. Ray Kroc’s formula for consistency should be a blueprint for any business operating in a multi-channel environment today. Managing each channel as unique and different shouldn’t be. Here’s why:

1. Customers are increasingly expecting multiple channel options. According to a Sterling Commerce Study, 80% of customers surveyed feel it is important to have a choice of shopping across multiple channels when choosing a retailer. Businesses with only a single channel option, or channels which are discrete and disconnected, will likely miss the boat.
2. Customers expect the customer experience to be the same across channels. According to a survey conducted by Tealeaf, 85% of adults expect their online service levels to be the same as offline, an increase of 3% from the prior year. Providing inconsistency across channels will only contribute to customer frustration or confusion.
3. Customers will likely switch channels. As the number of channels available to the customer continues to grow, so too does the challenge of providing seamless cross-channel integration. A customer experience that begins in one channel should transfer seamlessly and be continued in another without interruption. Lack of consistency across channels will only detract from the overall customer experience.

While each business channel has unique characteristics and can be used in different ways and for different purposes by the customer, each channel experience should not be designed or managed independently. Companies that are seeking to establish or improve their total customer experience should focus on cross-channel consistency and seamless channel handoffs regardless of the customer experience scenario. Simply put, maintaining discrete channels with separate customer experiences won’t cut it for today’s demanding customers.

Myth #2: Customer Experience Is Just A New Term For Customer Service

Make no mistake, customer service is as important as ever; delivering great customer service is one of the most tangible and visible methods for improving customer satisfaction. Customer service, however, represents only a small fraction of the overall customer experience. Companies that talk themselves into a false sense of accomplishment by focusing only on customer service are missing the bigger picture; customer experience encompasses much more that just customer service.

While customer service is important, focusing solely on customer service misses the mark on the bigger picture. Here’s why:

1. Customer service often represents only a subset of potential touch points: a receptionist, a call center representative, or a restaurant waiter or waitress. Each touch point does provide a significant contribution to how each customer is treated. Even the best customer service, however, won't rectify an otherwise flawed customer experience. In contrast, the customer experience is broad, encompassing all customer service touch points that can extend from the customer's first impression to their ultimate defection.
2. Customer service often refers to human interaction with the customer. While human interaction is critical, consumers are increasingly utilizing self-service alternatives via the internet, telephone response, and kiosk. According to a study by Pew Internet Study, 73% of adult Americans use the internet, a number that continues to grow steadily. Customer experience initiatives must consider all touch points and channels in order to grasp the end-to-end scope of the customer experience process.

While customer service is an important component of the overall customer experience, companies that are looking to establish or improve their customer experience capabilities should define their customer experience more broadly; the customer experience should be defined as an end-to-end process that begins with customer attraction, flows through interaction, and ends with cultivation – where the process starts over.

5 Customer Experience Management Myths

As customer experience management (CEM) continues to gain importance in the minds of today’s CEO’s, more and more companies are taking on customer experience management projects to improve customer satisfaction, develop better customer insights, nurture customer loyalty and advocacy, and improve customer lifetime value. The rapid rise to the top echelons of strategic priority has brought an unfortunate side affect; numerous customer experience management myths have begun to form due to a flood of conflicting definitions, perspectives and over-hyped promises.

For any company seeking to establish or improve its customer experience management capabilities, it’s important to dispel these myths once and for all.

Myth #1: Net Promoter Score (NPS) is the only metric you need

The customer experience can be broad, long running, it can span channels, and is influenced by any combination of internal and external factors. Attempting to measure it effectively with a single metric such as customer satisfaction or net promoter score is overly simplistic and risky. Effectively managing the customer experience requires effective measurement and management of a portfolio of metrics that will provide a true measure of what is – or is not - working.

The Net Promoter Score (NPS) is a measure of customer advocacy that was the centerpiece of Fred Reichheld’s 2006 book titled ‘The Ultimate Question.’ The net promoter score is calculated by taking the percent of customers who are promoters less the percent of customer who are detractors. Obviously, the higher the resulting number - the better.

While the net promoter score is an effective measure of overall customer advocacy, it will not address all of your potential customer experience management questions. Here’s why:

1. Customer advocacy – or net promoter score - measures only one dimension of the customer experience. Focusing only on a single metric such as net promoter score means ignoring equally important dimensions such as customer satisfaction and customer loyalty. An effective and comprehensive customer experience program must take all of these dimensions into consideration.
2. The net promoter score is only an aggregated measure of the total customer experience. However, the number of factors and touch points that contribute to the overall customer experience can be numerous. Focusing only on an aggregate metric without understanding or managing the contributing factors can yield unpredictable results. Companies seeking to improve their overall customer experience must focus on managing and measuring the underlying events that contribute to an exceptional customer experience.
3. The net promoter score does not necessarily equate to customer action. For example, for every customer that says they would ‘definitely recommend’ the company in a customer survey may not make any actual recommendations. Companies seeking to realize tangible results will need to correlate their NPS ratings with other key business metrics such as new customer additions, increase in profitability, or changes in market share.

While NPS is an important customer experience metric, companies that are looking to establish or improve their customer experience capabilities will need to identify a more robust set of metrics that will measure all dimensions of the customer experience life cycle.

The other myths:

Myth #2 Customer Experience is Just A New Term for Customer Service

Myth #3 Each Channel Should Have a Unique Customer Experience

Myth #4 A Centralized Customer Database Provides a 360-degree View of the Customer

Myth #5 CRM Software = Customer Experience Solution

Why Customer Experience Matters Most

Companies have long competed on manufacturing capabilities, innovation, or traditional customer service. But finding new ways to create a differentiated offering in those areas are increasingly difficult to find. As a result, customer experience has emerged as the new battleground to create long, broad and deep customer relationships; relationships which can differentiate your company and deliver significant value to the bottom line.

Strategically, a unique customer experience can differentiate your company in the marketplace. In a marketplace where competitive parity and/or commoditization have set in, customer experience becomes one of the few alternatives for strategic differentiation. Perhaps an over-cited example is Starbuck’s, where they have converted coffee from a commodity into a destination site that plays to customer’s emotions, tastes, and a feeling of prestige – mostly based on a unique customer experience (and some pretty good coffee, too.)

Optimizing the customer experience may sound like another noble cause, but the results can be real. Let’s take a simple example of two truck stops along a major interstate highway that both sell gasoline at the same price. The first station is clean, well lit, and has a pay-at-the-pump features. The second station has paint chipping, a broken sign, and requires that you pre-pay for gasoline. It’s pretty easy to guess that while the second station may have an occasional customer wander in, the first station has more repeat customers and customers who are willing to buy other products and services. Simply put, that means more revenue (more customers for longer) and higher profits (selling more products and services to the same customer for the same attraction costs).

Achieving real results from an improved customer experience is as straight forward as a-b-c. The revenue that you realize from each customer is determined by a) depth, b) breadth, and c) duration of your relationship. Improve upon any of these key factors and you can realize significant results.

The depth of your customer experience is the level of commitment, loyalty, and meaningfulness of your customer relationships. Customer relationship depth can be measured in several ways, but perhaps the most obvious is the frequency of customer visits or transactions. For example, a customer may get his hardware supplies at a local hardware store for smaller items, but shop the big-box hardware store for larger items. Increasing the depth of the relationship means converting those transactions from the other store to yours by delivering a substantially better customer experience.

The breadth of your customer experience is the number of reasons that your customers transact with your company. Customer breadth can be measured by the total portfolio of products or services purchased by each individual customer. For example, the big box retailers such as Wal-Mart, Target, and K-mart have all added product lines, such as groceries, to expand the breadth of their relationship with their customers. Their intent: To be the one-stop shop for everything.

The duration of your customer experience is the total time, from first recognition to final defection, that your customer has a relationship with your company. Customer duration can be measured by the total time that a customer has interacted with your company. The value of increasing customer duration is clear; serving your existing customers is almost always more profitable than attracting new ones. In one example during my consulting career, we spent nearly as much on getting the sale than the total sale was worth. Obviously, expensive customer attraction activities are not profitable for your company. Keep the customers you have.

During the initial incubation stages of your project, you shouldn’t expect to have a complete, detailed and final business case. We address that activity in depth in the following chapter. However, establishing the intent of your project based on the potential value gains can help to formulate the vision, goals, and objectives for the project and properly align your executive sponsors’ expectations and support.

We focus on the value associated with improved customer experiences because it matters. It matters to your customers that make a conscious decision every time they choose to spend their dollars. It matters to your company as you seek to increase revenues and profit margin. And it matters to your stakeholders to know that your company has an unbeatable competitive advantage in the marketplace.

Focus on the value of the customer experience – because it matters more than anything.

Inside Jobs, February 6, 2008

Is Your Business World Flat?

Perhaps you’ve heard the term ‘360 degree view of your customer.’ It’s a business term to describe the ability to identify and understand all aspects of a customer’s attributes, wants, and needs regardless of the channel. So if there are indeed 360 degrees to every customer – we must assume that they are round (metaphorically speaking, of course.)

But how does the customer view your business? Is it round or flat?
The answer may depend on the laws of customer relationship physics.

Physics and the Customer Relationship

It took a simple apple falling from a tree for Sir Isaac Newton to recognize that some force was in action. Soon, he had proven that there was a force – called gravity – that constantly pulled on all things in our world. He eventually determined that if gravity were constant around our large round world that an object traveling at the right velocity could orbit the planet – much like the moon!

The next time you look up at the moon, covet her. For the earth is your business and the moon is your best customer. You may not know where she came from or how she got there, but she keeps coming back like clockwork. She is extremely loyal, doesn’t complain, and never ever asks for a refund. Every business should yearn for a few more moons.

Unfortunately, the typical customer relationship is a bit more complex than the moon. To expand our physics analogy, consider your customer; he or she is a body of mass sitting motionless out in space. As a physics refresher – that body of mass won’t move itself. It requires a force to get it moving. That’s where socioeconomic and other forces come into play. Hunger, for example, is a powerful force and will drive customers to the grocery store or restaurant. Socioeconomic factors can push customers into the market for homes, cars, appliances, health care, or other services. The force can be slight (‘Oh, I’m just browsing’) or it can be extreme (‘I’ve just gotta have that now at any price!’).

As a business, you are the earth that hopes it has enough gravitational pull to capture those customers that may be hurtling towards a purchase. The problem, or course, is that there are plenty of other businesses out there competing for the same customer. Typically, the business with the greatest pull will win the business.

Does your business have the right stuff?

The Customer’s Flight Path

So what does physics possibly have to do with your customers and your business? Plenty. A customer in motion is a customer with a want or need that could be fulfilled by your business. If your business world is flat, you’ll lack the pull to capture the customer and they’ll just continue on their path. Apply the right force, however, and you can begin to influence their purchase decision.

The difference, of course, is that gravity is a constant force – regardless of where you stand on the earth. Business forces are quite inconsistent; some touch-points work well while others may send your customers flying away into the market universe.

Apply the right amount of force consistently, however, and the customer may orbit the business for eternity (much like the moon orbits the earth). Miss your opportunity and the customer could behave like a meteor – flying by the business only once – never to be seen or heard from again.

The Fly By
A customer that is in the market for a product or service is a customer in motion. Likely, that customer will continue on her path until the want or need is fulfilled or expires. Often a business will only get one opportunity to capture her attention.

For example, a drop in interest rates may prompt a customer to consider refinancing her home mortgage. This force puts the customer in motion and she may start by researching interest rates online. During that process, she will be exposed to a dozens of potential home loan providers. She may utilize a few of their web sites to get information, but without the appropriate pull, she will simply fly by – never to be heard from again.

Many companies understand this fly-by dynamic and are increasingly requiring customers to enter basic identifying information prior to providing them with product information. By doing so, the business can establish a dialog with the customer to encourage them to come back for a closer look.

The One-and-Done Customer

Many businesses will work tirelessly just to get the customer in the proverbial door. They’ll work even harder to convert that customer into a sale. Unfortunately, many businesses spend all of their time and effort on the sale and neglect the potential that a repeat customer represents. As a result, they may spend all of their efforts trying to attract new customers, but then let them slip away out the back door. Their customer pull may be great up front but weak in the end. Using our analogy of customer physics, that means that the customer will often just keep moving on.

Consider a first-time prospect; they may linger a little longer and take in more than one perspective of your business. If you make the right impression, you just might influence their decision and even ultimately convert them into a sale. But businesses that don’t over deliver and cultivate the relationship can have a customer that is simply one-and-done. First impressions can be hard to overcome, so make sure that yours is a good one.

For example, the customer looking to refinance their mortgage already has an account with a mortgage firm. It may be a strong and reputable firm, but without an effective cultivation and differentiation strategy, the current mortgage firm may lose its existing customers when they look to refinance.

Businesses that understand this relationship dynamic will work to keep their current customers. They maintain an active dialog, create a sense of membership, and offer incentives for sticking around. Without applying an effective and consistent retention force, the customer relationship is vulnerable to the next competitor trying to lure your customers away. And that can lead to customer relationships that are like a meteor – they are one and done.

The Repeat Customer

The holy grail of any business is the repeat customer. Any customer that is willing to stick around can be worth their weight in gold. Keeping your customers around doesn’t happen by accident. Businesses must apply a constant force at every possible touch point. To be effective, businesses should understand two important dynamics of the repeat customer relationship.

First, customers in the pre-sale mode may orbit your business multiple times before deciding to buy. During this phase of the decision making process, business should realize that some customers may require up to 5-7 interactions before they make up their mind. There is a correlation between the type and complexity of the product or service you are selling and the number of pre-sales contacts that may be required.

In this pre-sales phase, many businesses make the mistake of believing that their world is flat; they make only one contact or impression. If there is no sale, they assume the customer either isn’t qualified or interested and they give up. However, this is where persistence can pay off. Continuing the dialog can keep the customer interested and improve your chances for winning the business.

The second dynamic that businesses need to understand is the cultivation cycle. Take a customer that hires a contractor to do some repairs on their house. The contractor does a good job and the customer pays promptly. Businesses that truly value their customers will work to cultivate the relationship. Perhaps the customer – or their friends and neighbors - will have other home improvement projects in the future. It is in the contractor’s best interest to maintain a relationship that could help to circumvent the entire pre-sales cycle altogether. Ideally, the customer will become a loyal customer – and will avoid looking at other contractors.

The cultivation cycle is perhaps the most overlooked element in the entire customer relationship. Many businesses continue to spend an inordinate amount of time and money trying to attract new customers, rather than maintaining their existing relationships. In order to maintain the customer relationship orbit, the force must be applied equally across the entire customer experience lifecycle.

Newton Had It Right

Sir Isaac Newton knew that there was something at play when the proverbial apple fell from the tree. His study of how the force of gravity affects other objects provides us with some insightful perspectives of how customers interact with businesses. Perhaps the law of physics does closely resemble our customer relationships.

Some businesses may indeed appear flat to their customers. The customer may encounter the business, see that there isn’t much to it, and disappear over the edge of the world never to be heard from again.

Businesses should know better.

Your business world is indeed round. Customers will look at your business from many different angles. They may even orbit a few times before they decide whether or not to buy your products or services. Or they may slingshot by – like a meteor - inquiring once but never to be heard from again.

What do you think; is your business world still flat?

Would You Put Your Customers Through This?

There has been a lot of talk over the years about managing the Total Customer Experience. This is a Utopian view, of course, given the span of control that would be required to truly influence the myriad of events, factors, and third parties that make up the total customer experience in most industries.

Let me explain.

The travel industry, perhaps an easy target for criticism, is a perfect example. In order to get from one city to the next, we engage several entities, each one serving its own unique purpose. We need them all to accomplish our mission, yet none of them are necessarily motivated to work together.

You see, I’ve experienced these challenges firsthand. Admittedly, I am a frequent traveler and have logged an embarrassing number of airline miles and hotel points over my 20-year career. I’ve had my share travel miscues over the years, but a recent trip from San Diego to Kansas City this past weekend really highlighted the problems associated with any attempt at managing the total customer experience.

In this case, the total customer experience began when I checked myself, my wife, and three kids out of our hotel. It would end when we arrived safely at our home in Kansas City. Along the way, we would interact a hotel, a rental car company, two airlines, the transportation security administration (TSA), an airport terminal bus, and a parking lot attendant. In short, it was less than smooth.

Mysterious Beginnings. We began our day by trying to check out of our hotel in San Diego. Amazingly, the front desk said they had no record of our reservation, nor did their system have any record of anyone staying in our room. Apparently, we didn’t exist. Confused, we piled into our rental car and raced to the airport to return our rental car.

The Bad. We returned our rental car, full of gas, and void of any new scratches or dents. Hurray! But when we received our bill, they had not credited us for the coupon we provided for a free weekend rental day. Simply put, they made the offer – they should honor it. With little time to argue, we continued on to the airport with the issue unresolved. Needless to say, our experience wasn’t good so far.

The Ugly. Upon arriving at the airport at 7:30AM (have I mentioned the challenge of getting 3 kids out of bed at that hour?) we checked in to find out that our American flight had been cancelled due to weather in a city nearly 1,500 miles away. Obviously the airline industry can’t control the weather, but it impacted our customer experience greatly, to say the least.

The Good. American Airlines was able to book us on a direct flight (our original flight included a connection) on Midwest Airlines. Now, if you’ve flown Midwest – you know that this was a major upgrade; All seats are first-class leather seats. Although the flight departed nearly 4 hours later than our original flight – we took advantage of the time. We enjoyed a great Mexican breakfast in Old Town San Diego, and toured the Marine Corps Museum at the Marine Corps Recruit Depot (MCRD) before returning to the airport. Fortunately, we were able to make the most of our setback.

The Bad. If you’ve ever changed a flight at the last minute, you know that your ticket will be flagged for extra security screening. Now don’t get me wrong, I completely respect the TSA and personally thank them for the job they are doing. But the extra attention we received with three young children in tow added a bit of extra anxiety to our already bumpy customer experience ride.

The Good. We boarded our Midwest Airlines flight after confirming that they had meal service on this nearly 3 hour flight. In the air, however, they sold out of meals before we were served. Our kids didn’t seem to mind since they filled up on the warm chocolate chip cookies that followed. As you can imagine, dining on only cookies can have a potentially undesirable affect on any child. The pilot’s announcement that we would arrive 10 minutes early was a very welcome sound, indeed.

The Bad. At Kansas City International (MCI) airport, we arrived at a different terminal than where we started our trip, so I was required to jump on the terminal transfer bus that is supposed to run continuously in front of the terminal. After twenty minutes of standing and waiting, the first and seemingly only bus running, arrived to take us to our original terminal. This was just another weak link in a long chain of events.

The Ugly. We were ecstatic to see our own car and quickly loaded our luggage, anxious to get home. But not so fast. We pulled up to the parking lot toll booth and handed over our parking ticket and a credit card. I won’t go into details, because I don’t want to rehash the amazing incompetence we experienced. To cut to the short of it, our car idled at the booth for a full 25 minutes. No exaggeration. No apologies from the parking lot operators. No offers of rebates. Just an indignant notice that they were having ‘technical difficulties’ and that we would have to proceed to another toll booth to pay and exit the lot. There are a lot of four letter words I could have inserted here, but I bit my lip and proceeded on.

We did eventually arrive home safely, happy to have made the trip, albeit a full twelve hours after it began in San Diego. You might say our customer experience was less than ideal, but the point here is that there were many unrelated factors, entities, and third parties involved that all contributed (or detracted) from our experience.

In this example, the total customer experience was comprised of multiple independent links in a long chain. In order to manage the total customer experience, all of the entities would need to be well coordinated and tightly integrated. In addition, each party would need to share a common goal of optimizing the customer experience.

I don’t see that happening any time soon.

In the meantime, it’s the customer that must just grin and bear it.