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Beyond Personalization: Experience Architecture
© Copyright 2004 and 2008 By John Adcox
Personalization -- Bringing back the Good Old Days
Remember the good old days? No, you probably don't. But you may have seen them on TV. Think of The Waltons. Remember Ike Godsey, the man who kept the General Store? Ike knew how to greet all the folks on Walton's Mountain by name -- he could even keep all those Walton kids straight. More, he knew what the people in his community needed. That's how he stocked his store. He knew to keep favorite bolts of cloth for the ladies down the street, grains for the Baldwin Sisters' "recipe," guitar strings for Jason, and, of course, tablets of white writing paper for John Boy.
For Ike on The Waltons -- and for marketers in general -- personalization began as something primarily social and evolved into a way to add value. Ike started by greeting his customers simply because they were his friends and neighbors, and later modified his inventory as he got to know them better.
The point is, in those days personalization was pretty easy. Business owners knew their customers personally, because they lived in small communities. They knew exactly what to order, and for whom. They knew who liked blue hats and who needed milk and flour. They greeted everyone politely and personally. Why? Two pretty simple reasons. First, they could. Second, that was the way to stay in business.
The times they have a changed, to paraphrase Bob Dylan. A few decades ago, personalization meant putting someone's name on a direct mailer. If you got a name wrong here and there, no big deal. Some 1 to 5 percent of them would respond, and that was a pretty good return on investment.
It's pretty easy to imagine that the first few people who got magazine sweepstakes offers and pre-approved credit card applications addressed directly to them, by name, were pretty impressed. Now, however, that seems as quaint as Ike Godsey in his one-room store back on Walton's Mountain.
Somewhere between the good old days when shopkeepers knew your name and remembered to save you a good pot-roast for Sunday dinner and the Age of the Great Junk Mail Flood, something changed. The definition of personalization evolved, or was misused so often that the true meaning was lost. Personalization became less about customizing products and services to fit the unique and individual needs of customers and more about gathering vast amounts of data to find customers that fit the products and services. The same collateral was mailed to thousands or even millions of households, but marketers created the illusion of personalization by purchasing mailing lists in bulk and putting individual names on the address labels.
Marketers were trying to find customers that fit the needs of the enterprise, rather than shaping the enterprise to fit the needs of the customers.
Ironically, this was a step backwards for personalization. It was an attempt to appear social, but it did nothing to add value for the customer. Direct marketing was something done to the customer, not for the customer. Everyone who recognizes that feeling keeps a trashcan close to where they open the mail. Sound familiar?
"Personalization" continued to evolve, of course. Rather than mass mailing blindly, marketers were able to buy targeted lists, enabling them to send fewer pieces with more specific offers to fewer potential buyers, eliminating demographic groups that weren't likely to buy. This is the same principle that suggests it's better to run ads aimed at men during sports events rather than, say, the Oprah Winfrey Show. Obviously, this increased response rates and ROI. The problem is, it's still not true personalization. Why? The emphasis is on gathering information for the marketer -- finding customers to fit products -- rather than customizing products and services -- and even business operations -- to meet the needs of customers.
Let's say a company makes blue hats. Times change and trends evolve, and unexpectedly the customers all want red hats. Now, the company has two choices. It can start making red hats, or it can find new customers. It can adapt to serve the needs of the customers, or it can find customers who fit the product. That latter may seem easier in the short run, but it's not an approach that's likely to engender any sort of brand loyalty. The former is the secret to the long-term success of the best brands. Balancing the transition is the key to profitability through the transformation.
The trick is -- how do you anticipate the change? How do know that your customers are starting to prefer red hats to blue? More importantly, how do you find out before you have a backlog of blue hats that you eventually have to get rid of at painfully low sale prices? Or, before your customers satisfy their needs elsewhere? More, how do you learn what kind of environment they'd like to buy a red hat in? Or what else they might like to go along with their red hats? In short, how do you learn what value you can you add to your red hats to make customers prefer them to the red hats the guy down the street sells? And more importantly, how do you ensure that they will still prefer your brand when the market shifts from red hats to plaid scarves? After all, you want your customers to prefer your enterprise, not just the products you sell!
The first step is to listen.
Gathering Personalization Data
Customers are eager to tell businesses what they want, how they want it, and what else they want to go with it. More, they're eager to discuss the problems and issues they're facing -- perhaps the very problems you can solve, either with your present products and services, or by combining them into a suite of solutions, perhaps one they customize themselves that make their lives easier.
The questions are -- how do you capture this information? And, how do you obtain it early enough to make a positive difference? And how do you use it? Obviously, you can track purchases, or traffic patterns through a store. For the most part, though, you're measuring observable behaviors -- what some interpret as rational responses. What about the other half of the purchase decision, the emotional response? Most people use more emotional bias in their decisions than they realize. Imagine that you're on a tight deadline. Time is short, the stakes are high, and the stress is off the chart. Suddenly, you run into a problem you can't fix. You have to turn to an outside vendor. If a company comes through with a solution at the last minute, on deadline, and stays up way past midnight to ensure that everything works, you trust them. You're likely to turn to them again because your outcomes was successful and you've become emotionally vested.
So again, how do you find out what makes your customers respond positively? How can you "see" the "why" that you can't observe directly? What makes their lives and jobs more stressful than they should be? What keeps them awake at night?
The technique for finding the answer will be unique for each company. And it won't be (only) through traditional market research. Here are a couple of the new ways to get at the answers:
What these radically different methods have in common is that they "see" things from the customer's point of view. This viewpoint shift is essential to truly understand customers' core needs and desires. Both approaches require careful reflection before taking action, and each offers compelling evidence to help prepare the case for change.
Ike Godsey knew this secret well. He had very limited space, but he always seemed to have exactly what the folks were looking for. He didn't have video analysis or any of the other tools we've discussed, but he always knew exactly what customers wanted and needed, and did his best to keep it on hand. How? Simple. He asked them. But the days when shopkeepers knew every customer (and their specific tastes and needs) have all but disappeared. Still, the principle is the same. Ask. Listen. Respond.
So it all begins with understanding what customers need and want. The best companies place a variety of sensors out there to find out what their customers are saying, doing, and thinking. In retail businesses, clerks are on the front lines, hearing complaints, listening to suggestions and watching traffic patterns. Sales people meet with customers on a daily basis -- they are gathering information. Customers congregate -- especially B2B customers. Cash registers generate many reports. There are professional organizations, events, and publications. Focus groups are still very powerful tools. The point is, the information is there, waiting to be noticed.
Fortunately, you have more than your ears to listen with. As discussed, some very effective "customer hearing aid" technologies are being developed that, properly deployed, bring all sorts of new information to you for analysis and better decision-making. Machine vision can count customers in your stores, tell you about their traffic patterns and how record long they wait. Electronic proximity sensors can tell you who's walking by a display and who's got the interest to look in detail. Data mining and business intelligence systems can help you spot many kinds of patterns and trends at both the individual customer and at the aggregate levels by virtue of their ability to see the forest and the trees.
It's what you do with what you know that matters. It's not enough to hear, businesses must respond. What matters for customers today is making them feel good while reducing the effort, time, and resources required of them to work with you. If you do these things for them, focusing on the emotional outcomes they seek, customers will reward you with their preference and their loyalty. And that's exactly what investors and boards of directors want -- the customer's long-term interest that translates to sustainable competitive advantage.
Personalization and Operations
Let's jump ahead from Ike's store to the dawn of the 21st Century. Did Sam Walton know everyone (or heck, anyone) who shops at the local Wal-Mart? No way. But Wal-Mart does know how to identify the needs of its customer base. Sam Walton had strong opinions on how he wanted his stores run and how he wanted his customers treated. He managed the details of the entire encounter -- from the parking lot through the entrance, up and down the aisles, through check-out, and back out again -- with the customer in mind. He practiced doing things for the customer. He also coordinated his marketing with his operations and built an experience that continues to meet customers' expectations.
As a result, Wal-Mart has built a powerful brand, an experience that millions of customers have come to know. More, their attachment seems to be stronger than the feature set (lots of stuff at low prices) seems to merit. Something new and powerful is happening here. Personalization is evolving yet again. While the scale might be staggering, our pal Ike Godsey would recognize the thinking. It's evident in operations.
In modern business, one unfortunate trend is of the ever more noticeable disconnect between marketing and operations. The operations side is busy making products (or providing services) and telling marketing to go gather data about who might buy these products. Marketing's job, then, is to go out, find the audience for the product, communicate its feature set, and convince the prospects to buy.
What if, in a move toward a more customer-centric strategy, the marketing team proactively gathered data about what the customers wanted, why they wanted it--and what sort of problems and issues they were facing? Then, when marketing communicated that data to the operations side, the company could respond by tailoring its core offer(s) and ancillary services such as check-out, shipping, customer relations, finance, and store design to better meet the needs of customers -- based on how they (the customers) see things and based on what they want. Ike Godsey didn't convince John Boy that he needed tablets of writing paper. But when he found out that John Boy wanted to write, he made sure he had the tablets on hand. He gathered the marketing data (John Boy writes) and he shaped his business to meet the needs of the customer (he ordered tablets).
Sure, it's more complex today than it was in Ike's general store, and the scale is certainly larger. But the point here is simple. Personalization is more than just being polite. It's about knowing intimately what matters to the customer, then doing something for them with that knowledge. However, that's just the beginning. Remember, Ike Godsey ran the only store on Walton's Mountain. In today's crowded market, you've got to do more. Companies must see their brand as the experience that it really is and manage it accordingly.
Why? Because all things being equal (and in many cases they are, or close enough), customers will opt for the operation that offers them the better experience. Sometimes, people chose the experience even when the product is (arguably) inferior. Is McDonald's the leader because their product is best? Maybe. Or is it perhaps because they've communicated their story -- the MacDonald's experience -- better than the competition has? In either case, the experience itself represents a valid value proposition.
In America, we are "overretailed". Americans enjoy more square feet of retail space per capita than any other nation. And one of the biggest signs that Americans aren't happy with all those square feet of shopping opportunity is the quantity of empty retail space. The same is true of movie theatres and amusement parks. So what's to revitalize retailing and marketing in contemporary America? Glad you asked.
Experience Architecture is an emerging management discipline. When we say "emerging," don't think we mean "coming," or even "untested." The very best brands -- Disney and Coca-Cola, for example -- have been applying the principles of Experience Architecture successfully for years. As the author, futurist, and art critic Bruce Sterling is fond of saying: "The future is already here; it's just not well distributed yet."
Coca-Cola has converted its brand into an experience. Consumers think of it as a part of the very fabric of their lives, and respond to it with affection and even genuine nostalgia. Again, the response is greater than the feature set (a sweet carbonated beverage with loads of caffeine) and the benefits (tasty and refreshing) seem to merit. This doesn't happen by accident. The world's best brands create experiences for their core customers, and these experiences are carefully architected. This is personalization taken to a whole new level.
Grounded in marketing, branding, personalization, and strategy, Experience Architecture is a discipline that crafts individual experiences for customers -- and operationalizes them. Obviously, this happens on Web sites, where cookies and powerful databases make it possible to track buying habits and recommend future purchases.
But don't get the idea that this level of customer experience only happens in virtual cyberspace. It happens in the real, brick-and-mortar world every day. In fact, every time a business and a customer come into contact, an experience is created. Every interaction (a commercial, a Web site hit, an order, a support call, a wait in a lobby) provides a clue that shapes a customer's perception.
In fact, you can't not have an experience. Remember, every time customers interact with your business, they are going to have an experience. It is critical to craft that experience to facilitate a specific and desirable outcome that matters to the customer and represents value for them.
True, it's not always possible to gather the wealth of data that an online marketer like, say, Amazon.com does, or to customize each individual's experience to the degree that a retailer in cyberspace can. But it's important to remember that every detail of each interaction shapes the way a customer will perceive a brand. In a sense, how you are perceived is as important as what you deliver when it comes to a customer's intent to repatriate your business. The experience transcends rational analysis, and is based on more than the sum value of the feature set of the product or service. Managing the customer's experience WELL earns preference and loyalty, leading to sustainable competitive advantage.
One of the breakthroughs in Experience Architecture is in its ability to consider both the rational and emotional elements of decision-making. Most accounting systems, for example, look only at the rational aspects -- features, advantages, costs, and benefits, if you will. Managers follow the numbers and run the business as they always have (because they can only "see" what they look at). On the other hand, qualitative market research focuses primarily on the emotional side. Something magical (and profitable) happens when the total experience is designed to meet both sets of customer expectations -- when customers' needs are fulfilled in a way that delights them.
Another unique aspect of Experience Architecture is that it touches (and can be used to manage) all points in the employee-customer-shareholder value chain. Researchers have found (and we have personally experienced) that internal quality drives employee satisfaction, which drives employee loyalty, which drives productivity, which drives value, which drives customer satisfaction, which drives customer loyalty, which drives profitability and growth. Whew! That's a lot of driving. In other words, build a good environment and design a good experience for your employees so that they can (and will want to) treat your customers well. The customers, in turn, will return preference and loyalty to the brand/business thereby increasing shareholder value. It's simple. And it works. A company's culture is at the heart of its brand. This is a lesson MindSpring and Earthlink taught by thriving in a very difficult emerging market. Their cultures promoted employee satisfaction, which translated to industry-leading customer service. As a result, both employees and customers are extremely loyal to the MindSpring/Earthlink brand. Oh yeah, and the company makes money too!
If you create a meaningful and pleasant experience for everyone involved in the enterprise -- management, employees, partners, and especially the customer -- they're going to remember it. More importantly, they're going to have an immediate positive initial response when they encounter your brand again later.
Experience and Technology
Five years ago, dot coms seemed to be the wave of the future. Every month, it seemed that the big research firms like IDC, Gartner, and Forester were revising their estimates -- upward, way upward -- about how many people would be buying online in coming months, and how much they'd be spending. Venture capitalists couldn't find enough dot com startups to fund.
Then came the so-called dot com crash.
What happened? Did people stop using computers and the Internet? Take a look at how AOL and Earthlink are doing. Did they lose interest in convenience? Unlikely. Did the Internet stop working? No way. Did audiences lose interest? Not on your life. Did business not use it correctly? There you go. In many cases, the answer is a resounding "you bet."
In the year 2000, IDC Research reported that online e-commerce surpassed $100 billion. That sounds like a lot, but it's probably just the tip of the iceberg. E-commerce is still going strong, and it is getting stronger. So why aren't more companies succeeding? Our pal Ike Godsey might not be able to use a computer, but he would certainly spot the problem right off. E-marketers aren't learning about their customers and adapting to serve them. In many cases, they're just using technology to lower the cost of reaching prospects and serving customers. They're certainly not creating experiences.
In short, the technology that's supposed to be making the shopping experience easier, better, faster, more convenient, and more enjoyable for customers is often getting in the way. Why, when we visit our favorite office supply store (online or brick and mortar), do they let us leave with incompatible ink cartridges -- only to have us to return (frustrated) later to get the right ones? The retailer knows what printers we bought from them and what cartridges we usually get. Or they should -- they have the technology to track and store this data. Why don't they help me remember? Better yet, why don't they tell us when we're running low (based on previous purchase patterns) -- and suggest a new, improved photo-quality paper at the same time? Better yet, why can't our ink cartridge trigger a PC to tell the retailer that we're running low? That would be marketing as a creator of "smart infrastructure." That's an example of a missed opportunity to create a positive experience for the customer and to build brand loyalty for the manufacturer while increasing repeat sales for the retailer.
Back to times when technology gets in the way: Why do we have to enter our cell phone numbers, the last four digits of our social security numbers, and a PIN just to wait on hold for so many minutes (now, they tell you how many minutes you have to wait) only to have a customer service person ask the identical questions and key them in again (while taking more of our time)? We're inconvenienced, and the company suffers increased expenses because the call center operates inefficiently.
Once again, using the technology to do things for, not to, the customer is the key.
Take Amazon.com for an example. One of Amazon's problems in creating a successful retail environment -- an experience -- has been that for many shoppers, buying online doesn't match the pleasure of browsing in a brick and mortar store. Now, book shoppers, for example, who are just seeking to buzz in, pick up one specific title, and buzz out seem ideal for Amazon. In fact, for them, home delivery probably makes Amazon more convenient than a trip to the closest mall.
But what about the buyers who like to come in, browse through their favorite sections, and pick out some surprises? How does Amazon create a comparable experience for them? And how does Amazon adjust the experience to encourage impulse buys? Many stores depend on impulse purchases to move their statements from red to black. How does an online retailer provide impulse purchase opportunities and, more to the point, recreate in cyberspace the experience that makes shopping a pleasure, and provides marketers a chance to increases sales?
When it comes to creating a personalized experience for each unique customer, and making it useful and relevant (a service rather than an inconvenience), Amazon is the pioneer, and still the leader. When you buy a book or a CD, for example, you'll see a list of recommendations based upon the additional choices of others who made those same purchases. When you return to the site, Amazon will immediately make recommendations based on your past buying habits. The more you visit and make purchases, the more relevant the recommendations become. Not sure if a recommendation is right for you? Amazon provides helpful reviews from other customers. The customer actually participates in co-creating that experience. The reviews, for the most part, are written by customers. Now, these reviews are helpful, but they're also fun for the reviewers, many of whom become regulars. (And Amazon's site receives the benefit millions of dollars of "free content.")
Can you find out what your peers think of a particular book, CD, or gadget in a brick and mortar store? And can you share your own experiences? No way. Amazon has created a unique experience for each customer -- one that they can co-create. The customer actually participates in the generation of the experience. That's just a tiny part of the value Amazon adds to the experience of visiting its online store.
The experience of publishing reviews and reading others' inspires customers to return to the site. It removes obstacles and inspires them to become loyal to the brand. Granted, that doesn't ensure that they'll always (or ever) buy while they're on the site, but as Ike Godsey would be quick to point out, customers can't buy if they don't visit the store.
Every visit to the Amazon site is a personalized experience. Why? Amazon uses the information it gathers about its customers to do things for the customer. They provide additional, relevant service, and they purposefully create an experience. Whether people like to participate once and forget it (when they set the rules for how they want their account to be handled) or on a more regular basis, they feel that they are heard and that they are a part of the service delivery themselves. Two-way communication occurs. That's powerful stuff.
So why is it powerful? Is it a rational experience? Partially. The reviews and recommendations are certainly helpful. But it's more than that. Customers seem to like participating in the process. They like seeing their names on the reviews, and the "regulars" (there are many) seem to like feeling like they are a part of an online virtual community of people with similar tastes and interests. Amazon's customers aren't simply pleased with the products they buy or the convenience of home or office shopping and delivery. They actually like the experience of shopping at Amazon. Shopping on Amazon is appealing to both reason and emotion. It's a complete and rewarding experience, and it's personalized for each individual customer.
Amazon has used the information it gathers to provide useful tools for its customer. It turned shopping into an experience. Customers are happier, and Amazon's sales have increased. Not only that, but Amazon has used the information it's gathered to steer customers to other product areas as well -- book buyers look at DVDs, electronics, gardeners can buy power tools, and everyone has access to auctions in the areas that interest them most.
There's a key point here. In far too many cases, personalization systems haven't been used to their full potential. For all the learning that personalization systems do, so far their insights seem dedicated to selling "just another pair of pajamas" or "one more book." They're missing the true opportunity -- the best use of this wealth of customer understanding is to better meet the needs of the customer, so that they have a positive experience and are inspired to return. Enterprises can mine the information to help the business continually adjust to the needs and priorities of its customers. It should improve the way the company works, not force customers to be "better numbers" for the shareholders. Not that shareholders don't deserve better numbers. They do. We all like to succeed. But when companies use the information they gather to create better services that more efficiently and more completely meet the needs of the customers, they offer a greater value that, in large part, inspires brand loyalty. It's where long-term preference, loyalty, and profits come from. And it is exactly what Amazon is doing.
Has Amazon duplicated the feel of shopping in a mall or a bookstore? No. Instead, it's taken the information it gathers and the tools available in cyberspace to create a new kind of experience, with its own elements, that is unique and powerful. Actually, to Amazon, it doesn't matter if the customer experience is on-line or in a store. The feelings and the theme (story) are the same and that's what customers come back for.
Most importantly, Amazon systematically listens to its customers and uses the data to provide services that help them. They haven't gone out to find more people to buy the same products -- more people who buzz in to buy a single book or CD and leave, never to return. Well, they have, but not exclusively. They've found ways to provide more to the customers they already have. Rather than investing in more stores (a common real estate fallacy of the last decades; more stores -- yes, but the profits remain flat), they work on providing more value to their customers. They practice customer-centric strategy. They've put themselves in a position to provide the things their customers are looking for. Again and again.
Amazon provides a carefully crafted brand experience for its customers. For example, Amazon lets you track orders on their site (remember the killer application by FedEx that lets you track airbills?). They go the extra step and tell you at each critical juncture the status of your order. And they keep your MY ACCOUNT page constantly up-to-date and easy to access (just click on a link in the confirmation e-mail you receive every time you place an order), so you don't have to keep track of this information yourself. They sweat the details -- and customers return the favor with their loyalty. Sure there are other book, CD, video, and gadget sites out there. Some are even cheaper. But customers continue to prefer Amazon's model. It's probably the only online retailer that has achieved household name status like Coke or Kleenex.
Other sites may offer better prices or better deals on shipping, but customers seem loyal to Amazon. They appreciate the experience, because Amazon has done for, not to. They've added value and created a positive personalized experience.
Experience and Measurement
Measuring the effect of experience on the bottom line is difficult. The reason is that Experience Architecture designs simultaneously affect multiple parts of the business, coordinating emotional outcomes in a way that makes a positive difference to customers. But the measurement systems currently in use can't report on the effects of multi-component adjustments. Traditional measurement systems focus on the individual pieces of a solution. Managers are trained to optimize each piece individually. That can't yield results as good as a more holistic Experience Architecture approach with its ability to directly and positively affect customer's emotional outcomes.
Why? Because, like a living organism, and enterprise is more than the sum of its parts. Individual parts, optimized independently, may not integrate to create a complete, unified experience that meets customer needs and inspires an emotional response. To extend the organism metaphor, it's rather like treating a single symptom rather than curing a disease, or, even more appropriately, promoting total health. And a single, optimized independent unit might satisfy an immediate need, but it doesn't inspire brand loyalty.
The problem with traditional measures is that, usually, only rational reaction is measured -- the decision to buy, for example. Using technology-based and technology-assisted tools (Web, kiosk, machine vision, video ethnography, and data mining, for example), we can more quickly understand trends that help us, as marketers, to anticipate customers' needs.
It's all but impossible to measure whether a particular customer leaves intending to make another purchase in the future. Emotional response is, almost by definition, intangible. But emotion does factor in to the decision making process. In fact, emotion, more than rational thought, is at the heart (pun intended) of brand loyalty. While we may not be able to measure emotional response in a cost-effective, timely, or accurate way, that doesn't mean we should leave out the emotional part of decision-making. In fact, we should design explicitly for it. The intangibles are just as important -- if not more so -- in building a leading brand.
To continue using retail as an example, you can't measure Experience Architecture by the number of neckties or hammers a customer buys when they visit your store. But you can measure by how often they return, and how long they stay when they come back.
So how do you measure Experience Architecture? How will you know it worked? When customers refer to your brand in the same way they refer to Coke or Kleenex (at least in the "world" of your specific niche or market), you can be pretty sure the effort was successful. That may seem like a lofty goal, but Experience Architecture is a powerful tool.
Experience and Value
In Ike Godsey's good old days, proprietors knew that what they would earn was derived from the value they brought their customers. Their future value was in their customers' wallets, not in some exotic combination of balance sheets.
Products and services can create extrinsic value, but experiences can create ultimate, or intrinsic, value: fun, aesthetic pleasure, self-esteem, trust, and security, to name a few. So, people really want the total experience the product purchase brings. More, their future purchases are decided on, in large part, based on previous experience. In many cases, the purchase itself is part of the experience and from it comes a great deal of either satisfaction or dissatisfaction (few people are in the middle ground).
In some cases, it's the experience, rather than the product itself, that people are buying. How many customers do you know who go to Hooters primarily for the food? Or, to provide a more tactful example, why do families save to vacation at Disney World when many of them have excellent amusement parks right there in their own backyards?
When Personalization is a NEGATIVE Experience
We've made this point before, but it's worth making again: personalization is best used as a tool for doing things for customers, not to them. The latter option also creates an experience for the customer, of course, but it's seldom a positive one.
If we try to optimize what's "right" for the enterprise and its shareholders, all too often we abuse the information we get from personalization. We forget that in the long run, what's good for the customer is also good for the enterprise.
It comes down to a question of what to do with the information an enterprise gathers from customers -- whether it's personal information (like names and addresses), buying habits, or even their motions as they wander through a store. Do you use it to "push" more information at the customer, hoping they'll buy one more pair of pajamas? Or do you use it to reshape your business to better meet the needs of the customer?
This isn't rocket science. Have you ever heard a customer refer to "junk mail" or "Spam" as a positive experience? From an economic perspective, isn't it interesting that 90% or more of many direct marketing campaigns end up in the trash can? And that's considered "good!" Customers aren't happy and may even feel invaded, and the ROI isn't especially attractive. Who is winning here?
That kind of thinking leads to shortcuts that decrease customer satisfaction. It doesn't inspire brand preference and loyalty. Worse, it ultimately doesn't meet the needs of shareholders.
However, used the right way, information gathered from personalization efforts can be used to improve the enterprise. This is the ultimate connection between marketing and operations. Why not make the business better for the customer if it's the customer we're trying to please?
Making a Company Customer-Centric
We're all too familiar with situations where the brand makes one promise, but operations can't or doesn't deliver. From the customer's perspective, the company has lied. The customer's expectations weren't met, and the problems weren't solved. The enterprise didn't make the customer's life better -- in fact, it may have made it worse. Ouch. Needless to say, the customer has not had a positive experience. It's going to color the customer's future expectations of the company, and it's going to take massive amounts of goodwill to overcome that one bad experience.
How could this disconnect have been avoided? Once again, it comes to building a solid connection between marketing and operations. Marketing should listen to the customers, and gather meaningful information about what they want and need. Operations should use that data to shape the enterprise to ensure that everything the company does is designed to meet those needs and provide a positive experience to the customer. Marketing makes sure that the customer is aware of the company's message. The customer responds. Profits increase. Everybody is happy.
That may sound simple, but in far too many cases, the disconnect persists. Marketing is still seeking customers that fit what the company provides rather than communicating the information to the enterprise so that it can provide what the customers need. Communication happens in only one direction -- from the business to the customer. Personalization has, in many cases, run its course. You can only squeeze so much out of a closed system without making major changes. Instead, communication should be two-way. Marketing talks about communicating a company's message. That's great, but the other half of the marketing team's responsibility -- the part this article advocates -- is to listen.
Marketing's job is to be the company's advocate. After all, it's the company's story that's being told. But Marketing can and should also be the customer's advocate. Marketing can be the customer's voice in the enterprise. If the business listens, reacts, and respond when customers speak, the customers will be likely to listen -- and respond -- when the company speaks (markets) to them.
Perhaps more than anything else, personalization and experience architecture are about two-way communication.
Businesses everywhere, especially retail and business-to-business, are looking for a better value propositions. They are looking for better ways to add value and generate brand loyalty. The key is listening and responding by shaping every element of the customer's experience to meet their needs and fulfill their expectations. That's exactly what an experience architect does.
The Experience Architecture methodology focuses the attention of business designers on both the rational and emotional needs of the customers first, then coordinates the two through the building of an ideal yet tangible vision in logical steps.
Of course, while the customers must always come first, theirs isn't the only experience that needs to be crafted with a specific emotional and rational outcome in mind. Employees, management, partners, and even shareholders must also be considered. As we discussed before, the employee-customer-shareholder value chain is a good map for understanding the interrelationships that help brand experiences succeed -- or fail.
Remember, Brand Experience isn't just an ideal or a marketing slogan. It's about understanding what customers need and what they're likely to respond to -- then adjusting the business itself to fulfill those needs in a way that creates a positive experience for all the constituents. It requires changing both the business itself and the way people (inside and out) think about it. It's about sweating even the smallest and most seeming insignificant details (think of all the little details you see while you're waiting in line for a ride at a Disney park) to create a positive overall experience -- one that customers understand and notice with all their senses. It's about tailoring an offer to meet customer needs. It's about shaping every aspect of a customer's experience, from advertising and first contact to deal-making and follow-up service and support. It's even about the company's internal culture. Once again, MindSpring (now merged with Earthlink) is an excellent example.
According to Charles Brewer, the founder of MindSpring, he crafted the company's core value's and beliefs -- an emphasis on service and support, a work environment that employees love and thrive in, and dedication to absolute integrity -- before he'd decided what the company was going to do. The essence of the MindSpring experience was in place before the company developed its core offer and feature set.
MindSpring successfully turned its internal culture, based on excellent customer service and core values and beliefs, into an experience that its employees, and later its customers, embraced. Granted, MindSpring proved that story true by providing dependable Internet access and industry-leading service and support -- the MindSpring experience. But the heart of MindSpring's brand experience was in place long before those product feature sets became a reality.
More, Brewer foresees a day when Earthlink may no longer provide its core product -- Internet access. But Brewer believes the brand experience will endure. MindSpring's brand experience is excellent service and support, so Brewer believes that the company may someday evolve into an outsource for -- you guessed it -- customer service and support. In other words, Brewer believes that the company's brand experience will endure long after the product that it is known for is obsolete.
Products, features, and advantages come and go, but strong brand experiences endure. They become a part of the fabric of the lives of the core audiences.
How do you get there? How do you convince others in your organization to come along and work with you on improving the customer and employee experiences?
You prove it to them.
The world is becoming so much more a "show me" world. So show them. Create a tangible vision of what the future experience will be like and show it in a way that lets all stakeholders understand the new experience from their own point of view. It can be a literal prototype built in the brick-and-mortar world, or perhaps an experimental model built in cyberspace. In either case, it's this kind of collaborative creation that makes the business context clear and provides your colleagues with the motivation/energy to take on the fights that get new ideas supported and adopted. Commonly held visions are powerful tools.
Communicating the Experience -- Clues and Brand Stories
Once an experience is crafted, it's critical to communicate it to customers. Every detail that shapes the experience -- an advertisement, a store layout, a Web page, a conversation with an employee, a corporate lobby -- all provide clues that trigger responses in the customer. Each of these clues shape the experience a customer has of a brand and, most importantly, determines their future propensity to repatriate the enterprise.
Think of an excellent restaurant, one with the finest linen cloths placed carefully on tables of beautiful mahogany wood. The candlesticks are of polished silver and the wine goblets are of the finest crystal. The waiters in their perfectly pressed tuxedos are properly attentive. The food is exquisite... but it's served on paper plates. Something is wrong with this picture. One of the clues is wrong, and the customer's experience is diminished.
Experience Architects work with every aspect of a business -- from marketing and advertising to training to information systems to operations -- to ensure that such disconnects don't happen. The individual clues integrate and work seamlessly to shape the appropriate brand experience. They tell a story, if you will.
What makes the world's best brands -- Disney, Coca-Cola, and McDonalds, for example -- different from others? The difference can be summed up in a single word: experience. The very best brands carefully craft every single clue that helps shape an experience for core constituencies, an experience that more often than not transcends the feature set of the products these brands represent.
For Disney, the experience is obvious -- it's found in the company's all but unmatched attention to detail and story. Audiences expect a certain experience when they see a Disney film or visit a Disney theme park. They expect a story every time. That's why kids love visiting, say, Six Flags, but families dream of visiting Disneyland. They expect the experience that the Disney brand has come to represent.
For Disney, this experience centers on a single concept: story. There were and still are better animators than Disney, better filmmakers, arguably better theme park developers, and certainly better artists. But no one has understood story better than Walt Disney. Disney is famous for cutting complete and even charming animated sequences because they didn't advance, or worse, impeded, the flow of the story. Rides and attractions were scrapped even after expensive construction had begun because it was determined that they didn't fit with the theming -- or story -- of the park. For the Disney experience to work, every clue must always be spot on.
Disney tells this story internally, too. Employees at the parks and the Disney retail stores are referred to as cast members, Why? To remind them that they are always on stage, and they are always an integral part of the "show." They are always telling the story. Employees buy into it, too. After all, the brand experience begins with them.
In short, Disney has used its skill at telling stories to turn the elements of its brand into a compelling brand experience.
But while Disney is certainly an obvious example, they certainly aren't the only company to use experience architecture to create a brand experience that audiences know and prefer. McDonalds and Coca-Cola are also excellent examples. Let's start with McDonald's. Arguably, other fast food restaurants may have superior products. But McDonald's remains the benchmark for success in its industry. Kids demand to go to McDonald's. Why? McDonald's has used the media at its disposal -- from television commercials to the family-friendly design of its menus and stores (most of which now boast playgrounds) to tell a story that that creates a "McDonaldland" experience in the minds of its target customers.
Coca-Cola creates brand experience better than anyone. The product -- sweet syrup in carbonated water -- doesn't seem all that special. But consumers react to the brand in an emotional way that is far beyond what the features of the product itself seem to warrant. They've managed to communicate the core of their brand -- that Coke is a part of your past and of your life -- in a very compelling way. They've told a story, and consumers in every corner of the world have responded. Coke isn't just a soft drink, it's an expectation backed with an experience that always delivers.
The best brand experiences are timeless, and are not dependent upon the products, their features, or their advantages. When the first Disney Park debuted in California, customers were literally lining up long before the park was scheduled to open its gates, even though the park had no track record, and Disney had no experience in the theme park industry. Why? Because audiences already knew the Disney experience. They were already familiar with the story at the heart of Disney's brand -- it was already a part of their lives.
To recap, the best brand experiences don't happen by accident. Experience Architects understand the elements of a company's brand -- its products and services (along with their feature sets, advantages, and specific benefits for the audience), its culture, its champions, and more.
Experience Architects work inside companies as experience designers and as customer advocates to "connect the dots" from the inside out so that great experiences can happen. They listen to what customers are saying, and they use their information gathering sensors to learn more. As a result, they know their customers -- they how the brand can make their lives better. They know how the audience responds emotionally. They know how they perceive the brand now, and how they should perceive the brand. Brand architects understand the audience's core problems, and how a brand can help solve them. They understand how the audience gathers and uses information, where they congregate to share information, and how and why they are likely to respond to a brand experience. They put themselves in a position to be the customer's advocate within the enterprise.
Brand architects also know how to "work" their own organizations to obtain the internal changes that lead to better employee and customer experiences. Management must empower them and facilitate their efforts.
In short, they gather marketing data. Then, brand architects use this information to shape an enterprise -- on both the marketing and operations side -- to ensure that it is designed to meet the needs of the customer. Then, they ensure that every clue -- every experience a customer has with a brand -- shapes the appropriate emotional and rational experience.
The next step is to communicate that experience to the audience. In other word, it's time to put the blueprint in place and make the experience a reality -- it's time to react to what the customer has said and create a brand that customers respond to (favorably!) on both the emotional and rational levels.
The Experience Architecture Method
So far, we've made a case for Experience Architecture as the ultimate extension of personalization. We've shown that it's a powerful tool for connecting marketing and operations to respond to customer needs and to build brand experiences that customers will respond to -- and be loyal to -- on both the rational and emotional levels.
To recap, the following is an overview of Experience Architecture methodology:
Experience Architecture is simply a tool that helps people to work together, leveraging mutual efforts, ideas, and designs to create on-target, high-value experiences. Experience Architecture begins with a motif: a simple to understand, easy-to-align-to set of target emotional outcomes that harmonize with the values of the customers, the employees, and the business.
Some of the tools used in Experience Architecture include blueprints for the big picture, "clueprints" for the smaller details, and humanic narratives to address the roles people play. Experience Architecture can be used to envision the future state of the business, to build and align applications, projects, and initiatives. In other words, to listen to customers, create a vision that meets their needs, manage the enterprise to make that vision real, and communicate that vision to the customers to complete the "sense and response" cycle.
Experience Architects are the customer's advocates as surely as they are the advocates of the enterprise, its employees, its managers, and its stakeholders. Led by the Chief Experience Officer (CXO), they're the ones who listen and respond -- who shape the experience that creates a leading brand that thrives and endures even as market conditions change.
Experience Architecture and Personalization
Experience Architects are the modern Ike Godseys. They may not be able to greet every customer by name, but they work effectively at large scale because they know how to listen, how to shape the enterprise, and how to provide the clues that give them the powerful brand experience so that customers will respond in a positive way. Experience Architects craft compelling experiences that add value for the customers and inspire brand loyalty.
The most important point of all is that Experience Architecture is personalization taken to the ultimate level. It's no longer about putting someone's name on a piece of junk mail, or finding more customers that fit the needs of the company. In the long run, that's thinking that's doomed to failure, because untapped markets are, in the end, a finite resource.
With Experience Architecture, personalization has evolved. We've made this point before, but it's important enough to be worth mentioning one last time. Personalization is no longer about doing to the customer, it's about doing for the customer. Experience Architects make it possible for businesses to react and adapt to best meet the needs of customers -- and to present an experience that customer's respond to, both rationally, and emotionally.
Experience Architecture isn't about a quick fix -- it's not about selling one more pair of pajamas. It's about creating true value for the customer, a more inspiring environment for employees, and, in the end, greater returns for shareholders. Most of all, it's about creating the positive experiences that inspire enduring brand loyalty.
The best brands are doing it right now. You can too.
For more than 14 years, John has developed strategies using both new and traditional media to create memorable experiences -- and tell stories with impact. His creative work makes people sit up, take notice, and say wow. He is presently a consultant and freelance creative director, writer, and information architect, and is currently designing an amusement park!
Most recently, John was Chief Creative Officer at Talisman Creative, and Vice President/Regional Director of the Digital Media Group at Caribiner International. There, he served as a strategist creative director, and team leader on projects for a number of major clients, including BMC Software, IBM, Nortel, BellSouth, Clarus, 3M, Glaxo Wellcome, Home Depot, and several others. John has also worked as a communication strategy consultant/information architect for Southern Company, Lucent Technologies, Travelers Group, MindSpring, Glue Communications, New World Marketing and more. He even designed CD_ROM games for Turner Interactive.
Previously, he was Executive Producer and Creative Director at Cadmus Interactive, where he designed and produced interactive solutions for Lucent Technologies, AT&T, MCI, Holiday Inn, BellSouth, Delta Air Lines, NBC, IBM, Coca-Cola, First Union Bank, Cox Communications, Scientific Atlanta and several others. A former radio host and Astronomy teacher, John has also written and designed collateral materials, newspaper and magazine articles, press releases, video scripts, a play, and a soon-to-be-published book on content strategy for new media and a novel.
He has won Invision and Show South Creative Gold Awards.
Paco Underhill in Why We Buy: the science of shopping
Jerry Zaltman/ Jerry Olson, Olson-Zaltman Associates, company collateral.
Sensors can be mechanical, electronic, formal, or informal. Detectable or not. Real-time or recorded. What matters is the balance of information you take in. Some of it must be customer-centric.
Steven Haeckel and Lou Carbone in "Experiences as Customer Value Propositions", Sloan Mangaement Review, pre-publication draft of the article.
Lou Carbone, President & CEO, Experience Engineering, Inc. Personal communication to the authors.
Derived from "Putting the Service-Profit Chain To Work" by James L. Heskett, Thomas O. Jones, Gary W. Loveman, W. Earl Sasser, and Leonard A. Schlesinger, HBR Press, 1994.
Paco Underhill in "Why we buy: The science of shopping"
Charles Brewer, Founder and Former CEO, MindSpring Enterprises. Personal communication to the author.