Defining Customer Experience

Summary

This video emphasizes that customer experience goes beyond mere product interactions. It highlights three key stages: anticipated utility (expectations before use), experienced utility (actual use), and retrospective utility (memories of the experience). The script stresses that managing these stages is essential for creating a compelling customer journey, where positive memories and moments are crucial for word-of-mouth marketing. The focus is on shaping key moments throughout the experience to build emotional connections and brand loyalty.

Takeaways

• 😀 Customer experience goes beyond just the direct interaction with a product or service; it includes the before and after as well.
• 😀 People tend to think of customer experience as the moment of interaction with service staff, but it actually encompasses much more, like planning and reflecting on the experience.
• 😀 The concept of customer experience can be likened to how people think about a vacation — it involves anticipation, the actual experience, and the memories afterward.
• 😀 Three types of utility influence customer experience: anticipated utility (expectations before the product), experienced utility (use of the product), and retrospective utility (memories of the product).
• 😀 Anticipated utility plays a crucial role in the overall customer experience, as people form expectations before they even use a product or service.
• 😀 Experienced utility is focused on the actual use of the product and its impact on the consumer’s well-being.
• 😀 Retrospective utility, or memory of the experience, is often the most important factor in generating word of mouth and influencing future decisions.
• 😀 Managing all three sources of utility (anticipated, experienced, and retrospective) is key to creating a winning customer experience.
• 😀 Experiences are not uniform and can vary from delight to despair, with many shades in between, making them dynamic and full of emotional highs and lows.
• 😀 Memory works in snapshots, meaning people remember key moments from their experiences rather than the continuous flow, which is why managing these moments is crucial.
• 😀 Effective customer experience management requires focusing not on the entire experience but on specific key moments that create lasting memories and impressions.

Q & A

What is customer experience, and how is it typically perceived by most people?

Customer experience is often perceived as the interaction between the customer and the service or product during the transaction. Most people focus only on the moment of service delivery and the immediate customer interaction, but it actually extends beyond that.

How does the speaker use the example of a vacation to explain customer experience?

The speaker uses a vacation as an analogy to show that customer experience is not limited to the actual experience itself. It also includes the planning, anticipation, the actions taken during the experience, and the memories afterward, all of which contribute to the overall customer experience.

What are the three sources of utility mentioned in the script, and how do they affect customer experience?

The three sources of utility are: anticipated utility (expectations before the experience), experienced utility (satisfaction during the interaction), and retrospective utility (memories after the experience). All three play a crucial role in shaping a customer's perception of the overall experience.

Why is memory important in shaping customer experience?

Memory is important because it influences the retrospective utility, which ultimately determines word-of-mouth. Positive memories from the experience lead to better recommendations and brand advocacy, while negative memories can harm customer perception.

How does the speaker suggest companies should manage customer experience?

Companies should manage the entire customer experience journey—not just the direct interaction. This includes handling the anticipation before the experience, the experience itself, and the memories afterward, focusing on creating positive and memorable moments throughout.

What role does anticipation play in customer experience?

Anticipation is a key factor in shaping the anticipated utility. The excitement and expectations a customer has before experiencing a product or service contribute significantly to their overall satisfaction and the emotional connection they feel toward the brand.

How should companies use the concept of 'moments' in managing customer experience?

Companies should focus on managing specific memorable moments throughout the customer journey, as these 'snapshots' are what customers remember the most. Rather than trying to manage the entire experience, attention should be given to moments of delight, despair, or indifference that have lasting emotional impacts.

What is the significance of word-of-mouth in customer experience?

Word-of-mouth is a crucial outcome of customer experience. Positive memories from the experience lead to stronger recommendations and brand advocacy, whereas negative experiences can spread dissatisfaction and harm the brand’s reputation.

What is the difference between experienced utility and retrospective utility?

Experienced utility refers to the satisfaction a customer feels during the actual interaction with the product or service. Retrospective utility, on the other hand, concerns how a customer remembers the experience afterward, which is a major determinant of customer loyalty and advocacy.

Why are 'snapshots' of customer experience more impactful than the whole experience?

Snapshots, or specific moments within the experience, are more impactful because they are what customers tend to remember. These moments—whether positive or negative—are what shape their overall perception and their decision to share their experience with others.