Dobrev shared some fascinating statistics about both digital transformation and Customer Experience. In 2019, companies spent over $2 trillion on digital transformation, and even more in 2020, with COVID-19 driving many of these projects this year. However, success is not high with digital transformation. Experts estimate that anywhere from 50 to 80 percent of digital transformation projects failed in 2018. These projects came with a collective price tag of around $900 billion.

Unfortunately, that trend is not improving by much, per Dobrev. While there have been improvements in common metrics this year, the movements have not been significant. When added to an overall stagnation of the Customer Experience movement, digital transformation does not deliver the results that firms expected.

There are a few reasons for this result. My best way to explain it is through a recent experience I had buying glasses online. I didn’t want to go in for glasses because of the pandemic, so I ordered them online. After placing my order, however, I noticed that it was taking a long time. When I went to the site, I found no way to track them. I later learned that the holdup was because I missed an email where they asked me to measure the distance between my eyes (because they need to know how big to make the glasses). It turns out that their solution was for me to take a photo of myself with a credit card between my eyes. To me, this solution didn’t seem very technical and did not portend a good fitting pair of glasses (that cost around $300-$400, thank you very much). Also, I felt like a bloody idiot doing it. The glasses turned out fine, but I am not sure I would do it again when I reflect on the experience.

My reaction to the digital experience is not unusual, Dobrev says. He says that organizations often come into digital transformation projects with preconceived notions of what to should do that are not necessarily true or take the existing physical customers’ process and digitize it. Also, organizations often use a set number of channels (e.g., online, mobile, and call center) without regard for whether those channels will be useful. Add that to the fact that organizations do not know what provides value for customers in digital experiences, and you have a recipe for disaster. These Value Drivers are essential to success.

Forrester’s Four Categories of Value Drivers

Before we go any further, perhaps I should first explain what Value Drivers are. Value refers to what the organization gets as a payback for their investment of resources. These paybacks can range from increased customer spend, market share, or Net Promoter Score (NPS)*. Value is the result of Value Drivers, which are the parts of the experience that would inspire this type of Customer Behavior.

Forrester, a research and consulting firm, refers to four types of Value Drivers in a recent report from September. Dobrev details them as:

1. Economic Value: Economic Value concerns the perception of the value of your product or offer. Most organizations are trying to get on level terms on this part of digital transformation; otherwise, it’s a race to the bottom on price.
2. Functional Value: This term refers to how easy the digital experience is to use and the speed of service and convenience factors. In many ways, these are the transactional areas of the digital experience.
3. Experiential Value: This area is how the customer feels during the experience. Dobrev says that per his research and Forresters’, the Experiential Value delivers more than the first two areas outlined by the report.
4. Symbolic Value: The last area is about the customers’ self-image and how they feel about themselves when purchasing a particular brand. For example, you think differently about yourself when you buy a Jaguar vs. a Chevrolet. Dobrev says an exciting subset to this term is Social Causes. Many customers like to feel that they are working with a company that supports their social reform desires, whether that’s being green or lifting a social group, etc. The Symbolic Value Driver area of digital transformation is one we talk about a lot on our podcast.

Dobrev says that Forrester identifies one of the most significant challenges to digital transformation: knowing which area of these four steers the most value for your customers. Few companies have data on which of these drivers is most important for their customers. Organizations do have data, but it tends to be fragmented.

In reviewing Forrester’s list and my glasses experience, it occurs to me that if they had injected emotion into the experience, it might have improved my feelings about it. For example, I felt silly with the credit card on my head. Perhaps if they had explained it more or had me print out a guide that seemed more “technical” to me, it would have alleviated that negative emotion for me a bit. Another way to go would have been to embrace the silly; by making the dumb part of putting the credit card on my head even sillier with graphics or funny messages, it might have improved that moment. It is these types of design adjustments that Forrester’s #3 area addresses. To me, digital transformation success depends on recognizing these moments that drive or destroy value for you.

So, What Should We Do With This Information?

Digital experience isn’t going anywhere, certainly not as the pandemic carries on. The problem with unsuccessful digital transformation isn’t going away either. However, there are some things you can do to avoid them.

One of the things I love about digital experiences is all the data you can collect, even about emotions. Customers will let you know how they feel at different moments with their behavior. You can also measure people’s emotional responses to moments with technology like facial recognition software, which detects micro-expressions that denote emotional reactions to stimuli (like a widening of the eyes, a pursing of the lips, or shifts in body posture, etc.). Moreover, concepts like the Peak-End Rule, which describes how we remember our most intense emotion in an experience and how we felt at the end, will help you define the moments people will remember. The good news is all of these things are measurable in a digital experience.

Dobrev also suggests that you analyze your current Customer Journey with an eye toward what should be digitized and what should not. Some moments can digitize beautifully, and others that require a human touch to provide value to customers. For example, he learned on a project with an insurance company that a Key-Value Driver for customers in that experience was a human interaction during claims handling. Responsiveness was vital for them there, and the insurance company was previously relying too heavily on email, which was not delivering enough for customers. Dobrev says using Forrester’s four areas of Value Drivers is essential in this exercise. Then, test your choices, he says. The test results will help you identify where you need to tweak your designs either way.

Perhaps most importantly, this effort requires a strategy rather than a “check-the-box” attitude. Empathy helps, too. You need to understand what is driving value for your firm from your Customer Experiences. If you don’t understand that, you are throwing darts in the dark and hoping for a bullseye. It can be dangerous and passes up a lot of excellent opportunities.

Furthermore, I would add that you need to look at your digital transformation from a Behavioral Science perspective. Customers are not logical, and they do not behave logically as customers. They don’t like putting credit cards on their forehead and taking their picture to get their eyeglasses to fit. You have to take those things into account and design an experience that understands that about customers

Finally, it is vital to measure everything. See how and when they came into your digital experience, where your customers went while they were there, what they felt (using facial recognition technology), how long they stayed, and which way they left. All of this data will tell you what’s working in your digital transformation and what isn’t, among other things.

Another option is to consider an outside opinion. Sometimes you are too close to the project to see what could be a potential problem for customers, and, even worse, have an inside-looking-out perspective that might not realize how different moments make people feel. We have a tool we use called a Digital Experience Health Check to assess what they are doing well in their digital experience and what can use some work. The outside-in approach is more straightforward when the person approaching is on the outside.

Honestly, $900 billion in wasted resources chasing a digital transformation goal that you can’t meet is not a winning strategy. However, by approaching your online experience with the same eye for emotional engagement and with a comprehensive strategic approach to evoke emotions that serve your customers’ unmet needs, you can improve your success and get the results your customers (and your senior managers) expect.

* Net Promoter®, NPS®, NPS Prism®, and the NPS-related emoticons are registered trademarks of Bain & Company, Inc., Satmetrix Systems, Inc., and Fred Reichheld. Net Promoter Score℠ and Net Promoter System℠ are service marks of Bain & Company, Inc., Satmetrix Systems, Inc., and Fred Reichheld.

To hear more about this idea in more detail, listen to the complete podcast here.

Colin Shaw is the founder and CEO of Beyond Philosophy, one of the world’s leading Customer experience consultancy & training organizations. Colin is an international author of six bestselling books and an engaging keynote speaker.

Follow Colin Shaw on Twitter @ColinShaw_CX

The post Digital Transformation Didn’t Work: This Is What You Should Do Now appeared first on Beyond Philosophy.

So, me, you know. You might remember how I came to this field of Customer Experience almost 20 years ago after years of working in the corporate world. Furthermore, you have likely read my schtick about how we should take these ideas “beyond the philosophy” and into the real world. However, I realize that you might not be as familiar with these other blokes. So, allow me to introduce my other colleagues.

Lewis Carbone is a Customer Experience expert and speaker, and founder of Experience Engineering™. If you haven’t already, I suggest you read his book,  Clued In: How to Keep Customers Coming Back Again and Again. In it, Carbone shares his methodology for designing clues into your Customer Experience that signal to customers that you have what they want, so they come back for more. We hosted him to discuss this on a podcast not long ago. As a pioneer in our field, Carbone was one of the first to point out that you have a Customer Experience no matter what; the difference is that some organizations are deliberate (or haphazard) about what that experience is. He was also one of the first proponents of having an “outside-in” approach regarding the experience that you deliver to customers, which, my regular readers know, is one of the principles of which I am keenly fond. Carbone thinks that right now during the COVID-19 Pandemic is probably the most exciting time for Customer Experience Management advancement that he has ever seen because people are more sensitive to the experiences they have in their lives. Furthermore, it has brought awareness that an organization can manage its experience to create an emotional bond with customers.

Joe Pine is the author of The Experience Economy that started it all. As another pioneer for Customer Experience, Pine works with his colleague Jim Gilmore at Strategic Horizons, LLP. Pine and Gilmore have been working with clients worldwide to stage experiences that provide value for customers longer than I have, which is saying something. Pine believes organizations should understand that experiences are a distinct economic offering, not just better service. An authentic, distinctive experience is more than providing good service or being “nice.” Pine says Customer Experiences should be memorable, personal, and emotionally engaging, so customers value the time they spend with your company. In other words, Pine says if customer service is time well-saved, Customer Experiences are time well spent.

What Are Some of the Mistakes of the Past for Customer Experience?

The three of us, along with moderator Chantel Botha of Brand love, discussed in the webinar and a recent podcast some of our past experiences working in this industry, where we are today, and where we are going. Botha began by asking us where we have failed and what we learned from it.

When it comes to failure, my most significant ones are assuming that people are in the same mindset as mine. For instance, when I presented to a German insurance company about how they should use emotions in their experience, the clients asked me for proof that it would work. Unfortunately, at that time, I didn’t have any; I just believed that it worked, with or without evidence. Everyone did not share that mindset, and they still don’t. You have to prove it works. From that moment on, and this occurred back around 2005, my company links our Customer Experience efforts to proof so that the champions of Customer Experience are not caught out as I was all those years ago in that German conference room.

When I shared my story, I learned that Pine was empathetic to my plight. He says he often didn’t understand why other people didn’t believe in the impact of providing an emotionally engaging Customer Experience the way he did. However, he didn’t go the data route to prove it. Instead, Pine would develop frameworks. He and Gilmore would develop frameworks that describe what’s happening and prescribe what the organization should do about it. These frameworks would feature shining examples of these concepts at work to help convert the non-believers.

Often, Pine would have clients acknowledge that their philosophy was innovative but then ask who else had tried it. Pine found this frustrating because if it’s creative, it means that not a lot of companies had tried it. The challenge he encountered was getting senior leaders in interested organizations to feel comfortable enough being the first ones to take Customer Experience as a value enhancement in the marketplace—even if it might lead to failure. Failure is an always-present possibility, Pine says, because you aren’t sure how it will land until you get a real, live human being in the experience. Pine says he tells companies to save some of the budget (around 20 percent) to fix things in the experience that didn’t produce the reaction you wanted.

Carbone says that he has failed in the past by confusing the issue for people, clouding the real meaning of what Customer Experience means. There is a lot of discussion and perhaps not the depth of understanding of how different an experience economy of today is versus the industrial age of the past. He thinks a new distinctive lexicon is essential to clear up these misconceptions in the world of Customer Experience.

Carbone’s primary philosophy works with constructs around Clue Consciousness, which describes how their unconscious processing of Customer Experience signals drives customer behavior. These clues affect our emotions, shape our attitudes, and guide our actions.

Many organizations confuse process improvement and defect elimination with what experience management is, per Carbone. He says we need to begin to understand customer emotions and what stimulates them. Managing that critical aspect creates real power in experience management. Building systems that align the clues and signals goes well beyond process improvement. Customer-driven organizations that are inside the mind and heart, and soul of the customer are the goal. These companies know what customers feel even when the customers don’t know themselves. Moreover, how they think of us as a company is not as crucial as how the company makes customers feel about themselves, which, in turn, is how customers ultimately think about the brand.

What Are We Going to See Next in Customer Experience?

As the discussion moved on to the future of Customer Experience, I brought up the idea of Customer Science. You might recall that I recently discussed Customer Science on a podcast. It appeals to me because it uses a data-driven approach. Customer Science is a product of a perfect storm of artificial intelligence, the information provided by Big Data, and the interpretation of that data through Behavioral Science. This combination of technology and psychology, or understanding what people really do, makes it possible to anticipate and predict what the customer will do through data use.

These psychometric profiles have outstanding value for your Customer Segmentation efforts, an area where most organizations could use some work. Moreover, it enables you to anticipate customer needs and provide them automatically, particularly in digital experiences. Amazon does this, and they do it well, especially with me. Between my activities with the platform and associated products to their brand I use, Amazon knows everything about me from what I buy and eat to when I go to bed and even how many people ring my doorbell. These data points enable them to have a profile of me and provide me with helpful suggestions that I appreciate.

Pine sees that the COVID-19 Pandemic accelerated the shift from physical to digital experiences. However, he believes that the future of Customer Experience is the fusion of the two. An example of what he means is the platform Twitch, where people play video games while recording it and then show it to other people. The critical experience of Twitch is the social interactions that people have watching somebody play a video game. With all the possibilities of what Twitch and other platforms provide, Pine says we will see fewer people going to live events, whether it’s a conference or a festival or a concert, and many more people attending it “live” online. Those watching the live event online will also interact and have a different (and potentially better) overall experience with the amplification of that live event.

Pine says that the current crisis is accelerating is the recognition among people that what we really value are those shared experiences we have with our loved ones, friends, and colleagues. We want more of those and less stuff that sucks up our time, which we don’t want to waste. We spend that time on the meaningful experiences that we value.

Carbone thinks that the future holds an understanding that experience management is a way of doing business embedded in its values. He feels that business is operating on an “industrial age” platform but living in the “fusion economics” age. Fusion economics refers to a time in business when we have a greater depth of knowledge of the science and art of experience, what Carbone refers to as experience management 2.0. Carbone says that experiences are no longer linear but more like a pinball machine, presenting challenges in creating consistency with an emotional bond. Moreover, it is not a siloed responsibility but instead runs throughout the organization and across departmental lines. For instance, a restaurant client of Carbone’s combines the HR and Marketing departments because they realized that their people were their single greatest asset. Carbone says fusion economics enter into an era of virtuality, which understands the elements and role of technology and how to humanize it. This age requires understanding the delicate balance needed for human nature and needs and how the technology works well with these (and how it doesn’t). Perhaps most importantly, this age requires the realization that product attributes, features, and benefits have less influence on consumer decision making than what customers process unconsciously, emotionally, and from the perspective of the total experience.

What Should People Focus on Right Now?

Next, the discussion turned to what people can do or focus on right now to prepare for this future. For my part, I reiterated how I think a focus on how your efforts to create an emotionally engaging experience for customers leads to results. After all, why would anyone support all this if you cannot prove an ROI? In addition to results, I would also encourage people to consider things like the customer’s lifetime value vs. the costs involved with implementing the changes to the experience you propose. Often, by comparison, the value of keeping that customer for the long-term far outweighs the expense in the short-term.

Moreover, we’ve never implemented a Customer Experience program that doesn’t save money because it reduces the costs caused by failures, overlaps, and gaps in current experience. Furthermore, organizations often spend too many resources fixing what’s wrong rather than investing in the best opportunities to have a higher return. In other words, if you can start to identify the real ROI for your Customer Experience program, you will not only find more significant opportunities, but you will also get a hell of a lot more support.

Carbone urges businesses to consider the William Arthur Ward quote that said, “The pessimist complains about the wind; the optimist expects it to change; the realist adjusts the sails.” Carbone says it is time to adjust the sails of Customer Experience. He urges businesses to deepen their understanding of the new order and let go of industrial-age thinking that looks at the experience as a service and instead becomes customer-driven and going beyond customer-centricity. Carbone also thinks it would be wise to understand how customers think versus what they think by delving into unconscious thoughts and emotions. Finally, he recommends adopting a vision of a return on strategy and creating experiential value that will result in ROI. It is crucial to become champions of Customer Experience and convince people that building a culture that understands that the ultimate value the organization creates is in the experiences they provide.

Pine agrees that you should have the right mindset like Carbone suggests. If you have that, Pine says, then everything else can follow. The first thing that people can do is recognize that you’re in the experience business, not services. The second thing is to determine what you would change if you were to charge an admission fee for your experience. Pine says this is crucial is because when you “charge admission,” it inspires you to create an experience worth having. Pine also encourages people to understand that because experiences happen inside of us, it’s a reaction. Pine says there is not enough focus on customizing to the individual customer, the target of that customer-centricity. If you customize your goods or services and your experiences, you’ll thoroughly engage people.

We have come a long way with the concept of Customer Experience from its beginnings back in the late 80s and early 90s. Even since I joined the movement back in 2002, the ideas of what a Customer Experience is, how it works, and what you can do to optimize it have changed a lot. What has not changed through all of these transformations is the need to be deliberate about what you are trying to deliver and the emotional connection with customers you want to create. That is a foundational element that all of us “pioneers” of Customer Experience believe. That can set up your organizations for success to elicit the customer behavior you want that provides the customer-driven growth you need.

To hear more about this idea in more detail, listen to the complete podcast here.

Colin Shaw is the founder and CEO of Beyond Philosophy, one of the world’s leading Customer experience consultancy & training organizations. Colin is an international author of six bestselling books and an engaging keynote speaker.

Follow Colin Shaw on Twitter @ColinShaw_CX

The post What Do The Pioneers of Customer Experience See for the Future: And What Should You Do About It? appeared first on Beyond Philosophy.

Don’t worry, few people can. Nonetheless, it is a critical piece of information when you want to buy a rain poncho and need to choose a size. Without it, however, you can still make a decision—and as customers we often do this—by simply substituting in another question and answering it. It’s called a substitution heuristic, and it is how customer make up their minds about you.

A heuristic is a scientific term that describes how we use shortcuts in our thinking to help us make decisions or solve problems. A substitution heuristic means we replace a difficult decision with one that we consider easier to make, and then use the answer to the easier decision for the difficult decision also. Most of the time we use a substitution heuristic without realizing we did it.

My colleague Professor Ryan Hamilton of Emory University explained it with an example from a study about substitution heuristics and rain ponchos (hence, my question at the open). Researchers at MIT asked people as they were leaving a science museum to participate in a survey. One of the questions had participants imagine it had started to rain and they had an opportunity to buy a poncho in a small, medium or large. The length of the ponchos varied in the scenario by the group of people the researchers asked, but always were available in the three sizes. What the researchers found was that in all groups the people bought ponchos relative to how tall they were, i.e., the shortest people bought the shortest one and the tallest people, the longest, etc. The longest poncho in any of the groups was around 42”.

However, the average length of a poncho is around 50” to 52”. As Professor Hamilton says in our recent podcast on substitution heuristics, they were buying “comically short” rain ponchos that would not cover them up and keep them dry.

The people in the survey were unable to answer the question about what size poncho they needed because they didn’t know how long ponchos should be. So, respondents in the study substituted a different question they could answer, e.g., “How tall am I?” With that answer, the survey participants could then select a poncho they would buy in the scenario, and subsequently catch their death, apparently.

Now, armed with the information that all the ponchos were too short, you might think those participants were silly. However, we do the same thing when we buy a new smartphone. Phones come with different amounts of storage. When choosing, the proper way to decide is to determine how much you store on your phone now and choose the new phone accordingly. However, few of us have any idea how much we store on our phones. So, we guesstimate. I remember when I bought my last phone getting into some really ridiculous suppositions about which phone I should buy, e.g., “how much storage does the software take? ,” and “how many apps do I have?” There are too many bloody variables, so I just picked the biggest one.

How to Help Your Customer Guesstimate

You should never assume your customers are answering the questions you are asking them, and that they are answering them the way they should with rational and objective cognitive analysis. We ask them things all the time that they are not equipped to answer, like what size rain poncho they need or how many gigs of storage their phone should have. Instead, you should figure out what substitute questions are they asking.

So, how do you figure that out? Here are two ideas:

Ask them: One way to determine what questions customers substitute when faced with a decision in your customer experience is ask them. Many tools exist from market research experts that can help you determine how customers tackle the decisions you present.

Take an Outside-In approach: Another way, if you lack the resources or timeline for an investment in robust customer research is to take an outside-in approach to your customer experience. What I mean by this is to walk the experience as if you are a customer. If you sell shoes online, go buy a pair of shoes online. If you sell insurance, present yourself for a new policy. Walking a mile in your customers shoes will tell you exactly where the experience decisions rub, and how you satisfy these moments with an adequate answer.

When you know what question your customers are substituting in your experience, you can then help them get to the answer you want. For example, in politics you often don’t know as much about the two candidates that you should. Maybe all you know is one is an outsider and one is a career politician. Or one is a maverick and one is the incumbent office holder. So, when it’s time to vote you should be making a decision based on where the candidate sits on the issues, but instead you choose based on the description of the candidate you like best, or maybe even just party lines. The campaign manager then would be wise to sell the candidates’ description more than their voting history to earn your vote.

Same goes for cars. For anyone who has purchased a car, it can be overwhelming trying to compare all the makes and models and car features. So, many of us choose something much easier to decide upon, like color. I like the red one is a lot easier to consider for many of us than how many liters the engine has. Another substitution heuristic for car buying can be the brand. For example, I like Hondas because they are reliable and I cannot easily recall any examples of people having problems with their Honda. (This is also an example of a “halo effect,” but that’s a different blog.) This substitution is the whole reason that there is a thing called “brand.”

Understanding substitution heuristics is important for understanding how your customers make decisions because we use them all the time. We use them when we buy a car, vote for candidates, and even when we buy imaginary rain ponchos. Substitution heuristics help us make a complex decision accessible; and they result in pretty good choices most of the time.

Do you have a substitution question you use when making a difficult decision? Please share it with us in the comments below.

If you enjoyed this post, you might be interested in the following blogs:

How We Make Decisions—Prospect Theory

Why Customers Make Strange Decisions

Colin Shaw is the founder and CEO of Beyond Philosophy, one of the world’s leading Customer experience consultancy & training organizations. Colin is an international author of six bestselling books and an engaging keynote speaker.

Follow Colin Shaw on Twitter @ColinShaw_CX.

The post Are You Making The Right Decisions? appeared first on Beyond Philosophy.

I have recently been included in Brand Quarterly’s ‘Top 50 Marketing Thought Leaders over 50’ and they asked me an interesting question: “What do I think the next industry trends would be for the year?” I thought I would expand on my thoughts here and give a better explanation.

For those of you that do not know about this,  behavioral economics embraces the fact that often Customers make irrational decisions and as a consequence this affects what they buy. In short, you need to embrace the fact that Customers are irrational.

In our bland world everything is the same to many marketers who still only focus on the 4P’s (Price, Place, Product and Promotion)  and use this as a crutch. Marketers need to recognize that human decision making is far more complex than this. They need to elevate their thinking to a new level of  understanding and embrace behavioral economics to break through the glass ceiling that is engaging them.

Let us start with three simple questions:

1. What emotions are you trying to evoke in your Customers?
2. Do they drive value for your organization ($)?
3. Have you designed these emotions to be evoked in your marketing?

Not sure? Well you should be. To do your job effectively you should understand how emotions are evoked and design this into your Customer Experience or campaign. You therefore need to understand behavioral economics  and how to make the most of Customer’s irrationality. When you have mastered this I then suggest  you look into the whole area of predictive analytics and define how you can predict customer’s true behavior.

The last piece of the jigsaw is making this ‘live’ in an experience. Imagine that you have just designed a campaign that drives the customer into a store and they then have an interaction with  store personnel. How are you going to ensure that the emotion you want to be evoked is actually evoked during the ‘in store experience’? The answer is that the store personnel need to be trained on recognizing how the Customer is feeling when entering the experience. This is achieved through advanced soft skills training. This covers  recognizing Customer’s verbal and non-verbal cues (facial expression, body language, tone of voice ,etc.) in order to identify how the Customer is feeling. Then the store personnel can  implement their training to convert how that Customer feels,  maybe from ‘confused’ to one of the specific emotions that drive value for their organization.

Sounds far fetched? It’s not. This is what our more advanced clients are doing today with great success. One client moved their Customers from:

• ‘Feeling out of control’ to ‘in control’ by 25%.
• ‘Feeling Anxious’ to ‘feeling at ease’ by 10%.
• When Customers were asked, “Would you hire this person?” , a reply of ‘yes’ increased by 25%.

So, understanding that Customers are irrational, embracing behavioral economics, using this to predict their behavior and finally designing your experience and training people on how to convert customers emotions is the new world. Welcome to the new world of practical behavioral economics!

Colin Shaw is the founder and CEO of Beyond Philosophy, one of the world’s leading Customer experience consultancy & training organizations. Colin is an international author of five bestselling books and an engaging keynote speaker.

Colin is proud to be recognized by Brand Quarterly’s as one of the ‘Top 50 Marketing Thought Leaders over 50’.

The post ‘Top 50 Marketing Thought Leader’ Reveals Latest Trend appeared first on Beyond Philosophy.

September 1st, the high-end yoga-wear maker introduced their new Pant Wall. The new fits are arranged according to how they feel when worn, rather than the silhouette as it was in the past. The new pants range from Tight fit to Relaxed and include other fits such as Held in, Hugged or Naked.

I realize of course that I am not the target of Lululemon, since I would never wear yoga pants (you’re welcome!). They certainly wouldn’t have my size. And if they did, the sight of me wearing this is enough to put everyone off their food for a week! However, the last fit description sounds interesting, to say the least!

The new fit descriptions are designed to help Customers know which fit is appropriate for what activity. The new wall is in response to Customer Feedback that they were confused about how the pants should fit and sometimes bought them too big. The Pant Wall was designed to help Customers feel less confused in the store more satisfied with their purchase after they leave.

The Customer response to the change seems to be positive, according to analysts. They are upgrading the stock and forecasting a positive turning point the brand by the 4th quarter. Morgan Stanley upgraded LULU, predicting that the stock will continue its success in earnings for 2016.

The VOC is the Key

So what does this story show us? It shows us two things. First, that listening to the Voice of the Customer (VOC) is an important part of your brand strategy. Second, that incorporating what you hear in the VOC to your Customer Experience pays off for your bottom line, a.k.a. stock price value rising.

An important part of your success (a.k.a. stock price value rising), is having a few ways to keep in touch with the VOC. Lululemon has a few channels in place to listen to the VOC:

• There is the Ambassador program, designed to give local athletes and brand ambassadors a way to weigh in on the product lines.
• Then there is the heylululemon.com site (also called their feedback page) where they invite their Customers to make suggestions and submit ideas.
• There is the Guest Education Centre, where they answer all questions and concerns via email, live chat, or call center.

They also do roundtable research at the store level. One of my work associates emailed me recently regarding a recent experience she had with Lululemon. When she was invited to an event at the store, she thought it was a party with drinks and snacks and would feature an exclusive preview for new products. However, it turned out to be something much more rewarding. Here’s what she described:

“…Don’t get me wrong, there were drinks and snacks. However, I, along with about 10 other people, had the opportunity to not only network a bit, but also sit at a round table where we were asked about our lives and what inspires us, as well as our thoughts, likes, and reasons for shopping with Lulu.  Then, they offered us a chance to give feedback on our concerns and what they could change and improve (whilst notes were taken by the store and Regional managers of the brand). They also had new products we were given the opportunity to try on and give feedback as well. At the end of the evening, it was also a nice surprise to be given a gift card to shop with them again.”

All of these listening channels are paying off—and according to stock pundits, by next year or even the fourth quarter this year, quite literally.

It’s nice to see a brand remember what makes Customer Loyalty and Retention work. Lululemon had begun to lose their balance with their Customers coming out of their pose as the top Yoga-wear brand.  But by realigning their strategy with a Customer focus and listening to the VOC, they are once again finding their Customer Center, and positioned to take the top spot once more.

How are you listening to the VOC with your brand?

If you enjoyed this post, you might be interested in the following blogs:

5 Ways to Make a Great Impression on Your New Customer

When It Comes to Customer Experience, You Have to Keep Rolling the Dice

The Good, The Bad, and The Ugly in Customer Experience Lately

Colin Shaw is the founder and CEO of Beyond Philosophy, one of the world’s leading Customer experience consultancy & training organizations. Colin is an international author of five bestselling books and an engaging keynote speaker.

Follow Colin Shaw on Twitter & Periscope @ColinShaw_CX

The post Yoga Pants Can Realign Customer Experience appeared first on Beyond Philosophy.

My regular readers will know the importance of the subconscious experience, and this is an important aspect to master.

Here are five tips on how you can make a great impression on your new customer:

1. Remember that body language says a lot. If you are talking to the customer face to face, it’s important that your body language supports an environment of helpfulness and attentiveness. Be aware of your posture, your arm position and your facial expression. Some organizations go so far as to give you hand positions and go-to motions (stroking your chin thoughtfully, as an example) that indicate you are listening. Avoid hands on hips or crossed arms, which are both nonverbal cues that you are aggressive or not interested. It’s also a good idea to match posture voice and words to theirs as most of us prefer to be with people who are the most like us.

2. When it comes to eye contact, make it a focus. Eye contact helps you establish that you are interested in a person. Since you want your new customer to know that you are interested in them, it’s a good idea to look them in the eye when you talk to them. If this isn’t natural for you, try to remember to look at your customer’s eyes long enough to figure out what color they are. That’s usually long enough to get the ball rolling. Looking down or away is a subconscious signal that you are not interested or hiding something, neither of which are a great way to make a good impression on the customer.

3. Smile, even if you don’t want to. Let’s face it: we don’t always feel like being cheerful and helpful. It’s natural to have moods that get in the way of your customer experience goals. It is important, however, when you are trying to make an impression on a customer that it is a positive one at the outset. So smile, even when you would rather not. Many positive attitude speakers and sales gurus will tell you that you should “fake it until you make it.” I agree. You may start with less than a sincere smile, but you will likely find that it becomes more genuine over time.

4. Remember that it isn’t about you, it’s about them. Customers are as the potential date you are trying to impress. You want them to know that they are the focus of this interaction. For example, imagine that a customer turns in their rental car with a story about a narrow escape with the law about their lack of a front license plate on the car you gave them. Try to remember that while your story about the time you talked your way out of a ticket in Colorado is pretty entertaining, this is not the time to share it. It is, however, a good idea to be empathetic and try the feel, felt, found approach that Apple Geniuses have mastered.

5. Admit that you don’t know when you don’t but commit to a solution plan. In some customer-facing positions, you meet customers once they have a problem. Customers want to feel cared for, especially when the have a concern or a problem with your product or service. If you are in over your head, don’t panic or abandon them to get help immediately. Focus on getting the details right about the situation, apologize that they are having this problem, and tell them what you are going to do before you do it (like put them on hold or find your supervisor). Focusing on hearing what they have to say will help them be more patient when you are trying to fix the problem.

Making a great impression on your customers is not that different from asking your potential date out, or making a friend at a social event, or networking with others at a business function. These tried and true methods will help you make a great impression with your customers, and lay the foundation for their return business.

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Forrester’s blogger, Nick Elliot recently published a post proclaiming Instagram the King of Social Engagement. But this revelation followed by saying that the so-crowned king only had about a 4.21% post engagement rate. Even more revealing was that 4.21 % engagement rate was 58 times more engagement than a post on Facebook, and 120 times more engagement for each follower that a brand has on Twitter.

The Forrester study looked at the result of 2,500 brand posts across seven social networks based on interaction of more than 3 million users. The example Elliot gave was using a Red Bull Video from the previous month. Of the company’s 43 Million Facebook fans, only 2,600 of them liked the video. But the 1.2 million Instagram followers liked it 36,000 times. Elliot goes on to explain that while Red Bull is youth focused, they also observed great engagement for brands like General Electric and the Ford Fiesta, that both have a multi-generational appeal.

So it’s clear that people do engage with social media and it does work to some extent. But is also shows that when it comes to customer engagement all the social networks are not created equal. But how do you know which one is best for you and how to get engagement from your customers?

Making Your Social Media Experience More Effective

Whether the numbers of engagement are staggering or not, social media is a key part of your customer experience design strategy in today’s day and age. It needs to be built in, just like all the other channels of your customer experience. And like those other channels, there are some definite considerations that you must include in your strategy.

My book, Customer Experience: Future Trends and Insights covers social media strategy in more detail, but for the purposes of this post, we can drill down to these essential questions:

• What is the Customer Experience you are trying to deliver in social media?
• What are the emotions you are trying to evoke through your social media?
• Is your Customer Experience deliberate in social media?
• What do your customers really want from social media?
• What drives the most value for the organization in social media?

Answering each of these questions can help you decide which channel is right for you, your brand, and the results you are trying to achieve. As you can see, they are the same questions we are typically asking about any part of the customer experience. In fact, this list of questions really reminds me of how you add “in bed” to the end of a fortune cookie fortune. Only instead of “in bed” we add “for social media” to the end of the customer experience questions!

All joking aside, this social media experience has its own expectations and distinguishing characteristics. Each of these questions must be answered with that in mind. But like the other parts of your customer experience, there are rational parts of the social media experience and the irrational (emotional and subconscious) parts of the experience at work, too. A robust social media engagement strategy takes into account all of these factors and uses a metric system to measure results.

Steve Sickel, Senior Vice President, Distribution and Relationship Marketing for IHG, the hotel group that includes Holiday Inn, Intercontinental, Crown Plaza, Staybridge, Candlewood and Hotel Indigo, understands the importance of having a focused strategy for your social media efforts. He had this to say in my book:

“We have a business objective we are trying to achieve, and that’s the way we approach our social marketing agenda. I think a lot of companies miss this… a recipe for disaster. We have a very practical approach to our social marketing agenda. We want to drive a business outcome—delivering incremental revenue into our hotels by engaging with our customers so that they shop with us more than the others we’re racing against.”

Sickel shares an example that shows how they used this strategy successfully. They had a special incentive to stay at their hotels that they shared with 150 of their US private community. During the six weeks of the promotion, that original audience of 150 people grew to thousands and drove $300,000 worth of revenue to their hotels. Clearly in the case of IHC, social media is both engaging and working. This example isn’t showing millions in revenue, but if you consider the ROI for the promotion, its return is extremely profitable.

Emotions Are Still an Important Factor in Social Media

It is increasingly important to consider the emotions that your social media strategy evokes for your customers. There are emotions that drive value and those that destroy value in customer experience. These emotions make up a huge part of why customers do what they do. These same emotions play an important role in why customers do what they do on social media.

There are three groups of social media experiences:

• Personal Social Media experiences: This is the type of interaction designed to stay in touch with friends and family.
• Customer social media experiences: These experiences are comprised of consumers wanting to use social media to research before making a purchase of a product or service. They might visit any number of websites or social media pages to get this information.
• Business social media experiences: This is when a user is utilizing social media for business context. Examples of this type of experience include reading or writing a blog post on your area of expertise or focus, sharing industry updates or tweets to expand business knowledge, and/or connecting with people in your network for job opportunities.

No matter which group of type of experience you are using in your strategy, understanding all the layers of the psychological experience is critical to have an effective strategy. What users say they want from social media and what they really want from social media are usually two different things. You have to peel back the layers of research to understand the difference. Then once you understand the psychology behind their moves, you can use an effective strategy to capitalize on this for the benefit of your user and your organization.

I realize that this is just touching the surface of social media strategy and the importance of understanding what emotions drive and destroy value. We teach a program on this called, What Drives Value in a Social Media Experience that helps explain this all in more detail. If you want to download the presentation pdf , click here.

So is it working?

Social media is working and people do engage with it. But it still hasn’t reached a level of overwhelming numbers and millions in revenue. This can change over time as the medium matures and those that are using it refine their strategy and define their desired outcome.

So to answer my question in part, I would say yes it’s working. But don’t abandon all your other marketing strategies yet.

If you enjoyed this post, you may be interested in the following blogs:

• How Emotions Generate $$$
• What Drives Value in a Social Media Experience
• Why We Hate Losing

Emotional Engagement and Brand Loyalty: Procter and Gamble Gets It…Do You?

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I spend my life talking with ‘C’ suite executives about how they can improve their Customer Experience but social customer care is never raised by them. When I talk about it they look at me as if to say ‘oh, you are one of the strange geeks that I now must humor’. The problem social customer care faces is most of the people that run the majority of organizations are people of my age group and they don’t use social anything! Too many of them still think it’s a fad that will go away. But we all know it won’t…

When I wrote my last book Customer Experience: Future Trends and Insights, Palgrave McMillian 2010, I made the observation that technology is not driving social media it is the fact that people are social; the technology is just enabling the natural human behavior. The understanding of human behaviour in most organizations is not very high, thus it is not understood, nor embraced and therefore again they don’t see the power of this.

In the last five years it has been mainly an uphill battle to show that social customer care is here to stay. It won’t go away and it is just going to get bigger. You can decide to be like King Kinuit and order the tide to stop rising, but it won’t. You have to embrace it.

The big issue with embracing it means losing control and people of my generation are scared of this. Only the other day I was listening to the ‘United Breaks Guitars’ song and it reminded me of how slowly United responded to this. I am sure that many ‘C’ levels execs were shocked by how quick this happened and if they were honest realized this would have happened to them as well.

I wrote a piece called, “The Latest Social Media Gaffes: What Were They Thinking?” discussing how social experience can go so wrong when people of my generation start to play with things they don’t understand. The CEO of Ryanair, Michael O’Leary created a twitter storm in his sexist tweets and showing his naivety when it comes to this space. He did not even know what a hash tag was! This again just reinforces the CEO to run and hide and hope it goes away.

In my view we will quickly get to the point where people who have a high social influence will receive better customer service than those that don’t, as organizations realize that they can make a significant dent in the reputation to help promote them. I wrote about this, the fact that the more social influence equals a better customer experience. We are already seeing celebrities being paid for tweets, offering a better level of service to people with a high social influence is not new. Many organizations jump higher and faster if someone of influence wants them to do something. Social just increases the number of people that have this impact and through things like Klout see who has influence.

Social customer care has just about come of age but is still in its infancy. I look forward to seeing companies embrace this more as I for one think it’s a vital channel.

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But instead of fictional characters, they are real people that I used to work with or went to primary school alongside. I can’t tell you how many of these things I watched. What I can tell you is the reason I watched them was scientific—and certainly not a form of procrastination from my rather lengthy list of “to-dos”.

John Berlin, the bereaved father whose son, Jesse Berlin passed away on January 28, 2012, didn’t know his son’s Facebook password and really wanted to see his Look Back video. His plea went viral and Facebook heard about it. Facebook decided to make the video for the father. Mark Zuckerberg called him personally to let him know that they would develop a policy that allows family to access an account after they lose a loved one. The video was not public, but John posted it later on You Tube.

In this case, the story behind the story makes this Look Back video even more compelling.

Storytelling, when it is done well, can create a new chemistry in your brain and that chemistry changes the way you feel. In this case, I feel sentimental and connected to my family and friends. And my primary school chums, I suppose. In other cases it helps you form empathy. This is particularly useful for fundraising for charity.

In a recent study, researchers learned that the emotional reaction and resulting brain chemistry from watching a story could actually cause the viewer to spend more money. Here is a fascinating animation of the concept in a video from Dr. Paul Zak, PhD, the founding director for Neuroeconomics Studies at Claremont Graduate University and author of “The Moral Molecule: The Source of Love and Prosperity”:

What this video demonstrates is an important fact about your customer experience. Stories will help you connect with your customers and create and emotional reaction that will build a relationship. This relationship is only created when your stories are told well and contains emotion-provoking themes. These emotions create a reaction in your customer’s bodies that will help them decide to spend money on your products and services.

Before you get nervous about all this mind-controlling-wallet theory, remember that this is not an entirely new concept. Since the first charity appeared, and the first child with round hungry eyes ever asked the orphanage, “please, sir, can I have some more?” we have had this reaction. This was not developed on Madison Avenue in the 1960s by a bunch of morally questionable men who smoke too much. From the beginning of social interaction, stories have been the basis for learning, communicating and connecting between human beings.

Emotions are the biggest driving factor in most customer interactions, both rationally and subconsciously. What we learned in our research for our third book, based on responses from 4.5 Million survey questions is that 20 emotions basically drive and destroy value.  What emotional response you create with your customer experience directly effects whether that customer is coming back, coming back always, and recommending your company to his or her friends.

It also drives whether they decide to leave without buying anything, never come back, and post a scathing review of you on social media. Basically, emotions are the thing that make or break your customer experience.

Many times, when I am consulting with a client, particularly when they accept this concept, they ask, “How? How do I create emotions with my customers?” This is a great question that shows me that they are ready to make the kind of changes necessary to compete in today’s highly competitive, globally commoditized economy. The answer is not as simple as this, as there are a multitude of factors that go into the emotional arc of a customer experience, but in a very general sense it can be boiled down to creating stories that evoke emotions.

Whether the story is in the branding that drives your customers to your channels in the first place or in the interaction between your employees and the customer on a specific transaction, connections through stories are the best way to create the positive emotions that drive value for your organization. Unfortunately, these same stories, can create the negative emotions as well, but that’s another post…

So now you know. The reason you are clicking on all those Look Back Videos is scientific. Stories help you feel. Your feelings create chemicals in your body. These chemicals can feel good, scary, sad, or happy. Sometimes these feeling will drive you to give more money to charity.

So tell your boss/client/wife that you are not procrastinating and fooling around on Facebook. It’s scientific research on what stories do to create emotions. At least that’s going to be my excuse.

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Number 1: The Piano Stairs and the Fun Principle

This is a great Video that demonstrates the Fun Principle. If you have ever wanted to seek inspiration on how to turn
the most boring experience into something Fun, Interesting and Engaging then download and share this around.

Number 2: What is Customer Experience Management?

Getting to describe exactly what Customer Experience is always a challenge – so how is it different from Marketing and Customer Service then?  This video is a great short video from CustVox that can be shared around your organisation. It really gets to the heart of what Customer Experience Management actually means.

Number 3: The Digital Customer Experience

This is a great video from Blackberry highlighting the future impact of Social Media and the Digital Experience on customer’s daily lives. Ever wondered what Social really means for the future, this shows you.

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