A few years ago, I took a summer vacation to Disneyland Hong Kong with my extended family, a total of 13 people including my 15-year-old teenage son and my 86-year-old father-in-law (note 1).
There were many laughs and lots of effort expended during this vacation, but there was one defining moment. We all found it to be the most memorable and joyful – the photo opportunity at breakfast with all the Disney characters at the Disneyland Hotel restaurant. Let’s recall it now.
Our Remembered Experience is Great
The weather this morning is perfect. The breakfast is delicious; the buffet has so much variety. Then, the peak moment arrives – Mickey, Minnie, Donald and Daisy appear.
Their gestures are lovely and they tease and play with each of us, young or old. They spend an extended period of time with us to take individual and group pictures.
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The signature photo of the trip is the one with Daisy kissing my 25-year-old nephew. Even today, we still recall the smiling faces and big laughs during this breakfast. Our remembered experience is great.
Our Actual Experience is Unpleasant
Yet, the rest of the vacation is far from great. As in every other Disneyland around the world, there are long queues everywhere from restaurants to theaters to rides.
The food, other than breakfast, is only average. The play in the theater is neither fun nor exciting. The rides are boring. The hotel we stay in is dull, like any other local three-star hotel, lacking the genuine ‘Disney’ feel.
Despite the fact that Hong Kong Disneyland is small (note 2) with a flat landscape, their crowd control is terrible. We almost fight with a group of people who jump the queue while we line up for the ‘round the park’ train. Our actual experience is unpleasant.
Forget the Realities; Concentrate on Memories
Although there are numerous unpleasant moments during our actual experience, the whole family remembers only the most pleasurable moments – particularly the photos with the Disney characters during breakfast – and disregards all the unpleasant feelings.
By the end of it, everyone calls our Disneyland visit as “a great family vacation!” Whether we feel good or bad is not determined by the actual experience but our remembered experience.
To deliver a memorable and effective experience, we should forget the realities, and concentrate on memories – to focus resources on the critical few moments that customers recall. It lays the foundation for a resource revolution in customer experience management.
The Conventional Approach
The majority of business leaders have been brainwashed by the sacred beliefs of pursuing excellence, customer centricity and continuous improvement. They are determined to eliminate any pain points, efforts, frictions, imperfections and defects within an experience.
The red Emotion Curve (note 3) in figure 2 represents the conventional approach. Companies are working hard to raise the entire red curve higher and higher still.
Nobel-prize winning psychologist Daniel Kahneman suggested that human beings only remember two moments of any experience – the peak and the end (note 4).
The red curve dilutes your limited resources on too many things with insignificant peak and end. Customers forget you and resources are wasted. It is an ineffective experience.
A Resource Revolution
Now, let’s take a paradigm shift and allocate the resource differently by focusing on a critical few and allowing customers to experience valleys. The blue curve in figure 3 represents a resource revolution.
By following the Peak-End Rule, the blue curve generates a higher peak and a higher end point than the red one – which the customers will recall in their memories.
Does it mean that we have to spend more resources? Yes, we do have to spend more on the peak and the end as shown by the areas shaded burgundy. At the same time, we can save an even greater amount of resources as represented by the areas shaded navy. This implies that we can deliver a more pleasurable experience to our customers with fewer resources.
The resource revolution is patently simple: Allow valleys to create peaks.
Allow Low to Create High
A European bank takes the resource revolution to their retail operations (note 5). This bank used to deliver the retail banking experience using the conventional approach. They achieved neither high customer satisfaction ratings nor positive business results. They just looked more and more like rival banks, as represented by the red Emotion Curve in figure 4.
Then, they deployed a pilot project. They now allow their customers wait longer to be served than in an average bank. This generates a severe valley for their customers as shown in the blue emotion curve. By allowing the wait-time low, the bank creates a high point for their customers.
Without extra staffing but by reallocating their manpower, the bank concentrates resources on face-to-face consulting services and trains the staff with more comprehensive product knowledge and better listening skills and with the objective to spend more time with each customer to personalize solutions.
The resource revolution rewards. The overall customer satisfaction, Net Promoter Score (NPS) and conversion rate (percentage of customers who accepted the next consulting appointment for investment products) have increased. The bank utilizes resources more effectively than before and more effectively than any other banks, by “allowing valley.”
The foundation of the resource revolution is allowing valleys. Without valleys, we don’t have resources to spare for creating significant peaks. “No valley, no peak.” It is that simple. Like “No pain, no gain” this is common sense even a nine-year-old can understand.
Reactivate Your Independent Thinking
However, common sense is not always so common. Most of us are being indoctrinated to trust only data and the advises rendered by experts or authorities; our own thinking and judgments have long been uncalled for. Think of the last time you made a business decision based on common sense and your independent thinking – it’s time to reactivate them.
- No Valley, No Peak. Now you might become more astute to focus your resources creating peaks. But without allowing valleys – when your resources are still being locked for maintaining a certain level of standard throughout the entire experience – you wouldn’t be able to spare a substantial amount of resource to generate notable peaks.
- Your Rivals Will Do the Same Thing. The Peak-End Rule is easy to comprehend. You can focus your resources on the peak and end, and so too your rivals. Imagine when everyone is practicing it, you just play the catch-up game and become “me too”. The experience wouldn’t deviate much from the original flatten red curve and is forgotten.
- All Companies have Limited Resources. To avoid “me too” and to breakthrough, you would ask for an extra considerable amount of resource to create significant peaks. Why do so many CX initiatives fail to get the support of CEOs? Because quite a number of customer experience professionals are so devoid of business sense to acknowledge the fact that every company has just limited resources.
- Allow Valleys to Create Peaks. Focus resources on where customers would remember and save resources on where they wouldn’t recall. By doing so, you can deliver a more effective experience without extra resources. No CEO would stand in your way. Literally, when allowing valleys to create peaks, a dynamic blue curve appears.
Be Mediocre or Extraordinary?
Strategy is about resource allocation. The effectiveness of a strategy is judged largely by the effectiveness in resource allocation. “Allow Valleys to Create Peaks” is not just a fancy catchphrase, it’s an effective strategy in managing customer experience. It puts your limited resources to their best use, and creates an extraordinary and memorable experience to your customers.
Pursuing the flat red line – eliminating pain points, efforts, frictions, imperfections and defects – is safe and widely accepted, as almost every company in the commercial world is trying hard to achieve so, but it’s also the sure path to drive a mediocre and forgettable experience.
Striving for a dynamic blue curve is the road less traveled. You need to reactivate your common sense and independent thinking. It takes courage to start a resource revolution.
You also have to do the right things and do the things right – e.g. identify right peaks and right valleys, ensure the peaks not valleys are remembered, work out the most appropriate extent of the peaks and valleys, and derive the unacceptable levels of the valleys of your target customers. To be extraordinary is never easy or risk-free. (Note 6)
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1. I would like to add a disclaimer: the “Disneyland Hong Kong family vacation” was my personal experience and happened to me at a specific location. It is a simple example I use to clarify the concepts demonstrated in this article.
2. According to the official Walt Disney Company 2012 Fact Book, Hong Kong Disneyland is the smallest in terms of size among all Disneyland parks and resorts around the world.
3. An Emotion Curve is mapped by linking all the satisfaction levels of the sub-processes (touch-point experiences) and attributes that are encountered or perceived by customers and affect their emotions in a natural time sequence during a touch-point experience (total customer experience). I created the Emotion Curve in 2006. See Sampson Lee, One Cup of Coffee, 20 Experiences: Take a Tip From Starbucks (Customerthink.com, 4 June 2006).
4. Daniel Kahneman (born 1934) is an Israeli-American psychologist. He was awarded the 2002 Nobel Prize in Economics for his work in prospect theory. The Peak-End Rule is a psychological heuristic by which people judge experiences largely based on how they felt at their peak and at their end. This heuristic was first suggested by Daniel Kahneman and others. Originally, the Peak-End Rule was applied to the evaluation of pain, see Donald A. Redelmeier and Daniel Kahneman, Patient’s Memories of Painful Medical Treatments: Real and Retrospective Evaluations of Two Minimally Invasive Procedures (Pain 66, 1996), 3-8. Later studies supported the idea that the effects found in retrospective evaluations of pain are applicable to evaluating pleasure, see, for example, Amy M. Do, Alexander V. Rupert, and George Wolford, Evaluations of Pleasurable Experiences: The Peak-End Rule (Psychonomic Bulletin & Review, 2008, 15 (1)), 96-98.
5. The European bank is one of my clients who had attended the Global CEM Certification Program. For reasons of client confidentiality, they will remain anonymous.
6. For how to “Allow Valleys to Create Peaks”, see Sampson Lee, PIG Strategy: Make Customer Centricity Obsolete and Start a Resource Revolution (iMatchPoint, 2014).