This post was co-authored by Sarah Rahman.
Imagine that you’ve been tasked with improving customer experience. You have several experience improvement initiatives in progress and have been bombarded with endless anecdotes of customer horror stories, which lead to many more ideas to pursue. And, of course, you belong to a very fragmented organization where the other “owners” of customer experience aren’t clearly defined.
For many of you, this scenario doesn’t require much imagining at all. The majority of CX leaders have well-intentioned plans to transform the customer experience but struggle with two basic questions: Where do I begin? How do I know which CX improvement efforts to prioritize?
The answer starts with segmentation. Not traditional customer segmentation, although that’s helpful, too. To guide decisions about where and how to invest in CX, you should segment the “moments” in your customer journey. Once you segment these moments, you can prioritize where to focus your CX improvement efforts. Here are four moments that matter:
- Table Stakes: The moments in the customer journey during which customers expect you to be involved in shaping their experience are considered Table Stakes because you must meet minimum expectations, and failure to do so will erode customer loyalty. For example, a Table Stakes moment for airlines is baggage handling. Customers have a basic expectation that they will receive their luggage with minimal issues or delays. Any experience that fails to deliver on that basic expectation is unacceptable, and they won’t think more of an airline or “reward” it for consistently meeting their basic expectations. That’s the problem with Table Stakes moments: They have great downside risk, but as standalone moments, they have minimal upside potential.
- Competitive Differentiators: From your customer’s perspective, these are the moments that start with, “You know what would be great?” In these moments, customers can see how you could support them, even if they don’t expect you to. We call them Competitive Differentiators because positive experiences at these moments can sway customers to develop greater loyalty for one company over another, all else being equal.
The hotel industry, which is constantly seeking new ways to enhance the guest experience, is famous for delivering on Competitive Differentiator moments. For example, for business travelers, a very critical moment is late-night work and meeting preparation in the hotel room. Many hotels have recognized the importance of this moment. From redesigning rooms to have power outlets in convenient places to providing complimentary amenities like in-room Wi-Fi, hotels are constantly looking for opportunities to optimize productivity while creating a relaxing in-room experience during late-night hours.
- Signatures: Signature moments contribute to a company’s unique brand image and are highly effective at building customer loyalty and encouraging customer advocacy. These are moments where your customers have no expectation for you to shape their experience, but your engagement and support can create delight.
The key to Signatures is delighting your customers beyond their expectations at a meaningful moment. For example, for customers with young children, one of the most stressful moments of vacation is rental car travel. How might a rental car company support these customers? Examples include providing child-care packages or activities, giving parents more detailed information on available car seats, stocking the car with child-proof amenities like wet wipes and trash bags, etc. There are a number of ways that a rental car company can reduce parental stress during this moment, creating an unexpected and therefore deeper type of delight and brand affinity.
- Reinforcers: With so many moments in a customer’s journey and so little time and resources to focus on CX improvement at each moment, identification of these Reinforcer moments may be the most important outcome of this segmentation exercise. We call these moments Reinforcers because a good experience during these moments can reinforce the perceptions that customers have of you, but it isn’t going to drastically change overall perceptions.
Where Do Companies Go Wrong?
Companies that don’t identify these four distinct segments of customer moments make poor customer experience investment decisions. Here are the most common mistakes that we’ve seen:
- Overly investing in Table Stakes, with insufficient focus on Competitive Differentiator and Signature moments: Focusing only on Table Stakes may lead to—as the adage goes—a sale but not a customer. That is, good Table Stakes experiences enable customers to successfully complete transactions, but they do little to create customer loyalty or advocacy.
- Failing to capitalize on Competitive Differentiators when the timing is right: Competitive Differentiator moments eventually become Table Stakes. If you’re only creating positive experiences at those moments once they become Table Stakes, it’s too late.
- Creating poor experiences at Signature moments: Customers don’t expect you to help them navigate these moments, so be careful not to over-extend beyond your core competencies and create negative experiences during these critical moments.
- Investing in Reinforcers: Don’t waste your time and money improving experiences during moments in the customer journey that have minimal impact on the overall experience and minimal influence on customer perceptions of your brand.
Every company segments its customers, but very few companies segment customer “moments,” which leads to uninformed (and often low-return) CX improvement investments. In our next post in this series, we’ll discuss a rigorous quantitative approach that you can apply to identify these four moments. With a common language to talk about the moments that matter, you can guide your organization to focus on the right areas and make smart CX investment decisions.
Sarah is a consultant at ZS in Chicago and is focused in the customer experience and marketing practice areas. Over the past five years, Sarah has worked across a variety of industries and has specific expertise in customer insights and customer experience analytics, voice of customer programs, marketing strategy and qualitative and quantitative customer research.
Will, great article! We use a similar approach, using a Kano-like breakdown. I agree that many organizations focus on table stakes, confusing them with differentiators.
One other type is the negative feature – features that the company feels are positive, but that are actually a negative for customers! We frequently see this in product-focused cultures. The product teams build the products THEY want to buy. But because they’re so focused on the features, these become negative.
This typically shows itself in overly-complex products. Health insurance is one of the biggest offenders – creating a very complex product, when customers really just want to get their services without having to spend hours thinking through their coverage.
Good stuff!