Total Customer Experience (TCE) for Airlines

The target audience of this paper is not limited to business executives in the airline industry. Total customer experience (TCE) and “The TCE Model” [1], which I am going to introduce and explore in detail in this document, are applicable in most, if not all, industries and organizations, both commercial and not-for-profit.

Figure 1 – Total Customer Experience (TCE) and Customer Life-stages—Airlines

This is a white paper to introduce the fundamentals of the TCE Model. I shall disappoint you if you expect me to tell you the “hows” – with a tool kit or “Five Simple Steps to Implement a Total Customer Experience”. Instead, I will focus on the “whats” – the components of a generalized TCE Model; and the “whys” – potential gains from applying the TCE model in any organization.

If you read my previous white paper “Social Media under One Roof: Integrate Social Media into the TCE Model”, co-authored with Wendy Soucie, Karl Havard, Jim Sterne, Axel Schultze, Rick Mans, and Guy Stephens, you will find similarities in this paper. The description of the composition and components of the TCE model will be familiar to you. The primary difference between the two papers is as follows. The former paper focused on how a single channel, i.e. social media, impacts the total customer experience; while this paper explores the comprehensive architecture of a TCE Model and the reasons behind why it is built in such a way.

This white paper will cover:

• Defining the beginning, the end, and the composition of a typical total customer experience (TCE) – both touch-point experiences and customer life-stages – across the entire customer lifecycle;
• Exploring the relationship between touch-point experiences and channels; and
• Building a static – two dimensional – TCE Model and transforming it into a dynamic – three dimensional – TCE Model.

Customer Experience Management: How to Stand Out in a Crowded Market
Foreword by Bob Thompson, CustomerThink Founder/CEO

Our lives are full of experiences. Some we remember vividly years after the fact. Like the first time my son Matthew was able to ride a bicycle without training wheels. I’ll never forget the look of pure joy on his face when he finally succeeded.

Customers are people, so it shouldn’t come as a surprise that they, too, react emotionally after an especially good or bad experience with a business. When customers are pleasantly surprised, they are more likely to return again and refer their friends and colleagues. This so-call “loyalty effect” is what propels business growth for companies of any size.

In CustomerThink’s research on U.S. consumer experiences, we found that after just one memorable experience, 19 percent of happy customers said they purchased more products/services and nearly one-third said they recommended the company to a friend or colleague. Of course, negative experiences had the opposite effect: 20 percent of unhappy customers said they switched to another supplier and 25 percent said they complained to a friend or colleague.

The rising popularity of social media and other online resources means that good or bad news travels faster and farther than ever before. That makes it all the more critical to ensure that your customers have positive experiences with your business.

If you’re stuck in a commodity trap fighting for sales based mainly on price, then consider focusing on the customer experience to stand out from your competitors. Consider these personal examples:

• For grocery shopping, we have many options to choose from locally. Yet 70 percent of our household’s money is given to Trader Joe’s, because they have interesting selections and friendly staff that really enjoy serving customers.
• When I shop for electronics, I usually go to Best Buy. The products are available from many retail outlets and online. However, Best Buy stands out because its employees always help me find the right solution without aggressive selling.
• Our family dentist is a 30-minute drive from our house. Why do we go there when there are other dentists within walking distance? Because the dentistry practice was recommended by our friends. And sure enough, the dentist and his staff have done a great job, both in terms of technical proficiency and their friendly, competent staff.

Every day, your customers are making decisions like this on where to buy their goods and services. Their experience means their perception of all of the interactions with your company — including marketing, selling, purchasing, usage and service/support. Said another way, if the products or services are what you’re selling, then experiences are how you’re interacting with your customers.

These interactions really matter. CustomerThink research has found that customer experience is about 40% of what customers value — roughly equal to the value of the purchased product or service.

In the 1980s, Scandinavian Airlines CEO Jan Carlzon found that executives were too concerned about the type of aircraft they were flying, and were ignoring what mattered to customers. He focused the airline on improving passengers “moments of truth,” which included the entire flying experiences from reservation to the flight to collecting bags at the final destination.

Today we call this Customer Experience Management (CEM). Simply put, CEM means proactively managing customer interactions to build loyalty to your firm. In this white paper, Sampson Lee brings the latest thinking on how the Total Customer Experience model can help airlines, or any business, compete in a world of increasingly commoditized products and services.

Document Structure: The Flow and Specifics of Each Section
This document is composed of five sections. There are personal stories in the sections contributed by four of our international partners: Annemiek van Moorst from the Netherlands, Candice Chee from Singapore, John Chisholm from the United States, and Silvana Buljan from Spain; and in the foreword by Bob Thompson, CEO of CustomerThink, in the United States.

Section ONE: Total Customer Experience (TCE) for Airlines (current section) states the reasons why you should or should not spend your time reading this document. Here, I introduce the flow of the paper and give my perspective on the core components of total customer experience (TCE) throughout the entire customer lifecycle.

Section TWO: Lufthansa and Total Customer Experience (TCE) tells the personal experience of Silvana Buljan and her two daughters on Lufthansa. She brings out some intriguing topics: when does the total customer experience start and the end? And how is the total customer experience broken down into customer life-stages then subdivided into touch-point experiences?

Section THREE: Air Asia and Touch-point Experience Candice Chee and her kids were being treated unsatisfactorily during the in-flight experience on Air Asia during the “Flight” life-stage. Taking her experience as an example, we show the differences between touch-point and sub-process, and explain why it is mandatory for you to understand these differences when building the TCE Model.

Section FOUR: KLM (Air France) and the Static TCE (Total Customer Experience) Model Annemiek van Moorst and her partner were most concerned with the local newspaper and the Italian bread, as well as a disgusting odor! These were the attributes from different channels during their in-flight experience. When we map the relationships between each touch-point experience and its respective channels, we build a two-dimensional, static TCE Model.

Section FIVE: American Airlines and the Dynamic TCE (Total Customer Experience) Model Surprisingly, it is not the flight, but the lounge experience that has driven John Chisholm to fly again and again with American Airlines for the past 25 years. When we add importance levels, the third dimension, to touch-point experiences and channels, we transform a static TCE Model into a dynamic one.

An Overall View of Total Customer Experience (TCE) and Customer Life Stages
Figure 1 is an example of the customer life stages of airlines in a natural time sequence. In reality, the actual sequence may not occur in this exact order as there is no absolute sequential order for all customers under all circumstances.

The total customer experience (TCE) of airline passengers is similar to TCE in other industries; it is composed of numerous individual touch-point experiences, denoted as TX1 to TX12 in Figure 1. These touch-point experiences can be categorized into different customer life-stages, denoted as “Brand Perception”, “Plan & Purchase”, “Consumption”, and “Post-consumption”. The combination of all touch-point experiences with each customer life-stage is a complete customer lifecycle. It is equivalent to total experience of customers; this is also the first dimension of the TCE Model.

In the following section, “Lufthansa and Total Customer Experience (TCE)“, the beginning and the end of the total customer experience will be defined and the total customer experience will be broken down into customer life-stages then subdivided into touch-point experiences.