Whoa! Back up! What's customer experience management? Why should I care?

It might seem intuitive that you'd want to manage a customer's experience. If you're a caring business person, you want to make your customer's happy. Right?

Well -- not so fast. Good business management is about managing tradeoffs, because we generally don't have unlimited budget (unless you're Microsoft, and even their unlimited budget doesn't mean they're impervious to business tradeoffs). A couple of points:

1. Experiences matter. Sometimes more than anything else you do. Wal-Mart's got the largest civilian satellite system in the world. They've got a great supply chain. They are among the best in the world for managing the products on their shelves. But they got booted out of Germany -- in large part because they failed at customer experience management.

2. You can't make everyone maximally happy. You just don't have the money.

3. You don't WANT to make everyone maximally happy, because you won't be remembered for what makes you different.

Put those three together, and you'll see that the following conclusion is pretty darn inevitable:

Managing customer experiences is a critical part of being understood by your market, and of making your brand memorable, different and competitive.

Add to this the following truism: Satisfaction is what results when experience exceed expectation. Since your marketing department is getting really good at raising expectation (isn't it?), then you are in a pickle if you cannot manage experiences as well. In short, if you grant that marketing should be a core competency, then customer experience management should be a core competency.

Now, in the new book It's All About CEM, I define the customer experience as the provisional disposition customer's have about our company (or product, or brand). It's provisional because they can change their minds based on their next experience with you. And it's a disposition because the experience itself is less important than how it is remembered and assessed. So, when designing experiences, you've got to know a lot about consumer psychology in order to create a memorable experience.

We'll go into that in a later posting, but I wanted to lay out the basic definition of customer experience, and the basic case for customer experience management as a necessary -- and under-appreciated! -- core competency.

Gotta run, Wal-Mart is calling ... :)