Customer Experience Management (CEM) is the airline management buzzword of the year. After decades of cost-cutting, airlines discovered that customers are still willing to pay the extra $ or € if they get value for money.
Years after other service industries found out that customers not only valueWHAT they get, but also HOW they “live” the service consumption process, airlines, for too long still obfuscated with the low-cost threat, finally jumped on the CEM bandwagon, too. Many are doing it in a hurry, quickly reassigning marketing managers to a brand new “VP Customer Experience” position, without recognizing the strategic function of this role.
Not surprisingly, the results are mixed, at best. What’s going wrong?
CEM itself is becoming a commodity. In many organizations, the project gets waved through in a “same dog, different collar” manner.
But CEM is about synchronizing a company’s core value propositions (decided by the owners, board or –very– senior management) with the execution of its marketing strategy and corresponding brand and value promises (developed by C-level executives) and the actual operation that delivers the valued service (implying the whole chain of command from C-level, over middle management to supervisors and front line employees) and that creates the final customer perception of the value received in the commercial transaction.
This is the sum actual and pre-conceived perceptions of the actual service delivery, the communicated brand promises and third party influences, such as opinions from friends or in the Social Media space. If the value perception of the service received exceeds theexpectations created by direct or indirect promises, the value for the customer is positive. If it is too positive, the company looses revenue potential, if it is negative, the company risks losing a customer, wallet share or a “recommender”.
No company can mobilize the revenue and incremental profit potential that CEM offers by just acting on the operational or the marketing side nor by improvising new CEM positions buried somewhere in the company’s org chart
From our experience at avionline consulting, there are two corporate scenarios in which CEM really delivers the promises created by the buzz:
1) The CEO is deeply enrooted in a customer-value-creation mindset. Founder personalities frequently fall in this category because they created a company to serve a specific customer need. They adore their customers not as cash cows, but as real people they genuinely like to serve.
2) The company is transparently driven by financial goals. The CEO’s position depends on exceeding investor expectations. Some of these CFO-CEOs understand the full chain of creating value for the customer, leading the company’s CEM based change strategy.
Both scenarios are a good basis for developing a successful, value creation based Customer Experience strategy when the following key factors are taken into account:
1) You CAN do it with external consultants or create an internal position, or both.
2) You CANNOT do it without active support from the company’s top leadership.
3) You CANNOT activate CEM’s incremental profit potential without considering it a comprehensive change strategy that requires a really senior leader personality, either a consultant or an executive, ideally reporting to the CEO.
4) Despite common believe, the “career path” that leads to CEM is not typically related to marketing. CEM will benefit from a “clean sheet” approach. It is good to put brand promises into a dialectic customer experience context.
With the proliferation of undifferentiated CEM initiatives, at avionline (the airline and travel industry “CEM” consultancy I co-founded several years ago) we have decided to “rebrand” CEM to CEL – Customer Experience Leadership. Management alone is not enough to obtain the organizational changes required to convert the experienceelement of the service value chain into a sizable financial advantage.
Of course, Boutique consulting firms like avionline must be innovative to compete with the “big guys”. But this one is not just a new name for marketing reasons. CEL digs much deeper than CEM. Stay tuned – our thought leadership team is preparing some ambitious and potentially highly profitable, innovative proposals for the airline industry.
Welcome to the world of CEL!