The experience advantage
Customer experience? It’s everything these days
Customer experience is what makes or breaks brands. It is no longer simply enough to provide a good product or service – consumers want a great experience with it, and the better the experience, the more value commanded by a brand. In many ways the importance of experience now dwarfs everything else.
In the digital era of the last decade, ushered in by smartphones, the consumer journey has become exponentially more complex. It will become even more complicated as AR, VR and AI gain traction with brands, and become familiar to people. Technology may have simplified and improved much of our lives, but it also means people are bombarded with more brand and advertising messages than ever before. Which means brands compete not only for share of wallet, but also for share of headspace. Yet we also know that many brands are failing to deliver consistent, relevant experiences in this complex new world.
33% of consumers globally report an inconsistent quality of experience across online and offline touchpoints
SOURCE: CONNECTED LIFE, KANTAR TNS
An aspirational shift from accumulation to access
The value of experiences in people’s lives has never been greater. From the “conspicuous consumption” of previous decades, there is now a greater emphasis on lifestyle and experiences – and this is where growth and value are to be found. A 10-year longitudinal analysis of BrandZ data by Kantar Millward Brown found that brands high in Experience Capital outperformed the market by up to 188%, while brands with low Experience Capital declined in value.
People are spending more on experiences, partly due to the commoditisation of products and services, but mostly because of an aspirational shift from accumulation to access, or from owning things to hiring things as needed. What people want from brands (and therefore what they are spending more of their money on) is the experience, so marketers must find ways to turn goods into experiences, and to find new sources of value to meet growing experiential competition.
Customer experience is more than digital
One of the paradoxes of digital is that more digital has meant more demand for all things human and analog. Sales of LPs and printed books are up. Urban greenways are the new byways. There are even digital apps and tools to help people cut back on digital.
Digital is not slowing down, but analog and human scale are picking up as people demand experiences that are deeper, more engaging and more meaningful.
As never before, the customer experience is the centre of everything, whether it’s shopping, lifestyles or digital. The imperative for brands is as simple and as difficult as one clarifying idea: put the customer first by focusing first on the customer experience.