Thanks.

In twelve days we will graduate.  Pending our grade in this independent study, of course.  (Have we mentioned how much we value our Professors?  They are utterly fantastic!)  We sought out this independent study after, as we noted in our first blog post, having “fallen in love with an emerging idea that fuses the ideals of consulting with the analytics of operations, all the while focusing on the consumer.  In all, we have found, hope to define, and ultimately build our careers around: The Customer Experience.”

Since our first post, we have both become more conscientious consumers and more analytical customers.  We both find ourselves standing in lines at stores thinking “this experience would be better if the execution was better,” and mentally redesigning the processes that seem inefficient or to be causing the bottleneck.  We sat at a food court together, enjoying a falafel and a subway sandwich, geeking out about how we mutually agree that service recovery is the MOST important part of customer service and the entirety of a customer experience.  “A service could be amazing,” we contend.  “If it goes wrong, however, and the fix is non-existent, the whole experience is blown.  By the way – are you going to finish those chips?”

All in all, the blogging experience was refreshing, though not without drawbacks.  In an exciting, yet limiting way, committing to such a small piece of writing was difficult as each sentence, phrase, or idea opened up new avenues to explore.  With a smaller venue for our thoughts, however, and less of an idea of how to structure continuous, yet abridged, thoughts, we had to limit the depth of our exploration and move on to new breadth.  In order to stay in a linear fashion with our research, we both wrote offline so as to focus on logically sequencing our thoughts.  This made it harder for our smaller posts to be indicative of the depth of research that we actually sought out.

On the flip side, however (as Safi always asks us to consider), the smaller posts forced these two generally long-winded writers to condense our points and get across in 500 words what we might have used 1500 to, in the past.  As we now head out into the world of corporate emails and to-the-point executive summaries, this is a great pilot program for our real world lives.

The bottom line is, with some added professorial structure, we both feel that blogging can be a viable platform for sharing articles, contentions, and overarching ideas between professors and students.  If we had a longer timeline we both think that it would have been fun to have “guest posts” by both professors and potentially other experts in the field.  Looking long-term, I think we both feel that we’d like to keep this up even if our posts become more sporadic.

Our mutually favorite moment of the class was the session we spent discussing two agreed upon articles one afternoon in April with our professors.  We all allowed the conversation to wander and ended up delving into seriously interesting topics.  An afternoon to freely think with great minds is one of the greatest gifts of an MBA program.

And so we thank you – Safi and Kay – for allowing us to blog for a semester every now and then.  But we thank you more for giving us the opportunity to THINK; to take the time to analyze an everyday situation and leave our mark on it in this safe space.  To get to the heart of an issue by scouring the internet and asking our friends and family about seemingly inane moments of their service-based lives.  For getting excited about reading case studies… for FUN… for once, instead of for “work.”  We specifically sought you out for the knowledge and experience that you have to share and we were not disappointed.  Ultimately, our roles as “customers” and our views of “experiences” have been forever changed.  We could not be more grateful.

Ali & Amy

Auto Insurance Customer Acquisition

by Amy

In deciding what industry to focus on for the duration of this semester, I lit upon the insurance industry, specifically auto insurance. Insurance fascinates me for several reasons, the most prevalent being that this is a service consumers purchase in the hopes of never having to actually use it. In most cases of auto insurance use, the customer is under duress. Therefore, the delivery of the service and the customer experience is of the utmost importance in the claims process. A satisfied customer might stay with the company forever after a single great experience. A bad experience, however, may well lead to a permanent customer defection. Even more interesting to me than the claims process, however, is the customer acquisition process.

In general, customers do not have the opportunity to try and insurance company’s service before committing to a policy. Thus, how the customer experiences the insurance purchasing process greatly impacts a customer’s decision to purchase. Insurance companies must take great care to design the pre- and during purchase process to emulate the level of service the customer can expect in the event that an insurance claim is made. I am planning to explore HOW insurance companies may design these processes to facilitate customer acquisition.

The Homerun

by Amy

Today I had a customer experience that is worth noting, as efficient and customer-centric operating/payment systems will (I believe) result in higher revenues for the town of Brookline, Massachusetts.

Generally, I pull up to a parking meter, calculate my estimated need for the spot and cross reference that with the number of quarters I have available. From there, I judge the amount of risk I am willing to assume – how often I judge the meters to be monitored, the likelihood that I will overstay my meter time, the amount I assume I will have to pay if I do receive a ticket. I subsequently check the time compulsively, counting down the minutes until the meter expires or I have to reload, through dinner, an appointment, a job interview, etc. It can be nerve wracking, but is just a way of life in the Boston area.

Yesterday, I paid for my parking meter with my credit card, rather than with the quarters I so diligently collect and stash in my car. I paid the maximum amount ($2 for 2 hours), even though I only anticipated parking for an hour. No risk assessment, just a negligible $2 spent and seemingly all the time in the world in the parking spot. What a luxury.

So why did I feel like I had won the lottery, knowingly and gladly overpaying for the use of this parking spot? For me, it came down to the perception of value, AND the perception of value of the payment method. Two dollars on a credit card is a drop in the bucket, and hardly nudges the needle. However, eight quarters would put a serious dent in my stash of parking change. I couldn’t possibly collect eight quarters in a day, so spending eight quarters in a day seems beyond extravagant. But $2…well, I don’t think twice about spending $2.

So, you say, I overpaid by $1. Not exactly millions. If I had not overpaid and overstayed, Brookline might have earned an additional $25 from me by issuing a parking ticket. But the cost of that ticket to Brookline renders the dollar amount almost null. Brookline employs the meter maid, buys the parking ticket books, pays the data entry employees, incurs processing costs, and potentially deploys man hours to track me down if I don’t send in my payment. That starts to add up. A dollar less credit card fees sounds like free money for the bottom line compared to issuing a ticket.

So kudos to you, Brookline! I will forever overpay for my parking spots since you offer the payment system that provides the most value to me, your customer. I will save my quarters and continue to underpay the meters in Newton. And I will visit Brookline more often.

Starbucks – The Stars Delight!

By Ali

I’m probably a bit late to the party, but I recently downloaded the Starbucks app for my phone.  I was cleaning my room and found an old gift card so figured I would register it online to see if there was any money left.  Once at the My Starbucks Rewards site, I found that there was $3 on my card.  Thrilled about the half of a grande-nonfat-caramel-macchiato that this would finance (MBA student, full time – $3 is gold), I decided to download the app so that I would not have to carry around the card and inevitably lose it/forget about it.  Lo and behold, once I signed into the app with my email on my phone, an image of the exact card in my possession was on the screen.  “Happy Birthday!” the card image read.  Apparently every future purchase would now be a celebratory event!

At this point, I was subconsciously experiencing an emotion classified as “customer delight”.  As defined by Oliver, Rust, and Varki in 1997, customer delight is a “profoundly positive emotional state generally resulting from having one’s expectations exceeded to a surprising degree.”  Apparently there are debates as to whether a surprising degree plays a meaningful role in delight which we can discuss in future posts.  Nonetheless, the more I read the more I’m realizing that delight is starting to prove more of a profit driver than customer satisfaction – a metric currently touted as the gateway to lifetime loyalty.

Personally, I find this to be true.  Starbucks satisfies me almost 100% of the time.  They give me free wi-fi all day.  They fix my order with a smile on their face if something went wrong.  I qualify “it” the company as a “they” because “they” make me feel like they know me, that I’m in my own living room versus just making a transaction.  The downside is of course that coffee from Starbucks is expensive for the everyday, especially when I have my own espresso machine at home.  As a result, the $85 per month Starbucks habit I used to have has dissolved into a “special occasion”, “running late”, or “treat” experience a few times a month.

But I digress.  The surprising delight that my gift-card-phone provided led me to Starbucks and my next customer experience realization.  I decided to cash in my $3 total and the surprising $5 reward Starbucks gifted to me for registering my card and downloading the app.  It was early in the morning (10am – early for a grad student) and I knew that I would be suckered into a bacon gouda breakfast sandwich.  This would total more than the $8 on my gift-card-phone.  So, while waiting in line, I quickly typed in my VISA card number, added $25 to my account, and upon reaching the counter three customers later had to simply swipe my phone, and walk away.  In actuality, I stood there waiting for… something?  A receipt?  A souvenir?  The pleasant barista informed me gently that there was nothing else I needed to do and could wait for my drink in the usual spot.  Wow.  Easy.  Delightful.

The adventure does not end there, however.  For every transaction at Starbucks I receive a gold star that animatedly drops into my digital cup.  Surprise!! Another coffee, another star.  If I turn my phone, and therefore the cup, upside down, the stars spill out.  Turn it right side up, they come flying back in, bouncing off one another.  Only three more and I reach the green level!  What is the green level?  I don’t know!  Do I care?  NO!  Why not?  Because my phone will buy me Starbucks and give me stars.  Buying coffee has now become a game.  Even more, the cash I have added to my account on my phone has largely lost its monetary meaning.  It is no longer money that I have.  It is now money of mine that Starbucks has that I can play with.  In a sense, one could call this the ante to the star game.

Since anteing up, I have visited Starbucks three more times than I usually would, grossing Starbucks an extra $24.21 in March.  This delighted customer, in the past simply satisfied, has altered her behavior.  I even received a surprise birthday reward on April 6^th (Happy 28^th to me!) and it prompted my visit this morning to pen/type this blog post.  My real interest is what happens next.  I’m convinced that the longevity of this change will depend on what happens when I get to green.  Two stars to go.  The “new” is, I’ll have to admit, wearing off.  But the initial surprise did bring me back.  For that, and the caramel in my macchiato, I am delighted.

___________________________

Oliver, Richard L.; Rust, Roland T.; Varki, Sajeev.  “Customer delight: foundations, findings, and managerial insight.” Journal of Retailing.  September 22, 1997. 

Renting a Car at SeaTac – A Wonderful Experience

By Ali

My oldest friend in the world and her husband had their first baby in November 2012.  Naturally, I booked a trip to Seattle to meet the little guy.  They live about two and a half hours north of Seattle and so I would be renting a car for the weekend.  Though I was born in Massachusetts, Seattle is where I grew up and as my family no longer resides in the city, the Seattle Tacoma Airport (SeaTac) feels like home every time I pass through.  This was no exception.  I was, however, greeted with a treat upon this adventure.

My flight arrived in the early evening.  After six hours I was ready to stretch my legs.  As Seattle was home, I was not practiced at renting a car and so was unsure where to go.  My rental car memories at various locations consist of sitting for long periods of time with the bags and my younger siblings as my parents dealt with whatever counter had invariably run out of cars big enough for our crew of five and our (over-packed) luggage.  Though it was just me and two small bags this time, I was still not looking forward to the transaction.  I had reserved ahead with Enterprise and followed the signs dutifully to the rental car area.  What I found was a shuttle that would take me to the off-site location.  I was slightly confused that the shuttle was for ALL of the rental car companies and almost missed it, looking for a green, Enterprise specific ride.  I sat on the very quiet, seemingly eco-friendly bus and waited for the frustrating experience to begin, hoping I wouldn’t lose too much time before getting on the road.

What greeted me was one of the most memorable customer experiences of my life.  I was delivered to a huge, five-story, shining, state of the art building.  Surely this is not just for me and my rental car, I mused.  Even if it was, Enterprise must be buried in a maze somewhere inside.  As I was about to exit the shuttle a horizontal, brightly colored sign above the door lit up and caught my eye, showing me very clearly that Enterprise was located in the center of a line of desks I would easily find upon entering the building.   Still slightly wary, I walked through the center doors and my jaw dropped.  In front of me were a bank of desks, branded for every rental car company I had ever heard of, and several I had not.  Looking to my left and my right, the desks seemed to go on forever – shiny, easy to spot, with low hanging, clearly labeled signs and plenty of room for families to wait while business is conducted.  I walked, with my jaw still hanging, straight ahead to the Enterprise desk where I was greeted with such cheer and customer service that I felt like a VIP.

The man at the desk took care of my reservation at lightning speed, didn’t pressure me with extra insurance, and gave me clear directions to the Enterprise level of the garage.  “Walk to the end of the desks, through the door, and down to the second floor.  An Enterprise employee will greet you as you come off the escalator,” he promised.  I walked in a daze through the glass doors and saw clearly that, indeed, Enterprise was on the second floor (its brand was located at the top of the escalator, during the ride, and on the actual second floor – all to alert me of its location).

Stepping off of the two-story escalator, an Enterprise-jacket wearing employee greeted me holding an iPad, called me by my name, shook my hand, and directed me to a bank of vehicles to choose from.  Though he (obviously) attempted to up-sell me (who can fault him), I chose a fantastic VW Beetle Sport in black, signed the iPad contract, hopped in, and was on my way.  I exited by handing the man at the gate my pink form and was out of the establishment and on my way.  This whole interaction took eleven minutes.  ELEVEN!  To RENT a CAR!  Amazing!

Beyond Philosophy published an article that caught my attention entitled, “Jump-starting Your Customer Experience Strategy” by Chief Operating and Consulting Officer Qaalfa Dibeehi.  Viewing this $400 million rental car hub through the lens of Dibeehi’s perspective, strategically SeaTac seemed to take a hybrid approach of an outside in and inside out customer experience strategy.  An outside in approach would have focused solely on customer needs first and then acted upon by the company.  An inside out approach would have been designed by the business and then rolled out to customers.

Outside In:  Though I could not find secondary data about any customer interviews or focus groups, it is clear that once I arrived at the facility, I was the superstar in the process.  I have never felt more attended to.  The map on the bus got me ready for my arrival.  The clear signage outside and inside the building led me directly to the desk.  The one and two story escalators and their very clear, stacked signage in order of the actual floors got me to my destination quickly and accurately.  The iPad with all of my information, my signed contract, and my emailed receipt cut down on transaction time.  This time savings was largely due to the mobility of the iPad and the Enterprise rep.  All of my business was conducted as we walked to my car.  Believe me, it still makes me chuckle that renting a car made my whole day (until I met my four year old pseudo-nephew, that is).

Inside Out: Not only does this make customers’ lives easier, but it is more environmentally friendly, clears up congestion at the airport, and offers more on-site parking for travelers.  As SeaTac deals with 32 million passengers annually – 20% of whom will rent a car – this investment 14 years in the making will definitely pay off.  Most importantly, it will not bring any burden to locals who will most likely not use the facility, further extending the realm of this customer experience to non-customers.  New legislation allows for SeaTac to charge a $6/day fee for rental cars which will help to pay back the 30-year bonds used to finance the project instead of taxing locals.

This hybrid approach has anchored this facility, and SeaTac Airport as a whole, within the “Enlightened” to “Natural” realms of Dibeehi’s “Naïve to Natural Model”.  As an extremely satisfied customer, I am certain that the company took my emotions into account when planning this journey and, as a result, made my own journey that much better.

*All images are not my own and are linked to their original content.  Thank you for the insight!  

End to End Customers = End to End Process

By Ali

I believe that synonymous with the experience of a customer is the actual end to end process of being a customer from the company’s perspective.  The process is what the company controls and is what ultimately delivers the very individualized experience to the customer.  This is not a new sentiment.  What has changed is that the timeline of a customer has been drastically altered.  Technology allows customers to consume product, brand, and company information long before any actual interaction.  That same technology provides a megaphone to that same customer during, after, and way after their interaction, initial purchase, or repeat purchases.  The difference today is that customers must now be part of the process and tasked in that customer role as a specific player.

I am always a consumer.  At a hospital, however, I am a patient.  On iTunes I am a listener.  On Amazon and Yelp I am a reviewer.  I wonder if these different titles empower me as a consumer, simply make me feel part of a community, or tie me to that very specific community as a card-carrying member, of sorts.  Over time I wonder if we will suffer from too many memberships?  Will we have too many emails in our inbox alerting us of the latest sales?  Will we end up with customer or membership fatigue?  Where is the balance between being part of the process and suffocated by the process?  What about those experiences that are purposefully limited such as renting a car?  I personally hope that I won’t need to rent a car at an airport an inordinate amount of times but if I do, I surely hope it will be at the Seattle Tacoma International Airport due to a lasting, fantastic customer experience I encountered in November 2012.

Emotionally, customers will have to parse their personal level of involvement now that the back and forth between customers and companies can be immediate and at any location due to the prevalence of smart phones.  In the interim, however, this extended reach has afforded companies labor efficienciesas apps take over jobs but provide greater visibility and interaction to customers.  Personally, I religiously use my Starbucks app to gamify my coffee drinking, speed up my ski day in Stowe, VT with my RFID chipped ski pass, reloading it on my smartphone while waiting in the lift line, and choose an entertaining skin for my Domino’s Pizza Tracker.

Do I 100% believe that the Pizza Tracker follows my actual pizza’s progress?  Not necessarily.  I do know that once the tracker says “out for delivery” that I have, on average, about six minutes until it arrives so there must be some truth.  The important part of this emotion, however, is that I don’t really care about the specific location of my pizza within the supply-chain of crust, sauce, cheese, pepperoni, oven, hot packet, vehicle, and my home.  What does matter is that I become part of the process of my pizza and am entertained in the famished duration.

I am excited to continue to delve into these ideas and see how technology is changing the experience of customers and the companies with which they align their lives.

Exploring the Customer Experience Frontier

by Amy

Several years ago, I realized that in watching television and reading magazines, I often enjoyed the ads just as much as the content. As a psychology undergrad, I joined the “how” and “why” of people’s thoughts and behaviors to these advertisements, and began to think about who exactly was the target of a good or service. After working in hospitality, as an entrepreneur, and in marketing, I noted my fascination with how consumers experience different aspects of a business or brand. Additionally, I realized that some of my most loved brands were not necessarily delivering a consistent message through every channel. The magazine ads were well-designed and witty, while the website was confusing and boring. The Facebook page outlined a great conversation between customers and the brand, but it was impossible to get a human customer service rep on the phone. This led, during my business studies, to the question of how operational management influences the customer experience, and whether consistency can be achieved by changing the way a firm operates.

It seems to me that the way businesses operate is evolving. Gone are the days of unlimited resources and unnecessary head-counts. There is a move toward more cross-functional business structures, rather than purely siloed business units. Resources are shared across departments, and the notion of collaboration and communication is rising as a priority. In this continually globalized world, customers have a limitless number of competitors to chose from for any good or service. Firms are competing to differentiate themselves based on brand image and the level of service provided to customers. With the advent and maturing of social media and improvement of online capabilities, brands are no longer experienced singularly as a product or service, but through every outlet available. Consumers are able to laud or lambast a brand experience to a seemingly endless audience, shifting the power balance to the customer in the brand-customer relationship. Thus, the customer experience has become of the utmost importance in both retaining happy and acquiring new customers.

Aligning these business and customer experience trends flips the focus of business operations from an internal to an external perspective. The firm designs a best in class customer experience, and arranges operations and resources rather than determining an internally efficient use of resources and offering the resulting customer experience. Seemingly, it’s time for companies to buck the status quo. Are firms embracing this challenge?

There are different implications here for B2B (business to business) and B2C (business to consumer) firms, but those differentiations will have to be left to a later post, once we’ve explored existing trains of thought.

While I have a lot to learn on the subject – hey, that’s why we’re here! – I think that this Customer Experience movement will take hold. I see the potential, when executed well, for companies to provide a superior experience through all consumer touchpoints, while simultaneously reducing operating costs and positively impacting the bottom line. Hence, the Return On Customer Experience would be quantifiably and financially realized. My goal is to learn more about this, and hopefully share some best practices and success stories from companies on the Customer Experience frontier.

Two MBA Students. Two Professors. One semester.

Business school began as a career-switching endeavor for both of us.  Amy was coming from a world of hospitality and production marketing in the mountains of Jackson Hole with an eye toward consulting.  Ali drove away from LA and animation towards operational efficiency and process design.  Today, after countless study sessions, midterms and finals, networking events, all-nighters, and fantastically stressful presentations, we are staring down our final semester.  In a wondrous turn of events, we not only found one another, but we have fallen in love with an emerging idea that fuses the ideals of consulting with the analytics of operations, all the while focusing on the consumer.  In all, we have found, hope to define, and ultimately build our careers around: The Customer Experience.

As we have meandered through our courses with vigor, two statements have rung clear:  “The lifetime customer is your most important asset,” and “Increase the bottom line.”  Making both of these ideas top priority can often turn into a tug-of-war between the, at times, partisan Marketing and Operations.  What’s more, the ability to successfully flip from an internal, company vantage point to a customer vantage point, and translate those findings into a viable customer experience is unique.  Technology furthers this hurdle as customers are increasingly knowledgeable about products and services before they make any real contact with a company.

To get a handle on current ideas in the blog and business world as well as draw our own conclusions and career aspirations, we have enlisted two of our professors from The Carroll School of Management at Boston College, Professor Lemon and Professor Safizadeh, to guide us through a directed study.  In three phases, our course will give us all an opportunity to understand the broad state of customer experience initiatives, ultimately target a specific industry, company, or customer market, and determine in that space what has worked and what could be improved in the area of customer experience.

We are thrilled to be taking this journey.  Enjoy the ride with us!
Ali & Amy