Customer Experience - Does It Matter
Customer Experience - Does It Matter
Customer Experience - Does It Matter
net/publication/318499300
CITATIONS READS
2 2,160
2 authors, including:
Wioletta Wereda
Military University of Technology
33 PUBLICATIONS 31 CITATIONS
SEE PROFILE
Some of the authors of this publication are also working on these related projects:
The importance of knowledge and innovation in economic entities, enterprises, financial and public institutions. The impact of knowledge exchange and innovation on
the financial, business, market, strategic, etc. performance of economic entities operating in developing knowledge-based economies. Impact of knowledge exchange
and innovation on new ICT information technologies. Industry 4.0 and others on the issue of the effectiveness of business activities in the organization. View project
Program Mieszkanie Plus i prorozwojowa polityka mieszkaniowa. Program Mieszkanie Plus jako istotny czynnik reformy polityki mieszkaniowej i aktywizacji wzrostu
gospodarczego w sektorze publicznym w Polsce. View project
All content following this page was uploaded by Wioletta Wereda on 11 May 2018.
Wioletta WEREDA1
Monika GRZYBOWSKA2
The purpose of this article is to describe a role of a Customer Experience as a tool to in-
crease the sale of products or/and services provided by an organization, on the example of
Oracle Corporation. The customer experience is a mix of the physical image of the enter-
prise and the feelings and sensations evoked by it, consciously and unconsciously at every
stage of the customer contact with the enterprise and the brand at all points of the contact
(so called touch-points). A set of experiences creates the image in the mind of the customer
and at the same time the image of the brand and its values, having influence on the evalua-
tion of the activities of the firm and the brand, a tendency to go into closer relations with the
enterprise and purchasing decisions(CRM)3. In its study on the relationship between cus-
tomer experience and customer loyalty, the company Forrester Research4 found that cus-
tomers who had a positive experience were more likely to come back for another purchase,
more likely to recommend the business to a friend, and less likely to switch to a competi-
tor5. The article is a part of a series of articles on building the model of the professional
customer service and the relationship sales in the enterprise.
Keywords: Customer Experience, Customer Relationship Management, customer
value, customer loyalty, customer satisfaction
1. INTRODUCTION
A Customer Experience is a process of interactions between an organization and a cus-
tomer over the duration of their relationship. These interactions include a customer's at-
traction, awareness, discovery, cultivation, advocacy along with purchase of goods and
use of services. It is measured by an individual's experience during all points of contact
against his/her expectations6.
Customer Experience Management is a science about knowing your customers as
completely as possible. Such knowledge can create and deliver personalized experiences
that will make them not only to be loyal to the organization, but also to advertise to others
about its offer. This positive word of mouth is considered in various researches introduced
1
Wioletta Wereda, PhD, Wydział Nauk Ekonomicznych i Prawnych, Uniwersytet Przyrodniczo-Humanistyczny
w Siedlcach, ul. Żytnia 17/19, 08-110 Siedlce, weredawioletta@tlen.pl, tel. 504 128 144 (Author for corre-
spondence)
2
Monika Grzybowska, MSc, doktorantka Kolegium Gospodarki Światowej, SGH, Warszawa, moni-
ka.grzybowska@o2.pl, tel. 607 24 24 40.
3
CRM – Customer Relationship Management, more you can read in: W. Wereda, Zarządzanie relacjami
z klientem (CRM) a postępowanie nabywców na rynku usług, Difin, Warszawa 2009.
4
Forrester Reasearch, The Business Impact of Customer Experience, online document (10.12.2016),
www.forrester.com; Customer Experience Consulting (tab on the website).
5
Sift Science, ‘How Point-of-Sale Customer Experience Can Make or Break Conversion – whitepaper’
(10.12.2016), www.siftscience.com.
6
SAS Institute Inc., Customer Experience Management What It Is and Why It Matters (10.12.2016),
www.sas.com; Customer Experience Management (tab on the website).
200 W. Wereda, M. Grzybowska
by McColl-Kennedy & Smith7; Bernhardt & Kennett8 and Piercy9 as the most valuable
form of effective marketing any organization can work out.
7
J.R. McColl-Kennedy, A.K. Smith, Customer Emotions in Service Failure and Recovery Encounters [in:] W.J.
Zerbe, N.M. Ashkanasy, and C.E.J. Härtel (ed.) Research on Emotion in Organizations: Individual and Or-
ganizational Perspectives on Emotion Management and Display, UK Elsevier, Oxford 2006, pp. 237–268.
8
K.L. Bernhardt, N. Donthu and P.A. Kennett, A Longitudinal Analysis of Satisfaction and Profitability, “Jour-
nal of Business Research” 2963/98, pp. 161–171.
9
N.F. Piercy, Customer Satisfaction and the Internal Market: Marketing Our Customers to Our Employees,
“Journal of Marketing Practice: Applied Marketing” 1 (1995), pp. 22–44.
10
Capacity – Outsource Empower Grow, Customer Experience and You, 2015, www.capaciti.com.au, on-line
document (10.12.2016).
11
SAS Institute Inc., ‘Customer Experience Management...
Customer experience – does it matter? 201
response and transactional history throughout the customer life cycle, as well as customer
value, profitability and behavioural analysis12.
By analyzing traditional, structured data in conjunction with newer types of data, an
organization can:
learn how to improve the customer experience at every touch points;
understand what customers want and expect from it;
make better decisions and faster;
make it personal.
Once there is a thorough understanding of the customer, the organization can use that
knowledge to personalize every interaction. It is important to focus not only on the cus-
tomer, but also on the context in which the customer operates. By adding context to the
focus, the organization can deliver relevant, insightful offers, recommendations, advice
and service actions and thus creates again a positive customer experience13.
These days customers have more presence, power and choice than before. Therefore,
improving the interactions between business processes and customers entirely from their
perspective is a vital subject to discuss within the organization. If the organization ignores
that subject and do not provide a personal, relevant, timely and insightful service, it will
start to alienate itself from customers effecting in customers outflow.
To deliver the best value at each customer touch point and improve the Customer Ex-
perience the organization needs to map a path in the customer life cycle. Each path’s stage
is important from initial consideration, through active evaluation, to the moment of pur-
chase and even to the post-purchase procedure. And each stage is an opportunity to gain
more insight in customers’ requirements.
The another important fact about Customer Experience is gaining positive aspects of
clients` satisfaction. Customer satisfaction is variously presented in the literature for ex-
ample P. Kotler defines satisfaction as the “state felt by the body and connected with a
comparison of perceived characteristics of the product and the expectations of individuals
regarding these characteristics”14.
According to K. Mazurek-Łopacińska satisfaction is the “emotional response to the
comparative processes started by the client, consisting of the combination of their experi-
ences and feelings after consumption of a product or service with expectations, individual
standards or specific evaluation pattern”15.
The complete definition of consumer satisfaction formulated R.B. Woodruff and S.F.
Gardial, describing it as a positive or negative feeling a client in relation to the value re-
ceived as a result of use of a particular product offered in a given situation. This feeling
12
Ibidem.
13
Ibidem.
14
Cyt. za: L. Nieżurawski, B. Pawłowska, J. Witkowska, Satysfakcja klienta. Strategia – pomiar – zarządzanie.
Koncepcja wewnętrznego urynkowienia współczesnej organizacji, Wydawnictwo Naukowe Uniwersytetu Mi-
kołaja Kopernika, Toruń 2010, s. 51–52.
15
K. Mazurek-Łopacińska, Zachowania nabywców i ich konsekwencje marketingowe, PWE, Warszawa 2003,
s. 305.
202 W. Wereda, M. Grzybowska
may be a direct reaction to the use of the product or complete response to a series of situa-
tions experienced16.
Among the steps leading to the achievement of satisfaction stand out:
fulfillment – consisting in the offering by the company what the buyer needs;
value – meaning the fulfillment of the expectations of the buyer with regard to
price;
convenience – consisting of the easy availability of the product;
confidence – the confidence of the buyer as to the fact that the product is trustwor-
thy;
achieving customer satisfaction17.
The level of customer satisfaction thus depends on the actual characteristics of the
product or service, the individual characteristics of the buyer and its requirements for the
product (service), communication policy pursued by the company and previous experi-
ence of the consumer. These factors affect the perception of the product or service by the
purchaser and the shape of its expectations, and that as a result determine the level of
satisfaction18.
CX = A + R + E
16
P. Nowicki, T. Sikora, Czynniki kształtujące satysfakcję klienta oraz korzyści z pomiaru satysfakcji klienta
w procesie doskonalenia jakości [w:] Zarządzanie jakością – doskonalenie organizacji, red. T. Sikora, Wy-
dawnictwo Uniwersytetu Ekonomicznego w Krakowie, Kraków 2010, s. 204–205.
17
A. Iwanicka, Satysfakcja i jej rola w aktywności rynkowej nabywcy finalnego, „Zeszyty Naukowe Politechniki
Rzeszowskiej” 2009, nr 260, s. 57.
18
K. Mazurek-Łopacińska, op. cit., s. 308.
19
Oracle Corporation, ‘Customer Experience (CX) Metrics and Key Performance Indicators’, online leaflet,
2012 (10.12.2016).
20
Ibidem.
Customer experience – does it matter? 203
Acquisition focuses on how an organization can increase its customers’ base by gain-
ing new or additional customers. It can consist of three business challenges:
generate More Opportunities through an increase the amount of visitor and customer
traffic so that there are additional opportunities for sales transactions; organizations
benefit from having a respected brand, being visible and by creating great Customer
Experiences;
increasing Brand Equity as a key objective that builds corporate value and can influ-
ence sales and customer measurements such as increasing the average value of an
order, improving customer conversion (switching from a competitor) rates and driv-
ing higher revenues;
increase in Market Share provides companies with sustainability, growth, and pric-
ing influence; improving market share naturally leads to an overall better financial
position for companies.
Retention focuses on how organizations keep their customers to reduce outflow and to
increase their life-time value. There are three important business challenges associated
with Retention:
the first challenge is to create customer Loyalty; a customer who is loyal is one who
resists switching to another brand or doing business with another organization;
drive Advocacy is a desired result that goes beyond loyalty; in the social age, a posi-
tive word of mouth can drive a company to success. A customer who tells their
friends, family, or colleagues about how much they are satisfied by doing business
with the organization is the best advocate of all.
increasing the Share of Wallet for each customer drives higher profit; expanding
sales through expansion of sales to each customer is one of the best and most profit-
able approaches to increase revenue.
Efficiency focuses on doing the right operational activity to deliver the desired results
at a lower cost to the organization. There are also three important business challenges in
this area21:
increase Return on Invested Capital (ROIC) or Economic Value Add (EVA), both
are key measures of a company’s efficiency (increases in these areas typically indi-
cate a strengthening of the company’s financial position);
21
Ibidem.
204 W. Wereda, M. Grzybowska
the major challenge represents traditional accounting of the expenses associated with
the customer interaction and Decreasing the Cost of Operations (these expenses refer
to those costs associated with servicing the customer base either before they pur-
chase a product or after);
at most organizations, the largest cost associated with doing business is its employ-
ees (improving the productivity of this asset can go a long way toward improving the
overall impact that employees can have delivering a great customer experience22.
Each of business challenges provided above has measurements that organizations can
use to track the results in general performance. These measures inform the management if
there are any areas where the organization is currently underperforming and where im-
provements may be made, or if there are any areas of excellence that can be treated as a
perfect example for other departments and people to create positive customer experience
during mutual interactions.
22
Ibidem.
23
G. Gazzoli, H. Murat, P.B. Kim, Explaining Why Employee-Customer Orientation Influences Customers’
Perceptions of the Service Encounter, “Journal of Service Management” 2013, no. 24, pp. 382–400.
24
Ibidem.
25
M. Lee, J. Koh, Is Empowerment Really a New Concept?, “The International Journal of Human Resource
Management” 2001, no. 12, pp. 684–695.
26
G. Gazzoli, H. Murat, P.B. Kim, Explaining...
Customer experience – does it matter? 205
27
J.A. Antoncic, B. Antoncic, Employee Satisfaction, Intrapreneurship and Firm Growth: A Model, “Industrial
Management & Data Systems” 2011, no. 111, pp. 589–607.
28
E.A. Locke, The Nature and Causes of Job Satisfaction [in:] M.D. Dunnette (ed.) Handbook of Industrial and
Organizational Psychology, Chicago: Rand McNally, Chicago 1976, pp. 1297–1349.
29
S.D. Pugh, Service with a Smile : Emotional Contagion in the Service Encounter, Academy of Management
Journal” 2001, no. 44, pp. 1018–1027.
30
J.L. Heskett, T.O. Jones, G.W. Loveman, W.E. Sasser, L.A. Schlesinger, Putting the Service-Profit Chain to
Work Putting the Service-Profit Chain to Work, “Harvard Business Review” 1994, no. 72, pp. 164–174.
31
G. Gazzoli, et. al., op. cit.
32
M.K. Brady, J.J. Cronin, Customer Orientation: Effects on Customer Service Perceptions and Outcome Be-
haviors, “Journal of Service Research” 2001, no. 3, pp. 241–251.
33
Wrażenia klienta są najważniejsze, www. poradnikprzedsiebiorcy.pl (10.12.2016).
206 W. Wereda, M. Grzybowska
5. CONCLUSIONS
According to Rawson et. al an organization that is able to skilfully manage the entire
Customer Experience path obtains such rewards as: enhanced customer satisfaction, re-
duced outflow, increased revenue, higher employee satisfaction34 leading to overall posi-
tive Customer Experience.
In today’s connected, digital world, managing the Customer Experience can be even
more critical in gaining a competitive advantage than ever. The Internet has enabled a new
era of transparency, empowering consumers to instantly share their experiences with other
users around the world. Today, transforming Customer Experience into an advantage
requires taking the service well beyond just customer service. It requires engaging in
continuous dialogue with customers, distributing feedback and insights throughout the
business, empowering employees to take action, and innovating in response to create an
excellent Customer Experience. The companies that can develop these capabilities will be
able to drive a real financial impact35.
REFERENCES
[1] Antoncic J.A., Antoncic B., Employee Satisfaction, Intrapreneurship and Firm Growth: A
Model, “Industrial Management & Data Systems” 2011, no. 111.
[2] Bernhardt K.L., Donthu N. and Kennett P.A., A Longitudinal Analysis of Satisfaction and
Profitability, “Journal of Business Research” 2963/98.
[3] Brady M.K., Cronin J.J., Customer Orientation: Effects on Customer Service Perceptions and
Outcome Behaviors, “Journal of Service Research” 2001, no. 3.
[4] Capacity – Outsource Empower Grow, Customer Experience and You, 2015,
www.capaciti.com.au, online document (10.12.2016).
[5] Forrester Reasearch, ‘The Business Impact of Customer Experience’, on-line document
(10.12.2016), www.forrester.com; Customer Experience Consulting (tab on the website).
[6] Gazzoli G., Murat H., Kim P.B., Explaining Why Employee-Customer Orientation Influences
Customers’ Perceptions of the Service Encounter, “Journal of Service Management” 2013, no. 24.
[7] Heskett J.L., Jones T.O., Loveman G.W., Sasser W.E., Schlesinger L.A., Putting the Service-
Profit Chain to Work Putting the Service-Profit Chain to Work, “Harvard Business Review”
1994, no. 72.
[8] Iwanicka A., Satysfakcja i jej rola w aktywności rynkowej nabywcy finalnego, „Zeszyty Na-
ukowe Politechniki Rzeszowskiej” 2009, nr 260.
[9] Lee M., Koh J., Is Empowerment Really a New Concept?, “The International Journal of Hu-
man Resource Management” 2001, no. 12.
[10] Locke E.A., The Nature and Causes of Job Satisfaction [in:] Handbook of Industrial and
Organizational Psychology, ed. M.D. Dunnette, Rand McNally, Chicago 1976.
[11] Mazurek-Łopacińska K., Zachowania nabywców i ich konsekwencje marketingowe, PWE,
Warszawa 2003.
[12] McColl-Kennedy J.R., Smith A.K., Customer Emotions in Service Failure and Recovery
Encounters [in:] Research on Emotion in Organizations: Individual and Organizational Per-
spectives on Emotion Management and Display, ed. W.J. Zerbe, N.M. Ashkanasy, C.E.J.
Härtel, UK Elsevier, Oxford 2006.
34
A. Rawson, E. Duncan, C. Jones, The Truth About Customer Experience, “Harvard Business Review” 2013,
no. 9, www.hbr.com (10.12.2016).
35
Operationalizing experience management in the age of the customer the future of sustainable advantage,
online document, www.medallia.com (10.12.2016).
Customer experience – does it matter? 207
[13] Nieżurawski L., Pawłowska B., Witkowska J., Satysfakcja klienta. Strategia – pomiar – za-
rządzanie. Koncepcja wewnętrznego urynkowienia współczesnej organizacji, Wydawnictwo
Naukowe Uniwersytetu Mikołaja Kopernika, Toruń 2010.
[14] Nowicki P., Sikora T., Czynniki kształtujące satysfakcję klienta oraz korzyści z pomiaru satys-
fakcji klienta w procesie doskonalenia jakości [w:] Zarządzanie jakością – doskonalenie organi-
zacji, red. T. Sikora, Wydawnictwo Uniwersytetu Ekonomicznego w Krakowie, Kraków 2010.
[15] Operationalizing experience management in the age of the customer the future of sustainable
advantage, online document, www.medallia.com (10.12.2016).
[16] Oracle Corporation, ‘Customer Experience (CX) Metrics and Key Performance Indicators’,
online leaflet, 2012 (10.12.2016).
[17] Piercy N.F., Customer Satisfaction and the Internal Market: Marketing Our Customers to Our
Employees, “Journal of Marketing Practice: Applied Marketing” 1995.
[18] Pugh S.D., Service with a Smile: Emotional Contagion in the Service Encounter, Academy of
Management Journal” 2001, no. 44.
[19] Rawson A., Duncan E., Jones C., The Truth About Customer Experience, “Harvard Business
Review” 2013, no. 9, www.hbr.com (10.12.2016).
[20] SAS Institute Inc., Customer Experience Management What It Is and Why It Matters
(10.12.2016), www.sas.com; Customer Experience Management (tab on the website).
[21] Sift Science, ‘How Point-of-Sale Customer Experience Can Make or Break Conversion –
whitepaper’ (10.12.2016), www.siftscience.com.
[22] Wereda W., Zarządzanie relacjami z klientem (CRM) a postępowanie nabywców na rynku
usług, Difin, Warszawa 2009.
[23] Wrażenia klienta są najważniejsze, www. poradnikprzedsiebiorcy.pl (10.12.2016).
DOI: 10.7862/rz.2016.mmr.35