With increasing competitiveness, how will companies meet the needs of consumers? This is their great challenge today. And it is a fact that, in today’s economy, these consumers are looking for meaningful experiences in pursuit of a purpose when buying their products. In this book, the authors observe and define strategies for creating such experiences. Using examples from successful companies and defining practical actions on how to achieve these experiences, the book goes deeper into the subject and explains how you can deliver value to your customer. Learn how to integrate your business and get all departments or industries working together. All this so that you generate valuable experiences in your products and services, and thus achieve your goals.
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The change in consumer focus
The term “experience” has spread in the business world over the past decade. It emerged reflecting a recognition that consumers identify with their products and services in ways that exceed the functional values that are offered.
Marketing in the 20th century moved from the masses to the specific niches. In the late nineteenth and early twentieth century, entrepreneurs focused on price and function, with little differentiation of products. With the increase of competitiveness, a variety of products came to be offered, which generated consumer demand for choice. Innovation was focused on creating variations and extensions of products. Businesses were struggling to understand what motivates consumers to choose one product over another – using psychologists, sociologists, and anthropologists.
In the 1950s, companies began investing in brand recognition, in advertising and marketing, to increase consumer awareness. Consumers bought what their neighbors bought. In the 1970s and 1980s markets began to segment, children no longer bought what their parents bought. Marketing started asking “how can we do what people want?”
Marketing has reoriented by the 4 “P’s” – product, price, square and promotion, creating identities for products for the growing niches.
By the end of the 20th century, choices were more often made emotionally, rather than rationally. The focus was no longer on price and function. Innovation had expanded beyond the creators of the products, to the marketers who developed the brands and to the designers who added value to the products. The innovation team was now multidisciplinary, and often included tension and friction, with one discipline standing out from the others.
However, some companies began to develop experiences that demonstrated clear benefits and gained market share. Starbucks created an experience that was worth the highest price of coffee, Southwest Airlines created an experience that made up for the inconvenience of not having reserved seats. And that has raised customer expectations for more meaningful experiences with products and services. All members of the innovation team of a business need to work together to deliver a successful, especially meaningful experience.
Mature economies like Japan, most of Europe and the United States are experiencing an increasing desire of the population for meaningful experiences in their lives. People look for this purpose in non-traditional areas such as the products or services they consume. Addressing this need for a purpose has become the new challenge of innovation.
The late 20th and early 21st century will be seen as a time when a business has focused on its processes, with the goal of providing its customers with meaningful experiences.
The value of purposes
Consumer experience is a commitment delivered through a series of integrated contact points – Product, packaging, message and customer service, for example. The goal of designing the experience is to be consistent in the value proposition at each point of contact with the consumer. Experience design involves placing the client in a coordinated environment at all points of contact. But this project should also make these valuable points for the customer to connect with them and integrate them into their lives and workflows.
The definition of purpose here is of connotation, importance, or value. Products and services can create a purpose with positive or negative connotations, importance or value.
We need a purpose to interpret the world around us and to help us decide how to act. Purpose gives us a framework for assessing what we value, believe, and desire. The purpose has its roots in ancient civilizations. Symbols, languages, and artifacts are used to convey and share purposes. A shared purpose has the power to shape and control people’s lives, and that expands to religions, government systems, and cultures.
In this age of travel, technology, and information, we have the tools to customize the purpose in our lives. Every decision we make is a building block, to architect our purpose. And that’s what significant consumption means.
Know the universal purposes
The list of purposes below has been drawn from interviews with more than 100,000 people, and these purposes appear to be universal among people’s values:
# 1: Achievement – achieve goals and make something of yourself, a sense of status.
# 2: Beauty – Brighter hair, whiter teeth, many industries were created based on these purposes.
# 3: Creation – The sense that you produced something new or original, this sense popularized the customization of products.
# 4: Community – A sense of unity or connection to the people around us.
# 5: Duty – A sense of responsibility.
# 6: Enlightenment – The call for logic or inspiration.
# 7: Freedom – The sense of living without unwanted restrictions.
# 8: Harmony – The balanced relationship with the whole, with nature, society and work.
# 9: Justice – A sense of fairness and equality.
# 10: Unity – Unity with the things around us.
# 11: Redemption – Atonement or forgiveness of past mistakes.
# 12: Safety – The freedom not to worry about the loss.
# 13: Truth – A commitment to honesty and integrity.
# 14: Validation – A sense of value and respect.
# 15: Admiration – Fear in the presence of something that has no explanation.
This list is not exhaustive; it represents a list of purposes that are global.
The company’s innovation culture
To create meaningful experiences for a customer, you need the support of the entire company. And to be successful, a company needs to integrate the purpose not only into its development process but also into every point of contact with the customer. The starting point for any corporation is to understand what its kind of innovation culture is.
For some, it may seem like the company has no innovation, but it is not always the case. There are three basic cultures of innovation that are used in 80% of corporations:
The innovation culture of experience
Innovation is the result of a formal process.
Leadership is shared between management, R & D, and technology departments.
Collaboration between functions is not emphasized.
Analytical assessments are used.
Most innovations are iterative, and risk is minimized.
18% of companies use this form of innovation.
The culture of creative innovation
“Big ideas” inspire most innovation initiatives.
It is led by senior management.
The execution has a foundation and does not follow a defined process.
Curiosity and creativity are more important than analysis.
The risk is accepted.
26% of companies use this form of innovation.
The dynamic innovation culture
Strategic thinking guides the overall process.
It is led by senior management with multi-function teams.
Multifunctional collaboration is important.
A creative environment is important, but innovation is not dependent on a “great idea.”
Taking risks is acceptable.
39% of companies have this form of innovation.
The team in charge of designing meaningful customer experiences can not be represented by a single profession. It needs to integrate all the designers of a company, researchers, developers, marketers, and executives. The right team represents each of these and leads the collaboration to a shared outcome. Incremental innovations usually depend more on management, while breakthrough innovation requires commitment and the authority of a senior manager.
Each innovation team needs a leader to make decisions. A multifunctional team cannot function without leadership. This leader can be from any area, but he needs to stay focused on the customer. Leaders typically are the CEO, a division director, a marketing director, or the CFO.
Responsibilities and principles of design
The design must be responsible not only for the function and appearance of products but also must create value based on the understanding of consumers as people. To achieve this, design needs to be applied to product performance levels, and to business levels of strategies, structures, processes, and objectives.
The design is not an invention, and it requires research and analysis. The design is a collaborative and deliberative process and can help transform an organization and its markets. The following seven principles define the power of design in organizations:
# 1: Design creates corporate value – companies define their futures by articulating their visions; design teams bring that vision to reality.
# 2: Design is universal – Design is very valuable in an organization, involves all aspects of the business and should focus on the customer.
# 3: Design is collaborative – Design is the synthesis of multiple opinions, disciplines, and constraints.
# 4: The design includes the execution – The design is not the endpoint, it is the beginning of the process.
# 5: Design is a transparent and well-known process – True design is qualified and quantifiable.
# 6: Design is interactive – Perfection is not possible, the interactive design allows for refinement and increases chances of success.
# 7: Design includes short- and long-term goals – A good design process can support short-term needs as well as contribute to long-term vision.
The design principles above reflect design as a process, and it is a repeatable process with measurable success. Next, let’s look at the stages that define the process for designing a meaningful customer experience.
Identify market opportunities
The cultural and business perspectives are equally important in defining how a new experience will be perceived, and how big the business impact will be.
Determining market opportunity is a known business task, and you do not have to spend a lot of time doing it. The following questions need to be answered:
How big is the current market and what is your expected growth in the next 3-5 years?
What are the major categories of the industry, including size and growth rates?
Who are the main players and what are their business strategies?
What are the main trends shaping the future directions of the market?
What technologies and new capabilities are being adopted, and by whom?
What is the profile of the target audience and in which category do the biggest competitors fit?
What are the needs of key customers?
What channels serve the industry and which procurement process?
You can research in several places what is important to the consumer and the research needs to be broad and exploratory. The research field should focus on three primary issues. What kinds of meaningful experiences does the consumer want? What experiences are currently being offered in the market? How to deliver the desired purpose?
Define what opportunities you want to pursue
Now is the time to decide which opportunity best fits your company goals. And that means that some opportunities need to be abandoned.
Often a company will realize that it is already delivering a meaningful experience, but not in a consistent way. When choosing an experience, a company is choosing which consumers will focus on it. This experience must meet these criteria:
There is an identifiable customer segment that wants the experience chosen.
This segment is wide enough to meet the financial criteria of the corporation.
The experience chosen is not in conflict with other things the company does.
The chosen experience can be delivered within the current capabilities of the corporation.
Defining the scope of the customer experience helps to clarify the shared view, and is the starting point for collaboration between the departments that will develop the experience. An efficient way to define the scope is to prepare an experience framework, which defines the key factors in the experiment. The main factors include:
Functional value – exactly what the product or service does. The functional value that is offered to the customer.
Economic value – the price of a product or service can serve to establish its meaning for the customer.
Emotional Value – Many meaningful experiences of products or services need to be delivered through an emotional stimulus.
Identity – Experiences that depend on identity will require integration of the product or service with symbols or images.
Experience frameworks are not detailed documents, but only one-page direction intentions.
Creating a significant experience
A truly meaningful consumer experience needs to be consistent across three dimensions: Expression – Expressing the intended experience at every point of consumer contact creates an integrated, holistic, and enhanced experience. By extending experience through customer service, messages, materials, and employee behavior, a company can add value at each point of contact. There are five components of an integrated experience:
# 1: Product – The distinction between products and services is complicated. For this discussion, the product is defined as a physical or digital artifact of a thing provided by the company. If a business decides to deliver a meaningful experience to the customer through a product, it will prioritize and select features that support that experience, eliminating those that do not support it.
# 2: Service – Even when services are integrated with the product, they are much more likely to be dependent on company employees. Therefore, the delivery of experience is much more variable. Design principles are the same for products and services, be clear about experience and develop elements of that service that promote experience.
# 3: Brand – The most basic purpose of branding is to protect the experience by declaring your individuality and by linking to the brand of the company. While competitors try to copy successful elements of an experiment, they avoid copying anything that is protected by a brand.
# 4: Channels – The delivery of products and services can be direct or indirect, traditional or online. Channels represent one of the most important sets of contact points in consumer experience. The innovation team needs to think about the buying process that supports the experiment, and then select the channels that support that process.
# 5. Promotion – Through promotion potential customers will learn about what the company offers. So, this is the first consumer experience. Duration of Experience – The design of an effective experience anticipates the unfolding of this experience over time. Design needs to map the progression of the experience, from its initiation through immersion, to completion and continuation:
# 1: Initiation – It is the delivery of experience, when the consumer encounters the product or service, even before the purchase decision. This initial contact with the company needs to attract the client with a model of the experience promised and must attract that customer who will value the projected experience.
# 2: Immersion – This is the first interaction with the product or service. It is essential that the customer quickly senses the desired experience.
# 3: Conclusion and continuation – Conclusion marks the point at which the consumer’s mind experienced meaningful experience, but is comparing it with past experiences. Intensity – is a measure of the connection that the client has with experience. It may vary as:
# 1: Impulse – The weakest connection with a customer is a “push.” It usually only occurs for generic or low-cost products.
# 2: Habitual – Habits can develop from a need for convenience or efficiency, and people will be willing to modify their habits for convenience. Customers who habitually use a product will become loyal consumers.
#3: Engagement – Engaging experiences draw the consumer’s attention. It is with this engagement that meaningful experiences can be conveyed.
For customers to realize the purpose of an experiment, experience must connect with them. Designing to activate these critical contact points involves two dimensions: the interactivity with the consumer and the aesthetic details.
Interactivity – Of all types and possible characteristics of interactivity, those that contribute directly to the purpose are: creativity, productivity, control, adaptability, feedback, and communication.
Triggers – The aesthetic properties of a product or service directly influence the consumer experience. This was discovered by Louis Cheskin, who called this influence “transference.” Triggers can evoke the elements of a purpose. The most common triggers are language, symbols, and sensations.
A well-designed trigger, or a combination of triggers, can be emblematic of the desired experience. These triggers act on an instinctive level, and once they are activated, it is very difficult to undo them. It is important to understand the implications of a trigger before incorporating it into an experiment.
Generating a life-long connection with the customer
Implementing an experiment is much more confusing than planning one. This critical final phase of delivering meaningful experiences requires that the whole corporation act together. For an experiment to be meaningful, it needs to be consistent. For an experience to be consistent, the whole company needs to have a shared and common view. A sense of collaboration, a common vision, and a consumer focus will be the key to delivering the desired experience. Also, the process to maintain the experience never ends. This process consists of: Perpetual production – Meaningful experience creates a connection between the consumer and the company. This connection goes beyond the initial exposure of the experience; it will continue to be shaped by the future actions of the company, especially those that touch the consumer. The Experience Company – When all employees become an experienced designer – regarding thinking, participating, or delivering experiences – the likelihood of success increases exponentially. It is very important to train employees to support and contribute to the experience. Keeping the mindset – Maintaining an experimental mindset requires more than training, you need to constantly communicate about relevant data, especially about customer reactions and feedback. Tracking the future – Business leaders should meet with consumers whenever possible, at least a few times a year. Managers should not only concern themselves with the company’s experiences, but also with the experiences of its competitors. All this allows the company to receive feedback on its current performance, and also helps to track changes and predict future directions. A second opinion – Regular conversation with clients does not replace the role of researchers. Businesses with lots of customer information can track patterns, trends, and behavior changes.
Is a significant consumer experience just a recent idea and will it be replaced by a new idea in the future? If consumers are constantly looking for new, better, and more intense experiences on the market, then those experiences are unlikely to make much difference in corporate culture. But what if, instead, companies strive to determine what kind of experiences consumers want? Well, if they can consistently fulfill that desire, then those companies will have many reasons to be happy and satisfied.