In 2018, The Wall Street Journal stated in an article that: “Customer experience is the key competitive differentiator in the digital era.” This statement is not new, but it is becoming increasingly real and necessary for business leaders to adopt.

Some statistics provided by the book The Experience-Centric Organization illustrate how customer experience is the currency for creating sustainable competitive advantage. Surveys conducted during this research showed the following results:

• Fifty-five percent of consumers have canceled a previously planned purchase due to poor service.
• Seventy-four percent are willing to switch brands if the shopping experience becomes too difficult.
• Only forty-nine percent say companies are delivering a good shopping experience.
• On average, bad service experiences are shared with at least 15 people in their circle of influence.
• Companies in the U.S. alone lose a total of $62 billion each year due to poor service experiences.
• Only three percent of consumers claim to have never had a bad service experience with any company.

The need for memorable and unique experiences is something business leaders understand. The current consumer culture and dynamics dictate that perceived value resides in the experience customers have with a brand at every touchpoint, not just in a good product or service that fulfills its intended function—this is taken for granted by customers. Differentiation now lies in experience: how brands fulfill their promises and truly deliver a remarkable experience

Today, strategic competitive advantage is primarily determined by how we make our customers feel.

Currently, most companies have multiple initiatives aimed at differentiation and competitiveness, striving to create better customer experiences that make them feel differently and better than competitors do. However, there is not always orchestration between strategy, processes, functional areas, and technological platforms to proactively make customer experience a core value proposition. Often, these initiatives are isolated and confined to marketing, sales, operations, or product/service delivery departments. Consequently, traditional silos end up executing proposals independently, leading to an inconsistent and uncoordinated experience. This highlights the importance of strategic orchestration from the executive leadership, demonstrating the necessity of aligning company processes around customer experience and embedding key informational and directive elements into the organizational culture to define how we want customers and employees to feel.

From this, a set of foundational questions arises to help build a business strategy and culture truly oriented towards a unique customer experience that becomes a genuine competitive differentiator:

• How do we want our customers to feel? How do we want them to describe their experience doing business with us?
• What are the processes involving our team and customers? What areas for improvement exist based on how we want them to feel? Is there a proper flow of information and consistent service at every touchpoint from each department?
• Do our process configurations allow customers to experience a journey that makes them feel as intended? How could we improve them?
• How can we turn each moment of the customer experience into part of a unique journey and a virtuous cycle that makes customers feel as we want in:

These questions should be addressed collectively by functional leaders within the organization, led by the executive director. In some cases, this process may even lead to the need for a new leadership role, such as a Chief Experience Officer (CXO), responsible for ensuring continuous orchestration of customer experience. However, a mature organization can also measure its functional areas based on relevant customer experience key performance indicators (KPIs) and ensure alignment in strategic sessions where the team prioritizes structuring processes around customer moments.

Once the executive team has decided how to orchestrate around experience and clarified how to make customers feel what they intend, another crucial aspect emerges: the role of technology in this strategy. While technology is not the cornerstone, it is a powerful enabler and accelerator of the experience, requiring the active participation of the company’s CTO, CIO, or CDO, depending on the IT and digital organizational structure.

A Brief Guide to Key Technological Tools for the Customer Journey

Here are some key tools for four major standard phases of customer interaction (your company may have additional key moments not mentioned here):

The above is just a brief guide to some types of tools that may be useful. The selection of which ones to acquire and integrate will depend on the current platforms being used. In fact, there are already platforms that provide many of the previously mentioned services in a single solution. However, the choice of whether to use a single platform, integrate the best solutions for each functionality, or develop custom solutions will depend on the company’s IT policies, budget, specific functional requirements, current technology stack, and the recommendations of the IT leaders within the organization.

Finally, from a technological perspective, it is crucial to maximize the value of the data continuously collected in every user interaction and make the best decisions based on that information. For this, Data Integration and Analysis for a Multichannel Vision will allow for a comprehensive view of service levels and their impact on CLTV (Customer Lifetime Value) and COCA (Cost of Customer Acquisition)—essentially, understanding how much it costs to acquire a new customer and the future revenue that customer will generate, adjusted to present value. It is fundamental to integrate data from all mentioned tools and perform an in-depth analysis.

Key Areas of Data Integration and Analysis:

• Data Integration: Using a data integration platform or a data warehouse to centralize information from all sources.
• Data Analysis:
  • Key Metrics: Monitor metrics such as conversion rate, sales cycle time, customer retention rate, average order value, CLTV, and COCA.
  • Dashboards: Create visual dashboards to track the performance of each phase of the Customer Journey and its impact on CLTV and COCA.
  • Multichannel Analysis: Analyze how customers interact across different channels (online, offline, mobile, etc.) to identify patterns and optimize the experience at each touchpoint.
  • Observability: Implement observability practices to monitor the system as a whole, identify issues, and improve service performance.

Key Benefits of a Customer Experience-Centric Business Model:

• Increase CLTV: By improving the customer experience at every stage of the journey, companies can boost customer loyalty, encourage repeat purchases, and increase the average order value, leading to higher CLTV.
• Reduce COCA: Optimizing marketing campaigns, improving conversion rates, and increasing customer retention helps lower the cost of acquiring new customers.

By implementing these strategies and tools, the leadership team will gain a clearer understanding of the Customer Journey, enhance the customer experience, increase CLTV, and reduce COCA, ultimately driving greater business growth and profitability.

These are some guidelines on how to create or transform a business/brand into one that prioritizes unique and memorable customer experiences as a primary source of competitive advantage. Success will depend on the leadership team’s willingness to drive change and their ability to influence and engage the rest of the organization.