Customer Experience Value Quotient: What’s Yours?

How our customers experience our organizations is at the core of our Marketing Operations effectiveness. We hear a lot of talk these days about “value” and the importance of “customer experience management.” But often, the reality is that “value” is in the eyes of the beholder, and “customer experience management” is a nice buzzword that we proudly tout without taking the necessary steps to integrate the concept into the fabric of how we do business. Today, my colleague, Lynn Hunsaker, shares some insightful recommendations on how to view customer experience more holistically and measure the outcomes that comprise value from the customers’ perspective. Gary

If value is defined as benefits versus costs, what’s your company’s customer experience value ratio? Superior value is the objective of customers and marketers alike. And since customers hold the purse strings, marketers are compelled to view value as customers do. In the customer experience value ratio, the numerator includes product and service value, as well as image and personal value. We may often overlook or be unaware of some of the cost dimensions in the denominator: money… plus time, energy and psychic costs.

In managing customer experience, the challenge is not only to maximize the numerator, but also to minimize the denominator. Touch-pointanalysis can be very helpful, but make sure non-touch-pointsare also considered, as the customer experience contains several elements that do not touch the company or channel. By carefully identifying and improving the time, energy and psychic costs to customers, the customer experience value quotient can be boosted significantly. In fact, the intangible elements of the denominator may be the hardest things for your competitors to copy, and therefore, your surest strategy to sustainable value superiority.

customer lifetime valueA great exercise in exploring your value quotient is to quantify the value ratio for all choices available to your customer. To develop a holistic perspective, plot these quotients as they existed in the past, as they currently exist, and as you project them to evolve in the future.

While the exercise above is illuminating, it’s incomplete in its prescriptive value to your organization. You may realize that your solution is inferior or superior to other alternatives available to your target customer, but which superior elements should you prioritize for protection and strengthening, and which inferior elements should you prioritize for improvement? The answer lies is customer experience outcome research, which involves ethnography to observe customers in their natural surroundings, revealing a more accurate and realistic viewpoint of the dimensions in the numerator and denominator of the customer’s value equation.

customer experienceTo innovate superior value, plot all available solutions by customers’ desired outcomes. If you have conducted customer outcome research,rank-order desired outcomes by importance x frustration x frequency. Now you’re able to see things the way the customer does: for the most important outcomes, how do the choices compare? Root cause analysis may identify engineering issues, service skill gaps, business process complications, or outdated policies.

Involve your whole organization in outside-in thinking and continual improvement by teaching them about the customer experience value quotient. For similar ideas, see my newest handbook, Innovating Superior Customer Experience.

Contact the author to find out how to customize these tips to your situation.

by Lynn Hunsaker, President of Marketing Operations Partners and Customer Experience Strategist at ClearAction

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About the Author:

Lynn Hunsaker is CEO of Marketing Operations Partners, a consultancy that transforms marketing organizations into high-value engagement centers through accountability, alignment, and agility. Lynn is a past director of marketing and business development at Applied Materials, an award-winning past president of Silicon Valley American Marketing Association, and she taught marketing, advertising and business for 5 years at UC Berkeley Extension, SJSU, and Mission College. Lynn is a well-known expert in metrics, customer experience management, and organizational change. See more at

One Comment

  1. Naval Vaswani 2015/01/06 at 8:37 AM - Reply

    interesting, informative and effective. Would like to know for a research project

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