Marketers Must Offer ‘Consumable Experiences’: CRM Pro Paul Greenberg
Many brands are still grappling with mastering great customer experience. In a prequel to his upcoming presentation at Adobe Summit, Paul Greenberg, a.k.a. “the Godfather of CRM,” details the importance of playing into consumers’ sense of self-interest and choice.
What do marketers see as the most exciting opportunity on the horizon for marketing? Customer experience, according to a recent survey by Adobe (CMO.com’s parent company) and eConsultancy.
But many brands are still grappling with mastering great customer experience. Paul Greenberg, president of The 56 Group, who has also been referred to as “The Godfather of CRM,” will outline steps brands need to take to nail CX and the payoff they’ll see if they do at the upcoming Adobe Summit.
CMO.com interviewed Greenberg as a prequel to his presentation.
CMO.com: Could you define customer engagement, customer experience, and CRM? Let’s start with customer engagement.
Paul Greenberg: You have to be very careful with a definition. Every word I’m about to say actually has meaning. So my definition of it is that it’s the ongoing interactions between company and customer, offered by the company, and chosen by the customer.
Think of it this way: Because of things like e-commerce, mobile, courier services, very good supply chains and logistics, there’s a much leveler playing field. You can get the same exact or very similar levels of products and services, in particular, from a lot of different places. And they don’t really have to be a big company. They can be a small company competing with that big company.
I’ll give you an example. One time we had a problem with ADT. A smoke alarm kept going off. And we were put on hold for an hour listening to the stupid smoke alarm going off. And then when the lady finally answers, she says, “Well, we had an emergency in Texas, and I don’t know why you think you’re more important than an emergency.” But here’s the thing: I had no idea there was an emergency. I was just waiting on hold with music. What good does that do me? She didn’t even give me the courtesy of saying, “Hi, you’re going to be on hold a long time because we have an emergency in Texas.” And guess what that is? A recorded message.
Is it legitimately an emergency? Sure, but I’m still thinking my self-interest wasn’t realized, and the company could have done something very simple to accomplish the goal that they really needed to set out, which is give me enough information to figure out how I want to proceed. And every customer, every single customer out there, is very much like that when it comes to self-interest.
Let’s go back to the definition—the whole idea for customer engagement is continued and offered by the company. Look, all companies have constraints: financial constraints, labor constraints, legal constraints, time constraints, regulatory constraints. We have all kinds of constraints. Given our constraints, what is it we can offer to the customer? What are the things we can offer to the individual customer to make them feel as if they’re getting the kind of choices that are meaningful to them? And then they get to choose, and that’s the other end of engagement, that I, as a customer, feel empowered. Why? Because I’m choosing the way I want to interact with the company. At the same time, the company is offering me what they can given their own constraint. That’s the optimal customer engagement. That says, “I’m going to continue to interact.”
CMO.com: So that’s customer engagement. What about customer experience?
Greenberg: Customer experience has two ways you can look at it. One is the way we mostly look at it, which is very simple: how a customer feels about a company over time, not what their actual relationship is, but how they feel: I love you. I don’t like you. I like you a lot. I like you a little. It’s all about how you feel. A combination of a lot of different things have led to that feeling. It could be the last interaction I had with you. It could be the amount of interactions and the results of each of them over a longer period.
So [say] I’ve been [your] customer for the past five years, and 85% of my interactions have been really very, very good. Five percent have been outstanding, 5% have been so-so, and 5% have been horrible. And the last one I had was horrible. Because 85% of have been very, very good and 5% have been outstanding, I’m probably going to cut you some slack on that last horrible one. But if those numbers were different, I’m not cutting you any slack. So there’s a lot of things that go into a customer experience, but the sum could be greater than the parts.
And then there’s the other side, which is a consumable experience. I’ve spoken to thousands of people. And when the subject comes up and I’ve mentioned American Girl, the first thing I usually ask the crowd is, “How many of you have taken your daughter to an American Girl store?” And usually it’s about 50% of the crowd. It tends to be a relatively affluent group. And interestingly enough it’s more fathers than mothers, which is one thing that happens a lot, I’ve noticed.
So here’s what happens when you go to an American Girl store. Well, first of all you have the doll itself, which costs you a fair amount of money. But then there’s also the accessories that you either buy at the store or you’ve bought already, which could be anything ranging from the clothes the doll’s wearing to a bed of the era the doll represents. And then there’s a story, a specific story and a name associated with that doll based on the era and time that the doll is built for, and so you have the accessories, you have the story, you have a name, you have the doll. You walk into the store, and you’re not just buying more accessories or getting another doll when you get there. You’re bringing your doll in, and then you could do things like eat lunch with your doll, get your hair cut with your doll, watch a play with your doll, which then the play may very well be about your doll and the era that they live in.
The doll is not actually eating anything. The doll is not getting a haircut. The doll is really not appreciating that, but your daughter sure as hell is. Guess what happens? When you walk out of that store, you’re $400 poorer because of the theater, the beauty salon, and the restaurant. Now here’s the next thing I ask: “All of you people who raised your hand, how many wouldn’t do it again?” And nobody ever raises their hand because when it boils down to it, that experience, those consumable experiences, are worth a smile on their daughter’s face.
So it’s easily worth $400 every single time, and that’s a consumable experience—[which is] not the same as the overall customer experience [in terms of] how you feel about a company, how you feel about the company that you’re involved with over time. But they are really important to the offering that a company has that distinguishes them from any other company doing what they do that’s similar.
CMO.com: Then the last definition I need is CRM. What is it, and why does it matter?
Greenberg: Customer relationship management is the technology and system that sustains sales, marketing, and customer service activities. It’s designed to capture and interpret customer data (both structured and unstructured) and sustain management on the business side of customer-related operations.
CRM technology automates processes and workflows to helps organize and interpret data so that a company can engage its customers more effectively. CRM has gone from being nice-to-have to an absolute operational necessity for companies and fits in as an operational core for a much larger customer engagement market. So essentially it’s the systems and technology that handle all the customer-facing department’s activities.
CMO.com: Can we talk about measurement? How do you measure the customer experience?
Greenberg: Let’s say we decide we’re going to measure customer experience with a metric scale one to five, which a lot of people do, right? If I ask you, “What’s the difference between 4.0 and 4.2,” could you tell me really?
CMO.com: No.
Greenberg: Of course you can’t. It’s impossible. It’s just a stupid number. It usually just means a bonus somewhere. That’s probably the difference. But here’s the thing: I’m going to mention six states of feeling, and I will bet you can give me an example for each of these if you can.
[Greenberg asks the interviewer to name things she is in love with, loves, likes a lot, thinks is just OK, doesn’t like, and hates. She does.]
So here’s the interesting thing. If I asked you the difference in two and three even on a scale of five, you could hardly tell it, but you literally could tell me in love, love, like a lot, don’t like, and hate. You distinguished completely clearly. You had to think for a second or two, but you came up with something in every case—whereas if I asked you to name something that’s 4.2 on your scale vs. 4.5, you would not be able to.
As humans we have a highly granular idea of our emotional states. And, in fact, the actual measurement of our relationship to a company is more in those states than they are in any numbers we might use to represent those states.
We don’t have perfect measurement systems. But what we can do is look for indicators that say customers spend this much or they advocate for us. I’m talking about things that are indicators for how someone feels at a fairly granular level. So do we have really clear measurements of customer experience? No, we don’t really. We have approximations that we can use to help us with our business to gain a little bit of insight in how to deal with either an individual customer or a group of customers, but we don’t have anything even close to precise yet.
CMO.com: You’re writing a book right now, which is due out later this year. What can CMOs expect to get out of it?
Greenberg: The book focuses a lot on the alignment of sales and marketing and what that means when it comes to engagement. Last year I would have told you that marketing is the first line of engagement with a prospect. Today I’m seeing data everywhere that shows that content is as critical to closing a deal as is the sales person themselves. A 2014 Demand Gen report is really important in terms of identifying where marketing is, in addition to being the first line of engagement.
Sixty-eight percent of the respondents said they use more sources for research than they have in previous years. Sixty-five percent said that content had significant impact on the vendor decision. Sixty-one percent said that the vendors they choose have a better mix of content appropriate for each stage of the buying cycle.
And what does that say for marketers? That says that not only are you the first line of engagement, but once the sales cycle starts, marketers have a role to play there as well. It’s a crucial role, providing the appropriate content, which is another part of engagement. Marketing now is deep into engagement. It’s no longer just the initial engagement. It’s deep into engagement. It goes deep into the sales cycle.
The CMO’s lesson is make sure you’re involved strategically in customer engagement planning for the company, and I mean customer engagement planning, not just marketing planning.
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