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CreatingaHigh-ImpactDigitalCustomerExperienceAnA.T.KearneyWhitePaperCreatingaHigh-ImpactDigitalCustomerExperience..IntroductionInthepastfewyears,wehavewitnessedanexplosionintheonlineworld—anexplosionthatisalsoaharbingerofhowbusinesseswilloperateinthefuture.Supplychainsarebeingre-thought,productsandservicesreconfigured,andbusinessmodelsrevamped.Yetwhilee-businessandtheInternetareturningeverythingupsidedown,onebasiccomponentofbusinessremainsunchanged:Therelationshipbetweensupplierandcustomerremains(andalwayswillbe)thebasicbuildingblockforeverybusinesstransaction.Intheonlineworld,thewaythatrelationshipmanifestsitselfmaybevastlydifferentfromthetraditionalrelationship-buildingprocess,buttheneedtocreateacompellingcustomerexperienceremainscritical.Considerthis:Forallthehooplaaboute-commerce,42percentofcustomersshoppingontheInternetabandontheonlineexperienceinfavorofatraditionalbricks-and-mortarchannel.Inpart,thismaybeduetounfamiliaritywiththenewchannel;or,abiggerfactormaybethequalityofthecustomerexperiencethatmanye-businessesdelivertoday.Indeed,a1999A.T.Kearneystudyrevealedthatlessthan17percentofthewebsitesevaluateddeliveredahighlypositivecustomerexperience.Yetthereissignificantmiddleground—companieswithwebsitesthatperformwellinsomerespects(qualityproducts)donotperformaswellinothers(customerfulfillment).Giventhetremendousclutterintoday’se-commercemarketplace,themostsuccessfulsitesarethosethatbuildcustomerloyaltyandenthusiasm.Andwebelievethatthetime-honoredmethodologiesholdfast:Thereisnobetterwaytocreatecustomerloyaltyandenthusiasmthanthroughapositivecustomerexperience.Theimportanceofestablishingapositivecustomerexperienceisfurthersubstantiatedbylookingatthecurrentcostofacquiringanonlinecustomer.AccordingtoShop.org,anassociationofonlineretailers,purelyonlineretailersspendanaverageofUS$42toacquireeachnewcustomer,whileretailersthatcombinetraditionalstoreswithonlineshoppingspendonlyhalfasmuch.Thisacquisitioncostisaninvestmentthatonlyearnsareturnifcustomersreturn—placingcriticalimportanceondevelopingthedigitalcustomerexperience.Apositivecustomerexperienceisalsoindependentofacompany’sinherentbusinessmodel.Itdoesnotmatterwhetherthecompanysellstootherbusinessesordirectlytoendusers.Anditappliestophysicalcontentproviders(onlinebusinessesthatselltangibleproducts)aswellasthosethatprovideservicesovertheInternet.Researchshowsthat53percentofwebsite-relatedrevenuescomefromrepeatcustomers—despitethefactthatnewvisitorstypicallyoutnumberrepeatvisitorsastheInternetbuildstraffic.Clearly,theexperiencecanbethedifferencethatkeepscustomerscomingbackandtellingfriendsandassociatesaboutthesite.Conversely,apoorcustomerexperiencecanbedevastat-ing.AForresterResearchstudyfoundthat,onaverage,adisgruntledwebshoppertells10peopleaboutapoorexperience.CreatingaHigh-ImpactDigitalCustomerExperience..Simplydefined,thedigitalcustomerexperienceencompassesalltheinteractionsanactualorpoten-tialcustomerhaswithabusiness—everythingfromtheadvertisingthatprecedesdirectinteraction,throughpost-salefollow-upandrepeatpurchases.Ittakesfourbasicstepstodevelopahigh-impactdigitalcustomerexperience:1.Developacompellingcustomervalueproposition2.Createthedigitalcustomerexperienceframeworktoaddressallareasoftheprocess—fromawarenessbuildingtopost-salessupportandrepurchase3.Employproventools—the“7Cs”—tosupporttheframework4.MarrytheonlineandofflinecustomerexperienceWebelievethatthisprocess,applieddynamically,willseparatethewinnersfromthelosers—thosebusinessesthatdeliverahigh-quality,engagingcustomerexperienceontheWebfromthosethatdonot.Businessesthatareseriousaboutcreatingtheultimatecustomerexperiencewillberewardedwithtremendousgrowthinbothbrandandcustomerequity.ThispaperdescribesthefourstepsindetailanddescribesinnovativecompaniesthatarealreadycreatingcustomerpartnersontheWeb.Businessesthatsucceedine-businessbeginwithaclearlydefinedvalueproposition—astrongofferthatapotentialcustomerwouldfindcompellingandinteresting.Thisrequirescompaniestodevelopasolidunderstandingofwhotheircustomersare,whattheyvalueandhowtheproductsorservicesshouldbeoptimizedorconfiguredtodeliverthisvalue(seefigure1).Theymustthenconstantlyre-eval-Source:A.T.KearneyWhatdoesyourcustomervalue?Whatistheoptimalproductorserviceofferingthatdeliversthisvalue?Whoisyourcustomer?Figure1:DefinethevaluepropositionCreatingaHigh-ImpactDigitalCustomerExperience..uatetheirvalueprop-ositiontorespondtoadynamicmarketplace.Intheofflineworld,SamWaltondemonstratedhisunderstandingofthiswhenhefoundedtheWal-Martchain.Itsvalueproposition?Offerawideselectionofgoodstopeoplewholiveinsmallcommunities,anddosoinafriendlyenvironmentatpriceslowerthanthoseofferedbythecom-petition.Wal-Marthascontinuedtobesuccessfulbybasingitsbusinessdecisions(andcustomerexperience)onthisvalueproposition(whichhasevolvedovertheyearsinresponsetochangingcompetitiveforces).Intheonlineworld,Amazon.comstartedoutwiththegoalto“usetheInternettotransformbookbuyingintot