Detecon Study Customer Experience Management in The Telecommunications Industry. Market Survey and Action Recommendations For The Optimal Design of Customer Experiences

Study
Customer Experience
Management in the
Telecommunications Industry
Market survey and action recommendations for the
optimal design of customer experiences
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Customer Experience Management in the Telecommunications Industry Study <
Customer Experience Management in the

Telecommunications Industry
Market survey and action recommendations for the
optimal design of customer experiences
March 2010
In cooperation with
© Detecon International GmbH 1

> Study Customer Experience Management in the Telecommunications Industry
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Table of Contents
1. Preface 5
2. Executive summary 6
3. Trends on highly competitive telecommunications markets 9
3.1 Overview of current challenges 9
3.2 Focus: The new customer experience orientation 14
4. Survey of experts 15
4.1 CEM from the viewpoint of experts 15
4.2 Overview of current CEM measures 21
4.3 Objectives, success factors, and effectiveness 24
5. The customer perspective: results from basic research 28
5.1 Customer championship 28
5.2 Success factors of customer champions 29
5.3 Emotional Customer Loyalty 31
6. The Detecon CEM Framework 35
7. Recommendations for action 38
7.1 Knowing what customers really want 38
7.2 Fix the basics ... 39
7.3 ... and jump in for your customers when you fail! 40
7.4 Ice the cake 41
7.5 Walk the talk of your brand 44
7.6 Employees – your keys to success 45
7.7 Communicate your success successfully 46
7.8 Put the customer on your payroll 47
7.9 Experience by participation 49
7.10 Develop your CEM currency 50
8. Appendix 52
8.1 Recommended reading 52
8.2 Glossary 53
8.3 The Authors 54
8.4 Detecon International GmbH 56
8.5 forum! GmbH 56

Table of Figures
Figure 1: The TOP 5 CEM Measures 6
Figure 2: The Detecon CEM Framework 7
Figure 3: Average Revenue per Subscriber in Mobile Networks, 10
Germany 2004 – 2013 (estimated) in US$
Figure 4: Average Revenue per Subscriber in Fixed Networks, 10
Germany 2004 – 2013 (estimated) in US$
Figure 5: New Categories for Telecommunication Devices 12
Figure 6: Overview of Participants in the Detecon Study 15
Figure 7: CEM from the Participants‘ Point of View (categorized) 16
Figure 8: Relevance of Customer Experience according to phase 16
Customer Life Cycle (Mentions in % of Respondents)
Figure 9: Intended Emotions triggered by Experience Measures 18
Figure 10: Ways to Capture Customer Experience 20
(% of Respondents; Multiple Answers)
Figure 11: Relevance and Frequency of named CEM Measures 21
Figure 12: The TOP 10 CEM Measures 21
Figure 13: Intended Differentiation of Customer Experiences 23
(Mentions in %; Multiple Responses)
Figure 14: Objectives of CEM from the Participants‘ Point of View 24
Figure 15: Customer Experience Performance Measurement 26
(% of Mentions; % of Subset)
Figure 16: CEM Oriented Target Systems for Employees 27
(% of Mentions; Multiple Answers possible)
Figure 17: Cohesion of Complaint Satisfaction and Emotional Customer Loyalty 30
Figure 18: The forum! Index for the Measurement of Emotional Customer Loyalty 31
Figure 19: Customer Typology based on Satisfaction and Emotional Customer Loyalty 32
Figure 20: Customer Orientation Expands the Fan Community 33
Figure 21: Correlation of Emotional Customer Loyalty and Return on Sales 34
Figure 21: Emotional Customer Loyalty through Customer Orientation 34
and Customer Experience Management
Figure 23: The Detecon CEM Framework 35
Figure 24: Effects of Customer Experience Management 37
Figure 25: Derivation of Customer Experiences 38
Figure 26: Examples of Measures for Process Improvement 39
Figure 27: Examples of Moments of Truth, Triggers, and Countermeasures 40
Figure 28: Customer Experience Management, Sales and Service 42
Figure 29: Horizontal vs. Vertical Consistency of Customer Experiences 44
Figure 30: 10 Rules for Communication of Success 47
Figure 31: Professional Feedback Management 48

1. Preface
Even in today’s world, at a time when the lip service paid to the company objective of “customer satisfaction” is
deafening, customers repeatedly find themselves in situations which they never deemed imaginable. Sometimes
the customers must almost force their provider to allow them to register so that they can obtain the desired service.
Or they find themselves apologizing for daring to ask the company to actually deliver the promised services. They
may even notice enthusiastic feelings of gratitude bubbling up when they receive fast and friendly service, some-
thing they should normally expect to be part of the standard and not a positive exception. So companies, especially
those operating on mass markets such as the telecommunications industry, cannot avoid the key question of what
they should do to ensure that customers enjoy an optimal experience.
The current study on “Customer Experience Management in the Telecommunications Industry” performed by
Detecon International GmbH and forum! GmbH offers important answers to this question. Readers will be initially
impressed by the broad scope of the study design: not only do managers from outstanding telecommunications
companies have their say, but experts from other industries as well as academicians have contributed the latest
findings from research to the study. Building on this well-laid foundation, the study describes the key contents and
trends in the field of customer experience management. This in turn – as an extract, so to speak – serves as the
basis for the development of the Detecon Customer Experience Management Framework as a holistic management
approach. Starting from here, the paper addresses ten concrete recommendations for action which are capable
of blazing new paths. This inspires readers with important ideas for creating customer experience management
which functions perfectly, putting in their hands the key to more satisfied, enthusiastic, and consequently loyal
customers.
In preparing this study, Detecon and forum! GmbH have succeeded in creating a compendium which helps all
interested managers in general, and those at telecommunications companies in particular, to evolve and ultimately
professionalize their customer experience management.
Prof. Dr. Matthias Gouthier

Chair of Services Marketing
European Business School (EBS)

2. Executive Summary
The saturation on the telecommunications market has caused a steady rise in the intensity of the competition.
Customers often perceive the products to be interchangeable. So telecommunications providers find themselves
confronted with the growing challenge of setting themselves apart from competitors and securing the sustained
loyalty of their customers. They have to find ways to stay profitable while facing the dilemma of declining revenues
and inflationary customer expectations. But companies can utilize customer experience management as a tool to
profitably design unique customer experience and to secure emotionally the loyalty of their customers. The goal
of CEM is to positively influence rational and irrational factors of consumer behavior and to generate delight in
customers. Acknowledging that “good is not good when better is expected,” it explicitly takes into account
customers’ needs and paves the way to a holistic customer experience with the company. This is the background
to Detecon’s decision to conduct a market study which would provide the basis for recommendations for action
aimed at the optimal design of customer experience.
CEM from the expert’s viewpoint
When asked about their understanding of customer experience management, 53% of the respondents described it
as the generation of positive experience for customers. Many of them noted that the consistency of the customer
experience across all customer touch points and business transactions was essential. The most important goal of
CEM, as mentioned by 45%, is the surprise or delight of the customers, followed by measures to create loyalty and
building up trust with the customers. The five most frequent concepts and approaches of CEM and their impor-
tance for the customer relationships were named by the study participants as shown below (cf. Figure 1).
Success factors and measurement of CEM
In the opinion of the respondents, the success of customer experience management is determined by three key
factors: integration of the employees (59%), holistic company thinking and action (48%), and the exploitation
and provision of customer data (44% of the respondents). 62% of the respondents measure the effect of measures
initiated to design the experience (customer satisfaction being the most frequently mentioned target value). In the
view of our study participants, the relevant KPIs include customer loyalty indices, net promoter score, and various
customer satisfaction indices. 87.5% use these KPIs for steering of their employees, whereby customer satisfaction
is the management KPI frequently mentioned.
1 Exploiting the "Moments of Truth"
2 Generation of Customer Insights TOP 5

Customer
3 Employee Empowerment Experience
Management
4 Customer Experience Design Measures
5 Proactive Complaint Management
Figure 1: The TOP 5 CEM Measures
Customer orientation raises the level of customer loyalty and the fan quota
The following causality chain can be crystallized from the findings derived from the contest Deutschlands Kunden-
champions® and the many years of scientific base research conducted by forum! within the framework of the Excel-
lence Barometer®1: Companies with a high level of customer orientation generate a strong “emotional bond” with
their customers, and this in turn verifiably and clearly contributes to the company’s economic success.2
1
The Excellence Barometer® (ExBa®) is the benchmark study on the performance capability of the German economy. The
initiators of the study are the Deutsche Gesellschaft für Qualität e.V. (German Society for Quality), Frankfurt, and forum!
Marktforschung GmbH (forum! Market Research), Mainz. For additional information, go to www.exba.de.
2
This can be clearly demonstrated on the basis of business data which can be evaluated (cf. Chapter 5.3).

The key conclusion here: whether customers intend to buy again in the future and are willing to recommend the
company to others is dependent on their emotional ties to the company.
Customer champions are characterized by the following:

• They create especially strong emotional customer loyalty;
• They “live and breathe” customer orientation throughout the company. Customer champions take advantage
of every customer contact to strengthen the customer relationship;
• Thanks to the high level of customer orientation of their staffs, they enhance the emotional customer loyalty and
turn customers into fans of their company.
Emotional customer loyalty correlates verifiably with customers’ purchase behavior: emotionally loyal customers
buy more often and higher quantities. They are less likely to be enticed by offers from competitors, forgive mistakes
and mishaps more readily, and actively recommend the company to others. That is why the emotional customer
loyalty has a measurable effect on business success: the degree of the emotional customer loyalty correlates with
the return on sales and other business indicators (e.g., “EBIT”, “growth in turnover in percent”, “productivity”,
“gross profit in percent”, and “development of the market share of the most successful product”).
The Detecon CEM Framework

The Detecon CEM Framework embodies the results from the survey of experts and the findings from the customer’s
viewpoint, merging them into a holistic presentation of the elements of a practice-oriented customer experience
management.3 These elements display many and varied interdependencies in a complex self-regulatory cycle. This
is why the long-term success of CEM measures can be secured only by means of a systematic and orchestrated
design of all factors. The goal of the CEM Framework is the creation of profitable customer experiences through the
fulfillment or over-fulfillment of expectations and avoiding falling short in their fulfillment.
Customer Insight Brand Brand Halo

-
Design
Quality and
Product and Brand Product/Service Performance
Communication Management
Customer
Expectation Fulfillment
Experience
HR-Excellence
Customer Insight CEM Measures and Channel
Synchronization
Design
Interactions
Source: Detecon
Figure 2: The Detecon CEM Framework

3
The elements relevant for the CEM Framework and their interdependencies will be discussed in Chapter 6.

Recommended actions for your CEM

Based on the findings drawn from the scope of the survey, ten recommendations for action aimed at the optimal
design of customer experience management have been developed:
• Excellent customer experience management presumes that you “know what customers really want” so that you
can systematically recognize the starting points for the optimization;
• The second step is to ensure that your core services are in line with customer requirements: consider “fix the
basics” as an absolute necessity;
• Identify at an early stage the factors for possible customer dissatisfaction, and “jump in for your customers when
you fail!”, i.e., correct mistakes affecting the customer by coming up with fast, uncomplicated solutions;
• Then act purposefully to “ice the cake.” Delight your customers and create an emotional bond to your company
through individual experiences;
• “Walk the talk of your brand” by making sure that the customers receive a consistent image of you and your
company. Brand values and corporate identity must be conveyed during every single experience;
• Be aware that your “employees are your key to success” and enable them to influence the customer experience
directly and to delight customers personally within the framework of a consistent corporate identity;
• Take advantage of the opportunities your achievements provide for your brand by “successfully communicating
your success.” Employees frequently think more poorly of their own company than the customers do;
• In addition: “put your customers on your payroll” because they know your strengths and weaknesses best.
Systematically utilize this knowledge for continuous improvement by involving your customers in changes;
• Create positive “experiences by participation” and compensate the frequently low level of involvement of
customers for telecommunications products by integrating the customers into the continuous improvement
process. They will thank you in the form of word-of-mouth advertising;
• “Develop your CEM currency,” making measures that are drafted within the framework of the CEM measurable
so that you can successfully and sustainably shape your CEM investments.
The study reveals that CEM can already be found in the customer relationship management of many telecommu-
nications companies and has great potential as a meaningful enhancement of current CRM concepts. Read more
about the many and varied opportunities customer experience management offers to your company.

3. Trends on highly competitive telecommunications markets

The trends and the dynamic development on the telecommunications market form the framework for action and
the starting point for a company’s CEM activities. This study takes a look at the B2C telecommunications market
which is undergoing far-reaching technological, organizational, and competitive changes. At its core, the market is
a high-performance market which is technologically advanced, saturated, and highly competitive.4
Telecommunications markets have been largely deregulated. Telecommunications providers worldwide must today
survive on increasingly competitive markets, whereby the intensity of the competition on the markets which have
only recently been deregulated rises substantially faster than was the case on the markets which were“ deregulated
early.” What is more, the advances in technology and the related demand for new services and greater bandwidths
are driving the market forward. This is the background for the analysis and design of CEM activities within the scope
of this study.
3.1 Overview of Current Challenges

Five challenges confronting deregulated telecommunications markets are especially relevant for customer experi-
ence management. They affect the entire market spectrum, from market structure and development to (re)structur-
ing of providers to redefinition of the product portfolio to brand identity and marketing.
Challenge 1: High level of competitive intensity with accompanying declining growth potential and increa-
sing price pressure. Many telecommunications markets have already passed the phase of tumultuous growth in
the mobile network and broadband sector or have even reached the point of stagnation.5 Business with data and
content, on the other hand, is undergoing positive development, even though there has been a slowdown due to
the financial and economic crisis in 2008 and 2009.6
Mobile Networks
Although the number of mobile network users is slowly reaching a stage of stagnation, the number of new mobile
network subscribers continues to rise steadily. Mobile network penetration (number of SIM cards per capita of
the population) exceeded 100% several years ago (currently 131% in Europe).7 Additional growth is expected in
this area: in Germany, for example, an average of 1.7 subscriptions per capita of the population8 is prognosed for
2013. This high level is explained by the fact that many users own two or even more cell phones in the meantime;
moreover, there are temporary overlaps of the contract terms when users change providers. Another – important
– reason is the growing prevalence of data cards (e.g., in notebooks and netbooks, UMTS USB sticks, etc.) and the
steady growth of the so-called M2M cards (machine-to-machine) such as those found in motor vehicles or smart
meters.
4
This is indicated by an advanced fixed-mobile convergence (FMC) and telco-media convergence (TMC), a large number of
competitors, a low price level, and a high degree of mobile network and broadband penetration.
5
cf. Bank of America Merrill Lynch: European Telecoms Matrix Q3 2009, pp. 4 et seqq. and pp. 16 et seqq.
6
cf. Bank of America Merrill Lynch: European Telecoms Matrix Q3 2009, pp. 8 et seq.
7
cf. Bank of America Merrill Lynch: European Telecoms Matrix Q3 2009, p. 3
8
cf. Pyramid Germany Forecast Q4 2008

The Average Revenue per Subscriber in Mobile Networks is declining
$60.00
$50,91
$50.91
$48,57
$48.57
$50.00 $45,23
$45.23 $46,00
$46.00
$45,70
$45.70
$40,37
$40.37
$39,96
$39.96 $38,46
$38.46 $39,28
$39.28
$38,11
$38.11
$40.00
$30.00 $25,50
$25.50
$23,93
$23.93
$21,08
$21.08 $19,67
$19.67 $18,91
$18.91
$20.00 $16,13
$16.13 $15,03
$15.03 $14,70
$14.70 $14,49 $14.24
$14.49 $14,24
$11.64
$11 $10
$10.98
$9
$9.09 $7
$7.81 $8
$8.57
$10.00 $7,42
$7.42 $6,64
$6.64 $6,36
$6.36 $6,23 $7,01
$7.01
$5,42
$5.42 $5,47
$5.47 $5,32
$5.32 $5,70
$5.70 $6,04
$6.04 $5,47
$5.47 $5,37
$5.37 $5,75
$5.75 $6,28
$6.28 $6.12
$6
$0.00
2004A 2005A 2006A 2007A 2008E 2009E 2010E 2011E 2012E 2013E
Prepaid Postpaid Voice Data

Source: Pyramid Research Forecast Q4/2008
Figure 3: Average Revenue per Subscriber in Mobile Networks, Germany 2004 – 2013 (estimated) in US$
The Average Revenue per Subscriber in Fixed Networks is declining
$45.00
$38.94
$40.00 $37.21
$35.48 $33.82 $36.77
$34.01 $33.14 $33.49 $33.65
$35.00 $33.02
$30.00 $33.28 $33.69 $27.18 $26.91 $26.57

$31.24
$28.47 $29,65
$25.00 $26.05 $27.74
$20.00
$16.00
$14.91 $15.16
$15.00
$14.10
$13.00 $13.19
$10.00 $12.35 $11.58
$5.00
$0.00
$0.00
$0.00
2004A 2005A 2006A 2007A 2008E 2009E 2010E 2011E 2012E 2013E
Voice Telephony ARPS Internet Service ARPS IPTV/Video Service ARPS

Source: Pyramid Research Forecast Q4/2008
Figure 4: Average Revenue per Subscriber in Fixed Networks, Germany 2004 – 2013 (estimated) in US$

In contrast, the average revenue per subscriber (ARPS) has demonstrated a declining tendency for several years
now (see the example of German in Fig. 3). The greater part of the revenues still comes from voice telephony, but
data applications are enjoying increasing popularity. Overall, an average growth rate of data revenues amounting
to 25% is expected for Europe.9
Fixed Network
The fixed network market has experienced the greatest changes in the area of DSL broadband connections. In the
meantime, more than 55% of all European households have a broadband connection.10 There has been a corre-
sponding decline in the number of narrowband connections. However, growth in the DSL sector has slowed down
substantially. A relatively new service on the market is digital television via IPTV and the accompanying use of optic
fiber technology (FTTx). Continued high growth rates (26% p.a. across Europe) are expected in this field, although
the forecasts for the individual countries vary widely.11 Among other factors, this is a consequence of the varying
degrees of availability of alternative infrastructures (e.g. cable). The average revenue per subscriber is also declining
for fixed networks (cf. Fig. 4).
Fixed Mobile Convergence

Technically convergent FMC products will not become a mass business in Europe in the near future. By the year
2013, only 0.82% of the population will be using FMC connections.12 A powerful trend in the market, in contrast,
is the product bundling of mobile network and broadband services.
Challenge 2: Reconfiguration of the value chain – back to the universal provider.

The profound changes throughout the entire telecommunications industry caused by new technologies, expanded
services, and changes in customer requirements are reflected in the transformation of the value chain. Stagnating
revenues in the traditional core areas of voice transmission, especially in the fixed network business, are increasing
the pressure exerted by competitors and shareholders.
Growth potential on the saturated markets can be developed solely through new services and products such as
IPTV, VoD, and fixed-mobile hybrid products. More and more often, these services are being offered in bundled
form as Triple Play and Quadruple Play products from a single source. Investments in broadband technology (e.g.,
UMTS, HSDPA, VDSL), transmission technology (e.g., IP, IMS, SIP), data compression (e.g., MP3, H.264, MPEG-4),
and infrastructural advances such as broadband connection expansions represent the essential basis for these
new services. In view of declining revenue per subscriber in the narrowband and DSL fields and a corresponding
development in mobile networks, expansion decisions must be considered thoroughly and targeted because the
maneuvering room for investments is limited and wide-area expansion is expensive.13 On the other hand, expan-
sion is unavoidable if providers want to ward off the increasing competition from alternative broadband services
(e.g., from cable network operators).
Before convergent and bundled products can be offered, mobile network and Internet service providers (ISP)
previously maintained as separate entities must be either integrated with the fixed networks, or alternatively
partners from the various areas must conclude cooperative ventures.
9
cf. IDC European Telecom Services Database Q2 2009
10
11
cf. IDC European Telecom Services Database Q2 2009, CAGR for Germany until 2013 30%, for the
Netherlands 23%, for Italy 47%
12
13
cf. OECD: Communications Outlook 2009, p. 21

Challenge 3: Expansion of the product line through developments such as fixed-mobile convergence and
telco media convergence
Another noticeable development is the expansion of the product line within the framework of FMC, TMC, Triple
Play, and Quadruple Play.14 This includes products from the area of content such as IPTV, VoD, music-on-demand
(MoD), as well as the provision of mobile, stationary, or combined (hybrid) voice and data services. Related to this
is the greater differentiation within the portfolio of end devices such as set-top boxes, VDSL/WLAN routers, smart-
phones (with features such as WLAN, GPS, and multimedia capability), IP telephones, and completely new end
device categories such as multimedia fixed network telephones. This expansion increases the demands made on
the complexity management in sales and service. The success of the iPhone® for each of its exclusive distribution
partners shows that there are substantial opportunities for telecommunications providers in this development as
well.15
Kategorie
Category Beispiel
Example Betriebssystem
Operating System
� Nokia 1680 classic
Feature Phone Proprietär
Proprietary
� Sony Ericsson S312
� Blackberry Bold Symbian, Windows Mobile,
Smartphone
Mobile
� Nokia N900 Android OS, RIM

� Apple Iphone 3GS Iphone OS, Windows
High End Smartphone
� Android My-touch 3G Mobile, Android OS
� Sony Vaio P Goolge/Android OS,
Smartbook (UMPC)
� Wistron Pursebook Windows 7, Linux
� Macbook Air Mac OS X, Windows 7,
Convergence
Netbook
� Asus Eee Pc Linux
� Microsoft Courier (Konzepte)
Tablet PC Mac OS X, Windows 7
� Apple Tablet (Konzepte)
� IMB Thinkpad Mac OS X, Windows 7,
Notebook
� Dell XPS Linux
� Openpeak Media Phone
Media Phone Proprie r
Proprietary
� Touch Revolution NIMble
Home
� Dell Vostro Series Mac OS X, Windows 7,

Home Computer
� Apple IMac Linux
� Samsung 8000
TV (mit CPU) Proprietär
Proprietary
� Sony Bravia Z Series
Figure 5: New Categories for Telecommunication Devices
Many telecommunications providers want to use this as a stepping stone to enter business fields closely related to
communications such as smart metering and home management or assisted life (tele-medicine, alarm devices for
senior citizens, etc.). There are two especially important motives behind this expansion of the product line. One is
the development of new markets with growth potential, while the other is the long-term bonding of the customers
to the company on highly competitive markets, especially by offering basic services and the additional benefits of
a customized bundling of products or features.
14
cf. Ovum: Regional Telecoms Trends: Western Europe 04/2009, p. 10
15
cf. Bank of America Merrill Lynch: European Telecoms Matrix Q3 2009, p. 8 et seq.

When operating in this environment, the telecommunications industry must prove itself in comparison with com-
peting technologies of established satellite TV and cable network operators (who also offer services in the core
sector of telecommunications – e.g., broadband and voice services). This requires convincing customers of the
technological and commercial competitiveness of the core services and overcoming hurdles to acceptance among
customers. This is precisely the point where CEM becomes an essential success factor.
Challenge 4: From convergence to cross-usability and ubiquity

Convergence is the buzzword being heard everywhere; telecommunications and IT providers have been preaching
and using it for some time, with varying degrees of success, and it is now becoming tangible thanks to develop-
ments such as fixed-mobile convergence (FMC) and telco media convergence (TMC). But, at the same time, it is
becoming clear: convergence is not enough. The relevant requirements from the customers’ viewpoint are cross-
usability and ubiquity. Customers do not care what technology is used to transmit their data or how the functions
they use are supported. Their primary concern is simple, intuitive, and secure use. Telecommunications companies
pick up on this in their specific product development, for example, employing key phrases such as “e-home” or
“connected life and work”. The names alone are clearly indicative – in contrast to early product designations influ-
enced more by technology – of the usage context. But this welcome tendency must not exhaust itself in the brand-
ing of the products. A consistent customer experience oriented to simplicity and usability in the pre-purchase phase
(and for pilot customers in the start/exploratory and use phases as well) is a decisive success factor for overcoming
acceptance hurdles related to new products.16
Challenge 5: Strengthening the emotional customer loyalty through differentiated branding

On the telecommunications market, classic corporate brands are more successful than product brands. Owing
to the rapid pace of technical progress, the products are generally too short-lived to establish a separate product
brand with stable properties.17 The following marketing strategies can be observed on the market:
• The number of business area brands (fixed network brand, mobile network brand, business customer brand,
etc.) is declining, which is related to the development back in the direction of a universal provider. A major trend
towards international umbrella brands can also be observed among internationally active telecommunications
companies.18
• On the other hand, an increasing number of segment brands is to be noticed. Multi-brand strategies are among
others a form of offensive strategy for telecommunications service providers (e.g., a no-frills brand differentiated
from the core brand). Moreover, the use of segment brands makes it easier to address specific target groups.
Examples of this are the ethnic brands such as Ay Yildiz (for customers of Turkish origin in Germany) or Movida
(for Hispanics in the USA) or lifestyle brands for young people or senior citizens.19
• In addition, the trend to co-branding with attractive product brands as a way to enhance the company’s own
brand with the supplementary brand attributes of the partner (such as the Apple iPhone® for AT&T, T-Mobile
Germany, and other exclusive partners) is becoming solidly established.
In every case, the branding is of great significance for customer experience management because the brand strongly
influences the expectations held by customers with respect to the products, the services, and the form of interac-
tion with the particular company. Conversely, the customer experience in a concrete usage and interaction context
has a major effect on the brand image of a company. A brand identity cannot be successfully communicated long-
term if the customer experience does not match.
16
cf. TM Forum: TMF Insights Report Customer Experience Management, 09/2009, p.10.
17
cf. Detecon Opinion Paper: International Brand Positioning and Insights from Brain Research, 08/2009, p. 4.
18
cf. ibid, pp. 6 et seqq.
19
cf. Detecon Opinion Paper: Multi-Brand Management on Telecommunications Markets, 08/2007, pp. 9 et seqq.

3.2 Focus: The new customer experience orientation

In view of the challenges confronting the telecommunications market described above, an ever greater significance
is being attributed to the specific design of customer experiences with companies. Industry experts today already
regard customer experience management (CEM) to be a decisive enhancement of CRM for the coming decade.20 Of
just under 300 managers surveyed in the USA, 64% consider the “customer experience” to be of critical importance
within the framework of the corporate strategy – and their number is rising.21
The concept of the “total customer experience” was created back in 2002 by Berry/Carbone/Haeckel and describes
a perspective of looking at the way companies perform their services.22 It describes customer experiences through-
out the entire buying process, from the search for information to the complaint. The authors recommend exploi-
tation of the uniqueness of the customers’ experience of the service performance specific to the company as a
way to differentiate one’s own company from the competition. The prerequisite for this is the overall view of the
customers’ contacts (from their perspective) with the company. All the feedback from customers should be used to
improve their experience with the company’s performance.
Since that time, the ideas of Berry et al., have been widely accepted in the telecommunications industry as customer
experience management and various approaches have been developed and tried in practice. CEM has already
become established as an organizational unit in some telecommunications companies and is more and more
frequently the subject of Detecon projects conducted for domestic and international clients. It is certain that CEM
has great potential to supplement current CRM concepts in a meaningful way.
In the following chapters, customer experience management will be spotlighted on the basis of surveys among
experts and customers within the framework of a market study. The results will be consolidated in the Detecon
CEM Framework. In conclusion, the recommendations for action will summarize the results to achieve an optimal
design of customer experience.
20
J. Hauk, C. Jost, A. Luyken, C. Schulz (2007): Detecon study CRM 2010 and Beyond – Opportunities and Challenges for
Telecommunications Companies on High-Performance Markets, Eschborn.
21
Temkin, Bruce D (2008): Obstacles To Customer Experience Success, Forrester.
LL. Berry, Lewis P. Carbone, and Stephan H. Haeckel (2002): Managing the Total Customer Experience, MIT Sloan Manage-
22
ment Review, Spring 2002, Volume 43, Number 3.

4. Survey of experts
Method and respondents of the study
Of the 37 experts from 29 different institutions surveyed for our study using face-to-face and telephone inter-
views as well as online questionnaires, 30% are classifiable as C Level. This is indicative that customer experience
management is now perceived in the executive suites as being relevant for persisting in a high competition
environment. Besides experts from the telecommunications market, we also interviewed decision-makers from
other industries and academicians so that a broad and diversified range of experience could be considered during
preparation of the study. We therefore assume that many of the study results can be transferred to other indus-
tries as well. Some organizations have already set up structural units for which CEM is the primary concern (19%
of the respondents). CEM is met with great interest on the most widely divergent markets, domestic as well as
international (respondents from 10 countries and 4 continents) and is in the process of establishing itself as an
overlapping corporate strategy.
Figure 6: Overview of Participants in the Detecon Study
4.1 CEM from the Viewpoint of Experts

How the expert understand customer experience management
When asked about their understanding of customer experience management, 53% of the respondents described
it as the generation of positive experience for customers. Many of them (42%) noted that the consistency of the
customer experience across all of the customer touch points and business transactions – the horizontal perspective
– was important.
The vertical perspective, i.e., the creation of consistent experience worlds with the brand, and the fulfillment of the
companies’ performance promise is rather disregarded in comparison. Only 8% of the respondents indicated in an
unprompted interview that customer experience management is characterized via the brand.

Assuming the customers’ perspective (36%) in order to better design the interactions with them (31% of the re-
spondents) is an important task for CEM. Moreover, 19% regard CEM as a learning process between customers and
company for the optimization of the service performance. Taking emotions into account during the buying process
and the avoidance of negative experiences (17% of the respondents for each point) indicate that the creation of
loyalty and customer bonds are important tasks of CEM (cf. Figure 7).
How do you understand customer experience management?
Creating customer
53%
experiences
Consistency across all CTP and business
42%
transactions
Taking customer perspective 36%
Design of interactions with

31%
customers
Learning from customers‘ feedback 19%
Integration and consideration of emotions

17%
throughout the buying cycle
Avoiding negative customer
17%
experiences
Brand as center stage 8%
Source: Detecon
Figure 7: CEM from the Participants‘ Point of View (categorized)
Experiences are relevant during ...
... with the basic All experiences are equally

services important to consider…
... information
request 15%
... usage
of products 15%
and services 41%
... malfunction or ... the retention
... buying other faults phase
Relationship
24% or in case of
Intensity of
phase
churn
... presales
21% 47%
15%
32%
Time
Potential Current Lost

customers customers customers Course of
customer
Source: Detecon relationship
Figure 8: Relevance of Customer Experience according to phase of Customer Life Cycle (Mentions in % of Respondents)

Bill Price
General manager and founder of Driva Solutions, former
Global Vice President of Amazon and author of the
bestseller, “Best Service Is No Service”
How do you understand Customer Experience Management?

CEM is the art and science of figuring out what each customer wants and needs,
then surpassing their requirements in a cost-effective, consistent manner that creates
an awesome impression on them.
Which customer experiences are most important for companies?
The most important ones are before someone buys something from you, after someone bought
something from you and when something goes wrong.
How do your clients record and analyze customer experience with their company?
One way is to analyze unstructured data and unstructured speeches. But this also implies feedback
loops to integrate the voice of the customer into their daily work. When a customer has a problem
they can act directly and solve the problem. Another way is to use WOCAS (What our Customers are
saying?). It is an instrument we have developed for a better understanding of the customer.
Do you think it is important to generate different experience depending on the type of
customer or of the product or on other categories?
Yes, regarding to the customer you should separate your most important ones and the new ones.
For the products you should generate different experience based on complexity or newness of the
products for each customer. Doubtless customer experience is heavily influenced by regional and
cultural differences. This is an often underestimated factor.
What are your key factors for success in managing customer experience?
Listen to your customers. Act in order to the voice of your customer. Be proactive to prevent your
customer from bad experience.
Relevance of customer experience in the customer life cycle phases

The question as to what customer experiences along the customer life cycle are especially relevant for customer
experience management divides the respondents into two camps. All of the experiences are relevant for 41% of
them. Customer experience management is understood by these respondents as a continuous and reliably positive
confirmation of experiences for customers. A second group of 47% of the respondents believes that only very
specific moments are relevant for CEM. Of these so-called “moments of truth,” the technical malfunction is menti-
oned as being of utmost significance for the telecommunications industry. Owing to the significantly higher emoti-
onal commitment of customers when making buying decisions, e.g., for IPTV or complex installations of integrating
hardware in private households, 53% regard the (pre-)purchase phase with a cross-channel search for information
by customers, the advising, and the initiation of the sale, up to and including the booking, to be especially relevant
for customer experience (cf. Figure 8).
The usage phase is also especially relevant for customer experience for 24% of the respondents. In the fixed
network sector, this significance arises from the complex process of distributing the end devices and the service
provisioning, including the on-site installation and support during the set-up for the first usage. In the mobile
network sector, the phase between purchase and first use is significantly simpler but due to the emotional involve-
ment in the selection of a mobile end device when concluding or extending a contract, equally important to the
customers and therefore for the CEM.

Intended customer experiences through CEM

Over the course of the development of the telecommunications market, communication, products, and advertising
have become more emotional. The feelings and experience(s) of the customers which are of special significance in
the view of the respondents can be differentiated into three categories:
Brand-related
Feeling of appreciation 33%
Reliability/Trust 30%
Individual satisfaction of 42%

customer needs
Product-related
Delight/surprise/enthusiasm 30%
Consistent experiences 18%

Interaction-related
Simplicity 18%
Competency 12%
Proactivity 9%
Source: Detecon
Figure 9: Intended Emotions triggered by Experience Measures
(1) Experiences related to the company or brand: Owing to the saturation of the market, the current customer
base of one’s own or of other companies is becoming more important. 33% of the respondents would like to
demonstrate their appreciation to their customers. This is to be achieved by seeking to secure the customers’
trust, thereby hoping to erect additional barriers to a change – for no less than 30% of the respondents, the com-
munication of reliability and the communication of trustworthiness are important customer experiences. Many
respondents also establish the high relevance of positive experiences in the customer relationships by means of their
company-specific design of concrete experiences; this is not simply interchangeable from the customers’ viewpoint
and is a major differentiating point in competition.
(2) Product-related experiences: Satisfying the individual needs of customers is designated as the most important
experience and prerequisite for success (42% of the respondents). The reason for this is the trend away from simple
access products to added-value services and the growing importance of FMC and bundled products as growth
drivers for the telecommunications market. Enthusiasm for new and innovative products is also regarded as especially
relevant (30% of the respondents). The creation of “consistent experiences” for customers is mentioned by 18%
of the respondents as one of the top five experience goals: customers’ expectations concerning the brand and the
perceived customer contact and service quality must be consistent and positive at every single touch point. The trail
is blazed by the consistency of individual experiences with the company’s overall benefit promise: the right mix of
function, price, and emotional advantages will determine the market success of future offers.

3) Interaction-related experiences: For many of the respondents, the key to the success of customer experience
management is the way of reaching a new perspective on processes and channels which results from assuming
the customers’ viewpoint. Simplicity continues to be a constant theme for the complex service “telecommunica-
tion” (18%); but making this experience possible during the shorter and shorter innovation cycles is not getting
any easier. The customers’ experience of the company’s pro-activity is regarded by 9% of the respondents to be
the result of modern customer contact management. A provider can make a lasting impression on the customers’
emotional attitude by anticipating complaints or frankly dealing with malfunctions such as a network failure.
Dr. Bernd Weber

Director “Neurolmaging”– Life & Brain GmbH
Can the buying behavior of customers be influenced

by neuroscience?
Today’s focus is primarily on the analysis of key stimuli which influence the way people make
decisions, whether subconsciously or consciously. Trust, satisfaction, and loyalty are analyzed
according to the same procedure – but at the moment, such an analysis is not being conducted with
a commercial focus.
How can stimuli for buying decisions, just to name one example, be identified in the brain?
Magnetic resonance imaging allows us to view neural activation in specific areas of the brain. This is
possible because cognitive efforts, such as making decisions, result in a stronger flow of blood than
is the case in stimulus-free situations. As the flow of blood increases, the oxygen content rises at the
same time – and the increase in oxygen in the blood can be detected by MRI. So it is possible to
determine which areas of the brain are involved in specific cognitive processes.
What have you found to be the factors which most strongly affect customer satisfaction and
customer loyalty in a positive sense?
From a neurological viewpoint, the greatest influence comes from stimulating the human “reward
system” and “learning system”. For example, creating experiences which go beyond the expectation
levels of customers is enormously important in this respect. It is highly interesting to see that the past
plays more of a subordinate role with respect to expectation levels or the exceeding of expectations.
This is a very interesting aspect, especially concerning retention measures towards the end of a con-
tract term, because customers do not “bear grudges” from a neurological viewpoint! This means that
the presentation of a new offer shows the same brain physiology for both new and current customers.
However, past interaction is interesting for the learning capability of the brain. Certain experiences
are significantly more important than others because these moments remain deeply anchored in
customers’ memories. This learning function confirms the significance of good complaint manage-
ment as well as the necessity of initiatives to avoid complaints and contacts which do not generate
value for customers and company, e.g., a contact induced by invoice items which are unclear.

Capturing and analyzing customer experience

All of the respondents capture or analyze in some form the experience of their customers with the respective com-
pany, its performance, or the services it provides. Marketing is frequently mentioned as an important function for
the creation of an overall view of customers’ experiences. The surveyed companies frequently implement external
measures for the recording and analysis of experiences; they mostly engage specialized external agencies (38%
customer surveys, 28% studies). Internal measures are applied less frequently: analysis of customer contacts (24%),
complaints (17%), and terminations (17%) are the most widely used because the coding of the customer feedback
or behavior is done immediately by the employees at the front-end system and the administrative expenditures for
the processing of the information are relatively low. Qualitative surveys such as employee surveys (7%) or discussion
group interviews (3%) which always bear a substantial effort for categorization and consolidation are conducted
less often. The hollistic (external and internal) information potential is exploited very rarely by the companies.
External Measures Internal Measures
0% 10% 20% 30% 40% 0% 10% 20% 30% 40%
Customer contact
Customer surveys 38% 24%
analysis
Studies 28% Complaint analysis 17%
Termination
Satisfaction analysis 21% 17%
analysis
Feedback
Mystery shopping 17% 14%
management
Net Promoter Score 17% Call assessment 14%
‘Operations day’ for
Usability analysis 10% 10%
executives
Social media analysis 10% Usage data analysis 10%
Brand analysis 7% Employee surveys 7%
Discussion
Loyalty analysis 3% 3%
groups
Source: Detecon Source: Detecon
Figure 10: Ways to Capture Customer Experience (% of Respondents; Multiple Answers)
Many companies prefer case-based learning as a way to determine the customers’ perspective, while expectations
and requirements are explored by the use of surveys. Although many of the respondents confirmed the value of
the information from these sources, the company can frequently use the generated knowledge only in very specific
cases.

4.2 Overview of Current CEM Measures

4.2.1. CEM Measures for Designing Customer Experiences
Possible ways to design customer experiences were identified during the interviews with experts by asking un-
prompted questions. The interviewees mentioned a variety of more or less non-overlapping key words, concept
names, and project approaches. Some of them were mentioned especially frequently and discussed at length by
the respondents.
Relevance
Generation of
5.0 customer insights
4.5
Employee
empowerment Moments of truth
4.0
3.5
3.0
2.5
2.0
1.5 Frequency
1.5 2.0 2.5 3.0 3.5 4.0 4.5 5.0
Source: Detecon
Figure 11: Relevance and Frequency of named CEM Measures23
A group of 10 measures regarded as particularly important for customer experience was derived (cf. Figure 12):
1 Moments of Truth
2 Generation of Customer Insights
3 Employee Empowerment
4 Customer Experience Design

TOP 10
5 Proactive Complaint Management Customer
Experience
6 Development of a CEM Currency Management
Measures
7 Customer Service Excellence Program
8 Individual Needs Based Selling
9 Channeling Voice of the Customer into Action
10 Disaster Recovery and Business Continuity Planning
Source: Detecon
Figure 12: The TOP 10 CEM Measures
23
Relevance on a scale from 1 to 5 | Best rating = 5; frequency on a scale from 1 to 5 | x, very frequent = 5, multiple answers
possible

The 10 most important CEM measures in detail
Exploiting the “moments of truth”: The fact that they combine the three fundamental ideas behind CEM is alone enough
to point up their great importance:
Moments • The assumption of the customers’ perspective to evaluate the company’s performance on the market
of Truth • The awareness that the evaluation of the performance capability is determined by critical moments when the
company’s performance or failure to perform is perceived especially clearly
• The starting point for action behind this concept related above all to the “last mile of providing service” to the
customers which is especially perceptible or discernible for them
“Customer insights”: Many companies go to great lengths in their attempts to understand the service expectations and
Customer perception of their customers. Unlike the “moments of truth”, the generation of “customer insights” is not concerned with
Insights the specific moment, but rather with a general exploration of the company’s strengths and weaknesses from the customers’
viewpoint. Furthermore, the attempt is made to identify the basic requirements and the delight elements of products and
services.
“Employee empowerment”: The experience of the company’s performance is strongly marked by the interaction of custo-
Employee mers with the company’s employees. Ensuring their fundamentally friendly attitude, customer orientation, sincere conduct,
fair advising, competent information, and fast help are well-known success factors. The importance of the employees was
Empowerment frequently summarized by the respondents using the key phrase, “employee empowerment”, meaning the provision of a
supportive infrastructure and the assignment of decision-making authority to the employees in direct contact with custo-
mers.
Customer “Customer experience design”: The customer-friendly design of products, services, and interaction as well as customer-
Experience centric optimization measures for a company’s basic services are secured by customer experience design. The focus is on
Design the optimization of the customer experiences and experience within the framework of the “customer journey” generated for
customers by the design of company services.
“Pro-active complaint management”: The way complaints are handled is regarded as a key quality indicator for customer
Pro-active orientation and a company’s performance capability. After all, a complaint is an important “moment of truth” from the custo-
Complaint mers’ viewpoint. The company’s reaction is experienced as “extremely positive or negative”, resulting in correspondingly
Management strong emotional reactions. That is why many of the respondents view “pro-active complaint management” as critical for a
company’s success. Early recognition of causes of complaints (e.g., by using triggers in the CRM system) make it possible
to satisfy customers even before they have time to voice a complaint.
“Development of a CEM currency”: A common bias with respect to “soft” or experience-oriented options for actions now
appears to be a thing of the past. The measurement of the effects of measures for the positive design of customer expe-
Development
rience is now mentioned as of equal importance with the measures themselves. Companies depend on a combination of
of a CEM internal and external viewpoints when measuring these effects. The “development of a CEM currency” means, for example,
Currency that it must be possible to model statistically valid relationships between the largely satisfaction-oriented key performance
indicators (KPI) and the financial indicators (e.g., turnover, CM I, customer value, etc.) in a CEM dashboard or similar instru-
ment. This is the way to create transparency with respect to the economic efficiency of a CEM measures.
“Customer service excellence programs”: Significant variation in the company’s performance have an especially unfa-
Customer
vorable effect on the perceived quality of the services. “Customer service excellence programs” therefore attempt to achieve
Service Excel- a desirable basic level in the CE-relevant KPIs or to stabilize firmly a high level, e.g., by orchestrating various service and
lence Program customer experience initiatives. As they strive to achieve these goals, customer service excellence programs utilize findings
from especially successful or especially poor performances of services to the customers.
“Individual needs based selling”: In addition to the numerous approaches in the area of service design, service perfor-
Individual mance, and after-sales, the individual needs based selling also pushes its way into the top group of the customer experience
measures. This is based on the awareness that the usage-oriented address and advising of customers is an essential, but
Needs Based
often neglected, determinant for customer satisfaction, elationdelight, and loyalty. Companies which attributed particular
Selling importance to this measure aimed above all at the ideal quality of their advising services and the subsequent improved
success quota as well as the reduction of the termination rate, which simultaneously has positive effects on customer sa-
tisfaction and loyalty.
“Channeling customer voice into action”: The significance of the customer perspective and of the knowledge about
Channeling customers can be seen as implicit in many customer experience concepts. Customer feedback management, customer
Customer surveys, workshops with customer participation, and “case-based learning” are utilized with this objective in mind. However,
Voice into the assessment of the acquired information is considered to be more important for the success of the measures than the
Action application of these methods. “Channeling customer voice into action” in this context refers to the attempts to turn uncoor-
dinated isolated activities into a holistic learning process which makes this valuable information, so difficult to consolidate,
generally available within the company.
Disaster “Disaster recovery and business continuity planning”: As they concern an industry which provides very large groups of
Recovery customers with telecommunications services, disruptions in the technical infrastructure quickly turn into a question of trust
and Business and survival, eagerly seized upon by the media. So “professional intervention management” includes crisis, disaster, and
compensation management. The goal is to create structures and processes which can be activated quickly in the event that
Continuity
complex problems arise.
Planning

4.2.2 Differentiated and Selective Experience Design

The differentiated treatment of customers is one of the most important strategies for the improvement of
effectiveness and efficiency in customer management. The experience-oriented design of products, services, and
interactions must also be subjected to the test of economic efficiency as well. When asked which differentiation
approaches were especially promising of success, 24% replied that this depended on the expectation attitude of the
customers. This in turn is dependent on the strategic positioning of the company on the market (premium versus
discount provider), the emotional commitment of the customer when deciding to buy a specific product, and,
ultimately, on the price of the product.
79% of the study participants associate the triggering of varying experiences with the classification in customer seg-
ments, e.g., differentiated according to customer value. This can be explained by the high proportion of customer
contacts in the area of service, where the efficiency of customer service is strongly determined by a rigorous orien-
tation to customer value and customer life cycle.
Categories for Experience Differentiation
� depending on lifestyle
� depending on revenue
� depending on customer behavior
� according to the most important � depending on complexity
and new customers of the product
� depending on stage in customer life cycle � depending on customer needs/
preferences
� optimized experience for key
products
� depending on geographic
location/region
� process: provision, relocation
� according to customer loyalty
79 %
52 %
24 %
Customer Group Product Group Other Categories

: Detecon
Source:
Figure 13: Intended Differentiation of Customer Experiences

(Mentions in %, Multiple Responses)
Orientation on the acquisition process is significant for the selective design of customer experiences: depending
on the particular process step (search for information, purchase, installation, use, and replacement), the require-
ments and consequently as well the customers’ expectations for the company’s performance vary. Although this
awareness sometimes plays a role in product and service design as well as in process re-engineering, it is virtually
ignored in the design of distribution channels. This also explains the seemingly contrary statement by many of the
respondents that the non-differentiation of customers is an important component of the CEM approach. After all,
the consistent image with respect to products, prices, and the fulfillment of the brand promise across all distribution
channels is the goal of customer experience management.

4.3 Objectives, success factors, and effectiveness

4.3.1 Objectives of Customer Experience Management
The ideal result of customer experience management is the positive surprise of the customers and the over-
fulfillment of customer expectations on the basis of functioning processes. The most important objective of CEM,
as mentioned by 45%, is the surprise or delight of the customers, followed by measures to create loyalty and the
establishment of trust with respect to the customers.
Objectives of Customer Experience Management
Surprise and delight of customers 45%
Emotional customer loyalty & strengthened 24%

loyalty through greater trust, etc
Positive perception of the brand 14%

and differentiation from competition
Increase in revenues through recommendations

14%
(customer advocacy, positive word-of-mouth)
17 %
Increase in cost efficiency, profitability
10%
of marketing, sales, and service
Increase in customer satisfaction through

10%
(over)fulfillment of customers' expectations
Source: Detecon
Figure 14: Objectives of CEM from the Participants‘ Point of View
No fewer than 24% of the respondents intend to build up an emotional customer bond by means of CEM, e.g.,
through emotional relationship points such as reliability, integrity, reachability, etc. 14% expect an improved com-
pany image and subsequently a positive differentiation from the competition. The goal of increasing turnover
through improved recommendation quotas is mentioned just as frequently. The fact that the improvement of cost
efficiency and profitability is regarded as of equal value with the goal of increasing customer satisfaction is a clear
indication of the market maturity of the CEM approach.
4.3.2 Success Factors

In the opinion of the study participants the success of customer experience management is determined by three
key factors: integration of the employees (59%), hollistic company thinking and action (48%), and the exploitation
and provision of customer data (44% of the respondents).
1. Employees make a lasting impression in many ways in their contacts with customers, long remembered as part
of the customers’ experience. The significance of the specific know-how at the customer touch points as well as
the immediate effect of the employees’ personalities on customers are revealed by the high correlation between
employee motivation and customer satisfaction. Employees who live and breathe customer orientation, supported
by pride in the companies’ products and by appropriate incentive systems, are further success factors.
2. An essential prerequisite for the implementation of a successful CEM is a holistic way of thinking across the
boundaries of processes and channels by taking up the customers’ viewpoint. Since the customers’ experiences
are influenced by the various partial services of the business departments in the company, measures must be taken
to prevent “silo thinking” in the organization. A prerequisite for achieving this is close coordination among the
involved business units.

Bob Fletcher
CEO North American Customer Service at Arvato Digital Services
and former Executive Vice President
of the Service Academy of Deutsche Telekom
What is your understanding of customer experience management (CEM)?

For some, CEM is just another word for customer relationship management (CRM), but CEM can be
much more. If done correctly, it can uncover the real needs of your customers. A company has to
listen to its customers. CEM is not only about listening, it’s about changing. CEM means changing
to align yourself with your customers’ experiences. Find out why there was a mistake and resolve it
so that other customers don’t experience the same thing. View complaints as a chance to improve
yourself. Uncover the reason for the problem and fix it. That’s it. That’s CEM.
I believe the Telco customer experience of the future will be based on innovations like location-based
services. For example, a customer is in a shop holding a product in their hands and their mobile
device lets them know that the same product can be bought for half the price in a shop one block
away. Or a provider automatically giving credits to customers whose calls have been dropped.
Don’t wait for the customers to complain. Most of them never will – they just leave. You have to be
proactive.
People often talk about emotions in connection with CEM. How important are these emotions
for CEM? Emotional ties ultimately increase loyalty, but be careful. Many customers may not want
to have a relationship with their service providers – especially an emotional one. That’s why it is so
important to listen to the customer and understand their expectations.
How should a company catch up on the experiences of its customers? In terms of the Telekom
Service Academy, I help executives learn more about their customers. One central element is working
at the frontline face-to-face with the customer. This is the most effective way to experience the true
customer experience and also the employee experience, which is key to improving the customer ex-
perience. The CEO of Fedex worked for one week in a warehouse without anybody having any idea
who he was. Everyone should do that.
The positioning of the people in charge of CEM with the aim of creating specific customer experience worlds brings
about a high level of transparency and short communication paths among the responsible positions (constant
sharing of contents, regular communications, etc.). Some companies operationalize CEM goals with CE-relevant
key performance indicators.
3. Making all of the collected information about the company’s performance capability from the customers’
perspective available from a central source is regarded as critical for success. Methods mentioned as usable for
this purpose include the assessment of customer contacts (operational systems), the customer feedback manage-
ment (forums, blogs, complaint reports, etc.), and customer surveys (customer satisfaction or customer loyalty
indices, etc.).

4.3.3 Analysis of the effects of CEM measures

75% of the respondents measure the effects created by measures intended to design experience, whereby custo-
mer satisfaction is the most frequently mentioned target value (62%). In the view of our study participants, the
relevant KPIs include customer loyalty indices, net promoter score (NPS), and various customer satisfaction indices
(overall satisfaction, contact satisfaction, complaint satisfaction). Many regard the TRI*MTM customer loyalty index
as especially relevant. It encompasses, along with customer satisfaction, also the intention to buy again and to
recommend to others. Moreover, it can serve as a cross-company benchmark. Only 24% of the respondents who
measure the effect analyze the relationship of the calculated KPIs to the economic data such as turnover, contri-
bution margin I, customer value, etc.
25% of the interviewees do not measure the actual success of CEM measures and their effect. They criticize the lack
of validity of the statistical relationship between the survey results and the effects of the results over time. In additi-
on, the point in time of the survey plays a decisive role in determining which factors from the customers’ viewpoint
play a relevant role for the assessment of company performance. For example, in the case of a complaint, the com-
petence in finding a solution is all-important for the customers’ satisfaction, while the agent’s advising competence
is important for the customers buying a new product.
Answers of participants, whether they measure the effect of CEM
If yes, on the basis of ...

� Delight measured through
positive word-of-mouth
No Satisfaction 62% � Promptness of payment
� Number of products,
25% services or locations used
Loyalty 52% � Churn reactions
� Specific analysis of
advertising effects
75% Other KPIs 52%
� Product experience
� Number of queries
received by customer
Turnover/ 24% service
revenues
Yes � “Brand Performance”
� Campaign evaluation
Source: Detecon
Figure 15: Customer Experience Performance Measurement (% of Mentions; % of Subset)

4.3.4 Management of Employees on the Basis of CEM Indicators

The consistent implementation of the customer experience management requires a comprehensive setting of
targets for marketing, sales and service. In the best case, meeting these targets is secured by a common CEM
reporting system and the corresponding steering committee. 87.5% use the findings as signposts for instructions to
their employees, whereby customer satisfaction is the management figure most frequently mentioned.
However, there has to be a high level of differentiation concerning the employee’s functional role or level of
responsibility in the company. The most important difference is whether an employee is integrated into service
performance chain with direct customer contact or not. Moreover, some of the respondents were of the opinion
that the merger of sales and service tasks and the related crossover targets set for employees are supportive of
customer-oriented behavior.
All respondents agree that managing employees solely on the basis of CE-relevant KPIs does not lead to an optimi-
zation of the company’s business goals. They have the inherent risk that employees’ self-optimization will be one-
sided in this direction. Nor does it suffice to define the company’s overall achievement of its targets as a part of the
employees’ targets. CE KPIs should be tied to “indicators which can be influenced directly” as well as to personal
turnover or cost reduction targets.
Answers of participants, whether they set CE optimized incentives for employees
If yes, on the basis of ...

No
Customer
45%
12.5% satisfaction
Net Promotor Score 24%
Other customer
17%
87.5% loyalty indices
Financial
17%
KPIs
Yes
Churn 7%
Source: Detecon
Figure 16: CEM Oriented Target Systems for Employees

(% of Mentions; Multiple Answers Possible)

5. The customer perspective: results from basic research

In the following chapter, the customer perspective regarding successful customer management and the empirical
relationship between “emotional customer loyalty” and company success will be presented on the basis of research
results of the forum! Group. Some companies are less troubled by hard economic times than others. What makes
them successful? Companies with a high level of customer orientation generate a strong “emotional customer
loyalty” which verifiably contributes to the company’s economic success. Companies with excellent relationship
management can depend on their regular customers and need not concentrate solely on the high-cost battle for
new customers on shrinking markets.
5.1 Customer Championship

The Deutsche Gesellschaft für Qualität e.V. (German Society for Quality), Frankfurt, and forum! Marktforschung
(forum! Market Research), Mainz, searching for the companies with the best customer relationships in Germany since
2008 within the format of the competition, Deutschlands Kundenchampions® (Germany’s Customer Champions).
Deutschlands Kundenchampions® are outstanding, empirically verifiable examples which prove that consistent
service and customer orientation are a key opportunity for companies to position themselves successfully on the
world market.24 The following causality chain can be derived from the findings gleaned from the competition and
the many years of scientific base conducted by forum! within the scope of the Excellence Barometer®25 :Companies
with a high level of customer orientation generate a strong “emotional customer loyalty” with their customers, and
this in turn verifiably and clearly contributes to the company’s economic success.26
To put it simply: successful companies act as “customer champions”; they have grasped what factors make lasting
impressions on customers and secure their loyalty to the company, its products, and its services. Germany’s custo-
mer champions orient their “relationship management”– as a major building block of their management philoso-
phy – concretely to the needs of their customers. Thanks to this orientation, customer champions are demonstrably
more successful than other companies.
Customer champions are characterized by the following:

• They create an especially strong emotional customer loyalty; they exploit an optimal mix of outstanding
performance and first-class image to turn their B2B and B2C customers into fans of their companies.
• They “live and breathe” customer orientation throughout the company. The entire organization is conceived
with the customer in mind.
• Customer champions take advantage of every contact between customers and employees to strengthen the
customer relationship. They rely on the “human factor”, thereby adding to the relationship the all-important
“drop of heart’s blood.”
• The high degree of customer orientation among their employees exerts a positive influence on the emotional
customer bond.
• They have excellent customer relationships, independently of the size, industry, and business model of the
company itself.
24
In conducting this competition, the initiators want to heighten the awareness of companies for opportunity and dissemin-
ate the latest findings from research and practice for the improvement of a company’s performance capability. By promo-
ting public discussion and offering the chance to learn from the best, the competition contributes to the development
ment of excellent relationship management in companies. For additional information, go to:
www.deutschlands-kundenchampions.de.
25
The Excellence Barometer® (ExBa®) is the benchmark study on the performance capability of the German economy. The
goal of the ExBa® is to identify corporate success factors and communicate them to organizations in Germany. The initiators
of the study are the Deutsche Gesellschaft für Qualität e.V. (German Society for Quality), Frankfurt, and forum! Markt-
forschung GmbH, Mainz (forum! Market Research). For additional information, go to www.exba.de
26
This can be clearly demonstrated on the basis of business data which can be evaluated (cf. Chapter 5.3)

5.2 Success Factors of Customer Champions

As described above, successful companies are disproportionally in many cases customer champions: they
constructively utilize the awareness that every customer contact bears within the opportunity to intensify the
customer loyalty. Success factors of customer champions can be derived from the ExBa® Business 2009 Benchmark
Study.
Firmly anchored in the corporate model and everyday life of the company
The topic of “customer orientation” has been anchored as a firm role model of the company for more than 90%
of the surveyed German companies. Moreover, 72% of the successful companies base concrete target values for
their customer orientation on this model; only 63% of the less successful companies do the same. 58% of the sur-
veyed successful companies conduct an evaluation of the target values of customer orientation and rewards/penal-
ties for the achievement/non-achievement of these targets – in comparison with only 45% of the less successful
companies.27
Brand management and strategic positioning

Furthermore, brand management and strategic positioning are important levers. Strong emotional bonds are cre-
ated when companies set themselves perceptibly apart from their competitors through their special strengths.
Successful companies, for example, involve their customers in the (further) development of products and services,
thereby creating a strong sense of identification.
Target group related offerings

Customers appreciate individual products customized to meet their specific needs. About half of the survey com-
panies regularly carry out the target group segmentation necessary for this purpose, the successful ones more
frequently than the less successful ones. Customer loyalty programs hold promise of success only if they are oriented
to the unique selling proposition of the company.
Responsibility for customer loyalty

Important starting points are self-analysis and self-criticism. Only a few companies are prepared to regard them-
selves as responsible for weakening customer loyalty. Three-fourths mention external factors as the reason behind
the weakened customer loyalty; only 17% look for the causes in their own area of responsibility.
Service quality and sustained customer orientation

A close relationship can be clearly discerned between service quality and customer orientation of the employees
and the emotional bonding of customers to the company. The degree of customer orientation among employees
is decisively influenced by their motivation, in turn a product of their personal traits (intrinsic motivation) and the
general conditions at their place of work (extrinsic motivation). The contact between employees and customers
offers excellent opportunities to shape a business relationship emotionally and consequently uniquely: successful
companies have motivated employees and higher customer orientation.
If a sustained impression of customer orientation is to be created, it is not enough to look solely to the employees
with customer contact. The overall impression made by the company must generate a consistent image in this
respect. In other words, the general attitudes of the company towards customer orientation, not just the attitudes
and behavior of the employees and their superiors, must be shaped in such a way that they are credible and con-
vincing for customers.
®

27
Studie ExBa Business 2009, www.exba.de

Word of mouth recommendation

Recommendations for services and products generated by customers (e.g., in the form of product reviews on online
portals or among friends and family) are especially effective because they are perceived as highly credible from a
customer viewpoint. “Using testimonials to convince others” does not yet enjoy the attention it deserves, but has
tremendous inherent potential which can be exploited when companies know their loyal customers and specifically
make use of communications channels.
Communication of success
The importance of the communication of success within the scope of professional relationship management is
frequently underestimated. Who wouldn’t like to be the customer of a successful company? There is need for action
in this area. Successes are a big item during upswing phases – but problems arise when customers are expected to
perceive the company as successful in economically troubled times. This is when employees play a key role because
their positive sense of their own company translates into positive perceptions by customers as well.
Complaint management
Complaints put loyalty to the test. Customers expect companies to outdo themselves when complaints are made.
The bar for efficient and professional complaint management is to reach “outstanding” satisfaction for the custo-
mer voicing the complaint! “Mere” satisfaction will not get it done – rating the handling of a complaint as “good”
is not sufficient to achieve positive effects (cf. Figure 17).
79
forum! Customer Loyalty Index
74
Reference line =
66
Loyalty index of
customers without
complaints 60
Mean value: 74
52
35
36
100 (very satisfied) 75 50 25 0 (very dissatisfied)
Satisfaction with Handling of Complaints

Source:forum! Marktforschung
Figure 17: Cohesion of Complaint Satisfaction and Emotional Customer Loyalty
Opportunity for emotional identification with the provider

Whenever products become more and more substitutable, customer loyalty is a major source of sustained company
success. But this works only if the company possesses an unmistakable, differentiated identity and offers customers
the opportunity to identify themselves emotionally with it. Customer experience management provides a meaning-
ful opportunity to deepen customer loyalty substantially.

5.3 Emotional Customer Loyalty

5.3.1 Significance and Measurability of Emotional Customer Loyalty
Customer satisfaction is essential for the success of a company – but it is not enough. More than one-fourth of the
customers are highly satisfied with the performance of a company, but they nevertheless do not have a durable
tie with it. The decisive target value for companies is the emotional customer bond28: emotionally loyal customers
buy more frequently, are less sensitive to prices, and less susceptible to offers from competitors. Emotionally loyal
customers are enthusiastic fans of their company and recommend it more often.29 Yet emotional customer loyalty
is not static; it fluctuates constantly. Measurements must be repeatedly taken over the course of time. Two drivers
influence the emotional customer bond: the emotional side (image) and the rational side (satisfaction). The overall
image is a composite of the perception of individual image factors – the customers’ overall satisfaction is built up as
a conglomerate of numerous individual satisfaction moments.
Willingness to recommend
Intention to buy again
Willingness for cross-buying

forum!
Customer Loyalty
Index
Unique Selling Point (USP)
Trust
Commitment
Source: forum! Marktforschung
Figure 18: The forum! Index for the Measurement of Emotional Customer Loyalty
What is the purpose of a customer loyalty index?
The emotional customer loyalty is one of the most important drivers for the success of a company. Measuring
the degree of customers’ loyalty to a company requires an instrument which makes these drivers assessable
and comparable in a benchmark. The forum! customer loyalty index enables the measurement of the custo-
mer bond and is thus an important management instrument.
How does the forum! customer loyalty index work?
The index for the measurement of the emotional customer loyalty developed by forum! market research
and used extensively as a tried and proven instrument is generated from the six indicators “intention to buy
again”, “willingness to recommend”, “cross-buying willingness”, “claim to exclusivity”, “trust”, and “commit-
ment”. Standardized weighting factors are applied to calculate a weighted index on the basis of the answers
from respondents. The result is a hard indicator, and its development can be tracked over a period of time by
repeatedly taking measurements. The index is measured on a scale of 100 points and can be compared with
average values from the forum! research.
The customer loyalty index developed by forum! from the ExBa® research measures the strength of the emotional bond
28
on the basis of six weighted indicators. These indicators have proven to be especially suitable for distinguishing between
profitable and non-profitable customers
®
29
ExBa research

5.3.2 Emotional Customer Loyalty and Company Success

Most markets are characterized by high market saturation and fierce competition. The differentiation potential of
products declines, and even product innovations generally only have a brief differentiation impact. The Internet has
created a high degree of market transparency which is highly appreciated by customers. During the last few years,
customers have developed into avid bargain-hunters, and this tendency has been reinforced by manufacturers and
retail trade alike through their focus on prices. It has long been clear that there is a price to be paid: the stability of
customer relationships is eroding. The subsequent decline in customer loyalty is a constant factor throughout all
industries. So the stability of customer relationships is decisive for the success of the company. But how are stable
customer relationships established and sustained? There are plenty of customer loyalty programs – but their effects
are often disappointing. A substantial part of the customer base is very satisfied, but feels virtually no sense of loyalty
to the company – seemingly disloyal for no reason?
So what are the essential tasks for companies to create an emotional bond with their customers? The key to this
bond is frequently seen in customer satisfaction. There is a general assumption that satisfied customers will also
remain loyal. That is why companies invest in performance, conduct satisfaction surveys, optimize their product
lines and their service, train staff members, and set up loyalty programs. But these investments often fail to produce
the hoped-for returns because satisfaction does not automatically translate into a emotional bond. The ExBa study
impressively documents this fact with the aid of a cluster analysis in which customer groups are formed according
to satisfaction and emotional customer loyalty.
Above-average
Fans 21
21%
%
Gefangene
Prisoners
Followers
S ympathis anten
Emotional Loyalty
27
27%
%
34
34%
%
Mercenaries
Söldner
Terroristen
Terrorists
Below-average
11
11%
%
88%
%
Below-average Above-average
Overall satisfaction ExBa customers (B2C)
Figure 19: Customer Typology based on Satisfaction and Emotional Customer Loyalty
Five groups can be distinguished here: in the upper right of the portfolio, in the area of high satisfaction and
emotional customer loyalty, we find the “followers” and “fans” of the company.
Followers: The followers are satisfied, but highly critical. Nevertheless, they display a very strong
emotional customer loyalty. They are evidently prepared to forgive small mistakes made by the com-
pany because the emotional side of the customer relationship provides adequate compensation for
such failures. As long as the company continues to strengthen the emotional aspect, these customers
are highly unlikely to leave the fold.
Fans: The level of satisfaction for fans is above average, and they are strongly bonded emotionally; a
company does not need to be concerned about these customers in the least.

So in total, companies in Germany have only about 48% (b-to-c)30 of their customers on the “save side”. But this
also means that about half of the customers do not have a stable customer relationship to their providers. These
potentially at-risk customers break down further into three groups.
Terrorists: Terrorists are as good as lost for the continuation of the customer relationship – unless
there are massive obstacles to a change such as contractual commitments or a lack of alternatives.
Importantly, terrorists represent a risk to a company’s image because they communicate their nega-
tive experience.
Prisoners: Although highly dissatisfied, prisoners still have certain but weak emotional customer
loyalty with the company and its products.
The size of this group in the consumer sector is 34% of the customers – about one-third.
Mercenaries: Although their level of satisfaction is above average, they have only weak emotional
customer loyalty to the company. In this case, the rational side of the customer relationship is in good
shape, but not the emotional aspect. Despite the high level of satisfaction, these customers have a
potential churn risk or are latently prepared to change. If other providers entice them with a good
offer, they are gone.
Customer orientation raises the level of the emotional customer loyality and the fan quota
The key conclusion here: whether customers intend to buy again in the future and are willing to recommend the
company to others is dependent on their emotional ties to the company. Clear customer orientation in all of the
company’s activities strengthens the emotional customer loyalty and raises the fan quota within the customer
base.31 Fans are keen to recommend: the company to other potential customers – and pinpointing ways to optimize
products and services to the company. Fans are customer experience front runners with a positive attitude towards
the company.
Satisfaction Loyalty Groups in Dependency on Contact Satisfaction
Very high
51% 34% 12%
contact satisfaction
Average/low
15% 42% 30% 8% 6%
contact satisfaction
Fans Followers Mercenaries Prisoners Terrorists
Source: Customers from commissioned study of forum! Marktforschung
Figure 20: Customer Orientation Expands the Fan Community
30
The study examined this aspect for the B2B area as well and came to conclusions which are structurally similar.
31
Companies with very high contact satisfaction with customers have almost three times as many fans (51%) as companies
with average or low contact satisfaction (15%). Cf. forum! B2C commissioned study.

Emotional customer loyalty supports commercial success

Emotional customer loyalty correlates verifiably with customers’ purchase behavior: emotionally loyal customers
buy more often and higher quantities, are less likely to be enticed by offers from competitors, forgive mistakes and
mishaps more readily, and actively recommend the company to others. That is why an emotional customer bond
has a measurable effect on business success: companies or branches with strongly loyal customers have substan-
tially higher profits than their comparable partners whose customers display only weak loyalty.
Retail study: Correlation of Emotional Customer Loyalty and Return on Sales
Returns on Sales
Emotional Customer Loyalty
Source: forum! customer survey for a retail company; retail branches
Figure 21: Correlation of Emotional Customer Loyalty and Return on Sales
The six factors of the index for emotional customer bonds have an effect on economic indicators. The degree of
emotional customer loyalty correlates to the return on sales and other commercial indicators. Indicators such as
“EBIT”, “growth in turnover in percent”, “productivity”, “gross profit in percent”, and “development of the market
share of the most successful product” are significantly influenced by the customer orientation of the employees.
Emotional customer loyalty and commercial success
Willingess to 88 1,4
EBIT
recommend 69 1,0
87 1,5
Trust Revenue growth in percent
70 1,3
Long-term customer 85 1,3

Productivity
relationship 66 1,0
81 1,3
Commitment Gross profit in percent
62 1,1
Development of the market

76 1,4
Claim to exclusivity share of the most successful
60 1,2
product
Willingness for 65
cross-buying 45
Companies with highly customer-centric staff Companies with less customer-centric staff
Source: Deutschlands Kundenchampions 2009; mean value on a scale of 0 (do not agree at all) to 100 (agree completely)
or from -2 (much worse) to +2 (much better) in comparison with an average company in the sector
Figure 22: Emotional Customer Loyalty through Customer Orientation and Customer Experience Management

6. The Detecon CEM Framework

The Detecon CEM Framework merges the results from the expert survey and the findings from the customer’s
viewpoint into a holistic presentation of the elements of a practice-oriented customer experience management.
These elements display the various interdependencies and relationships in a complex self-regulatory cycle. This
is why the long-term success of CEM measures can be secured only by means of a systematic and orchestrated
composition of all factors. The individual fields and their relationships are described in the following and subse-
quently operationalized in Chapter 7 in the form of concrete recommendations for action.
Customer Insight Brand Brand Halo

-
Design
Quality and
Product and Brand Product/Service Performance
Communication Management
Customer
Expectation Fulfillment
Experience
HR-Excellence
Customer Insight CEM Measures and Channel
Synchronization
Design
Interactions
Source: Detecon
Figure 23: The Detecon CEM Framework
Customer experience
The focus of the CEM Framework is on the customer experience which arises through the individual customer’s
comparison of expectations and fulfillment: if expectations are exceeded, the result is an emotionally positive
customer experience, but if expectations are not fulfilled, the customer experience is correspondingly negative. A
fundamental approach of CEM is the influencing of expectation levels and their generation as well as the perception
of their fulfillment by the targeted design of brand, product/service, interactions, and special CEM measures. The
following tasks must be taken into consideration.
Customer insight
The generation of customer insight is of great relevance at a number of points in the CEM self-regulatory cycle. The
process serves the continuous determination of customer expectations and needs for each customer group, laying
the baseline for customer-oriented product and brand development as well as expectation-oriented experience and
interaction design. Moreover, the systematic surveying and observation promote the determination of performance
perception and experience effects from the interplay of product, brand, interaction, and specific CEM experience
moments.
So a company’s strengths and weaknesses from the customers’ viewpoint can be revealed and optimized with an
effect on the experience in the sense of a continuous improvement process. Furthermore, it is possible to distin-
guish in this way between basic requirements and delight elements, and the moments of truth for each customer
segment can be identified. Well-known methods to achieve these goals are customer surveys, discussion group
interviews, and usability studies, but complaint management and feedback management programs belong here
as well.

Product and brand communication

The development of customer expectations is based to a significant degree on the perceived product and brand
communication. CEM concepts can benefit from this by influencing specific customers’ expectations level and
making it easier or even possible to exceed expectations. If, for example, the company’s communications convey
unrealistic promises, it is virtually impossible to fulfill the resulting expectations through CEM. To this extent, the
product and brand communication is an integral component of the CEM Framework so that customers’ expecta-
tions attitudes can be steered and exceeded actively to create positive experiences.
Brand halo
The brand affects the customers’ perception of performance just as it creation influences expectations (halo effect).
This can be a positive factor if the perception is improved by the brand. But in the very same way, a brand can
also have undesirable impact on performance perception; for example, consumers may evaluate the price level of
a brand provider as being worse than it actually is in objective terms. This occurs particularly often in situations in
which customers are unable or unwilling to make an objective evaluation because of an overwhelming flood of
information, limited involvement, or deliberate lack of transparency on the part of the market. By specifically
designing the brand, CEM can steer the perceived fulfillment of expectations as well as the development of
expectations.
Quality and performance management

Companies secure the operational fulfillment of performance targets as defined in the course of the product or
service design with the aid of quality and performance management (e.g., using a CEM KPI dashboard). In this
case, CEM defines the criteria of the company’s measurement of quality on the basis of the disclosed quality percep-
tion determinants of the customers and assures goal-oriented performance of the basic service.
HR excellence
Employees with frequent customer contact have a lasting impact on customer experience. The significance of the
specific know-how at the customer touch points as well as the immediate effect of the employees’ personalities on
customers are revealed by the high correlation between employee motivation, emotional customer loyalty, and the
company’s success. When employees are motivated to live and breathe customer orientation through leadership,
proudness of the product(s) and the appropriate incentive systems, the result is a decisive aid to effectively turning
CEM activities into positive customer experiences.
Channel synchronization
The objective of channel synchronization is the assurance of consistency of interactions across all channels as an
essential prerequisite for consistent results and for presenting a uniform image of the company to the customers.

Crossover coordination
Key to the implementation of a successful CEM is a perspective and thinking which overarches the boundaries of
processes and channels by taking up the customers’ viewpoint. Close coordination with and among the involved
business units is a mandatory prerequisite in achieving this. Setting up positions responsible for CEM or CEM boards
to coordinate the realization of specific customer experience worlds paves the way to high transparency and short
communication paths between the responsible positions. Since customers’ experiences are affected by the most
widely divergent partial performances of the company’s functional units, “silo thinking” must be prevented and a
holistic CEM approach including the integration of all of the relevant stakeholders has to be the clear target.
Increasing the company’s success

The goal of the CEM Framework is the creation of profitable customer experiences through fulfilling or even
exceeding customer expectations and avoiding dissatisfaction among customers. The CEM effect chain makes clear
what impact the systematic design of customer experiences has on company value. The individual levers must also
be applied during the profitability evaluation of the various measures.
Special attention is to be paid to the costs because it is also possible, with the help of specific measures, to
increase satisfaction and loyalty and simultaneously to lower costs. One example here is the systematic reduction of
customer contacts without long-term value.
Effects of Customer Experience Management
Customer Experience Management
Customer Value/
Shareholder Value
Financial
Excellence
Loyalty � ARPS �
� Churn �
Satisfaction � Market Share �

� Pos. Word of Mouth �
Fulfillment � Brand Equity �
>=
� Cost ��
Expectation
Source: Detecon
Figure 24: Effects of Customer Experience Management

7. Recommendations for Action

The following recommendations for action for telecommunications providers have been crystallized for the optimal
design of the elements of the CEM Framework. The recommendations build successively on one another and, in
their totality, contribute to the successful implementation of customer experience management in the company.
7.1 Knowing what customers really want

Challenge
Under the aforementioned market requirements telecommunications providers are often oriented primarily to
economical and technological interests. The actual requirements of their customers often tend to recede into the
background. But the company’s orientation must continuously be aligned with the actual needs of its customers.
Solution
“Customer experience management is the art and science of figuring out what each customer wants and needs.”
(Bill Price, cf. interview box, p. 17). First and foremost goal is the company’s orientation to the customer needs
(customer centricity). When all of a company’s products and services are based on genuine customer needs and
requirements, you can provide an ideal experience to your customers. But doing so means you must systematically
determine customer needs, perception and expectations via surveys and observations. Analyze your customers’
requirements by uncovering the strengths and weaknesses of your company from the customers’ perspective. By
taking the customers’ perspective, you can lay the foundation for defining the basic requirements and enthusiasm
elements.
Approach
The first step is to collect the customers’ needs and requirements. As you do so, you should take into account all
of the customer contact points and business transactions. The external and internal sources of information shown
below are available to you. Since this collected data has been found or gathered in many different units of the
company (service, marketing, product development, market research, etc.), it is essential to consolidate all of these
acquired data.
External Sources Internal Sources

� Customer surveys: personal, phone, written, online � Survey of customer contact employees
General and/or transaction-related
� Discussion groups with customers � Discussion groups with customer contact employees
� Market analysis and studies � Pride Diary (employees write down daily/weekly
their emotions from customer contacts)
� User shadowing (close observation of customers) � Customer contact analysis

or long-term accompaniment of selected households
� Mystery Shopping � Customer days/Operations day (every manager

spends a set period of time in call center or points
of sale every year)
� Forums (Internet evaluations)/Social media analysis � Web analysis
� Brand fit tests � Feedback management
� Product use and usability studies � Complaint analysis
� Behavior analysis of customers � Service disruption analysis
Figure 25: Derivation of Customer Experiences
This could be handled by a centralized customer experience intelligence department, for example. This is where
the puzzle is put together and crossover conclusions are drawn which are sent back to the involved units. They can
then be used as regular input for the customer-centric segmentation, brand design, product development, and
service design.

7.2 Fix the Basics ...

Challenge
The basic services cover the minimum requirements of a customer. The starting point for the optimal design of
customer experiences, the compulsories for telecommunications companies begin with the securing of reliable
and high-quality basic services as well as recognizing errors and defects early and initiating measures to counteract
them.
Solution
Avoid dissatisfaction and generate a positive learning experience through the repeated fulfillment of customer
expectations; this will reduce the risk of churn, negative word-of-mouth advertising, and the contact volume of
your inbound channels. The assumption of the customers’ perspective during the operational improvement of pro-
ducts, processes, and services does not inevitably lead to solutions which presume an annulment of the corporate
framework – such as the dissolution of heterogeneous process worlds, making logistic expenditures leaner, or con-
solidating complex IT system landscapes. Closing the gap between customer expectations and perceived perfor-
mance is achieved much more readily by improving the company’s activities on the “last mile” to the customer.
Approach
1. Reactive identification of possible improvements in processes which do not (over)fulfill customer expectations.
The analysis of customer contacts is an excellent method for the identification of inadequate basic services. You
should concentrate here on non-valuable customer contacts. These are primarily complaints and advising elements
which are not relevant for sales which arise during the entire customer life cycle. By identifying (e.g., using retroac-
tive customer surveys or observations at the points of sale) and analyzing reasons for the contacts, you will obtain
an overview of which basic requirements for products and processes are currently not being fulfilled. Make use
of these findings and respond by implementing quick fixes which harmonize inconsistent results upstream of the
customer and avoid errors in performance.
Contact Reasons Example of Measures

Give your customers the opportunity to track the provisioning process
Inquiries during the
online and notify them by SMS or e-mail about next steps and delivery
provisioning process
dates.
Invoice items have to be easy to understand for all customers or

Sales Unknown invoice items explained if necessary. Make sure all customers know how to read their
invoice when they receive their first bill (e.g. add an insert to the bill).
Lack of transparency of Avoid queries and check the consistency of the services you offer
services, products or tariffs across all contact channels.
Avoid dissatisfaction and ensure an error-free change process for

Failure to change customer
customer address and account data by integrating your front-end
master data
systems.
Avoid long waiting queues on hotlines and offer customers a way to

Complaint Hotline overload address their requests directly, e.g. via self-service portal or FAQ list,
including an intelligent search engine.
Malfunctions of product or Make sure that properties such as bandwidth and product features
technology correspond to your offers. Create transparency within your tariff plans.
Figure 26: Examples of Measures for Process Improvement
2. Design of customer-friendly processes corresponding to customers’ requirements. Ultimately, the high

quality of new products is one of the decisive elements for the perception of the quality of all of the products and
services in regular operation. The product and support quality must be optimized for the fulfillment of customer
expectations before the market launch.

The key method is the assumption of the customers’ perspective during product and process design. The desired
business process and the desired product properties must be described from the experience viewpoint of the custo-
mers and the expectations must be defined from the customers’ viewpoint. The well-known kano model32 from the
automotive industry makes it possible to structure customers’ expectations and to take them into account during
the configuration of your own (basic) services. All of the customer-centric processes across all channels should be
considered during the definition of the basic services. But product-specific basic services as well as basic processes
must be assured. This could, for one, concern a transparent and understandable rate schedule, but assuring the
usability and functionality of the services (promised bandwidths or simple installation and usability) should also be
warranted to customers. Involvement of customers, e.g., in workshops, by using customer feedback or by con-
ducting surveys are an essential prerequisite.
7.3 ... and jump in for your customers when you fail!
Challenge
Many telecommunications providers have set themselves the goal of designing their products and services to be
customer-centric. But despite their strenuous efforts, the services perceived on the market do not always satisfy
their own standards. The causes may be infrastructural problems or complex, cross-unit processes which cannot be
re-engineered in the short or middle term.
Solution
Identify the critical situations, the so-called moments of truth for your customers (see interview box, p. 43). They
can lead to a high level of dissatisfaction, but specific CEM measures can also transform them into a positive
experience. If a company wants to be able to act in the event of poor performance at a moment of truth, suitable
options for a solution must be prepared and kept ready for use. Create the general conditions in your service
and marketing organization so that you can act professionally instead of merely reacting in the event of potential
customer dissatisfaction.
Approach
The key method is the assumption of the customers’ perspective at the moment of truth. This requires consider-
ing the relevant business process from the experience viewpoint of the customers and describing it in accordance
with the customers’ expectations related to the company’s performance. If you want to be able to act in case of
discrepancies between the performance and customers’ expectations, you must identify the trigger of the negative
experiences on the basis of business transactions or customer behavior and develop countermeasures. Examples of
moments of truth, triggers, and countermeasures in the telecommunications industry are shown below.
Moment of Truth Customer Expectation Trigger Example of Measures
Number portability: customer Continuous reachability Request for number portability Configure call forwarding/
is temporarily not reachable waive all related costs
Customer problem Instant and simple solution Exceeding a defined call fre- Forward caller to a specialized
cannot be solved quency (e.g., >3 times a week team within customer service
repeatedly by per customer) or assign an individual case
customer service manager
Complex installation of hard- Enjoy product benefits imme- Shipment of hardware/activati- Enable customers to perform
ware on day of provisioning diately on of products installation before/on delivery
(e.g., with service films,
avatars)
Figure 27: Examples of Moments of Truth, Triggers, and Countermeasures

32
N. Kano: Attractive Quality and Must-be Quality; Journal of the Japanese Society for Quality Control, H. 4, S. 39-48, 1984

The customer’s expectations at a moment of truth are highly dependent on the individual customer type as well as
on the product in question, its basic price, and the service promised by the company. Falling short of customers’
performance expectations is unacceptable in particular with respect to products with high involvement and far-
reaching buying decisions such as IPTV or premium cell phones (e.g., iPhone®). Negative experiences must be
eliminated completely in these cases so that the premium standard and the related expectations are seen to be
legitimate. The satisfactory handling of complaints is essential to secure emotional customer loyalty. This requires
that companies systematically record complaints and prioritize their processing over other requests. Customer
orientation and empowerment of the employees is mandatory in this respect. Options for actions must be kept on
stand-by particularly for mass phenomena such as mass faults (e.g., failures caused by storms). If a systematic crisis
management with defined escalation plans cannot step in here, there is a risk that large groups of the customer
base will have negative experiences with the company going beyond the concrete unsatisfactory usage experience.
But such experiences are often one of the decisive factors related to intensity and duration of media coverage.
Despite all of your efforts: “... when you fail”, you will never be able to restore the satisfaction of 100% of the
affected customers. Dissatisfaction remains inevitable and also requires the preparation of appropriate strategies for
action. When dealing with dissatisfaction, a company’s ability to provide answers to customer queries, for example,
is of great significance. A standardized CRM system across all touch points featuring a detailed customer history is
the necessary prerequisite so that the company can provide the relevant information to customers. In many cases,
sincere, trust-inspiring conduct by company employees is decisive for the long-term stabilization of the customer
relationship rather than the momentary restoration of satisfaction.
But caution is advised: even a wonderful remedy for a problem will not bind customers long-term if they must
expect the problem to occur again in the future.
7.4 Ice the cake

Challenge
By and large, customers view telecommunications services as commodities. Low customer involvement in combina-
tion with extensive homogeneity of the products makes it more difficult to stand out from the competition. Besides
the legal methods for binding customers, e.g., contract terms and the related barriers to change, companies must
take steps to promote the sustained loyalty of their customers by means of emotional measures.
Solution
Delight your customers by going beyond the core services. Create differentiation and emotional customer loyalty to
your company through individual experiences. Come up with measures which are beyond the expectation horizon
of your customers, creating surprising moments which are perceived by the customers and remain fixed in their
memories. Even a small step beyond the customers’ performance expectations will generate sustained satisfaction
and positive emotions. Use the power of positive emotions to further your customers’ involvement and, ultimately,
to turn them into your fans. Remember, fans remain true to your company, and because of their convictions, they
recommend your company in their surroundings.
Approach
1. First the compulsories – then the freestyle
The elementary foundation for creating of outstanding experiences is fulfilling the customers’ expectations for the
company’s basic services, thereby preventing dissatisfaction. Many providers, either consciously or unconsciously,
conduct delight campaigns for the symptomatic compensation of customer dissatisfaction. But dissatisfied custo-
mers often view such enthusiasm attempts as hypocritical or superfluous if the basic performance is unable to satisfy
even their fundamental requirements.

The counterproductive result is even greater dissatisfaction and increased distrust with respect to these attempts to
obtain loyalty. A frequent mistake in this context is issuing credit notes when there are reoccurring technical faults.
Instead, ways and means must be found to make connectivity available to the customers as quickly as possible (e.g.,
through call diversions to the cell phone free of charge) and to eliminate the cause long-term (e.g., replacement
of infrastructure susceptible to failure).
2. Creating effective highlights

Once the basic service has been secured, surprising moments such as an appreciative anniversary mailing, can be
meshed with sales campaigns (cf. Figure 27). The improved basic attitude leads to significantly rising success rates.
Moreover, a need-oriented campaign offer can in itself generate loyalty if it is perceived to correspond to actual
requirements. Do not underestimate the importance of details and small displays of attention. A clever birthday/
Christmas text message or a voucher for a romantic video-on-demand evening can also trigger an experience. One
special case in this context is the win-back management. Extraordinary experience moments can be utilized to
win back especially valuable customers who are prepared to terminate. For example, an invitation to an exclusive
product presentation opens the way to a perfect display of the brand or making product benefits clear (example:
IPTV). Make sure that customers are blocked for sales actions if they have reported faults or lodged complaints
which have not yet been resolved.
How to interweave CEM, Sales, and Service
Occasion CEM Measure Break Sales and Service
Valentine's Day Video-on-demand voucher on 4 Weeks Multi-stage sales process: IPTV
Teaser Detailed Information Follow-up Conclusion
Status information Provision Check-up Call
Anniversary Anniversary mailing 4 Weeks Offer oriented to needs
Text message offer Status information
„You send a lot of text messages; „Your text message

our text message package would package has been
help you to stay in contact successfully activated,
even better!„ have fun!„
First mobile
Obtain feedback Real Time Response to feedback
Internet use
„Congratulations on your first Yes Mobile Internet Offer Status information
mobile use of the Internet!
Were you satisfied with it?„
No Service Check Problem solution
Source: Detecon
Figure 28: Customer Experience Management, Sales and Service
3. Pay attention to timing in your customers’ emotional cycle

Assure maximum requirement orientation by creating highlights specific to the customer life cycle (e.g., welcome,
anniversary, retention) as well as to segments (such as a premium customer care). You must make sure here that the
segmentation is actually oriented to requirements and is not solely value-oriented. The timing of measures should
be coordinated precisely so that experiences are distributed over the term of the customer relationship. A burst of
measures leads to inflationary demands and ultimately to disappointed expectations in times of reduced activity.
Constant attempts to delight customers carry the risk that they will become accustomed to these small pleasures
and come to see such highlights as a part of the basic service. Finally, give consideration to the correct contact and
communications behavior for the customer requirements (low vs. high involvement customer with low or high
contact needs) and promote your customers’ involvement systematically through emotionalizing mass communi-
cations (examples: the Vodafone one-hit wonder campaign or the Paul Potts campaign of Deutsche Telekom).

Torben Roffka
Head of Benefit & Loyalty Programs – Deutsche Telekom AG, T-Home
1. How do you identify the moments of truth (MoT)?

Moments of truth occur – from the customers’ perspective – during periods
of critical interaction. The performance during these interactions has a
lasting effect on the customer relationship (“make it or break it”).
That is why MoTs can often be determined only after they have passed. Moreover, the feedback or
information from the customers is required to determine the gap between the requirement and the
perceived performance. Important instruments for the identification of moments of truth are the
analyses of complaints and of forums/blogs/social networks; these are the sites where customers
make concrete statements about their especially good or bad experience with companies.
2. In your opinion, to what extent do MoTs stand out from the total of all contacts?
Generally speaking, you cannot determine from one contact whether it will develop into a MoT for
the customer. However, with the help of the above-mentioned ex-post analyses, you can very quickly
recognize the relevant and especially frequently addressed customer experiences.
Critical customer contacts also stand out because of their relatively great effects on the measured
customer loyalty (e.g., TRI*MTM customer loyalty index). Simultaneously, the same thing is true for all
MoTs as for complaints: a solution to the problem provided in a reasonable period of time can result
in a long-term increase in the customer’s satisfaction.
3. Which MoTs do you regard to be decisive for all customer groups?

The decisive MoTs for all customers or, to put it more precisely, all product groups are these:
• Query / Purchase • Problem-solving

• Provision • Complaint
• Usage • Billing
On the other hand, we must not forget that a customer’s individual expectations as well as the
company’s performance define MoT. Customers with an affinity for technology, for example, make
completely different demands on a provider than a customer who is keen on service.
What can companies do to generate specific benefits from the MoTs?

Ideally, MoTs are designed as positive surprise or to exceed customer expectations (“surprise and
delight”) on the basis of customers’ functioning processes (“fix the basics”). To achieve this, howe-
ver, telecommunications providers must identify the important MoTs of their target groups and have
complete command of their performance at these moments. There is an opportunity here to shape
unmistakable and emotional experiences for customers, making a tremendous contribution to distin-
guishing one’s own company from the competition.

7.5 Walk the talk of your brand

Challenge
The image of a company and its brand promise are the communicative projection screens of the strategic market
positioning of a company. They have a decisive influence in forming customers’ expectations for the quality and
performance of its services and, consequently, direct influence on the customer experience (see the chapter on
the CEM Framework). The values and properties conveyed via the brand, unfortunately, do not always correspond
to what customers experience with the company, its products, and employees (vertical inconsistency). Moreover,
special product or service offerings in the various channels lead to differing experiences at two contact points
(horizontal inconsistency).
Solution
Consistency leads to trust and a sense of sincerity. Brand values and corporate identity must be communicated
during every single experience. Do not make any brand promises which you cannot keep. Especially in time of
information overload creating unique and holistic customer experiences enables you to differentiate yourself from
competition.
Markenversprechen
Brand Promise
Image
Vertical
Call Center Interaktion 1

Interaction
E-Channel
eChannel Horizontal Consistency Interaktion 2
Interaction
… …
Consistency
Customer Experience
Source: Detecon
Figure 29: Horizontal vs. Vertical Consistency of Customer Experiences
Approach
1. Measures for the creation of vertical consistency between brand promise/image and customer experience.
Your first step is to evaluate your corporate image from the customers’ perspective and to compare it with the
brand promise. Analyses of specific advertising effects will help you to determine the brand fit. If brand promise and
customer experience diverge from one another, either the image components which are to be transported or the
resulting demands must be adapted to the corporate experience. If you position your brand as a premium provider,
for example, your customers will expect faster reactions with a greater willingness to consider their wishes in the
event of service queries than would be the case for a discount brand. An important indicator for the brand fit is the
resonance in the pertinent blogs, forums, and social networks concerning your company’s performance as percei-
ved on the market. Pre-launch quality checks of products and processes are also important. Products should not be
released until it is certain that the brand promise can also be fulfilled. Take into account the secondary experiences
of your customers with their friends (“word of mouth”) which affect your image as well. This is where the avoidance
of dissatisfaction pays for itself twice over. Special service programs for decision-makers and opinion leaders (e.g.,
VIPs) will also help you to disseminate positive secondary experiences in especially relevant target groups.

2. Measures for assuring horizontal consistency of interactions at the various contact points. Furthermore,
the brand values of the company must be communicated at all of the contact points and throughout the entire
customer life cycle. This affects both measures of corporate communications and corporate design as well as a
corporate culture which has been brought into line with the brand. The point is to communicate to the customers
a consistent experience which fits the brand both by means of consistent, high-quality service and by the commu-
nication of the brand values in every contact situation. It may also be necessary to pursue a multiple-brand strategy
to address various target groups and not to overextend the main brand.
Possible measures extend across touch point boundaries include the following:
• Crossover definition of service and interaction targets
• Cultural anchoring of the brand promise in the company’s guidelines for managers and employees, including
regular evaluation of the degree of compliance
• Consistent design of offers, discounts, and benefits (e.g., discounts for new customers also for current
custo mers when extending their contracts to prevent learned disloyalty)
• Regular conducting of customer experience reviews/audits
7.6 Employees – your keys to success

Challenge:
In their customer interactions employees must represent the credibility and sincerity of the company’s CEM con-
cepts. The challenge here is to select and train the right employees for the right topics so that their skills and capa-
bilities are appropriate to the requirements of the specific interaction.
Solution:
Besides their professional qualifications, customer orientation should be a decisive selection criterion for the hir-
ing and assignment of your customer contact employees (“hire the smile and train the skill”). In addition to this
“emotional fit”, you should strive to ensure that all of the employees not only know your company values, but that
they identify with them and live them in their work! Otherwise, there will never be a sincere dialog during the talks
with the customers. Emotional customer loyalty is based to a large extent on the effect of the gratitude displayed
towards the customers. This can only be generated in a personal sense by your employees. So motivate your em-
ployees to act on their own initiative and in accordance with the particular context, and equip them with the tools
required for individual solutions satisfying to customers.
Approach:
Develop your employees into solution-oriented contact people in the interaction with customers:
• Invest in employee training programs and communicate to them that a positive customer experience should
always have one of the top priorities;
• Make sure that your employees understand “quality before quantity” as a corporate strategy and work
philosophy. Ensure that credibility, a calm manner, trust, and consistent information are conveyed in all
interactions with customers;
• Stand behind definite values with your company’s name, and communicate this in the customer contacts;
• Secure high availability and easy access for your customers in the contact center;
• Maintain direct and transparent communications with both your employees and your customers.

Competent and well-trained employees raise the first contact resolution rate and lower the subsequent contact
rate. Give your employees a chance to be successful by providing to them all of the relevant customer data such as
the complete contact history and current products. But ability is only one of the components for success. Employees
must stand behind their company’s CEM strategy and want to serve the customers because they are personally
motivated to do so. And ultimately, they must also be allowed to do so.
In other words, as expressed by this can-want-to-may principle 33, qualifications, a well-grounded service culture,
values, and empowerment are required. Moreover, although performance based compensation is an effective
instrument for steering behavior, it also involves a certain risk. There is a danger that the individual target values will
not be compatible with the supraordinate company goals. That is why indicators for long-term objectives such as
the first contact resolution rate are recommended. When calls are quickly concluded (short call handling time), but
lead to multiple subsequent contacts, neither the customer nor the company have benefited. So be sure that you
have a consistent target system which promotes customer orientation. Since conduct in complex, dynamic environ-
ments cannot be steered completely by means of a target system, a healthy value culture based on the concept of
“principles, not rules” 34 must take care of the rising number of unforeseeable special cases.
7.7 Communicate your success successfully

Challenge
Success must be communicated especially during times of crisis. It is part of the psychological make-up of human
beings, a kind of anthropological constant, one might say, that they tend to think in terms of risk rather than of
opportunity and to experience failure more intensively than success. This is backed up by the results from numerous
customer and employee surveys conducted by forum! Marktforschung: employees have a tendency to assess the suc-
cess and overall image of their company more pessimistically than the customers. To put it bluntly, the customers
have more confidence in the company’s abilities than its own employees!
Solution
Utilize the communication of success to set yourself apart from the competition and to create a bond between your
customers and your brand and company. Customers, prospects, and other possible target groups of the communi-
cation are keen to find safe harbors, especially during times of uncertainty. They want information efficiency, orien-
tation functions, and risk reduction; in short, they want to feel that their decisions have been confirmed. Credible
communication of success has a direct effect in this case and helps your key factor “employees” to be convincing
in their approach to customers.
Approach
Corporate successes require successful communication if they are to achieve an ideal effect. Positive perception
requires care – and the care must be continuous and based on a strategy. So it is absolutely essential to make self-
confident use of all of the meaningful potential channels of your communications, once you have segmented the
target groups and defined the communication goals. The same rules apply to external and internal communica-
tions. Success creates trust and loyalty (among customers and employees). Plan your communications for the short,
middle, and long term. Strategy without actions paralyzes a company; actions without a strategy make it blind.
Employees are the most effective and most important brand ambassadors of your company. Take this into account
in your communications, make use of the opportunities your staff offers you – both in the form of customer contact
and in the form of the communications channel – in your strategic deliberations and operational realization.
33
J. Hauk, C. Jost, A. Luyken, C. Schulz (2007): Detecon study CRM 2010 and Beyond – Opportunities and Challenges for
Telecommunications Companies in High-Performance Markets, Eschborn, p. 48.
34
cf. Detecon (2004): Vom Wissen zum Können – Merkmale dynamikrobuster Höchstleister (From Knowlegde to Competence
– Characteristics of dynamic robust high performance companies), pp. 34 et seqq.

1 Wer
If younicht kommuniziert,
do not communicate mit dem
others wird
will kommuniziert.
communicate about you.
2 Erfolgreichecommunication
Successful Kommunikationserves
ist einas
Produktionsfaktor.
a factor of production.
3 Kommunikation braucht
Communication requiresFührung,
leadership,
Perspektive
vision – and
– und
flexibility
Flexibilität.
in action.
4 Kommunikation
Intended messages
ist erfolgreich,
will succeedwenn
if communicated
sie kontinuierlich
continuously
und langfristig
on long-term
stattfindet.
basis.
10
10 Regeln
Rules
5 Wichtige Botschaften
Important messages must
müssen
be transported
auf glaubwürdigen
via credible
Kanälen
channels.
transportiert werden.
for
der Erfolgs-
Communication
6 Strukturelle
Following structured
Kommunikation
communication
ist immerplans
erfolgreicher
is alwaysals
more
individuelle
successful
Kommunikationsauftritte.
than secluded actions.
kommunikation
of Success
7 Erfolgreiche Erfolgskommunikation
Communicating successes successfully
arbeitet
means
integriert
integration
und multimedial.
of all channels and multimedia.
8 Erfolgreichecommunication
Successful Kommunikationisist
built
Hierarchie
on simple
von
messages
Botschaften
and und
subsequent
Maßnahmen.
targeted measures.
9 Erfolgskommunikation
To communicate successfully
brauchtyou
Analyse,
need analysis,
Strategie strategy
– und eine
and
Lernkurve.
patience along the learning curve.
10 Wer Erfolg
Who talks about
kommuniziert,
successesistwill
erfolgreicher.
be more successful.
Figure 30: 10 Rules for Communication of Success
7.8 Put the customer on your payroll

Challenge
During the customer interactions, your employees receive large amounts of diversified information about your cus-
tomers and their experiences with the products and the company. The challenge here is to record, then systemize
the unstructured information from the interactions so that you can discern desires and problems from the custom-
ers’ viewpoint and use these data for the improvement of your company.
Solution
Customers know your strengths and weaknesses. Utilizing customer feedback enables you to uncover systematically
defects in performance. You can develop improvement measures which are ideally suited to the needs and require-
ments of your customers. Moreover, it helps you to avoid negative scaling effects at an early stage. The prerequisite
for this solution is a culture of handling errors in the company which allows employees to deal constructively with
mistakes made by the company. Moreover, people must be designated in the organization as responsible for cate-
gorizing customer feedback and integrating it into a continuous improvement process for the further development
and optimization of the company. Successful companies are characterized in this respect by constant monitoring
and contemporaneous implementation of the improvement measures.

Input 1. Collection 2. Analysis 3. Improvement
@ E-mail
Shops Recommen- Feedback Selection of improvement

reception Feedback analysis measures
Letter
dations
Contact Center
E-Channel
Technicians
Implementation planning
Fax
Complaints Feedback reporting
Retail partners
Feedback
Corporate sales categori- Monitoring of
zation implementation
Magazines
Web Opinions Feedback based controlling

Transition of improvements
Blogs
measures into regular
Product tests operations
Communities
Discussion
groups Storing Use of information Communication of
Ideas
Surveys feedback improvements
Forums
Source: Detecon
Figure 31: Professional Feedback Management
Approach
The feedback circuit comprises the phases collection, analysis, and optimization.
The collection of customer information helps you to “know what customers really want.” It is dependent on the
systematic capture of information in the CRM or a dedicated feedback management system. This is where the
information, once it has been categorized, must be saved.
The next step is the analysis and learning phase during which the information is regularly categorized, then dis-
cussed by quality or feedback review boards with the aim of identifying the necessary measures. During this step, it
is absolutely essential to determine the causes of praise or dissatisfaction (e.g., by using cause and effect diagrams).
It is advisable to involve experienced customer contact employees as well as quality managers in this process. You
will frequently find additional critical customer events in complaint management. They can be ideally dealt with in
the course of a systematic analysis of complaints. But the evaluation of courtesy or welcome calls can frequently be
helpful as well, indicating where there are malfunctions in the provision and acquisition process.
To convert these learnings continuously into improvement measures, you must select the appropriate actions as
indicated by the cause analysis and implement them, in part across business unit boundaries. The introduction
of regular monitoring of the progress of the implementation is recommended so that the improvement of the
customer experience in the pertinent business processes is confirmed during the implementation as well as after the
conclusion of the initiatives. The obtained results should also be disseminated throughout the organization. When
employees are “vaccinated” with these experiences, they are transferred into the collective memory for action, so
to speak.
Avoid “banana products” that do not mature until the customers have them. This is an especially important rule
for large telecommunications providers: “prototyping in the niche” goes before “widespread roll-out”. You can use
pilot measures or a “test and learn” center to cultivate feedback loops specific to each case. The goal is to try out
new products, the processes, and the customer responses first and then to operationalize the confirmed findings.

7.9 Experience by participation
Challenge
In their relationship to their telecommunications provider, customers are often given the feeling that they are
victims of an arbitrary machine lacking in transparency. The desires and problems of the individual seem to vanish
in anonymous mass production. When there is a malfunction, all the customers can do is reach for the phone and
call the service line, hoping to at least reach a customer service employee and perhaps even to solve their problems
quickly with the employee’s help. However, a number of contacts are often required because customers are not
proactively told about the status of their order or of the progress in remedying the problem.
Inconsistent information about product availability exacerbates the feeling of arbitrariness. Another point is that
some customers attempt to formulate suggestions for improvements during surveys, but never receive any com-
ments on them and ultimately see no response.
Solution
Create positive experiences by involving your customers: actively include their input when making changes and
integrate their suggestions for improvement, thereby improving the customer experience long term and demon-
strating your appreciation. Create transparency about the processes and relationships within the company, and let
your customers play a part in shaping the business relationship (e.g., with the selection of the contact channels
preferred by the customer). Your customers will thank you with their involvement, acceptance, loyalty, and recom-
mendations.
Approach
Include your customers in the development and improvement processes of products and services (e.g., through
discussion group interviews, product tests), thus demonstrating your appreciation of their patronage. In addition,
use the dialog about your products and your company on social media channels (e.g., social networks, moderated
forums) to create transparency and trust. Have your online support provide sites and moderated forums in which
customers can exchange their experiences with problems, including helping them to help themselves. Self-service
offers enable customers to deal with their requests on their own initiative and contemporaneously. For example, the
opportunity to carry out oneself the diagnosis of a line or end device problem by measuring online the performance
of connections is widely and consistently accepted as positive.
Be honest about known weaknesses which crop up during processes by explaining the malfunctions simply and
transparently. Proactive communication regarding process status or in the event of faults or process delays demons-
trates fairness and generates trust. Proactive customer feedback helps you to establish an emotional relationship to
customers.
But participation also means thinking in terms of contact chains which process the customers’ reactions. Campaigns
based on triggers activated by a defined customer activity (e.g., initial use of data) raise the context and relationship
to requirements of sales actions and consequently the acceptance by customers. The same is true of sales campaigns
which utilize the information and experience from the previous customer contacts so that a requirement-oriented
offer can be submitted at the right point in time and with the right address. When in doubt, let your customers
decide about frequency, channel, and topic of offers by indicating their preferences.
Make use of the company’s fans you have won and customers who participate especially actively in member gets
member programs, and demonstrate your appreciation by establishing exclusive communities. The resulting sense
of belonging to a company generates a feeling of loyalty in the long term.

Dr. Gesche Joost

Director Design Research Lab, Deutsche Telekom AG
What does CEM mean for you, and what aspects of CEM do you
concentrate on during your work in the Design Research Lab?
Custom experience management is for us the design of products and services integrating the direct
and indirect participation of customers. We immerse ourselves in the everyday lives of our customers
to explore qualitatively their habits in using technologies, products, and services and to understand
their needs. Besides the close observation of customers (user shadowing), we achieve this primarily
through the use of qualitative surveys and integration of customers into the creation process of a
service. For example, we ask customers to describe briefly the cell phone or customer service of the
future. We call this approach co-design or participatory design. The customers are fundamentally
regarded as partners in a dialog and not only as the users of a company’s services. They are the best
experts concerning their wishes that one can imagine and see their involvement as the highest form
of personal appreciation. Generally speaking, our approach receives a highly positive response from
our test subjects. What is more, this has an added benefit of generate a positive attitude towards the
company.
Where do you see the greatest potential for improving the relationship between customers
and company?
The greatest potential is in an extensive image transformation in the direction of greater openness
and dialog. A company should show that it gives careful consideration to its customers and attempts
to understand them. All of our surveys have led to extremely positive feedback and a change in the
way the participants view Telekom. We demonstrate that we appreciate the value of our customers
and create a basis of trust for the sustained solidity of the customer relationship.

7.10 Develop your CEM currency

Challenge
As the CEM Framework illustrates, the relationships of the effects between CEM measures and customer behavior
and the related commercial effects are highly complex. Many companies are not able to conduct a cost-benefit
analysis of their CEM investments.
Solution
Become familiar with the success factors of your CEM. Make the CEM actions measurable, and apply your success
levers precisely and constantly. You must place the commercial efficiency of your CEM measures in the foreground
so that you can create a relationship to economic relevance as well as observe a felt, qualitative success.
Approach
1. Develop a CEM dashboard
Develop a CEM dashboard which models valid contexts between the customer-centric key performance indicators
(e.g. customer loyalty index) and the financial indicators (e.g., turnover, customer value). You will need to develop a
set of performance indicators (KPI) so that you can measure the effect of your CEM activities. One important perfor-
mance indicator is the customer contacts, categorized according to cause (e.g., number of complaints, number of
queries about Product A, number of disputed invoices) because they reveal something about the development of the
interaction with the customers. Since customer loyalty is the key to company success, you should regularly and
long-term calculate the customer loyalty index.
2. Determine and manage using the drivers of customer loyalty

Measurements of satisfaction reveal little about the relationship between a CEM measure and the desired customer
behavior. But the effect of CE-oriented actions on customer behavior should be at the forefront. So in the first step
you should be able to determine and systematically record the desired behavior patterns (e.g., increase in success
rates, increase of turnover, reduction of termination rate). Identify the drivers/factors for these behaviors (e.g.,
appreciation, relieve, gratitude) in the second step. Finally, you must develop measures which further the positive
drivers and lessen the force of the negative ones. You must regularly validate the effect of the measures.
A time series analysis is a tool which enables you to use the drivers to derive statistical relationships between the
CEM activities and their effects on customer loyalty and sales behavior (e.g., increases in customer loyalty index
result in an average reduction of the termination rate by x%). In addition, you will uncover interesting findings
about the time periods of the effects, necessary intensity of the contacts, etc. The ex-post capture of the data is
preferable to the ex-ante survey. The simple behavior intention alone does not create a reliable basis for interpreta-
tion; quite frequently, it deviates significantly from the behavior actually shown in the situation.
3. Anchor the CEM goals in the employees’ targets

Include the CEM performance indicators along with financial targets in the management of your employees
(differentiated according to customer contact and support employees) so that the agreed targets for the employees
support customer-centric conduct. The experiences of the customers with the customer contact (e.g., satisfaction
with contact, initial contact solution rate, recommendation rate) should make a contribution to the determination
of the achievement of targets for customer contact employees along with the productivity indicators (e.g., CHT in
the call center) and sales KPIs (e.g., address rate, conversion rate). The same principle applies to CEM management
and support employees. They should also be rewarded in terms of the effects of the measures for which they are re-
sponsible (e.g., anchoring of the customer assessment and user experience with the Web site for the Web specialist
as component of the variable compensation).

8. Appendix
8.1 Recommended Reading
Bonnemaizon, A.; Cova, B.; Louylot, M.: Relationship Marketing in 2015: A Delphi Approach; in: European Management Journal,
pp. 50-59, 02/2007
Bruhn, M.; Stauss, B.: Kundenintegration im Dienstleistungsmanagement – Eine Einführung in die theoretischen und praktischen
Problemstellungen, in: Bruhn, M.; Stauss, B. (Ed.): Kundenintegration – Forum Dienstleistungsmanagement, 2009
Berry, L.; Carbone L.; Haeckel, S: Managing the Total Customer Experience, 2002
Carlzon, J.: Moments of Truth, 1987
Deutsche Gesellschaft für Qualität; forum! Marktforschung (Ed.): Der emotionale Entscheider. Lieferantenauswahl, Kaufprozesse
und Kundenbindung im Business-to-Business-Bereich. Sonderstudie Excellence Barometer (ExBa®), 2006
Deutsche Gesellschaft für Qualität; forum! Marktforschung (Ed.): Emotionaler Supergau Beschwerde. Benchmarkstudie zur emo-
tionalen Kundenbindung und dem Kommunikationsver-halten von Beschwerdeführern im Business-to-Business- und Business-to-
Consumer-Bereich Sonderstudie Excellence Barometer (ExBa®), 2007
Deutsche Gesellschaft für Qualität; forum! Marktforschung (Ed.): Qualität bewegt. Excellence Barometer (ExBa®), Benchmark-
studie zur Excellence in der deutschen Wirtschaft, 2008
Deutsche Gesellschaft für Qualität; forum! Marktforschung (Ed.): Benchmarkbericht zum Wettbewerb “Deutschlands Kunden-
champions 2008”, 2008
Deutsche Gesellschaft für Qualität; forum! Marktforschung (Ed.): Qualität bewegt. Excellence Barometer (ExBa®), Benchmark-
studie zur Excellence in der deutschen Wirtschaft, 2008
Deutsche Gesellschaft für Qualität; forum! Marktforschung (Ed.): Erfolgreich in starken Zeiten. Excellence Barometer (ExBa®),
Benchmarkstudie zur Excellence in der deutschen Wirtschaft, 2009
Deutsche Gesellschaft für Qualität; forum! Marktforschung (Ed.): Benchmarkbericht zum Wettbewerb “Deutschlands Kunden-
champions 2009”, 2009
Duncan, L.: Customer Experience Management vs. Customer Relationship Management, 2006
Eberwein, P.; Luyken, A.: Customer Experience Management – Kundenerlebnisse profitabel gestalten, Detecon, 2009
Forrester: Focus on Customer Experience, Not CRM, Forrester, 2008
Forrester: Obstacle to Customer Experience Success, 2009
Gentile, C.; Spiller, N.; Noci, G.: How to Sustain the Customer Experience, in: European Management Journal, pp. 395–410,
October 2007
Gouthier, M. H. J.: Service Excellence in Deutschland – Wohin soll die Reise gehen?, in: Gatermann, I./Fleck, M. (Ed.): Technolo-
gie und Dienstleistung – Innovationen in Forschung, Wissenschaft und Unternehmen, Beiträge der 7. Dienstleistungstagung des
BMBF, 2008
Gouthier, M. H. J.: Mitarbeiterstolz im Call Center – Eine theoretisch-konzeptionelle Betrachtung auf Basis der Affective Events
Theory AET, in: Benkenstein, M. (Ed.): Neue Herausforderungen an das Dienstleistungsmarketing, 2008
Hauk, J.; Jost, C.: Paving the way to customer centricity, CRM Strategy – Directions for a customer-driven service provider:
Detecon Management Report 03/2006
Hauk, J.; Jost, C.: Wo der Schuh drückt (Mystery Shopping), in: TeleTalk, 05/2007
Hauk, J.; Jost, C.; Luyken, A.; Schulz, C.: Study CRM 2010 and Beyond – Opportunities and Challenges for Telecommunications
Companies on High-Performance Markets, Detecon, 2007
Hauk, J.; Jost, C.; Schulz, C.: Konzepte für ein zukunftsorientiertes Customer Relationship Management, in: Berater Guide 2008
(Handelsblatt), Das Jahrbuch für Beratung und Management, 2007
Harvard Business Review: Welcome to the Experience Economy, 1998
Harvard Business Review: Understanding Customer Experience, 2007
Kwortnik, R.; Thompson, G.: Unifying Service Marketing and Operations With Service Experience Management, in: Journal of
Service Research, 11/2009
Penkert, A. ; Funk, J.; Schlereth, J.; Schulz, C.: Kundenservice der Zukunft – Trends und Herausforderungen für das Kundenservice-
geschäft, Detecon, 2010
Reimann, E.; Sexauer, H.: Kundenbeziehungsmanagement / Vorgehensweisen – Checklisten – Best Practice, 2007
Schmitt, B.; Mangold, M.: Kundenerlebnis als Wettbewerbsvorteil, 2004
Schwager, A.; Meyer, C.: Das Kundenerlebnis verbessern; in: Harvard Business Manager, p. 58, April 2007
Stauss, B.; Seidel, W.: Preiskündiger und Qualitätskündiger: Zur Segmentierung verlorener Kunden, in: Link, J.; Seidl, F. (Ed.):
Kundenabwanderung – Früherkennung, Prävention, Kundenrückgewinnung, 2009
Telemanagement Forum: Customer Experience Management: Driving Loyalty & Profitability, 2009
Wöhler-Moorhoff, F; Dieter, S.; Schwill, M; Telco 2010 – Emerging telecommunication landscapes, Detecon, 2004

8.2 Glossar
AHT Average Handling Time IMS IP Multimedia Subsystem
ARPS Average Revenue Per Subscriber IP Internet Protocoll
ATL Above the Line ISP Internet Service Provider
B2B Business to Business IVR Interactive Voice Response
B2C Business to Consumer KPI Key Performance Indicator
BTL Below the Line M2M Machine 2 Machine
CAGR Compound Annual Growth Rate MoD Music on Demand
CE Customer Experience MoT Moments of Truth
CEM Customer Experience Management MP3 MPEG-1 Audio Layer 3
CEO Chief Executive Officer MVNO Mobile Virtual Network Operator
CLC Customer Lifecycle NAB Needs, Attitude and Behavior Segmentation
CTI Computer Telephony Integration NPS Net Promoter Score
CXO Chief x Officer RoCEM Return on CEM
(Member of the Executive Board) SIP Session Initiation Protocoll
CRM Customer Relationship Management Telco Telecommunications Company
CM Contribution Margin TMC Telco-Media-Convergence
DMB Digital Multimedia Broadcasting TRI*MTM Customer Loyalty Index of TNS Infratest
DVB-H Digital Video Broadcasting – Handhelds UMTS Universal Mobile Telecommunications System
EBIT Earnings before Interest and Taxes USP Unique Selling Proposition
EBITDA Earnings before Interest, Taxes, VDSL Very High Speed Digital Subscriber Line
Depreciation and Amortization VIP Very Important Person
ExBa Excellence Barometer Benchmarkstudie VoD Video on Demand
FMC Fixed Mobile Convergence VoIP Voice over IP
FTTx Fibre to the x WLAN Wireless Local Area Network
GPS Global Positioning System
GSQ German Society for Quality
HSDPA High Speed Downlink Packet Access

8.3 The Authors

Christian Jost works as a Senior Consultant in the Global Competence Team CRM at Detecon International GmbH.
His consulting activities focus on CRM strategies, CRM process design, customer care, and complaint management.
Christian Jost studied business administration, specializing in information and service management, in Ingolstadt
and Santiago de Chile. He has been working intensively in the field of customer relationship management since
2002. His projects include the pilot planning and implementation planning of a cross-divisional service concept for
a Tier 1 carrier and the project management for the establishment of a retention organization for a leading telecom-
munications provider.
Contact: +49 6196 903316 or Christian.Jost@detecon.com
Patrick Eberwein is a Consultant in the Competence Practice Organization at Detecon in Bonn. At the conclusion
of his course of studies of international business administration at the University of Applied Sciences of Bonn, focus-
ing on corporate consulting and corporate development, he wrote his final thesis on the topic, “CRM for Automo-
tive Suppliers in the OEM Business and in Spare Parts Business”. He has been a member of the Global Competence
Team CRM of Detecon International GmbH since July 2007. He is an expert on the topics of lead management and
customer experience management.
Contact: +49 228 700 2563 or Patrick.Eberwein@detecon.com
Joachim Hauk works as a Managing Consultant and Team Head of the CRM Team at Detecon International GmbH
in Eschborn. His consulting work focuses on CRM design and implementation strategies, multi-channel manage-
ment, customer value management and CEM, campaign management, and CRM process design. Joachim Hauk
studied business administration, specializing in marketing, banking administration, and journalism, in Mannheim
and Mainz. After a number of years of professional experience in the banking world, he moved to corporate consul-
tancy in 1999 and has been involved with the complex of topics related to CRM at Detecon since 2001. The scope
of his experience includes many various CRM projects for international clients in telecommunications and in other
industries, ranging from CRM strategy to support for implementation.
Contact: +49 6196 903370 or Joachim.Hauk@detecon.com
Onno Hoffmann works as a Senior Consultant in the CRM Group at Detecon International GmbH. Onno Hoffmann
studied business administration, specializing in information management and management information systems,
in Ingolstadt. He is an expert on the topics of CRM strategy, service and loyalty programs, and customer contact
management. He has been involved with topics related to the broad field of customer relationship management
since 2004. His projects include the drafting of concepts and implementation of VIP programs as well as various
developments in loyalty management for telecommunications providers.

Contact: +49 89 54636515 or Onno.Hoffman@detecon.com

Alexander Luyken works as a Consultant in the CRM Group at Detecon International GmbH. After finishing his
course of studies in business administration at the Universities of Potsdam and St. Gallen, focusing on marketing
and innovation management, he wrote his final thesis on the topic “CRM 2010 and Beyond — Opportunities and
Challenges for Telecommunications Providers on High-Performance Markets”. He has been a permanent member
of the CRM Group at Detecon International GmbH since 2007 and has participated in both domestic and interna-
tional CRM projects. He is an expert on the topics of Telco CRM, service strategy, service differentiation, CRM sales,
campaign management, and customer experience management. He has been responsible for various projects in
these related fields, both as an expert and project manager, and has written a number of publications.
Contact: +49 228 700 2576 or Alexander.Luyken@detecon.com
Dr. Christoph Schumacher is General Manager of forum! Marketing- und Kommunikationsberatung in Mainz. He
heads the consulting unit of the forum! Group and supports clients in the analysis and optimization of their corpo-
rate and organizational relationship management. The holder of a doctorate in political science and communica-
tions specialist has had extensive experience in the investment goods industry and is regarded as a specialist for
questions of integrated organizational communications. For many years, Dr. Christoph Schumacher was the head
of the headquarters unit for marketing and communications for global leaders in the production of investment
goods, including in-house full-service communications agencies. Schumacher is an advocate of a marketing ap-
proach characterized by communications extending from the strategic concept to the operational implementation.
He has been passing on his comprehensive professional experience from the industry as a lecturer at the Heinrich
Heine University Düsseldorf since 2000, where he teaches the subjects of “corporate communications” and “press
and public relations”. Moreover, he is a scientific advisor to the knowledge magazine, “life + science”, published
for school students by the Klett-Verlag.
Contact: +49 6131 32809 160 or Schumacher@forum-mainz.de
For their support during the study, we wish to thank warmly:

• All of the study participants
• Fabian Krane
• Rolf Lichter

8.4 Detecon International GmbH

We make ICT strategies work
Detecon is a consulting company which unites classic management consulting with a high level of technology
expertise. Our company history is proof. Detecon International is the product of the merger of the manage-
ment and IT consulting company Diebold, founded in 1954, and the telecommunications consultancy Detecon,
founded in 1977. Our services focus on consulting and implementation solutions which are derived from the use
of information and communications technology (ICT). Clients around the world in virtually all industries profit from
our holistic know-how in questions of strategy and organizational design as well as the utilization of state-of-the-art
technologies.
Detecon’s expertise bundles the knowledge from the successful conclusion of management and ICT consulting
projects in more than 160 countries. We are represented globally by subsidiaries, affiliates, and project offices.
As Detecon is a subsidiary of T-Systems International, the business customer brand of Deutsche Telecom, we as
consultants profit from an infrastructure which spans the globe and is maintained by a major international player.
8.5 The company forum!

forum! GmbH
forum! is an internationally active market research and consulting company; through its business units, forum!
Marktforschung and forum! Marketing- und Kommunikationsberatung, forum! is the leader in the field of analysis and
optimization of corporate relationship management. International clients from the B2C and B2B sectors as well as
non-profit organizations profit from the outstanding know-how of forum! Marktforschung and forum! Marketing- und
Kommunikationsberatung.
Excellence Barometer®: Basic research on the performance capability of the German economy forum!
Marktforschung, acting jointly with the Deutsche Gesellschaft für Qualität e.V. (DGQ), is one of the few market research
institutes in Germany to conduct its own basic research on the success factors of relationship management: the
Excellence Barometer® (ExBa), a benchmark study on the performance capability of the German economy recognized
across Germany. The close relationship to the Institute for Journalism of the Johannes Gutenberg University in Mainz
is indicative of the up-to-dateness and innovation of the research models and techniques which are used.
Initiator of “Deutschlands Kundenchampions”

In cooperation with the Deutsche Gesellschaft für Qualität e.V. (DGQ), forum! conducts an annual competition all
across Germany, Deutschlands Kundenchampions, seeking the company with the best customer relationships. The
goal of the competition is to establish a benchmark for the quality of the customer relationship management and
to honor exemplary customer centricity.
Organizer of the Mainz Relationship Management Congress

forum! is also the organizer of the annual Relationship Management Congress in Mainz. Know-how, best practices,
and valuable contacts related to corporate relationship management are communicated here to decision-makers
from the world of business.

Detecon International GmbH
Oberkasseler Straße 2
53227 Bonn – Germany
info@detecon
www.detecon.com
© 03/2010

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We make ICT strategies work

Customer Experience Management in the

© Detecon International GmbH 1

Published by Detecon International GmbH

2 © Detecon International GmbH

© Detecon International GmbH 3

4 © Detecon International GmbH

Prof. Dr. Matthias Gouthier

© Detecon International GmbH 5

1 Exploiting the "Moments of Truth"

2 Generation of Customer Insights TOP 5

5 Proactive Complaint Management

Figure 1: The TOP 5 CEM Measures

6 © Detecon International GmbH

Customer champions are characterized by the following:

The Detecon CEM Framework

Customer Insight Brand Brand Halo

Figure 2: The Detecon CEM Framework

© Detecon International GmbH 7

Recommended actions for your CEM

8 © Detecon International GmbH

3. Trends on highly competitive telecommunications markets

3.1 Overview of Current Challenges

© Detecon International GmbH 9

The Average Revenue per Subscriber in Mobile Networks is declining

Prepaid Postpaid Voice Data

The Average Revenue per Subscriber in Fixed Networks is declining

$30.00 $33.28 $33.69 $27.18 $26.91 $26.57

Voice Telephony ARPS Internet Service ARPS IPTV/Video Service ARPS

10 © Detecon International GmbH

Fixed Mobile Convergence

Challenge 2: Reconfiguration of the value chain – back to the universal provider.

© Detecon International GmbH 11

� Nokia N900 Android OS, RIM

� Dell Vostro Series Mac OS X, Windows 7,

Figure 5: New Categories for Telecommunication Devices

12 © Detecon International GmbH

Challenge 4: From convergence to cross-usability and ubiquity

Challenge 5: Strengthening the emotional customer loyalty through differentiated branding

© Detecon International GmbH 13

3.2 Focus: The new customer experience orientation

ment Review, Spring 2002, Volume 43, Number 3.

14 © Detecon International GmbH

Figure 6: Overview of Participants in the Detecon Study

4.1 CEM from the Viewpoint of Experts

© Detecon International GmbH 15

How do you understand customer experience management?

Taking customer perspective 36%

Design of interactions with

Learning from customers‘ feedback 19%

Integration and consideration of emotions

Brand as center stage 8%

Figure 7: CEM from the Participants‘ Point of View (categorized)

Experiences are relevant during ...

... with the basic All experiences are equally

Potential Current Lost

16 © Detecon International GmbH

How do you understand Customer Experience Management?

Relevance of customer experience in the customer life cycle phases

© Detecon International GmbH 17

Intended customer experiences through CEM

Feeling of appreciation 33%